Largest Banks Profited by Borrowing From Federal Reserve, Lending to Federal Government
June 2nd, 2011Via: Huffington Post:
A newly-released study from the Congressional Research Service bolsters claims that the nation’s largest banks profited off the Federal Reserve’s financial crisis-era programs by borrowing cash for next to nothing, then lending it back to the federal government at substantially higher rates.
The report reinforces long-held beliefs that the banking system in essence engaged in taxpayer-financed arbitrage: They got money for free, then lent it back to Uncle Sam while collecting juicy returns. Left out of the equation are the millions of everyday borrowers, like households and small businesses, who were unable to secure loans needed to tide them over until the crisis ended.
Recovery: ‘Double-Dip’ in Housing Prices Even Worse Than Expected
June 2nd, 2011Via: CNBC / Reuters:
U.S. single-family home prices dropped in March, dipping below their 2009 low, as the housing market remained bogged down by inventory and weak demand, a closely watched survey said Tuesday.
The S&P/Case Shiller composite index of 20 metropolitan areas declined 0.2 percent in March from February on a seasonally adjusted basis, in line with economists’ expectations.
The price index was below the low seen in April 2009 during the financial crisis. The glut of houses for sale, foreclosures, tight credit and weak demand have kept the housing market on the ropes even as other areas of the economy start to recover.
The 20-city composite index was at 138.16, falling below the 2009 low of 139.26.
“This month’s report is marked by the confirmation of a double-dip in home prices across much of the nation,” David Blitzer, chairman of the index committee at S&P Indices, said in a statement. “Home prices continue on their downward spiral with no relief in sight.”
Park Police Arrest People for Dancing at Jefferson Memorial
June 2nd, 2011Ok, please stop submitting this. Yes, it’s stupid that these people were arrested, but these types of tactics are a total waste of time.
If you want to protest, do it as a general strike that shuts down the Ponzi scheme economy, make a lot less taxable income, produce your own food, participate in local, outlaw food economies, remove your money from the bank, stop buying shit you don’t need.
But dancing in front of Vader’s minions? Give me a break. I wish I had a Bitcoin for every time this one was submitted. How many YouTube videos until the revolution? *sigh* The sign waving class is going to have to figure this one out the hard way.
Via: Washington Post:
We can’t know for sure what Thomas Jefferson would have thought of the arrests Saturday of five people who were dancing in his memorial. According to reports, they were grooving in silence to protest an earlier court ruling banning dance within the Jefferson Memorial.
The arrests sparked outrage galore, complete with viral videos on YouTube of the forceful police response. But overlooked is the utter irony of outlawing dance in the name of the third president. After all, this is the man who netted this nation a dance heritage with the Louisiana Purchase.
The Heavy Cost of the Bush-Obama Murder Rampage
June 1st, 2011Via: Lew Rokwell:
In every election cycle, the politicians love to pretend there is a difference among them on the foreign policy questions. Yet on these issues of unsurpassed importance, we see the Democrats and Republicans are all part of the same bloodthirsty gang.
On the superficial level of presidential politics, Obama and Bush appeared light-years apart. They play opposites in the DC-approved official culture war between those who pretend to be genuine red-blooded Americans of the heartland and those who feign an understanding of the beleaguered urban minorities and oppressed underclass, when in truth both perfectly embody the same Wall Street-Pentagon-friendly power elite. This is most clearly seen in their virtually identical approach toward empire.
Local Food Makes Strange Dining Companions
June 1st, 2011Via: The Freeman:
The litany of abuses by centralized power against the individual is long and predictable. But centralization in agriculture, that hazy realm from which our food spontaneously appears, poses its own set of dangers to individual aspirations. Now that fewer than 2 percent of the population is directly engaged in food production (down from 25 percent at the beginning of Franklin Roosevelt’s failed drive to “save the farmer”), the fact that agriculture has been massively consolidated is inescapable. While this is not entirely a bad thing (obesity now trumps hunger in our collective top-ten list of concerns), it does present a troubling side. When the vast majority of meat processing (87 percent) is done by just four companies, the system is top-heavy and fragile. Coupled with the crony-capitalism of a powerful lobby, centralized agriculture makes youthful entry into agriculture difficult and financially reckless. The local-foods movement offers an alternative to this agricultural-industrial complex, presenting producers with healthier profit potentials and reviving a more diffuse and independent agrarian production base.
Research Credit: Pookie
CONGRESS MULLS CUTS TO FOOD STAMPS PROGRAM AMID RECORD NUMBER OF RECIPIENTS
May 31st, 2011Millions of broke, hungry, armed people? What could possibly go wrong? Besides, there are robotic, long range nuclear bombers to be built.
Via: ABC News:
Congress is under pressure to cut the rapidly rising costs of the federal government’s food stamps program at a time when a record number of Americans are relying on it.
The House Appropriations Committee today will review the fiscal year 2012 appropriations bill for the Department of Agriculture that includes $71 billion for the agency’s “Supplemental Nutrition Assistance Program.” That’s $2 billion less than what President Obama requested but a 9 percent increase from 2011, which, critics say, is too large given the sizeable budget deficit.
A record number of Americans — about 14 percent — now rely on the federal government’s food stamps program and its rapid expansion in recent years has become a politically explosive topic.
More than 44.5 million Americans received SNAP benefits in March, an 11 percent increase from one year ago and nearly 61 percent higher than the same time four years ago.
Nearly 21 million households are reliant on food stamps.
Mobius Says Fresh Financial Crisis Around Corner
May 31st, 2011Via: Bloomberg:
Mark Mobius, executive chairman of Templeton Asset Management’s emerging markets group, said another financial crisis is inevitable because the causes of the previous one haven’t been resolved.
“There is definitely going to be another financial crisis around the corner because we haven’t solved any of the things that caused the previous crisis,” Mobius said at the Foreign Correspondents’ Club of Japan in Tokyo today in response to a question about price swings. “Are the derivatives regulated? No. Are you still getting growth in derivatives? Yes.”
The total value of derivatives in the world exceeds total global gross domestic product by a factor of 10, said Mobius, who oversees more than $50 billion. With that volume of bets in different directions, volatility and equity market crises will occur, he said.
Libya Lost $1.3 Billion on Options Trades Done with Goldman Sachs
May 31st, 2011But first, remember this one? The Long and Short of It at Goldman Sachs:
The point to bear in mind, as Mr. Sloan brilliantly makes clear, is that as Goldman was peddling C.M.O.’s, it was also shorting the junk on a titanic scale through index sales — showing, at least to me, how horrible a product it believed it was selling.
They had the insight (whatever black magic that entailed) to do those shorts, which means they knew what else was going to blow up; everything, in other words. I don’t think it’s rocket science to know who pocketed the premiums from the sales of these options to the Libyans.
And now, NATO is bombing Libya to save the children? Oh yeah, that’s the ticket.
Via: Wall Street Journal:
In early 2008, Libya’s sovereign-wealth fund controlled by Col. Moammar Gadhafi gave $1.3 billion to Goldman Sachs Group to sink into a currency bet and other complicated trades. The investments lost 98% of their value, internal Goldman documents show.
What happened next may be one of the most peculiar footnotes to the global financial crisis. In an effort to make up for the losses, Goldman offered Libya the chance to become one of its biggest shareholders, according to documents and people familiar with the matter.
Negotiations between Goldman and the Libyan Investment Authority stretched on for months during the summer of 2009. Eventually, the talks fell apart, and nothing more was done about the lost money.
An examination of the strange episode casts light on a period of several years when Goldman and other Western banks scrambled to do business with the oil-rich nation, now an international pariah because of its attacks on civilians during its current conflict. This account of Goldman’s dealings with Libya is based on interviews with close to a dozen people who were involved in the matter, and on Libyan Investment Authority and Goldman documents.
…
Goldman soon carved out a new business with the Libyans, in options—investments that give buyers the right to purchase stocks, currencies or other assets on a future date at stipulated prices. Between January and June 2008, the Libyan fund paid $1.3 billion for options on a basket of currencies and on six stocks: Citigroup Inc., Italian bank UniCredit SpA, Spanish bank Banco Santander, German insurance giant Allianz, French energy company Électricité de France and Italian energy company Eni SpA. The fund stood to reap gains if prices of the underlying stocks or currencies rose above the stipulated levels.
But that fall, the credit crisis hit with a vengeance as Lehman Brothers failed and banks all over the world faced financial crises. The $1.3 billion of option investments were hit especially hard. The underlying securities plunged in value and all of the trades lost money, according to an internal Goldman memo reviewed by the Journal. The memo said the investments were worth just $25.1 million as of February 2010—a decline of 98%.
Officials at the sovereign-wealth fund accused Goldman of misrepresenting the investment deals and making trades without proper authorization, according to people familiar with the situation. In July 2008, Mr. Zarti, the fund’s deputy chairman, summoned Mr. Kabbaj, Goldman’s North Africa chief, to a meeting with the fund’s legal and compliance staff, according to Libyan Investment Authority emails reviewed by the Journal.
Ex-Egypt Bank Head Arrested on Sex Charges
May 31st, 2011Via: Bloomberg:
The former chairman of Egypt’s Bank of Alexandria was charged with sexually abusing a maid at the Pierre Hotel in New York, police said.
Mahmoud Abdel Salam Omar, 74, chairman of El-Mex Salines Co., was arrested yesterday after a 44 year-old female maid alleged he attacked her May 29, according to a police department spokesman. Officers were called to the hotel, located in midtown Manhattan, after she informed security of an alleged incident when she went to Omar’s room after he requested tissues.
Police charged Omar with sexual abuse, unlawful imprisonment, forcible touch and harassment. He allegedly asked the maid for her telephone number and she gave a false one before leaving the room, police said.
The alleged incident comes two weeks after the arrest in New York of Dominique Strauss-Kahn, the former International Monetary Fund chief charged with attempted rape of a maid at the Sofitel Hotel in Manhattan. He plans to plead not guilty, according to his lawyers.
Omar is the former chairman of the Egyptian American Bank and the Federation of Egyptian Banks, according to the El-Mex Salines company website. He is scheduled to be arraigned this afternoon in Manhattan Criminal Court.
U.S. to View Major Cyber Attacks as Acts of War
May 31st, 2011The Bin Laden spectacle was completely absurd from top to bottom—and now…
Via: AFP:
The Pentagon has adopted a new strategy that will classify major cyber attacks as acts of war, paving the way for possible military retaliation, the Wall Street Journal reported on Tuesday.
The newspaper said the Pentagon plans to unveil its first-ever strategy regarding cyber warfare next month, in part as a warning to foes that may try to sabotage the country’s electricity grid, subways or pipelines.
“If you shut down our power grid, maybe we will put a missile down one of your smokestacks,” it quoted a military official as saying.
The newspaper, citing three officials who had seen the document, said the the strategy would maintain that the existing international rules of armed conflict — embodied in treaties and customs — would apply in cyberspace.
It said the Pentagon would likely decide whether to respond militarily to cyber attacks based on the notion of “equivalence” — whether the attack was comparable in damage to a conventional military strike.
Such a decision would also depend on whether the precise source of the attack could be determined.
