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Tansy_Gold

(17,815 posts)
Sun Dec 21, 2014, 07:59 PM Dec 2014

STOCK MARKET WATCH -- Monday, 22 December 2014

[font size=3]STOCK MARKET WATCH, Monday, 22 December 2014[font color=black][/font]


SMW for 19 December 2014

AT THE CLOSING BELL ON 19 December 2014
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Dow Jones 17,804.80 +26.65 (0.15%)
S&P 500 2,070.65 +9.42 (0.46%)
Nasdaq 4,765.38 +16.98 (0.36%)


[font color=green]10 Year 2.16% -0.03 (-1.37%)
30 Year 2.76% -0.06 (-2.13%) [font color=black]


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[font size=2]Market Conditions During Trading Hours[/font]
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(click on link for latest updates)
http://tools.investing.com/market_quotes.php?
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[font size=2]Euro, Yen, Loonie, Silver and Gold[center]

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[font color=black][font size=2]Handy Links - Market Data and News:[/font][/font]
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Economic Calendar
Marketwatch Data
Bloomberg Economic News
Yahoo Finance
Google Finance
Bank Tracker
Credit Union Tracker
Daily Job Cuts
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[font color=black][font size=2]Handy Links - Essential Reading:[/font][/font]
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Matt Taibi: Secret and Lies of the Bailout


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[font color=black][font size=2]Handy Links - Government Issues:[/font][/font]
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LegitGov
Open Government
Earmark Database
USA spending.gov
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[font color=red]Partial List of Financial Sector Officials Convicted since 1/20/09 [/font][font color=red]
2/2/12 David Higgs and Salmaan Siddiqui, Credit Suisse, plead guilty to conspiracy involving valuation of MBS
3/6/12 Allen Stanford, former Caribbean billionaire and general schmuck, convicted on 13 of 14 counts in $2.2B Ponzi scheme, faces 20+ years in prison
6/4/12 Matthew Kluger, lawyer, sentenced to 12 years in prison, along with co-conspirator stock trader Garrett Bauer (9 years) and co-conspirator Kenneth Robinson (not yet sentenced) for 17 year insider trading scheme.
6/14/12 Allen Stanford sentenced to 110 years without parole.
6/15/12 Rajat Gupta, former Goldman Sachs director, found guilty of insider trading. Could face a decade in prison when sentenced later this year.
6/22/12 Timothy S. Durham, 49, former CEO of Fair Financial Company, convicted of one count conspiracy to commit wire and securities fraud, 10 counts of wire fraud, and one count of securities fraud.
6/22/12 James F. Cochran, 56, former chairman of the board of Fair, convicted of one count of conspiracy to commit wire and securities fraud, one count of securities fraud, and six counts of wire fraud.
6/22/12 Rick D. Snow, 48, former CFO of Fair, convicted of one count of conspiracy to commit wire and securities fraud, one count of securities fraud, and three counts of wire fraud.
7/13/12 Russell Wassendorf Sr., CEO of collapsed brokerage firm Peregrine Financial Group Inc. arrested and charged with lying to regulators after admitting to authorities he embezzled "millions of dollars" and forged bank statements for "nearly twenty years."
8/22/12 Doug Whitman, Whitman Capital LLC hedge fund founder, convicted of insider trading following a trial in which he spent more than two days on the stand telling jurors he was innocent
10/26/12 UPDATE: Former Goldman Sachs director Rajat Gupta sentenced to two years in federal prison. He will, of course, appeal. . .
11/20/12 Hedge fund manager Matthew Martoma charged with insider trading at SAC Capital Advisors, and prosecutors are looking at Martoma's boss, Steven Cohen, for possible involvement.
02/14/13 Gilbert Lopez, former chief accounting officer of Stanford Financial Group, and former controller Mark Kuhrt sentenced to 20 yrs in prison for their roles in Allen Sanford's $7.2 billion Ponzi scheme.
03/29/13 Michael Sternberg, portfolio mgr at SAC Capital, arrested in NYC, charged with conspiracy and securities fraud. Pled not guilty and freed on $3m bail.
04/04/13 Matthew Marshall Taylor,fmr Goldman Sachs trader arrested, charged by CFTC w/defrauding his employer on $8BN futures bet "by intentionally concealing the true huge size, as well as the risk and potential profits or losses associated."
04/04/13 Matthew Taylor admits guilt, makes plea bargain. Sentencing set for 26 June; faces up to 20 years in prison but will likely only see 3-4 years. Says, "I am truly sorry."
04/11/13 Ex-KPMG LLP partner Scott London charged by federal prosecutors w/passing inside tips to a friend in exchange for cash, jewelry, and concert tickets; expected to plead guilty in May.
08/01/13 Fabrice Tourré convicted on six counts of security fraud, including "aiding and abetting" his former employer, Goldman Sachs
08/14/13 Javier Martin-Artajo and Julien Grout charged with wire fraud, falsifying records, and conspiracy in connection with JP Morgan's "London Whale" trade.
08/19/13 Phillip A. Falcone, manager of hedge fund Harbinger Capital Partners, agrees to admit to "wrongdoing" in market manipulation. Will banned from securities industry for 5 years and pay $18MM in disgorgement and fines.
09/16/13 Javier Martin-Artajo and Julien Grout officially indicted on charges associated with "London Whale" trade.
02/06/14 Matthew Martoma convicted of insider trading while at hedge fund SAC (Stephen A. Cohen) Capital Advisors. Expected sentence 7-10 years.
03/24/14 Annette Bongiorno, Bernard Madoff's secretary; Daniel Bonventre, director of operations for investments; JoAnn Crupi, an account manager; and Jerome O'Hara and George Perez, both computer programmers convicted of conspiracy to defraud clients, securities fraud, and falsifying the books and records.
05/19/14 Credit Suisse, which has an investment bank branch in NYC, agrees to plead guilty and pay appx. $2.6 billion penalties for helping wealthy Americans hide wealth and avoid taxes.
09/08/14 Matthew Martoma, convicted SAC trader, sentenced to 9 years in prison plus forfeiture of $9.3 million, including home and bank accounts







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[font size=3][font color=red]This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.[/font][/font][/font color=red][font color=black]


39 replies = new reply since forum marked as read
Highlight: NoneDon't highlight anything 5 newestHighlight 5 most recent replies
STOCK MARKET WATCH -- Monday, 22 December 2014 (Original Post) Tansy_Gold Dec 2014 OP
Ukraine crisis: Obama orders ban on Crimea trade Demeter Dec 2014 #1
MICHAEL HUDSON: How Russia May Create a More Viable Financial and Fiscal System FROM 1999 Demeter Dec 2014 #3
China is Planning to Purge Foreign Technology and Replace With Homegrown Suppliers Demeter Dec 2014 #2
If Apple Were A Worker Cooperative, Each Employee Would Earn At Least $403K Demeter Dec 2014 #4
Business News and Not So Much the Rest..is the Clue to Capitalist KoKo Dec 2014 #5
welcome aboard, matey Demeter Dec 2014 #7
Fed calls time on $5.7 trillion of emerging market dollar debt By Ambrose Evans-Pritchard Demeter Dec 2014 #6
Greece, the EUROZONE and the prospects of a SYRIZA government Demeter Dec 2014 #8
Markets Around The World Are Rallying xchrom Dec 2014 #9
Oil Rebounds Above $62 xchrom Dec 2014 #10
South Korea Cuts Its 2015 Growth Forecast xchrom Dec 2014 #11
10 Things You Need To Know In Markets This Morning xchrom Dec 2014 #12
So, the Oligarchs leave Russia. This is good for Russia. Demeter Dec 2014 #21
The Weekend Is Over, And Markets Are Up In Asia xchrom Dec 2014 #13
Argentina Has Declared An Orangutan A ‘Person’ And Granted It The Right To Freedom xchrom Dec 2014 #14
The End of Zoos Demeter Dec 2014 #22
I can see it. Zoo people have used them in the past to test cage security. Warpy Dec 2014 #39
Belarus Is Taking Extreme Measures To Stop A Currency Panic xchrom Dec 2014 #15
Russia Is Bailing Out Its First Bank Of The Ruble Crisis xchrom Dec 2014 #16
Putin will be nationalizing the banks Demeter Dec 2014 #23
GLOBAL MARKETS GAIN AS OIL REBOUNDS xchrom Dec 2014 #17
Oil MIGHT be stabilizing--I wouldn't call it a rebound yet Demeter Dec 2014 #25
China Offers Russia Help With Currency Swap Suggestion xchrom Dec 2014 #18
This was predicted in a Weekend post Demeter Dec 2014 #24
Crossing my fingers..... Hotler Dec 2014 #26
As long as it pisses off the right people, AND they can't do anything about it Demeter Dec 2014 #29
Swiss Bankers in Limbo After U.S. Jury Clears Ex-UBS Man xchrom Dec 2014 #19
Just like the Insider Trading Debacle? Uncle Sap is taking it on the chin again! Demeter Dec 2014 #27
S&P 500 Beating World Means It’s Time to Go Global xchrom Dec 2014 #20
Optimisim? I'd say it's a time of Warning! Danger, Will Robinson! Demeter Dec 2014 #28
Prudential Piles on the Corporate Pensions INFAMOUS! Demeter Dec 2014 #30
The 401(k) Killed Off Pensions RIIIGHT.... Demeter Dec 2014 #31
getting rid of defined benefit pensions is one of the biggest mistakes this country has made. nt antigop Dec 2014 #35
Congress Says It Has to Cut Pensions to Save Them Demeter Dec 2014 #32
there is something very fishy with this whole thing. It was rammed through without debate. antigop Dec 2014 #36
and I'll say it again...this is bullshit. If we can bail out the banks, we can bail out pensions. antigop Dec 2014 #37
and if the companies were forced to actually.... Hotler Dec 2014 #38
Pensions Aren't Sacred, a Judge Tells Calpers Demeter Dec 2014 #33
The Hidden Risk in the World’s Best Pension System NETHERLANDS AND US Demeter Dec 2014 #34
 

Demeter

(85,373 posts)
1. Ukraine crisis: Obama orders ban on Crimea trade
Sun Dec 21, 2014, 09:20 PM
Dec 2014
http://www.bbc.com/news/world-europe-30558502

US President Barack Obama has ordered a ban on the export of goods, technology and services to Crimea. The executive order also imposes new sanctions on Russian and Ukrainian individuals and companies. Mr Obama said the move showed the US would never accept Russia's annexation of Crimea in March.

AFTER ALL, WHY SHOULD THE US ACCEPT THE FREELY DETERMINED, BY FAIR ELECTION, DECISION OF A PEOPLE? ARE WE SOME KIND OF RESPECTERS OF THE RULE OF LAW AND THE RIGHT TO SELF-DETERMINATION? I SHOULD THINK NOT!--DEMETER


Similar measures agreed by the European Union earlier this week came into effect on Saturday. Canada announced its own sanction on Crimea on Friday. The European Union announced its own sanctions against the region on Thursday. All investment in Crimea is banned, as is participation in Russian oil and gas exploration in the Black Sea. European cruise ships will not be able to visit the peninsula's ports.


After the peninsula was annexed, pro-Russian separatists took control of parts of the Donetsk and Luhansk regions of eastern Ukraine in April, and later declared independence. Some 4,700 people have died and another million have been displaced by fighting in recent months. On Friday, five Ukrainian soldiers were killed in fighting - the highest death toll since the latest attempt at a ceasefire began on 9 December.


Mr Obama said in a statement:
"The executive order is intended to provide clarity to US corporations doing business in the region and reaffirm that the United States will not accept Russia's occupation and attempted annexation of Crimea."

In addition to the goods, technology and services ban, US individuals or companies cannot now buy any real estate or businesses in Crimea or fund Crimean firms. The new measures also include sanctions on 24 Ukrainian and Russian individuals and on a number of companies deemed to be destabilising Ukraine. They include the Russian equity investment group, Marshall Capital Partners, and the Night Wolves biker group, over its involvement in Crimean military action...But like the EU, Mr Obama said he would not yet impose new sanctions on Russia itself, urging it again to de-escalate the tension in eastern Ukraine.

Russian Foreign Minister Sergei Lavrov said that "threatening new sanctions against Russia could undermine the possibility of normal cooperation between our countries for a long time".

Mr Obama said: "I again call on Russia to end its occupation and attempted annexation of Crimea, cease its support to separatists in eastern Ukraine, and fulfil its commitments under the Minsk agreement."

The agreement signed by Ukraine and the rebels in Minsk, in Belarus, in September, put in place a ceasefire and set out the terms for a peace process. However, fighting has continued, with more than 1,000 people killed since then. The Ukraine crisis began a year ago, when pro-Moscow leader Viktor Yanukovych abandoned an agreement on closer trade ties with EU in favour of closer co-operation with Russia. This decision sparked pro-EU protests in the capital Kiev, eventually toppling Mr Yanukovych in February. Russia annexed Crimea after his removal AND A PLEBESCITE OF THE PEOPLE IN CRIMEA.

 

Demeter

(85,373 posts)
3. MICHAEL HUDSON: How Russia May Create a More Viable Financial and Fiscal System FROM 1999
Sun Dec 21, 2014, 09:51 PM
Dec 2014
http://michael-hudson.com/1999/04/how-russia-may-create-a-more-viable-financial-and-fiscal-system/

English translation of a pamphlet published in Russia by The Land Policy Association, St. Petersburg, Russia, April 1999

Instead of becoming wealthier and more like America since 1990, Russia is being turned into a third world country. In less than a decade the nation has been stripped of its capital and forced into debt to its former NATO adversaries. The point now has been reached where new credit merely covers the interest charges on past loans, so that the debt grows exponentially. Russia is being turned into an indebted raw materials exporter, told to sell off its natural resources and public utilities at distress prices to obtain the money to pay interest on its foreign debt – and to enable investors to convert their ruble earnings into foreign exchange. Even after this experience, Russia is being told to take yet more IMF advice as the price for obtaining new loans. The alternative is to be declared a pariah in the global economy. The policy leverage obtained by creditors thus threatens to lead to the industrial dismantling of Russia under continued austerity, or else to isolate Russia commercially much as Cold War containment did prior to 1990. One is tempted to amend von Clausewitz’s famous dictum to read that economic warfare is the continuation of military policy by financial means.

Russia’s financial distress was not inevitable. It is largely the result of having followed IMF and World Bank directives. Foreign advisors are telling Russia to depend on other countries for its food, consumer goods and most other manufactures. Russia is to pay for these imports by exporting more raw materials (thus depressing their world price, much to the benefit of industrial raw-materials importers) and selling off yet more of its public utilities to foreign buyers. The rental value of these assets is thus to be taken by their new owners, not by the public sector. Many Russians are coming to realize that this advice has been bad, but they may not realize the degree to which Western economies are experiencing a parallel financial distress. A real estate and stock market bubble that goes hand in hand with debt deflation is sweeping North America, Europe and the third world. Although this is heralded as a sign of prosperity, more and more income must be used to pay interest and amortization on the rising overhead of personal, corporate and government debt. This shrinks current spending on goods and services. The result has been a downsizing of employment and a slash in government spending and social safety nets in the West as well as in Russia. Meanwhile, a rising share of government budgets is being paid as interest.

The entire world is experiencing a plague of debt, aggravated by a financial system that has become decoupled from the funding of new tangible investment. In the West, banks recycle about 70 percent of savings into the real estate market, while money market funds, mutual funds and retirement funds channel most of their savings inflows into the stock and bond markets. This pattern of recycling provides a rich field of speculative gains for global investors, but creates little new tangible capital. This phenomenon raises the question of whether Russia really wants to be like the West. Should it perhaps view the U.S., European, Asian and third world experience as an object lesson in what pitfalls to avoid? One is reminded of the popular joke that what the West warned about communism and its bureaucratic inefficiency is true, but what the communists said about capitalism and its inequities also turns out to have been true.

Ideally, a banking system’s objective should be to finance industrial modernization and employment. The government can support this aim by not taxing activities it wishes to promote. Instead of imposing income and sales taxes that fall on labor and capital – that is, instead of impeding tangible capital formation and a thriving consumer market for the products of national industry – Russia may tax the rental value of its land and natural resources. This option no longer is available to the West. Nearly all the net cash flow generated by its urban and rural real estate, mining and other resource extraction has been pledged as debt service on the loans that banks and other investors have attached to these assets. Russia’s land and natural resources remain free of such debt as banks have not lent money against these resources, thanks to the Duma’s resistance to Mr. Yeltsin’s proposed land privatization edicts. The rental cash flow of these resources amounts to 35 to 45 percent of national income, and as much as 90 percent of Russia’s foreign-exchange earning power. Public collection of this revenue would not impair the supply of these resources, for they are provided by nature. Their flow of rent exists regardless of whether it is taken by the banking system as interest, by the government as taxes, or is not collected at all (as often is the case in socialist economies). The government may free labor and industrial capital from the tax burden – and thereby promote their employment and upgrading – by basing its fiscal system on this rental value. Not to collect this rent would be to let it be taken in rising amounts by buyers and, at one remove, the creditors who lend these buyers the money to operate. The underlying fiscal question for Russia thus concerns who shall benefit from the enormous rent surplus capable of being generated by its land, mineral wealth land public utilities. Will the government collect their rental potential as taxes, thereby freeing industry and labor? Or will the revenue be turned over to foreigners and a domestic elite as interest and dividends?

MUCH MORE...A WORTHY READ! AND A GOOD LESSON FOR THE REST OF THE WESTERN WORLD
 

Demeter

(85,373 posts)
2. China is Planning to Purge Foreign Technology and Replace With Homegrown Suppliers
Sun Dec 21, 2014, 09:34 PM
Dec 2014

NSA RESISTANCE BEING THE PRIMARY GOAL, NO DOUBT
DEFEATING THE TPP IS A BONUS

https://finance.yahoo.com/news/china-planning-purge-foreign-technology-091347795.html

China is aiming to purge most foreign technology from banks, the military, state-owned enterprises and key government agencies by 2020, stepping up efforts to shift to Chinese suppliers, according to people familiar with the effort.

The push comes after a test of domestic alternatives in the northeastern city of Siping that was deemed a success, said the people, who asked not to be named because the details aren't public. Workers there replaced Microsoft Corp.'s (MSFT) Windows with a homegrown operating system called NeoKylin and swapped foreign servers for ones made by China's Inspur Group Ltd., they said.

The plan for changes in four segments of the economy is driven by national security concerns and marks an increasingly determined move away from foreign suppliers under President Xi Jinping, the people said. The campaign could have lasting consequences for U.S. companies including Cisco Systems Inc. (CSCO), International Business Machines Corp. (IBM), Intel Corp. (INTC) and Hewlett-Packard Co.

"The shift is real," said Charlie Dai, a Beijing-based analyst for Forrester Research Inc. "We have seen emerging cases of replacing foreign products at all layers from application, middleware down to the infrastructure software and hardware."

China is moving to bolster its technology sector after Edward Snowden revealed widespread spying by the U.S. National Security Agency and accused the intelligence service of hacking into the computers of Tsinghua University, one of the China's top research centers. In February, Xi called for faster development of the industry at the first meeting of his Internet security panel...Foreign suppliers may be able to avoid replacement if they share their core technology or give China's security inspectors access to their products, the people said. The technology may then be seen as safe and controllable, they said...The push to develop local suppliers comes as Chinese regulators have pursued anti-trust probes against western companies, including Microsoft and Qualcomm Inc. (QCOM) Recent months have seen Microsoft's China offices raided, Windows 8 banned from government computers and Apple Inc. (AAPL) iPads excluded from procurement lists. "I see a trade war happening. This could get ugly fast, and it has," said Ray Mota, chief executive officer of Gilbert, Arizona-based ACG Research, who expects the issue to result in direct talks between the U.S. and China. "It's not going to be a technology discussion. It's going to be a political discussion."

MORE

 

Demeter

(85,373 posts)
4. If Apple Were A Worker Cooperative, Each Employee Would Earn At Least $403K
Sun Dec 21, 2014, 10:01 PM
Dec 2014
http://www.forbes.com/sites/cameronkeng/2014/12/18/if-apple-was-a-worker-cooperative-each-employee-would-earn-at-least-403k/

Apple has 98,000 employees and earned $39.5 billion after tax over the past year. If Apple was a worker cooperative, then each employee would’ve received a $403,000 dividend on top of their salaries. Even the lowest paid worker would’ve earned at least $403,000 in Apple as worker cooperative.

The first thing naysayers and disbelievers will say is “but, Apple isn’t a worker cooperative.” Mondragon is a worker cooperative that has about 74,000 employees and earned $12.6 billion in revenue. Mondragon is smaller than Apple, but it’s at a scale that demonstrates that we can do better as employees.

What Is A Worker Cooperative?

A worker cooperative is a company that is owned by the employees. Thus, employees receive salaries for their labor and a dividend at the end of the year from the company’s profits. As employees, we all see how much our employers charge their customers. I used to bill $475 per hour to my employer’s client, but I was only getting paid $35 an hour. Seeing this makes everyone question why they’re making so little.

Worker cooperatives answers the question we’ve all asked ourselves – what’s the point of working hard for someone else? Finally, we’re able to justify working ourselves to the bone for our fair share of the spoils. Instead of the scraps that manifest as 3% inflationary raises.

MORE

KoKo

(84,711 posts)
5. Business News and Not So Much the Rest..is the Clue to Capitalist
Sun Dec 21, 2014, 10:35 PM
Dec 2014

Domination......

Follow the Business News and not Political News is where the Truth Lies...reading between the lines is Most Important.

Forgive my Cryptic......

 

Demeter

(85,373 posts)
6. Fed calls time on $5.7 trillion of emerging market dollar debt By Ambrose Evans-Pritchard
Sun Dec 21, 2014, 10:52 PM
Dec 2014
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/11300454/Fed-calls-time-on-5.7-trillion-of-emerging-market-dollar-debt.html

World finance is rotating on its axis. The stronger the US boom, the worse it will be for those countries on the wrong side of the dollar (UNTIL THE PETRODOLLAR COLLAPSES AND RUSSIAN AND CHINESE CURRENCIES DOMINATE WORLD TRADE...DEMETER) The US Federal Reserve has pulled the trigger. Emerging markets must now brace for their ordeal by fire. They have collectively borrowed $5.7 trillion in US dollars, a currency they cannot print and do not control. This hard-currency debt has tripled in a decade, split between $3.1 trillion in bank loans and $2.6 trillion in bonds. It is comparable in scale and ratio-terms to any of the biggest cross-border lending sprees of the past two centuries. Much of the debt was taken out at real interest rates of 1pc on the implicit assumption that the Fed would continue to flood the world with liquidity for years to come. The borrowers are "short dollars", in trading parlance. They now face the margin call from Hell as the global monetary hegemon pivots. The Fed dashed all lingering hopes for leniency on Wednesday. The pledge to keep uber-stimulus for a "considerable time" has gone, and so has the market's security blanket, or the Fed Put as it is called. Such tweaks of language have multiplied potency in a world of zero rates.

Officials from the Bank for International Settlements say privately that developing countries may be just as vulnerable to a dollar shock as they were in the Fed tightening cycle of the late 1990s, which culminated in Russia's default and the East Asia Crisis. The difference this time is that emerging markets have grown to be half the world economy. Their aggregate debt levels have reached a record 175pc of GDP, up 30 percentage points since 2009. Most have already picked the low-hanging fruit of catch-up growth, and hit structural buffers. The second assumption was that China would continue to drive a commodity supercycle even after Premier Li Keqiang vowed to overthrow his country's obsolete, 30-year model of industrial hyper-growth, and wean the economy off $26 trillion of credit leverage before it is too late.

These two false assumptions have blown up simultaneously, the effects threatening to feed on each other with wicked force. Russia's Vladimir Putin could hardly have chosen a worse moment to compound his woes by tearing up the international rulebook and seizing chunks of territory from Ukraine, a country that gave up its nuclear weapons after a pledge by Russia in 1994 to uphold its sovereign borders. Stress is spreading beyond Russia, Nigeria, Venezuela and other petro-states to the rest of the emerging market nexus, as might be expected since this is a story of evaporating dollar liquidity as well as a US shale supply-glut.



Turkey relies on imports for almost all its energy and should be a beneficiary of lower crude prices. Yet the Turkish lira has fallen 12pc since the end of November. The Borsa Istanbul 100 index is down 20pc in dollar terms. Indonesia had to intervene on Wednesday to defend the rupiah. Brazil's real has fallen to a 10-year low against the dollar, as has the index of emerging market currencies. Sao Paolo's Bovespa index is down 23pc in dollars in three weeks. The slide can be self-feeding. Funds are forced to sell holdings if investors take fright and ask for their money back, shedding the good with the bad. Pimco’s Emerging Market Corporate Bond Fund bled $237m in November, and the pain is unlikely to stop as clients discover that 24pc of its portfolio is in Russia. There could be a cascade if - as many predict - the Kremlin is forced to impose capital controls, triggering the automatic ejection of Russia from benchmark indices. One might rail against the injustice of indiscriminate selling. Such are the intertwined destinies of countries that have nothing in common...The Fed has already slashed its bond purchases to zero, withdrawing $85bn of net stimulus each month. It is clearly itching to raise rates for the first time in seven years. This is the reason why the dollar index (DXY) has jumped 12pc since May, smashing through its 30-year downtrend line, a "seismic change" in the words of HSBC. The US economy has shaken off its long malaise. It grew 3.9pc in the third quarter, an incipient boom. The latest confidence survey by the University of Michigan said expected wage gains "rose to their highest level since 2008". More spoke of job gains than "any other time in the last half century". Consumers are the most positive in "30 years." This is powerful stuff. New York Fed chief William Dudley has strongly hinted that rate rises may come faster and harder than markets expect, more like the bond crash cycle of 1994 than the dilatory style of 2004.

MORE PROPHESYING AND DOOM AT LINK

METHINKS THE AUTHOR PROTESTS TOO MUCH
 

Demeter

(85,373 posts)
8. Greece, the EUROZONE and the prospects of a SYRIZA government
Sun Dec 21, 2014, 10:57 PM
Dec 2014
http://yanisvaroufakis.eu/2014/12/15/interviewed-by-thomas-fazi-for-oneuro-greece-the-eurozone-and-the-prospects-of-a-syriza-government/


Q Thomas Fazi for ONEURO): There’s a lot of talk about Greece’s supposed ‘recovery’, a sign of the ‘success’ of austerity. How do you judge this narrative, and how would you describe the real state of the Greek economy? (It would be great if you could mention what you said in Florence, about Greece’s ‘GDP growth’ being non-existent when deflation is taken into consideration)

A Yanis Varoufakis, ECONOMIST): Greece is and remains in a Great Depression. Seven years of precipitous falls in income, coupled with negative investment, have spawned a humanitarian crisis. In each of these years, the European Commission, the European Central Bank and the International Monetary Fund predicted that recovery was “around the corner”. It was not! Now, on the basis of one quarter of positive real GDP growth, they are celebrating the recession’s ‘end’. But if we look carefully at the numbers, it turns out that, even according to official figures, the recession is continuing. Consider this: real GDP rose by 0.7% at a time that prices, on average, fell by 1.9%. I remind our readers that real GDP equals GDP measured in euros divided by an index of average prices. Given that this index went down by 1.9%, and that the whole ratio (real GDP) only rose by 0.7%, this means that GDP as measured in euros declined! So, the rise in real GDP happened because national income, in euros, went up. It rose because total income, in euros, fell more slowly than prices did. Preposterously, the powers-that-be expect the Greek people to celebrate this as the ‘End of Recession’. They won’t!

Q: Regarding the state of the Greek economy: is this simply the unintended result of ‘flawed’, ideologically-driven policies, or should it rather be considered the desired outcome of such policies?

A: Neither, I think. These policies were the only policies they could come up with which would not require an admission that the Eurozone was badly designed and that the crisis is systemic. They were also the only policies consistent with their prime objective; that is, to shield bankers from expropriation by the European Union or member-states. In short, a proud nation was forced into an internal devaluation that caused great hardship, and made private and public debts unpayable, so as to maintain the lie that the Eurozone design was pristine and, more pertinently, to hide the fact that their number one priority was to shift gargantuan losses from the books of the private banks onto the shoulders of the weakest of taxpayers. Once this strategy was in place, it was embellished with neoliberal ideology…

Q: Following the call for early presidential elections, markets have gone into a panic. Do you think their fears of an early general election are justified? If so, what are they so afraid of, in your opinion?

A: They are justified. What they are afraid is that the twin bubbles that the Berlin, Frankfurt and Brussels so elaborately pumped up over the last year, in the bond and stock markets, so as to pretend that Greece was recovering, would burst. But this is the fate of bubbles: they burst. And the sooner they do the better our chance to facing reality and doing something to make it better for the majority of the people – both in Greece and in the Eurozone at large.

Q: Do you think a victory by SYRIZA is a realistically possible option? Or will establishment forces avoid that outcome at all costs?

A: Both. There is no doubt that the establishment will throw everything they can at SYRIZA, inspiring the maximum amount of terror in the hearts and minds of Greek voters. But, at the same time, it is looking increasingly likely that this campaign of fear will fail to prevent a SYRIZA victory.

Q: How do you judge Mr. Juncker’s call to avoid the ‘wrong outcome’ in the elections (i.e., the victory of ‘extreme forces’)?

A: It reveals a deep-seated contempt for democracy and a colonial attitude that makes a mockery of the notion of a Union that respects the sovereignty of its member-states. The European Commission is supposed to be answerable to the citizens of member-states. The citizens of member-states are not answerable to the Commission and, by definition, the Commission can have no view on what is a ‘correct’ and what is a ‘wrong’ electoral outcome. Mr Juncker took his office further into disrepute by overstepping the mark and widening spectacularly the democratic deficit typical of the European Union. His intervention was probably one of the most fiercely anti-European moves, to the extent that he managed singlehandedly to de-legitimise the Commission and, by extension, the Union.

Q: Could you outline the main points of SYRIZA’s program (for Greece and for the EMU)?

A: In three short sentences: First, a SYRIZA government will work tirelessly to ensure that Europe has the ‘conversation’ it has so far refused to have about the faulty design of the Eurozone and the fact that the bailouts were toxic both for the Periphery and for core countries like Germany. Secondly, it will strive to render Greece’s social economy viable again through a New Deal for Europe that lifts the veil of depression from the whole Periphery – not just Greece. Thirdly, it will struggle to reform Greece, both its public and private sectors, in a manner that enhances creativity, improves productivity and shapes a better society.

xchrom

(108,903 posts)
9. Markets Around The World Are Rallying
Mon Dec 22, 2014, 07:27 AM
Dec 2014
http://www.businessinsider.com/market-update-dec-22-2014-2014-12

Here's the scorecard, so far:

France's CAC 40 is up 0.97%

Germany's DAX is up 0.72%

Britain's FTSE 100 is up 1.00%

Spain's IBEX is up 0.43%

Italy's FTSE MIB is up 1.09%

Asian markets closed in the green. Japan's Nikkei closed up 0.08% and Hong Kong's Hang Seng closed up 1.26%.

US futures are also up. The Dow is up 38 points, the S&P 500 is up 3.6 points, and NASDAQ is up 9.75 points.

In Europe, December consumer confidence will be released at 3 p.m. GMT.

And later in the US, the National Association of Realtors will publish existing home sales data at 3 p.m. GMT (10 a.m. ET). Economists estimate the pace of sales fell 1.1% in November to an annualised rate of 5.20 million.



Read more: http://www.businessinsider.com/market-update-dec-22-2014-2014-12#ixzz3McorIOts

xchrom

(108,903 posts)
10. Oil Rebounds Above $62
Mon Dec 22, 2014, 07:29 AM
Dec 2014
http://www.businessinsider.com/r-oil-rebounds-above-62-tracking-broader-markets-2014-12

LONDON (Reuters) - Oil rose above $62 a barrel on Monday, mirroring gains in equities, as investors became confident there would be no further substantial price loss in the run-up to the new year.

Saudi Arabia's powerful oil minister, Ali al-Naimi, said on Sunday that lower crude prices would help demand by stimulating the economy and slow down supply growth.

"Naimi said that the market would correct itself and was confident that the fall was temporary," Michael Hewson, chief market strategist at CMC Markets, said.

"The market has calmed down and it is forming a short-term base above $60, and it's to be expected that there would be a bit of a rebound after such a sharp fall."



Read more: http://www.businessinsider.com/r-oil-rebounds-above-62-tracking-broader-markets-2014-12#ixzz3McpIjGFV

xchrom

(108,903 posts)
11. South Korea Cuts Its 2015 Growth Forecast
Mon Dec 22, 2014, 07:30 AM
Dec 2014
http://www.businessinsider.com/afp-south-korea-trims-2015-growth-forecast-vows-to-spur-consumption-2014-12

Seoul (AFP) - South Korea on Monday trimmed its economic growth forecast for 2015 to 3.8 percent from 4.0 percent as it vowed to continue expansionary policies aimed at spurring domestic consumption.

The revised projection comes after the country's central bank this month warned its own 3.9 percent growth forecast would be "difficult" to maintain as domestic demand alternated between positive and negative territories and a weak yen hurt the price competitiveness of South Korean firms against Japanese rivals abroad.

The finance ministry said Monday that, in addition to the 2015 growth forecast being lowered, its estimate for this year's economic growth was also revised down to 3.4 percent from 3.7 percent. South Korea's economy grew 3.0 percent last year.

"We must maintain our expansionary macroeconomic and fiscal policies so that people can feel the effect of economic recovery," President Park Geun-Hye said at a meeting of economic ministers on Monday.



Read more: http://www.businessinsider.com/afp-south-korea-trims-2015-growth-forecast-vows-to-spur-consumption-2014-12#ixzz3McpfCgKQ

xchrom

(108,903 posts)
12. 10 Things You Need To Know In Markets This Morning
Mon Dec 22, 2014, 07:33 AM
Dec 2014
http://www.businessinsider.com/european-markets-open-dec-22-2014-2014-12

Arab Gulf Oil Exporters Stand By OPEC. Gulf officials on Sunday defended OPEC's decision last month not to cut oil output and instead blamed non-OPEC producers, especially American shale producers, for the supply glut that has sent prices tumbling.

Belarus Blocked Online Stores And News Websites. Government officials introduced the block on Dec. 19 in an attempt to stop panic-buying spurred by the depreciation of the Belorussian ruble, which has been hit hard by the slide of the Russian ruble.

US Gas Prices Hit A 5-And-A-Half-Year Low. The average price of regular-graded gasoline fell 25 cents in the last two weeks to $2.47 a gallon, according to a survey released on Dec. 19.

Rich Russians Are Fleeing To The UK. Figures from Britain's Home Office show that the number of Russians granted investor visas in 2014 jumped by 69% compared to the previous year as the economic situation in Russia worsens.

China Is Willing To Help Russia. "If the Russian side needs, we will provide necessary assistance within our capacity," Chinese Foreign Minister Wang Yi was quoted as saying in a state newspaper on Monday.



Read more: http://www.businessinsider.com/european-markets-open-dec-22-2014-2014-12#ixzz3McqIXKoR
 

Demeter

(85,373 posts)
21. So, the Oligarchs leave Russia. This is good for Russia.
Mon Dec 22, 2014, 09:50 AM
Dec 2014

Especially if Putin manages to either destroy or capture some of the Obscenely Wealthy Loot on their way out.

I am dreaming of the Koch Brothers and Sheldon Adelson, fleeing across the borders, shedding their citizenship and control...or more likely, realizing they've lost control and the protection of power...and fleeing for their lives...

xchrom

(108,903 posts)
13. The Weekend Is Over, And Markets Are Up In Asia
Mon Dec 22, 2014, 07:34 AM
Dec 2014
http://www.businessinsider.com/r-asian-shares-dollar-stand-tall-in-thin-trade-2014-12

TOKYO (Reuters) - Asian shares and the dollar began a holiday-shortened week on a strong footing on Monday, with the euro testing two-year lows against the greenback on divergent monetary policy expectations.

MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> was up 0.3 percent in early trade, while Japan's Nikkei stock average <.N225> was up 0.4 percent ahead of a Japanese holiday on Tuesday.

Activity was likely to be thin this week, with many investors away for Christmas and the run-up to New Year's holiday and many investors not wanting to end the year with dollar-short positions.

"U.S. data over the next three weeks are likely to underline the outperformance of the U.S. economy and provide broad support" for the U.S. dollar, strategists at Barclays wrote in a note clients on Monday.



Read more: http://www.businessinsider.com/r-asian-shares-dollar-stand-tall-in-thin-trade-2014-12#ixzz3McqiT9fc

xchrom

(108,903 posts)
14. Argentina Has Declared An Orangutan A ‘Person’ And Granted It The Right To Freedom
Mon Dec 22, 2014, 07:53 AM
Dec 2014
http://www.businessinsider.com/r-captive-orangutan-has-human-right-to-freedom-argentine-court-rules-2014-12


An orangutan named Sandra, covered with a blanket, gestures inside its cage at Buenos Aires' Zoo, December 8, 2010.

BUENOS AIRES (Reuters) - An orangutan held in an Argentine zoo can be freed and transferred to a sanctuary after a court recognized the ape as a "non-human person" unlawfully deprived of its freedom, local media reported on Sunday.

Animal rights campaigners filed a habeas corpus petition - a document more typically used to challenge the legality of a person's detention or imprisonment - in November on behalf of Sandra, a 29-year-old Sumatran orangutan at the Buenos Aires zoo.

In a landmark ruling that could pave the way for more lawsuits, the Association of Officials and Lawyers for Animal Rights (AFADA) argued the ape had sufficient cognitive functions and should not be treated as an object.

The court agreed Sandra, born into captivity in Germany before being transferred to Argentina two decades ago, deserved the basic rights of a "non-human person."



Read more: http://www.businessinsider.com/r-captive-orangutan-has-human-right-to-freedom-argentine-court-rules-2014-12#ixzz3McvSitkb
 

Demeter

(85,373 posts)
22. The End of Zoos
Mon Dec 22, 2014, 09:55 AM
Dec 2014

Well, I can see a lot of good, and a lot of bad....

Zoos have been a store of genes for endangered species. A well-run zoo can protect the earth from continued extinction of species, especially the physically largest and those whose habitat is destroyed by Man.

On the other hand, very few zoos are well-run.

Warpy

(110,900 posts)
39. I can see it. Zoo people have used them in the past to test cage security.
Mon Dec 22, 2014, 05:41 PM
Dec 2014

Give a chimp in a cage a screwdriver and he'll bang it on a rock, maybe use it to crack a couple of nuts, and lose interest.

Give it to an orangutan, he'll wait until your back is turned and use it to dismantle the cage.

That was the story I read years ago, veracity unknown, but what is known is that they're far more adept at using tools and figuring things out than other species except a few bird species.

Argentina is correct about this in any case. If we're going to keep other creatures where we can visit them safely, we need to provide them with homes they'd choose for themselves in their natural habitat, not confine them in cages.

xchrom

(108,903 posts)
15. Belarus Is Taking Extreme Measures To Stop A Currency Panic
Mon Dec 22, 2014, 07:55 AM
Dec 2014
http://www.businessinsider.com/afp-belarus-blocks-sites-closes-stores-to-stem-currency-panic-2014-12

Minsk (AFP) - Belarus blocked online stores and news websites Sunday, in an apparent attempt to stop a run on banks and shops as people rushed to secure their savings.

The Belarussian currency was dragged down by the slide of the Russian ruble last week, leading authorities to impose draconian measures, forbid price increases even for imported goods, and warn people against panic.

In a statement Sunday, BelaPAN news company, which runs popular independent news websites Belapan.by and Naviny.by, said that the sites were blocked Saturday without any warning.

"Clearly the decision to block the IP addresses could only be taken by the authorities because in Belarus the government has a monopoly on providing IPs," it said.



Read more: http://www.businessinsider.com/afp-belarus-blocks-sites-closes-stores-to-stem-currency-panic-2014-12#ixzz3McvukQ4V

xchrom

(108,903 posts)
16. Russia Is Bailing Out Its First Bank Of The Ruble Crisis
Mon Dec 22, 2014, 07:58 AM
Dec 2014
http://www.businessinsider.com/r-russian-central-bank-to-bail-out-trust-bank-with-up-to-530-million-2014-12

MOSCOW (Reuters) - Russia's central bank said it would will provide a mid-sized bank to with up to 30 billion rubles ($530 million) to stop it going bankrupt, in the first bailout of its kind during the current rouble crisis.

The central bank's Deposit Insurance Agency, responsible for managing crisis-hit lenders, would also take over supervision of Trust Bank as of Monday, it said in a statement.

In all Russia's banking sector, under increasing pressure from a plummeting rouble and western sanctions over Ukraine, could get a capital boost of up to 1 trillion rubles under a new law being prepared by the government.

The central bank will soon choose a leading investor for bailing out Trust Bank, which is likely to be one of the country's major banks, it said.

($1 = 56.4600 rubles)



Read more: http://www.businessinsider.com/r-russian-central-bank-to-bail-out-trust-bank-with-up-to-530-million-2014-12#ixzz3McwX4GOD
 

Demeter

(85,373 posts)
23. Putin will be nationalizing the banks
Mon Dec 22, 2014, 09:57 AM
Dec 2014

Because doing anything else would be stupid. Putin is not stupid. This is his opportunity to get a source of oppositional power and looting under state control.

Unlike the US, which coddles its criminals.

xchrom

(108,903 posts)
17. GLOBAL MARKETS GAIN AS OIL REBOUNDS
Mon Dec 22, 2014, 08:00 AM
Dec 2014
http://hosted.ap.org/dynamic/stories/F/FINANCIAL_MARKETS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2014-12-22-05-15-56

KEEPING SCORE: Britain's FTSE 100 rose 1 percent to 6,607.17 while Germany's DAX gained 0.8 percent to 9,862.75. France's CAC 40 advanced 1.1 percent to 4,288.34. Wall Street appeared to be headed for another day of gains, with futures for the Standard & Poor's 500 and Dow Jones industrial average both up 0.3 percent.

ASIA'S DAY: China's Shanghai Composite Index was up 1.6 percent to 3,158.94. South Korea's Kospi added 0.7 percent to 1,943.77 and Hong Kong's Hang Seng rose 1.5 percent to 23,452.25. Japan's Nikkei 225 dipped 0.1 percent to 17,610.33 while Australia's S&P/ASX 200 jumped 1.9 percent to 5,422.00. Stocks in Southeast Asia and Taiwan also rose.

ANALYST'S TAKE: "Our markets have opened firmer after the strong rebound in energy prices," said Tony Kwok, a sales trader in Sydney for CMC Markets. "Oil futures in particular, jumped 3.3 percent, despite Saudi Arabia refusing to cut production, which is seen as a very positive sign for the recently battered commodity."

OIL REBOUND: Saudi Petroleum Minister Ali Naimi said Sunday that he was certain the oil market would recover with the improvement of the global economy. Oil peaked at $107 a barrel in June but has plunged since then due to weak demand, especially after Saudi Arabia and other members of the Organization of Petroleum Exporting Countries agreed to maintain production levels. Naimi, in a speech at an energy summit in Abu Dhabi, denied his government was trying to suppress oil prices.

ENERGY STOCKS: Shares of energy companies, which have underperformed benchmarks, made gains as crude prices rebounded after the Saudi petroleum chief, Naimi, expressed confidence the market would stabilize. State-owned Chinese oil and gas producer PetroChina Co. jumped 4 percent while another state-owned energy company, Sinopec Shanghai Petrochemical Co., advanced 2.6 percent.

FED PLEDGE: Last week's volatile stock movements found an upward direction after the Federal Reserve reassured investors on Wednesday it was in "no hurry" to hike interest rates and that a rate hike will not take place during the first quarter of next year. The news emboldened investors and the U.S. dollar rose against other major currencies.
 

Demeter

(85,373 posts)
25. Oil MIGHT be stabilizing--I wouldn't call it a rebound yet
Mon Dec 22, 2014, 10:04 AM
Dec 2014

And if there is a 'rebound" it will mean that somebody is trying to reinflate the oil bubble, and we know who that would be, the idiots with all the junk bonds, the paper that is suddenly worthless. I hope they aren't that greedy and stupid. I hope that the government doesn't let them, and also that it doesn't bail them out.

OR somebody else might continue to drive oil down...figuring they will be able to pick up some bargains in the oil patch.

Shark food!

xchrom

(108,903 posts)
18. China Offers Russia Help With Currency Swap Suggestion
Mon Dec 22, 2014, 08:02 AM
Dec 2014
http://www.bloomberg.com/news/2014-12-22/china-offers-russia-help-with-suggestion-of-wider-currency-swap.html

Two Chinese ministers offered support for Russia as President Vladimir Putin seeks to shore up the ruble without depleting foreign-exchange reserves.

China will provide help if needed and is confident Russia can overcome its economic difficulties, Foreign Minister Wang Yi was cited as saying in Bangkok in a Dec. 20 report by Hong Kong-based Phoenix TV. Commerce Minister Gao Hucheng said expanding a currency swap between the two nations and making increased use of yuan for bilateral trade would have the greatest impact in aiding Russia, according to the broadcaster.

While the offer won’t relieve the main sources of pressure on the ruble -- capital outflow tied to plunging oil prices and sanctions linked to Russia’s annexation of Crimea from Ukraine - - the currency gained 3.1 percent against the dollar by 12:37 p.m. in Moscow. The Micex Index (INDEXCF) was little changed, and the yield on Russia’s 10-year bond fell 30 basis points to 13.3 percent, according to data compiled by Bloomberg.

“In the current conditions, any help is very welcome,” Vladimir Miklashevsky, a strategist at Danske Bank A/S, said by e-mail. “Yet, it can’t substitute the losses of the Russian banking system and economy from western sanctions.”
 

Demeter

(85,373 posts)
24. This was predicted in a Weekend post
Mon Dec 22, 2014, 09:59 AM
Dec 2014

Russia gives China rubles, China gives Russia dollars, Russia buys up all the rubles outside the country, and anyone trying to bring Putin and Russia down is neatly clipped.

The petrodollar's days are coming to an end...

 

Demeter

(85,373 posts)
29. As long as it pisses off the right people, AND they can't do anything about it
Mon Dec 22, 2014, 10:18 AM
Dec 2014

Otherwise, it's time for the Elephant Sock Hop

A professor of mine years ago quoted someone who defined laissez faire capitalism as "Every man for himself screamed the elephant as he danced among the chickens."


"Well, every one for himself, and Providence for us all--as the elephant said when he danced among the chickens."
~A Simpleton by Charles Reade

From the number of passengers on board, as well as from the calmness of the voyage, it had been anticipated that the cabin would not contain one-half of the hungry. The first knife and fork had not as yet been laid, ere every stool and chair had been occupied, thus excluding, in the teeth of good breeding, every lady from the table, the feeling of each being pretty evident, "Let every one take care of himself, as the jackass said when he was dancing among the chickens." They manage things otherwise in America, and we might look to `' brother Jonathan," in this particular, as to an example. The deference and respect there paid to the ladies should be a salutary lesson even to us, who boast of our breeding and politeness.
~ from A SIX DAYS' TOUR THROUGH THE ISLE OF MAN;
OR,
A PASSING VIEW OF' ITS PRESENT NATURAL, SOCIAL, AND POLITICAL ASPECT,
BY A STRANGER, (thought to be written by John Welch, architect) 1836


In all probability Longstreet and Dickens had a common source in Samuel Beazley ‘s play, The Boarding House, first performed in London late in 1811. Dickens’s biographer Thomas Wright ascribes Sam Weller’s phraseology to this long-successful farce, in which the militiaman Simon Spatterdash has such lines as "I am down on you, as the extinguisher said to the rushlight," and "Let everyone take care of themselves, as the jackass said when he was dancing among the chickens."

~ the quotation is attributed to The Life of Charles Dickens (New York: Charles Scribner’s Sons, 1936), pp. 87–88.
http://www.compedit.com/vernacular_humor.htm


When the elephants dance, the chickens must be careful."
~ Filipino saying (proverb)

Papa explains the war like this: "When the elephants dance, the chickens must be careful." The great beasts, as they circle one another, shaking the trees and trumpeting loudly, are the Amerikanos and the Japanese as they fight. And our Philippine Islands? We are the small chickens. I think of baby chicks I can hold in the palm of my hand, flapping wings that are not yet grown, and I am frightened.
~ opening lines of the book “When the Elephants Dance” by Tess Uriza Holthe
http://www.amazon.com/exec/obidos/tg/detail/-/0142002887/104-6489516-5328744?v=glance
http://www.bookbrowse.com/index.cfm?page=title&titleID=958&view=excerpt
http://search.barnesandnoble.com/booksearch/isbnInquiry.asp?endeca=1&isbn=0142002887&itm=5


Why shouldn't you dance with an elephant?
Because you'd end up with flat feet.
http://www.fionasplace.net/Elephantjokes.html

ORIGINAL SOURCE: http://forum.quoteland.com/eve/forums/a/tpc/f/99191541/m/677102102

“When two elephants fight, it is the grass that gets trampled” African Proverb

xchrom

(108,903 posts)
19. Swiss Bankers in Limbo After U.S. Jury Clears Ex-UBS Man
Mon Dec 22, 2014, 08:08 AM
Dec 2014
http://www.bloomberg.com/news/2014-12-22/swiss-bankers-in-limbo-after-u-s-jury-clears-ex-ubs-man.html

The courtroom victory of the only Swiss banker to beat the U.S. in a trial over offshore tax evasion may embolden other indicted financial workers to leave a legal limbo some have occupied more than five years.

Twenty-five offshore bankers, lawyers and advisers have yet to answer U.S. Department of Justice charges that they helped Americans evade taxes. Most live in Switzerland, where they remain off limits to U.S. prosecutors because the country doesn’t extradite people for tax crimes. If they cross the border into another country, however, they risk arrest, and the U.S. charges have no expiration date.

Raoul Weil, 55, the former head of wealth management for UBS (UBSG) Group AG, was in similar straits until he was arrested in Italy last year, after his indictment in 2008. After two months in an Italian jail, he waived extradition and went to the U.S. to face a conspiracy charge that he conspired to help thousands of U.S. clients use Swiss banking secrecy to evade taxes.
 

Demeter

(85,373 posts)
27. Just like the Insider Trading Debacle? Uncle Sap is taking it on the chin again!
Mon Dec 22, 2014, 10:06 AM
Dec 2014

Is this a Nation of Laws, or what?

xchrom

(108,903 posts)
20. S&P 500 Beating World Means It’s Time to Go Global
Mon Dec 22, 2014, 08:10 AM
Dec 2014
http://www.bloomberg.com/news/2014-12-22/s-p-500-beating-world-means-it-s-time-to-go-global.html

This year’s record-setting rally in U.S. stocks is good news for the rest of the world.

Pushed higher as momentum builds in the American economy, the Standard & Poor’s 500 Index (SPX) has advanced 12 percent in 2014, compared with a dollar-denominated decline of 6.5 percent for equities everywhere else. The divergence, a consequence of rising stocks and a strengthening currency, is the widest for any year since 1992, data compiled by Bloomberg show.

At a time when emerging-market equities have lost more than one tenth of their value in three months and debt crises from Russia to Venezuela recall the shocks of 1998, gains in U.S. shares are a reason for global optimism. History shows that every time the gap between America and the rest of the world got this wide, the other countries caught up in the next 12 months.

“It’s really the strength in the U.S. that contains these global issues more than anything else,” said David Lafferty, who helps oversee $894 billion as the chief market strategist for Natixis Global Asset Management in Boston. “If the U.S. weren’t accelerating, people would be much more worried and volatility would be much higher.”
 

Demeter

(85,373 posts)
28. Optimisim? I'd say it's a time of Warning! Danger, Will Robinson!
Mon Dec 22, 2014, 10:08 AM
Dec 2014


that would make a nice avatar...
 

Demeter

(85,373 posts)
30. Prudential Piles on the Corporate Pensions INFAMOUS!
Mon Dec 22, 2014, 11:48 AM
Dec 2014
http://www.businessweek.com/articles/2014-12-18/as-prudential-takes-over-corporate-pensions-risks-are-unclear

Big U.S. companies have found a way to escape the burden of ballooning pension obligations: pay an insurance company to take them over. Since 2012 corporations have transferred $41.4 billion of U.S. pensions to insurers, according to Limra, an insurance industry trade association. Prudential (PRU) has dominated the dealmaking, agreeing to acquire more than $35 billion in pension obligations from companies including Bristol-Myers Squibb (BMY), General Motors (GM), Motorola Solutions (MSI), and Verizon (VZ)—meaning the nation’s second-biggest life insurer now has the responsibility of making pension payments to almost 200,000 of those companies’ retirees.

For corporate executives, the transfers offer peace of mind. They no longer need worry about how stock market crashes or low bond yields will affect the company’s pension burdens. And they don’t need to estimate how long each of their retirees will live. For insurers, pensions are familiar territory: They already sell annuities and are in the business of managing pools of money to meet long-term obligations. Corporations have “no strategic rationale for wanting to hold on to these liabilities,” says Jonathan Novak, who oversees American International Group’s (AIG) institutional life business. “It’s a far more natural fit for the skill set of the life insurers.”

For workers, the benefits of the deals are less clear. Pensions lose federal government protection when they’re transferred to insurers, according to Karen Friedman, policy director at the Pension Rights Center, a nonprofit consumer organization. “The verdict is not in on how safe these transactions are,” she says. “They happen very quickly. We still think the government regulators need to act.” Companies typically transfer plans covering employees who are retired or near retirement and are no longer accruing additional benefits. At some companies, retirees outnumber employees. Motorola Solutions, which employs 15,000 people, had 95,000 participants in its pension plans before striking a deal with Prudential in September to take over payments for 30,000 of them. The agreements have increased in popularity in recent years as a recovering stock market helped bring pension assets back in line with liabilities, making the transfers less costly for companies. In a typical transaction, the insurer gets about $1.09 in assets for every dollar of pension promises it takes on, according to consulting firm Mercer (MMC).

The market is growing fast. About $100 billion to $150 billion in transactions could take place in the next five years, says Mercer. MetLife (MET) took on about $279 million of obligations in the first nine months of the year, while AIG has acquired $65.6 million, according to Limra. Prudential was No. 1 with $604.8 million (the figures include only completed deals). The latest: On Dec. 16, MetLife said it agreed to take over pension benefits for about 7,000 people from TRW Automotive (TRW) in a $440 million deal. Ultimately, AIG estimates, at least $1 trillion in U.S. pensions could go to insurers. To ensure a deal is profitable, insurers have to make complicated calculations about mortality, interest rates, and investment returns over periods of 20 years or more. Small variations from a forecast could have a large impact on results. “The competitive landscape for large closeouts leaves little margin for error,” MetLife Chief Executive Officer Steven Kandarian warned in October. “A negative surprise relative to assumptions could impact returns for decades.” Prudential’s success in winning the biggest deals could mean its pricing is too low. Moody’s Investors Service (MCO) tried to figure out what would happen if death rates fell at about 2 percent a year faster than Prudential’s expectations. That’s the equivalent of the average 70-year-old living 1.7 years longer than expected. That sort of shock, while highly unlikely, could lead to big losses for the insurer, especially if it takes on many more pensions, Moody’s analysts warned. “Once you write a block of business, you’ve assumed that risk for decades,” says Scott Robinson, a senior vice president at Moody’s. “If you write a big deal, you don’t get a second chance.”

Aegon (AEG), the Dutch owner of Transamerica, says insurers need to take a lot of credit risk to earn enough to meet the obligations they’re taking on and generate a profit. “We’ve looked at that market, and we cannot make that pricing work,” says Chief Financial Officer Darryl Button. “I don’t think that product in that market is rationally priced in the U.S.”


WELL, THAT'S A GOOD REASON TO GO GOVERNMENT SINGLE PAYER HEALTH INSURANCE AND PENSIONS...
 

Demeter

(85,373 posts)
31. The 401(k) Killed Off Pensions RIIIGHT....
Mon Dec 22, 2014, 11:51 AM
Dec 2014

NOT CORPORATE MALFEASANCE AND BREAKING UNION CONTRACTS AND PENSION COMMITMENTS? THE CORPORATIONS BAILED...NOT THE WORKERS

http://www.businessweek.com/articles/2014-12-04/the-401-k-killed-off-pensions

1978: President Jimmy Carter signs a revision to the tax code allowing workers to contribute part of their pay to tax-sheltered accounts.

“There was absolutely no discussion in ’78 that if you do this, the world is going to change,” recalls Carter-era Treasury official Daniel Halperin of the 869-word provision in the tax code that created a $4.4 trillion pool of retirement savings. According to the Investment Company Institute, 18 percent of all retirement assets are held in 401(k)s, the third-largest stash behind IRAs and government pensions.

How did an obscure section of a bill designed to cut taxes become a ubiquitous part of life-planning? Companies realized that they could slash future liabilities by moving employees from pensions into tax-sheltered retirement accounts: From 1985 to 2012, the number of Fortune 100 companies offering traditional defined-benefit plans fell from 89 to 11.

Although 401(k) accounts offer flexibility to workers hopping between jobs, the balances in accounts held by older Americans are shrinking. The median household 401(k) balance for workers nearing retirement age was $111,000 in 2013, a drop of 8 percent since 2010, according to the Center for Retirement Research at Boston College. The 401(k) may have made corporate boards happy, but most middle-income workers would gladly pass up the thrill of picking their own index funds in favor of guaranteed retirement income.

antigop

(12,778 posts)
35. getting rid of defined benefit pensions is one of the biggest mistakes this country has made. nt
Mon Dec 22, 2014, 02:12 PM
Dec 2014
 

Demeter

(85,373 posts)
32. Congress Says It Has to Cut Pensions to Save Them
Mon Dec 22, 2014, 11:57 AM
Dec 2014
http://www.businessweek.com/articles/2014-12-11/congress-says-it-has-to-cut-pensions-to-save-them

Joshua Gotbaum doesn’t like telling retirees that their pensions are about to be cut. After all, until August he was the director of the Pension Benefit Guaranty Corporation (PBGC), the federal insurance fund that’s supposed to safeguard pensions. But yesterday Gotbaum interrupted a vacation in Madrid to return my call asking about a bill working its way through Congress that would allow multi-employer pension plans to cut benefits. He’s a huge supporter of the legislation.

“The alternative is that the plans would collapse. It’s reorganize rather than die,” says Gotbaum, a former Lazard investment banker who is now a guest scholar at the Brookings Institution.


On Dec. 9, lawmakers agreed on pension reforms as part of a $1.1 trillion spending bill to keep the federal government from shutting down. Inclusion in that bill almost ensures the provision’s passage. The bill applies to roughly 10 million participants in multi-employer pension plans, typically found in construction, trucking, and other industries in which several employers, often small businesses, negotiate collectively with unions to cover a group of workers in a region. They tend to be in much worse condition than single-employer plans, because many of the companies in them have gone out of business, leaving the survivors to pick up the slack for workers who never even worked for them. About 1.5 million of those participants are in plans that could run out of money in the next two decades if nothing is done.

The legislation would allow the plans’ trustees to cut benefits without having to shut down and be taken over by the PBGC. The bill is bipartisan and supported by some—but not all—labor unions. As explained by Bloomberg News, “The provision reflects an agreement by House Education and the Workforce Committee Chairman John Kline, a Minnesota Republican, and senior Democrat George Miller, a California Democrat.” Allowing these plans to cut benefits is strongly opposed by the Pension Rights Center, an organization backed by foundations and unions. It’s “a huge breach of Erisa,” the Employment Retirement Income Security Act of 1974 whose 40th birthday was celebrated in September, says Karen Friedman, the center’s policy director. “We’re totally outraged by this legislative deal, which was done in the middle of the night.” She says it sets a precedent that could weaken the protections of single-employer pension plans and even Social Security. As Friedman notes, it’s been a tough year or two for pensions. In October, a federal bankruptcy judge ruled that the California Public Employees’ Retirement System doesn’t deserve special protection when cities turn to bankruptcy court. Retired city workers in Detroit took benefit cuts in that city’s bankruptcy.

AND YET, THE STOCK MARKETS HAVE ALL BEEN DOING SO WELL....

Alicia Munnell, director of Boston College’s Center for Retirement Research, says the change to multi-employer plans “is letting the genie out of the bottle. Once it becomes legal to cut accrued benefits, then it’s a different world. It’s really precedent-making change.” While not opposed to giving trustees flexibility, she said, “It needs to be applied very, very judiciously.” Gotbaum and others say that there was no alternative to letting trustees of trouble plans cut benefits. “To me, it’s the natural and predictable evolution of a long-running problem,” says Olivia Mitchell, executive director of the Pension Risk Council at the University of Pennsylvania’s Wharton School. “The fact is the PBGC has never had any government backing, and it’s never been set up so that the premiums are sufficient. The Erisa Act of 1974 didn’t price the insurance right, and this is the result.”

Multi-employer plans are in particularly poor shape. Mitchell says the PBGC reported assets for them of $1.8 billion and liabilities of $44 billion. The worst off among the major plans, the Teamsters’ Central States pension fund, has just one worker for every five retirees or inactive members collecting benefits, a dramatic reversal from the four-to-one employee-to-retiree ratio it had in 1980, the Washington Post reported. The bill in Congress has some safeguards built in for retirees. Those older than age 80 would be spared cuts, and workers 75 to 80 would suffer only part of the cut. Retirees and current workers have the right to reject cuts, although Friedman said that veto can be overridden by the plan’s trustees. Trustees would not be allowed to cut benefits to less than 1.1 times the minimum provided by plans that are taken over by the PBGC. So employers will bear some of the pain: Their premiums will double to $24 per worker per year.

Says Gotbaum: “When I started doing this, no one thought this bill could pass. I’m ecstatic. It’s great.”

IS HE A WEASEL, OR WHAT?

antigop

(12,778 posts)
36. there is something very fishy with this whole thing. It was rammed through without debate.
Mon Dec 22, 2014, 02:18 PM
Dec 2014

And there are two pension funds that are causing the most problems: a mining fund and Central States' Teamsters fund. There were proposals to fix the funds without cutting benefits.

Here is what you need to know about Central States' Teamsters fund: it was run by Wall Street:
http://www.ibtimes.com/pension-fund-run-wall-street-cited-push-cut-retiree-benefits-1748439


I think this is the groundwork for future Social Security cuts.

antigop

(12,778 posts)
37. and I'll say it again...this is bullshit. If we can bail out the banks, we can bail out pensions.
Mon Dec 22, 2014, 02:24 PM
Dec 2014

nt

Hotler

(11,353 posts)
38. and if the companies were forced to actually....
Mon Dec 22, 2014, 03:31 PM
Dec 2014

put the money in to the pension funds right away instead of writing an IOU and say we'll pay into it when we need to would have helped. The post office is the only business that is legally required to pay into their funds 75yrs ahead of when they are needed. Can you imagine the howling that would rise up from corporate America if Washington made all businesses do that.

 

Demeter

(85,373 posts)
33. Pensions Aren't Sacred, a Judge Tells Calpers
Mon Dec 22, 2014, 12:00 PM
Dec 2014
http://www.businessweek.com/articles/2014-10-02/pensions-arent-sacred-a-judge-tells-calpers

The nation’s largest pension fund just got some bad news. Almost 70 percent of Calpers’s 1.7 million members work for city and local school agencies in California, and a new ruling in U.S. bankruptcy court could put their pensions at risk. Calpers, a state agency that manages the pensions for public workers, has long argued successfully that California law provides extra protection for public pensions when a city struggles financially, allowing Calpers to use special liens to force cities to pay up. In a ruling yesterday, U.S. Bankruptcy Judge Christopher Klein said that the state law “is simply invalid in [the] face of the U.S. Constitution.”

The ruling comes in the bankruptcy case of the City of Stockton, which confronted a financial crush after overbuilding during the housing bubble. Stockton proposed exiting bankruptcy with a deal that would leave its pension obligations intact and force other creditors to take reductions on what they’re owed. As the Sacramento Bee explained:

“City officials have said they have no choice but to stick with Calpers. If it doesn’t pay the pension fund in full, default would occur, and the city would either have to make a one-time payment of $1.6 billion to keep pensions whole or let Calpers slash benefits by 60 percent. The result would be a mass exodus of employees, the city said, creating an enormous setback just as the troubled city, saddled with poverty and a high crime rate, is starting to get back on its feet.”


Other creditors, namely the money manager Franklin Resources, have argued that Calpers doesn’t deserve special protections and that it should be subject to reductions in what it’s owed, just like other creditors. Klein’s opinion agrees in principal, meaning that when a city such as Stockton is in bankruptcy, Calpers doesn’t have special legal powers to force the city to sell its assets.

The judge stopped short of issuing a final ruling in Stockton’s case, giving the city until Oct. 30 to work out a deal with Franklin or to argue that its bankruptcy plan should still be approved. How these scenarios play out over the next month could determine just how much of a precedent Klein’s findings will create for other struggling cities. Before finalizing his ruling, Klein said,“I need to reflect more carefully.”
 

Demeter

(85,373 posts)
34. The Hidden Risk in the World’s Best Pension System NETHERLANDS AND US
Mon Dec 22, 2014, 12:06 PM
Dec 2014
http://www.businessweek.com/articles/2014-10-17/the-hidden-risk-in-the-worlds-best-pension-system

In the pension-nerd community (of which I am a card-carrying member), the Dutch are renowned for their creativity and prudence. According to the New York Times, Dutch corporate pensions are the gold standard. They’re well funded, cover 90 percent of Dutch workers, and replace 70 percent of income. Compared with defined-benefit plans in the U.S.—rare, underfunded, and governed by accounting standards derided by almost every economist—the Dutch pension system looks even better. It does have a weakness, though, one that’s often overlooked, even though it may be the only aspect of the Dutch system that’s likely to be adopted here: In the Netherlands, annual cost-of-living increases depend on the health of the pension’s balance sheet. If returns fall, benefits don’t increase. If the fund performs badly enough, pensioners may even suffer benefit cuts.

This kind of risk-sharing has been catching on in America. Public pension benefits are often secured by state constitutions, but it’s not clear whether those guarantees extend to inflation-linked adjustments. Eager to contain costs, some states have eliminated cost-of-living increases entirely. The state of Wisconsin adopted a variant of the Dutch model in which retirees in the Wisconsin Retirement System get a cost-of-living adjustment only when pension assets return at least 5 percent. Previous inflation adjustments can be clawed back; monthly checks were 10 percent smaller in 2013 as a result of the financial crisis. Although, unlike in the Dutch plans, retirement income can never fall below its nominal level at retirement.

Such risk-sharing seems to solve one of the U.S. pension system’s biggest problems: Most pensions are horribly underfunded, because guaranteeing income for thousands of people no matter what is more expensive than most state governments can even admit to themselves. Letting benefits fluctuate with the pension funds’ assets puts some boundaries around the guarantee that make it more affordable. Stanford economist Josh Rauh and University of Rochester’s Robert Novy-Marx estimate that if other states followed Wisconsin’s lead, unfunded pension liabilities would fall 25 percent. If they went with the full Dutch-style model, and could cut benefits, unfunded liabilities would fall 50 percent. But to call it risk-sharing makes it sound more benign than it really is, particularly because retirees can’t tolerate as much risk as working people can. Post-retirement, most people live on a fixed income. In general, it’s too late to save more or get another job. Many state employees don’t have other sources of inflation-linked income like Social Security. If “fairness” means everyone has to bear risk equally, then the Dutch system makes sense. But if it’s more “fair” to treat people differently according to their means, then it would be better to share the risk with current workers instead.

Inflation risk may not seem like a big deal now. But the future is uncertain, which is why the guarantees are so valuable. Until the financial crisis, Dutch pensioners took it for granted they’d get their cost-of-living adjustment each year. Gambling on future inflation may be preferable to an underfunded pension—or no pension at all—but it’s no free lunch.
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