Infinite Unknown

In 2009 the Fed monetized 80% of US government debt, according to PIMCO’s Bill Gross.

The US has no credibility anymore.

Chinese Premier Wen Jiabao makes a point at his annual press conference after the closing of the National People’s Congress held in the Great Hall of the People in Beijing, China, Sunday, March 14, 2010. (AP Photo/Ng Han Guan)

BEIJING – China’s premier expressed concern about the U.S. dollar and called on Washington on Sunday to take “concrete steps” to reassure Beijing about the safety of its huge Treasury bond holdings.

“Any fluctuation in the value of the U.S. currency is a big concern for us,” Premier Wen Jiabao said at a news conference.

“We cannot afford any mistake, how slight it is, when running our financial assets,” he said. “I would like the United States to take concrete steps to reassure investors.”

China has pressed Washington to control its yawning budget deficit and prevent inflation that would erode the value of the dollar and China’s holdings.

The premier said Treasury values were a matter of the “national credibility” of the United States. Continue reading »

Tags: China, Debt, Dollar, Economy, Global News, Government, Inflation, Politics, U.S.

- Report: JPMorgan, Citigroup helped trigger Lehman collapse (Telegraph)

- Lehman bosses used accountancy gimmick to cover up debt (Times)

- EXPLOSIVE: Lehman Corruption - Where Are The Cops? (Market Ticker)

Added: March 12, 2010 MSNBC

Tags: Banks, Ben Bernanke, Dylan Ratigan, Economy, Eliot Spitzer, Fed, Federal Reserve, Global News, Government, Lehman Brothers, Politics, Timothy Geithner, U.S., Wall Street

Added: 13th Mar 10

- Gerald Celente: ‘The Crash is Coming in 2010.’

- The No.1 Trend Forecaster Gerald Celente: Financial Mafia Controlling US and Wall Street

- Survivor, America: ‘It’s Only Going to Get Worse,’ Gerald Celente Says

- The No.1 Trend Forecaster Gerald Celente: The Terror And The Crash of 2010

If Nostradamus were alive today, he’d have a hard time keeping up with Gerald Celente.
- New York Post

When CNN wants to know about the Top Trends, we ask Gerald Celente.
- CNN Headline News

There’s not a better trend forecaster than Gerald Celente. The man knows what he’s talking about.
- CNBC

Those who take their predictions seriously … consider the Trends Research Institute.
- The Wall Street Journal

A network of 25 experts whose range of specialties would rival many university faculties.
- The Economist

Tags: Banks, EU, George Papandreou, Gerald Celente, Gordon Brown, Government, Lehman Brothers, Nicolas Sarkozy, Politics, U.S., Wall Street

Related articles:

- RBS banksters dumping toxic assets on Ireland

- EU allows Ireland to keep the cost of funding the National Asset Management Agency (Nama) off its budgetary balance sheet

It has been confirmed that board members of the National Asset Management Agency are to receive higher fees for their work than originally planned.

Chairman Frank Daly will receive €170,000 this year, up 70% from €100,000.

The other six members of the board will receive a 32% increase in their fees, up from €38,000 to €50,000.

The information is contained in a reply from the Minister for Finance to a parliamentary question asked by Sinn Féin Finance spokesman Arthur Morgan.

‘They should receive the remuneration that was indicated originally. The Government cannot justify pay cuts for some people but incredible an 70% pay increases for others,’ Mr Morgan said. Continue reading »

Tags: Economy, Government, Ireland, NAMA, Politics

See also:

- Lehman bosses used accountancy gimmick to cover up debt (Times)

- EXPLOSIVE: Lehman Corruption - Where Are The Cops? (Market Ticker)

The implosion of Lehman Brothers was in part triggered by excessive capital demands from JP Morgan Chase and Citigroup, and in part by the manipulation of its balance sheet by leading directors, a wide-ranging official report into the investment bank’s collapse has found.

Dick Fuld, the former chief executive of Lehman, is criticised in the report which has taken a year to compile

In what is likely to kick-start a series of costly and long-running court cases, the exhaustive investigation found that the two Wall Street banks demanded significant amounts of capital and extra guarantees in the run-up to Lehman’s downfall - with JP Morgan Chase requesting $5bn (£3.3bn) just three days before Lehman’s bankruptcy filing.

At the same time, Lehman directors, including chairman Dick Fuld and former finance director Erin Callan, failed to disclose key practices, and certified misleading statements. The astonishing claims are made in a 2,200-page, nine-volume report written by court-appointed examiner Anton Valukas, which Judge James Peck admitted read “like a best seller”.

The explosive report also calls into question:

• The use of accounting tactics designed to move $50bn from Lehman’s balance sheet.

• The work of auditor Ernst & Young.

• Barclays’ subsequent purchase of Lehman’s US assets.

Among Mr Valukas’s findings - which are designed to help the court and the bank’s trustees establish where there may be legal grounds for future claims - he asserts that the evidence “may support the existence of a . . .[valid] claim that JP Morgan breached the implied covenant of good faith and fair dealing by making excessive collateral requests” to Lehman.

“The demands for collateral by Lehman’s lenders had direct impact on Lehman’s liquidity pool,” he says. Continue reading »

Tags: Banks, Citigroup, Economy, JPMorgan, Lehman Brothers, U.S., Wall Street

Sarbanes-Oxley was supposed to prevent crap like this:

From the paper:

Lehman employed off-balance sheet devices, known within Lehman as “Repo 105″ and “Repo 108″ transactions, to temporarily remove securities inventory from its balance sheet, usually for a period of seven to ten days, and to create a materially misleading picture of the firm’s financial condition in late 2007 and 2008.2847

Oh yeah, that’s legal?  It’s not supposed to be!

Lehman regularly increased its use of Repo 105 transactions in the days prior to reporting periods to reduce its publicly reported net leverage and balance sheet.2850  Lehman’s periodic reports did not disclose the cash borrowing from the Repo 105 transaction - i.e., although Lehman had in effect borrowed tens of billions of dollars in these transactions, Lehman did not disclose the known obligation to repay the debt.2851  Lehman used the cash from the Repo 105 transaction to pay down other liabilities, thereby reducing both the total liabilities and the total assets reported on its balance sheet and lowering its leverage ratios.

Isn’t that special?

It gets better, as you might expect.

The Examiner concludes that colorable claims of breach of fiduciary duty exist against Richard Fuld, Chris O’Meara, Erin Callan, and Ian Lowitt, and that a colorable claim of professional malpractice exists against Arthur Anderson Ernst & Young.2915  (strikethrough mine, not in the original)

It is stated that Government Regulators (FRBNY and The SEC) had “no knowledge” of these practices.  Perhaps true.  But this calls into question why we’re hearing of this just now, and whether other firms have or are at present doing the same sort of thing.

There also appears to be a colorable claim that Lehman Management was fully-aware of what was going on: Continue reading »

Tags: Banks, Ben Bernanke, Corruption, Economy, FDIC, Fed, Federal Reserve, Government, Lehman Brothers, Politics, SEC, Timothy Geithner, Treasury, Wall Street

I have told you many times before that Gordon Brown, ‘THE SAVIOR’, is really just another elite puppet prime minister, that is destroying any future that the people of the UK might have had, hand in hand with the Bank of England, that is printing money like mad to destroy the pound.

The BoE calls it ‘Quantitative Easing’, which is creating money out of thin air = pure inflation, which is nothing more than a hidden tax.

Those criminals are looting the taxpayer until there is nothing left.

The same is happening in the US, with their elite puppet President Obama and the Fed.

UniCredit has alerted investors in a client note that Britain is at serious risk of a bond market and sterling debacle and faces even more intractable budget woes than Greece.

No turning back: Sterling is going to fall further over coming months, warns Unicredit

The Italian-German group, Europe’s second largest bank, said Britain’s tax structure will make it hard to raise fresh revenue quickly enough to restore confidence in UK public finances.

“I am becoming convinced that Great Britain is the next country that is going to be pummelled by investors,” said Kornelius Purps, Unicredit ’s fixed income director and a leading analyst in Germany.

Mr Purps said the UK had been cushioned at first by low debt levels but the pace of deterioration has been so extreme that the country can no longer count on market tolerance.

“Britain’s AAA-rating is highly at risk. The budget deficit is huge at 13pc of GDP and investors are not happy. The outgoing government is inactive due to the election. There will have to be absolute cuts in public salaries or pay, but nobody is talking about that,” he told The Daily Telegraph.

“Sterling is going to fall further over coming months. I am not expecting a crash of the gilts market but we may see a further rise in spreads of 30 to 50 basis points.” Continue reading »

Tags: Bank of England, Bonds, Debt, Economy, Politics, pound, Quantitative Easing, Rating, U.K.

The US deficit in 2008 stood at $459bn

(AP) WASHINGTON — The government ran up the largest monthly deficit in history in February, keeping the flood of red ink on track to top last year’s record for the full year.

The Treasury Department said Wednesday that the February deficit totaled $220.9 billion, 14 percent higher than the previous record set in February of last year.

The deficit through the first five months of this budget year totals $651.6 billion, 10.5 percent higher than a year ago.

The Obama administration is projecting that the deficit for the 2010 budget year will hit an all-time high of $1.56 trillion, surpassing last year’s $1.4 trillion total. The administration is forecasting that the deficit will remain above $1 trillion in 2011, giving the country thrree straight years of $1 trillion-plus deficits.

Continue reading »

Tags: Barack Obama, Debt, Economy, Global News, Government, Obama administration, Politics, U.S.

Related article:
- JPMorgan Employee Who Invented Credit Default Swaps is One of the Key Architects of Carbon Derivatives, Which Would Be at the Very CENTER of Cap and Trade

… suddenly politicians “get religion” about making damn sure it has no bullets in it:

“We’re of the opinion that a quick implementation of actions in the area of CDS has to happen,” Merkel said. Citing “ongoing speculation against euro-region countries,” she called for the “fastest possible” implementation of new rules. Europe must “do everything to avoid unhealthy speculation,” said Juncker, who heads the euro-area finance ministers group.

Where ‘ya been Angie?

Oh, and you too Papandreou:

“Europe and America must say ‘enough is enough’ to those speculators who only place value on immediate returns, with utter disregard for the consequences on the larger economic system,” Papandreou said yesterday in a speech in Washington.

And, of course, Sarkozy.

Note that I’ve been calling for these things to be either exchange-traded with central counterparty “blinding” (on purpose) as is the case with the regulated option and futures markets or be torn up since The Ticker began publication.

Why?  Because it is my position and remains so that unless you have this sort of market these contracts are all a scam.

They are a scam because: Continue reading »

Tags: AIG, Angela Merkel, Derivatives, Derivatives market, Economy, EU, Europe, George Papandreou, Government, Karl Denninger, Politics

House Financial Services Chairman Barney Frank caused a bit of an uproar Friday when he suggested the U.S. government does not guarantee the debts of Fannie Mae and Freddie Mac.

Rep. Frank later recanted and backed a Treasury Department statement reassuring investors that, yes, Fannie and Freddie Mae debt is guaranteed by the U.S. government. “Going forward,” he said in a statement, we “will make sure that there are no implicit guarantees, hints, suggestions, or winks and nods…we will be explicit about what is and is not an obligation of the federal government.”

But after years of winks and nods, there’s no doubt that Fannie and Freddie now enjoy an explicit guarantee, according to most observers. The U.S. government placed Fannie Mae and Freddie Mac in conservatorship in September 2008: “This means that the U.S. Taxpayer now stands behind $5 trillion of GSE debt,” according to the Congressional Research Service.

The problem is that $5 trillion of so-called agency paper is not treated as if it is a debt of Uncle Sam for accounting purposes, says Richard Suttmeier, chief market strategist at Niagara International Capital and ValueEngine.com.

“Get it on the balance sheet - that’s where it belongs,” Suttmeier says. “Add it to the $14.2 trillion in [federal] debt and let’s move on.”

Another Time Bomb Ticking

But $5 trillion is a lot of money - even by government standards — and moving on may be the problem because of ongoing problems in the housing market, Suttmeier says. “There’s a general concern on Main Street U.S.A. that ‘my neighbors are throwing in their keys, there’s more for sale signs in my community…do I want to buy a new home, risking there’s still downside risk to housing?’ ” Continue reading »

Tags: Banks, Barney Frank, Economy, Fannie Mae, FDIC, Freddie Mac, Government, Politics, Taxpayers