STOCK MARKET WATCH -- Wednesday, 27 May 2015

[Tansy_Gold]

[font size=3]STOCK MARKET WATCH, Wednesday, 27 May 2015[font color=black][/font]

SMW for 26 May 2015

AT THE CLOSING BELL ON 26 May 2015
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Dow Jones 18,041.54 -190.48 (-1.04%)
S&P 500 2,104.20 -21.86 (-1.03%)
Nasdaq 5,032.75 -56.61 (-1.11%)


[font color=green]10 Year 2.14% -0.07 (-3.17%)
30 Year 2.90% -0.07 (-2.36%) [font color=black]


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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 - Videos:[/font][/font]
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Charlie Rose talks with Roubini
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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]

[Demeter]

1. Survived Tuesday--the ultimate qualification for life

My car is again water-proof, now that the windows roll up, and it rained a little, finally, after they were fixed. And we survived prom night for the Kid in good shape. So, what's a psychic scar here or there? (more than I can stand, actually...time for chocolate).

[Demeter]

2. The Most Hated Company in the Retail Industry

http://www.fool.com/investing/general/2015/05/25/the-most-hated-company-in-the-retail-industry.aspx?source=eogyholnk0000001

...The most hated companies in America have a knack for angering people. Whether it's due to inept management, subpar products, poor service, or lackluster stock performance, these businesses earn the wrath of customers, employees, and shareholders alike. The retail industry in particular has its share of struggling businesses. It's a brutal arena, where cutthroat competition can take a toll on even the strongest businesses. Brick-and-mortar retailers are especially vulnerable as consumers steadily shift their purchases online. In addition, the low wages typical in the industry often lead to tension with employees, which can negatively impact customer care. Maybe no company epitomizes these struggles better than retail giant Wal-Mart Stores. The discount chain is among the greatest retail success stories in history, yet it was recently named one of the most hated companies in America by 24/7 Wall St.

The e-commerce megatrend has taken a toll on Wal-Mart's business. Amazon.com in particular is a major threat, with the retail juggernaut increasingly becoming the first -- and last -- place people shop online. As more and more dollars flow to the Internet, Wal-Mart's massive store base could become less of an asset and more of a liability. That's because the cost of operating its stores and paying its millions of employees puts it at a structural disadvantage to Amazon and other Internet-based competitors. Unfortunately for Wal-Mart and its shareholders, this trend is unlikely to change in the foreseeable future.

Worker compensation is another hot-button issue. Wal-Mart is the largest private employer in the United States and is at the epicenter of the "Living Wage" movement. The company has long been targeted by protesters demanding pay increases for its workers. Recently, Wal-Mart took action to meet those demands by raising its minimum U.S. hourly wage to $9. The company also announced plans to increase it to $10 for current employees next year. It should be noted that these figures are above the current federal minimum wage of $7.25. However, critics note that even with these pay increases, many Wal-Mart employees will still rely on food stamps, Medicaid, and other government programs to survive. It's a difficult position for Wal-Mart: low wages dampen employee morale and can lead to poor customer service, but pay hikes increase labor costs and dent its profit margin. And if Wal-Mart tries to pass on those costs to customers, demand for its products (and thus sales) would likely fall. That's because Wal-Mart's customers tend to be more cost-sensitive, and the company's low prices are what many consumers find most appealing about its offerings.

These labor issues have no doubt affected the quality of care that customers receive from Wal-Mart's employees. In fact, 24/7 Wall St noted, "Few companies received a lower rating than Walmart for customer satisfaction, according to the [American Customer Satisfaction Index]. Walmart's scores were low even relative to other discount and department stores, as well as relative to other supermarkets. Walmart was the worst performer in both industries."

LET'S MAKE AN EXPANDED LIST OF THE MOST HATED COMPANIES: I'LL START

1. COMCAST

[Demeter]

3. Can’t Find a Job? Here Are 10 Jobs That Are Hiring Like Crazy

...Globally, here are the top 10 jobs employers are having the hardest time filling:

Production/Machine Operators
IT Personnel
Office Support/Administrative Staff
Accountants/Financing Staff
Managers/Executives
Drivers
Technicians
Engineers
Sales Representatives
Skilled Trades


Read more: http://www.cheatsheet.com/business/cant-find-a-job-here-are-10-jobs-that-are-hiring-like-crazy.html/?a=viewall#ixzz3bIbYSiBR

GLOBALLY?

[Demeter]

4. The rise of non-standard work undermines growth and increases inequality

http://bilbo.economicoutlook.net/blog/?p=30994

One of the on-going themes that emerges from the neo-liberal commentariat is that fiscal deficits undermine the future of our children and their children because of the alleged higher implied tax burdens. The theme is without foundation given that each generation can choose its own tax structure, deficits are never paid back, and public spending can build essential long-lived infrastructure, which provides benefits that span many generations. The provision of a first-class public education system feeding into stable, skilled job structures is the best thing that a government can do for the future generations. Sadly, government policy is undermining the future generations but not in the way the neo-liberals would have us believe. One of my on-going themes is the the impact of entrenched youth unemployment, precarious work and degraded public infrastructure on the well-being and future prospects of society as neo-liberal austerity becomes the norm. This theme was reflected (if unintentionally) in a new report, release last week by the OECD – In It Together: Why Less Inequality Benefits All. The Report brings together a number of research findings and empirical facts that we all knew about but are stark when presented in one document....SEE LINK

There are two concepts of – income distribution – that economists consider.

First, the so-called size distribution of income or personal income distribution, which focuses on distribution of income across households or individuals. Often the data is expressed in percentiles (each 1 per cent from bottom to top), deciles (ten groups each representing 10 per cent of the total income), quintiles (five groups each representing 20 per cent of the total income) or quartiles (self-explanatory). Various summary measures are used to demonstrate the income inequality. For example, the share of the top 10 per cent to the bottom 10 per cent.

The Gini coefficient is another summary measure used in this type of analysis. The Gini Coefficient takes the value of zero when everyone in the income distribution has the same income and at the other extreme a value of 1 where one person has all the income. So rising values indicate increased inequality.

Second, the functional distribution of income or the factor shares approach, which divides national income up by what economists call the broad claimants on production – the so-called “factors of production” – labour, capital, and rent. Other classifications also include government given it stakes a claim on production when it taxes and provides subsidies (a negative claim).

As I have recently noted, the shift in most nations has been towards profits gaining a greater share of national income at the expense of wages. Please read my blog – Neo-liberal dynamics restored after the shock of the GFC – for more discussion on this point...

[Demeter]

5. GREECE: Austerity Is the Only Deal-Breaker By Yanis Varoufakis

http://www.project-syndicate.org/commentary/greece-government-reforms-by-yanis-varoufakis-2015-05

A common fallacy pervades coverage by the world’s media of the negotiations between the Greek government and its creditors. The fallacy, exemplified in a recent commentary by Philip Stephens of the Financial Times, is that, “Athens is unable or unwilling – or both – to implement an economic reform program.” Once this fallacy is presented as fact, it is only natural that coverage highlights how our government is, in Stephens’s words, “squandering the trust and goodwill of its eurozone partners.”

But the reality of the talks is very different. Our government is keen to implement an agenda that includes all of the economic reforms emphasized by European economic think tanks. Moreover, we are uniquely able to maintain the Greek public’s support for a sound economic program.

Consider what that means: an independent tax agency; reasonable primary fiscal surpluses forever; a sensible and ambitious privatization program, combined with a development agency that harnesses public assets to create investment flows; genuine pension reform that ensures the social-security system’s long-term sustainability; liberalization of markets for goods and services, etc.

So, if our government is willing to embrace the reforms that our partners expect, why have the negotiations not produced an agreement? Where is the sticking point?

The problem is simple: Greece’s creditors insist on even greater austerity for this year and beyond – an approach that would impede recovery, obstruct growth, worsen the debt-deflationary cycle, and, in the end, erode Greeks’ willingness and ability to see through the reform agenda that the country so desperately needs. Our government cannot – and will not – accept a cure that has proven itself over five long years to be worse than the disease.

MORE

[Demeter]

7. A Parallel Currency for Greece: Part I & Part II

http://www.nakedcapitalism.com/2015/05/a-parallel-currency-for-greece-part-i.html

http://www.nakedcapitalism.com/2015/05/a-parallel-currency-for-greece-part-ii.html

MORE THAN YOU COULD POSSIBLY WANT TO KNOW ABOUT GREECE AND ITS OPTIONS.

[Demeter]

6. Thousands of Ukrainians protest Kiev regime’s draconian utility price hikes

WEIMAR REPUBLIC...PICK UP THE WHITE COURTESY PHONE

http://www.wsws.org/en/articles/2015/05/25/ukra-m25.html

Protests are mounting against decisions by the NATO-backed regime in Kiev to drastically increase prices for energy, water, and other basic necessities. Protesters reportedly set up a mock gallows near government buildings in downtown Kiev this weekend. The protests follow a march on May 16 of an estimated 5,000 people in Kiev to protest the price hikes.

The right-wing government in Kiev is slashing spending on subsidies to basic goods to funnel the money to the Ukrainian regime’s Wall Street creditors and boosting military spending on the war against Russian-backed forces in east Ukraine. As a result, consumer prices for basic necessities are skyrocketing. On May 1, hot and cold water prices rose by 71 percent. A month before, natural gas prices had increased by 285 percent, passing from just over 1,000 hryvnia (US$48.20) to over 4,000 hryvnia per thousand cubic meters of gas. Ukrainians were already struggling to pay their utility bills, with one report in January showing that nearly 30 percent of Ukrainians were unable to pay their bills after utility rates rose 35 percent last year and prices for food, transport, and medicine increased between 50 and 200 percent. Now, broad layers of the Ukrainian people are threatened with destitution.

Protesters at the May 16 rally in Kiev carried signs denouncing the government, such as “[Prime Minister Arseniy] Yatsenyuk means poverty for Ukraine.” On May 21, protesters set tires on fire outside the Ukrainian parliament in Kiev, clashing with police and fighting to gain entrance to the parliament. The protesters came from the “Financial Maidan” movement, which is demanding that private loans taken out by Ukrainians in foreign currency be restructured, based on the exchange rates before last year’s NATO-backed putsch installed the current regime in Kiev. Now, after the hryvnia collapsed from roughly 5 to 20 per US dollar, the cost of servicing foreign loans owed by private citizens has quadrupled.

Social anger is rising in Ukraine at the reactionary and undemocratic policies of the Kiev regime, which is plundering the country’s economy in the interests of international banks and a handful of multibillionaire oligarchs in Ukraine. There has been widespread draft dodging against attempts to conscript western Ukrainians to fight Russian-backed forces in east Ukraine, as well as protests by coal miners who lost their jobs as industrial subsidies were withdrawn and mines were forced to close. Already in March, a poll by the Kiev-based Research and Branding Group found that 58 percent of Ukrainians disapproved of President Petro Poroshenko’s performance, and only one-third supported him. Yatsenyuk was even more unpopular, with only a 24 percent approval rating. Only 8 percent of those polled said they thought Ukraine was going in the right direction.

This is a devastating verdict on the reactionary character of the putsch launched last year with the backing of Washington, Berlin, and the European Union (EU) to install a pro-NATO, violently anti-Russian regime in Kiev. The move plunged the country into a civil war that has claimed at least 6,000 lives, forced 1.5 million people to flee their homes, and cost billions of dollars, even as Ukraine’s economy and currency collapsed...


MORE

[Demeter]

8. Polish Voters Elect Eurosceptic President; Disenchantment with Brussels Spreads

http://globaleconomicanalysis.blogspot.com/2015/05/polish-voters-elect-eurosceptic.html


Andrzej Duda outed president Bronisław Komorowski, the pro-Brussels incumbent centrist Civic Platform party president, in an election over the weekend. Komorowski was expected to win. The Duda Victory Sent Shockwaves Through Polish Politics, and no doubt Brussels as well. The win for the socially conservative, nationalist, eurosceptic party, which saw Mr Duda oust Bronisław Komorowski, the government-backed incumbent from the presidential palace, represents a significant lurch to the right in Polish politics. It has sent shockwaves through the country’s political establishment that could ultimately topple the ruling party in October after eight years in power.

Backed by both the country’s restless, anti-establishment youth and its conservative pensioners, Mr Duda’s election, which was unthinkable just a few months ago, represents a significant and far-reaching rejection of the ruling Civic Platform party. Mr Duda has called for a repatriation of more powers from Brussels to individual member states, an effort that chimes with British prime minister David Cameron’s attempts to renegotiate the UK’s relationship with Europe ahead of a referendum on its EU membership.

The vote illustrated deep divides in Polish society. Despite headline growth figures since 2008 that are almost twice as large as any other EU member, the fruits of Poland’s economic boom have not been equally shared. Strikingly, all of the country’s poorer eastern regions backed Mr Duda, while the more prosperous western regions supported Mr Komorowski without exception. In rural areas, 62 per cent of voters backed Mr Duda, according to an exit poll, while Mr Komorowski carried 59 per cent of votes from the country’s cities.

Poland Vote

image:



Disenchantment with Brussels Spreads

The Polish unemployment rate is a modest 7.8%. Youth unemployment is 20.5% as of March. Both numbers are better than France and far better than Spain. Poland and Spain are two countries with the highest growth rates, yet voters are increasingly agitated, as they should be. The nannycrat policies of the eurozone (and EU in general), are not good for growth prospects or jobs...Euroscepticism and/or general disenchantment with Brussels is on the rise in Spain, France, Greece, the UK, and now Poland...There is much disenchantment with Brussels, and it is spreading.

Read more at http://globaleconomicanalysis.blogspot.com/2015/05/polish-voters-elect-eurosceptic.html#fEshWKyKbEfe6eeo.99

[Demeter]

9. JPMorgan’s Guilty Plea Puts Wealth Unit in Spot With Regulators

http://www.bloomberg.com/news/articles/2015-05-26/jpmorgan-s-guilty-plea-puts-wealth-unit-in-spot-with-regulators

JPMorgan Chase & Co. put allegations of currency-fixing largely behind it with a guilty plea, but it’s not out of the woods yet. With its new felony record, America’s biggest bank needs to seek the Department of Labor’s permission to keep managing money in the $8 trillion private pension market. At the same time, there’s a cloud over the JPMorgan unit where pensions are managed: The Securities and Exchange Commission is well along in an investigation into conflicts of interest in the bank’s wealth-management unit, whose products include individual retirement accounts. That puts the bank in a sticky position -- arguing that a criminal conviction shouldn’t keep it from managing Americans’ retirement savings, while the SEC is investigating possible wrongdoing in the same division.

“When a bank has enforcement action after enforcement action, it becomes hard to argue that it won’t happen again,” says Urska Velikonja, an assistant law professor at Emory University whose research focuses on securities law....The May 20 guilty pleas by America’s biggest bank and four others -- Citigroup Inc., Barclays Plc, Royal Bank of Scotland Plc and UBS Group AG -- required each to apply for regulatory exemptions from the SEC, as well as from the Labor Department, to carry on business as usual. The SEC issued the necessary approvals for the banks, but Democrats on Capitol Hill, as well as on the SEC Commission, have criticized rubber-stamping of waiver requests.

Bank of America Corp. lost its ability late last year to issue certain securities without first seeking SEC permission. Credit Suisse Group AG is operating its $2 billion pension business under a temporary, one-year waiver while the Labor Department conducts an extensive review of whether to grant the Swiss bank’s request for permanent relief.

The stakes are higher for JPMorgan Asset Management, the quickly growing business unit that includes mutual funds, private wealth management and some trusts. Its assets under management included $319 billion in U.S. pension funds at the end of 2014, according to Pensions & Investments. On the day last week when JPMorgan pleaded guilty to antitrust violations for manipulating currency rates, the bank applied to the Labor Department for an exemption to continue managing pensions as a Qualified Professional Asset Manager.

Banks rely on their QPAM status to carry out key transactions for pension clients, and a plea by any bank affiliate anywhere in the world triggers the need for it to apply for an exemption to maintain that business. JPMorgan needs to secure the waiver before it is sentenced....


SUCH UNNECESSARY WORRY. THE US GOVT/ WILL SKATE, AND JPMORGAN WILL CONTINUE ITS LIFE OF CRIME...YOU KNOW IT WILL!

[Demeter]

10. Sales of New U.S. Homes Climbed More Than Forecast in April

MUST BE ALL THAT SUPPLY DESTRUCTION DURING THE MASS EVICTIONS OF THE PAST DECADE..


http://www.bloomberg.com/news/articles/2015-05-26/sales-of-new-u-s-homes-increased-more-than-forecast-in-april

Purchases of new homes in the U.S. rose more than projected in April, a sign this part of the market is picking up steam during the busiest selling period of the year.

Sales increased 6.8 percent to a 517,000 annualized pace from a 484,000 rate in the prior month, figures from the Commerce Department showed Tuesday in Washington. The median forecast of 70 economists surveyed by Bloomberg called for 508,000. Prices picked up and inventory was little changed.

Steady hiring, low borrowing costs and a limited supply of existing homes is helping lift demand for new properties. Housing-related companies from PulteGroup Inc. to Home Depot Inc. have said the spring selling season is off to a good start, and the brighter outlook for sales may spur more residential construction, which would contribute to economic growth.

“Housing is coming back after a bad winter period,” said Robert Brusca, president of Fact & Opinion Economics in New York, whose forecast for sales was among the closest of economists surveyed by Bloomberg. “There’s going to be an improving housing market, but a slowly improving one.”

MORE OPTIMISM AT LINK

[Demeter]

11. Amazon declaring revenues in EU, not just Luxembourg

http://www.dw.de/amazon-declaring-revenues-in-eu-not-just-luxembourg/a-18476890



Online retailer Amazon has announced it has opened national branches in certain European countries. Previously, all revenue was recorded in Luxembourg, prompting criticism from the European Union. An announcement from Amazon on Tuesday indicates it will be subject to local taxes in several European countries, rather than just within the borders of its current official European base of operations in low-tax Luxembourg.

"More than two years ago we began the process of establishing local country branches of Amazon EU Sarl, our primary retail operating company in Europe," Amazon said in a statement to DW. Amazon EU Sarl is the full legal name for Amazon's European headquarters.

"As of May 1, Amazon EU Sarl is recording retail sales made to customers through these branches in the UK, Germany, Spain and Italy. Previously, these retail sales were recorded in Luxembourg."

The company said it was also working on setting up such an office in France...MORE

[Demeter]

12. Breach Exposes I.R.S. Tax Returns

TALKING ABOUT TRUST IN THE SYSTEM....

http://www.nytimes.com/2015/05/27/business/breach-exposes-irs-tax-returns.html

Criminals used stolen data to gain access to past tax returns of more than 100,000 people through an application on the Internal Revenue Service’s website, the agency said on Tuesday. Using Social Security numbers, birth dates, street addresses and other personal information obtained elsewhere, the criminals completed a multistep authentication process and requested the tax returns and other filings, the I.R.S. said. Information from those forms was used to file fraudulent returns, the I.R.S. said, and the agency sent nearly $50 million in refunds before it detected the scheme.

“We’re confident that these are not amateurs,” John Koskinen, the I.R.S. commissioner, said. “These actually are organized crime syndicates that not only we but everybody in the financial industry are dealing with.”

The agency has opened an investigation into the breach and has temporarily shut down the Get Transcript application, which was used to gain access to the information. Old tax returns are sometimes needed to apply for college loans or mortgages, and taxpayers can still request the records by mail. More than 200,000 attempts to view the past returns using stolen information were made from February to mid-May, and about half were successful. It is unclear whether the criminals were operating inside or outside the United States.

Dealing with fraudulent tax claims has been a challenge for the I.R.S. as online crime has grown more sophisticated in recent years. The agency paid $5.8 billion in falsely claimed refunds in 2013.

“Eighty percent of the identity theft we’re dealing with and refund fraud is related to organized crime here and around the world,” Mr. Koskinen said at a news conference on Tuesday. “These are extremely sophisticated criminals with access to a tremendous amount of data.”

The I.R.S. said the attackers exploited data, like email addresses and passwords gleaned from other breaches, to answer basic authentication questions about subjects like birth dates or the names of family members. After recent breaches at the health insurer Anthem and Home Depot, security experts note that users’ personal information is now widely available to hackers, who can buy it from criminal websites.

“This is a wake-up call that breaches have a compounding effect and the stakes are getting higher,” said Eric Chiu, a security expert who is the president of HyTrust, a cloud computing security company. “Attackers are on the hunt for our personal and financial information using data stolen from other breaches to gain a larger amount of information on those same individuals.”

The consequence, Mr. Chiu said, “could be devastating to consumers — attacks can potentially open new accounts, siphon off funds and ultimately steal identities of victims.”


OKAY...THE CRIMINALS ARE OBVIOUSLY MORE SOPHISTICATED THAN THE IRS, THE NSA, OR ANY OTHER GOVT. AGENCY..WHAT DOES THAT SUGGEST TO THE LOGICAL MIND?

[Fuddnik]

18. "We are confident these are not amateurs".

Yeah, but the criminals are confident that they're dealing with amateurs.

[DemReadingDU]

20. If my data was stolen

they can pay my taxes!

[Demeter]

13. The taming of the Fed’s balance sheet

http://www.ft.com/intl/cms/s/0/520377e8-037e-11e5-b55e-00144feabdc0.html?siteedition=intl#axzz3bKikfAsu

The exact timing of the Federal Reserve’s first interest rate rise is uncertain, but even less clear is what will happen to the $4tn pile of bonds the central bank amassed during the financial crisis. Optimists take the view that, like a skilled pilot, Fed chairwoman Janet Yellen will be able to bring the size of the balance sheet down smoothly and steadily without hitting too much turbulence. Pessimists, however, believe the pilot is flying blindly through dense clouds with a faulty radar and constant risk of storms, making the policy normalisation process particularly risky.

“For me the new thing to look out for is what they do to the portfolio,” says Robert Michele, chief investment officer at JPMorgan Asset Management. “We know about moving the interest rate corridor. What we should be worried about is what they do with the balance sheet.”

The Fed’s strategy for reducing its bloated balance sheet has evolved over time, but in September policy makers said the Fed will cease or start phasing out reinvestments only after it first begins increasing short-term interest rates. The balance sheet would shrink in a “gradual and predictable manner”, but the details were left unclear — as well as the timing, which will depend on how economic and financial conditions evolve.

One market concern is that allowing assets to roll off automatically as they mature could lead to a jagged path of balance-sheet reduction. BlackRock’s Investment Institute pointed out in a recent report that a third of the Fed’s entire Treasury portfolio, about $785bn, comes due by the end of 2018. Allowing the balance sheet to deflate that quickly could spook markets...


SOUNDS LIKE WORRYING ABOUT HOW MANY ANGELS CAN DANCE ON THE HEAD OF A PIN...IN THIS LIQUIDITY TRAP WE HAVE BEEN THROWN INTO, THERE'S NEVER GOING TO BE AN END TO QE, SO THERE'S NO REASON TO PLAN AHEAD FOR IT

[Demeter]

14. WHATEVER HAPPENED IN ICELAND? Putsch: Iceland‘s crowd-sourced constitution killed by parliament

MARCH 2013

http://www.verfassungsblog.de/en/putsch-icelands-crowd-sourced-constitution-killed-by-parliament-2/#.VWWkClIerko

Following its spectacular plunge from grace in 2008 when its banking system crashed, inflicting huge damage on foreign creditors as well as on local residents, Iceland caught attention for trying to come to grips with what happened by bringing court cases against bankers and others allegedly responsible for the crash as well as for inviting the people of Iceland and its directly elected representatives to draft a new post-crash constitution designed inter alia to reduce the likelihood of another crash.

Up against the wall, with throngs of protesters boisterously banging their pots and pans in parliament square in Reykjavík, the post-crash government formed in 2009, to its credit, set the process in motion. A National Assembly was convened comprising 950 individuals selected at random from the national registry. Every Icelander 18 years or older had an equal chance of being selected to a seat in the assembly. Next, from a roaster of 522 candidates from all walks of life, 25 representatives were elected by the nation to a Constitutional Assembly to draft a new constitution reflecting the popular will as expressed by the National Assembly. Believe it or not, the Supreme Court, with eight of its nine justices at the time having been appointed by the Independence Party, now disgraced as the main culprit of the crash and in opposition, annulled the Constitutional Assembly election on flimsy and probably also illegal grounds, a unique event. The parliament then decided to appoint the 25 candidates who got the most votes to a Constitutional Council which took four months in 2011, as did the framers of the US constitution in Philadelphia in 1787, to draft and unanimously pass a new constitution. The constitutional bill stipulates, among other things: (a) electoral reform securing ‘one person, one vote’; (b) national ownership of natural resources; (c) direct democracy through national referenda; (d) freedom of information; and (e) environmental protection plus a number of new provisions designed to superimpose a layer of checks and balances on the existing system of semi-presidential parliamentary form of government. The preamble sets the tone: “We, the people of Iceland, wish to create a just society where everyone has a seat at the same table.” The people were invited to contribute to the drafting through the Constitutional Council’s interactive website. Foreign experts on constitutions, e.g. Prof. Jon Elster of Columbia University and Prof. Tom Ginsburg of the University of Chicago, have publicly praised the bill and the democratic way in which it was drafted.

Even so, it was clear from the outset that strong political forces would seek to undermine the bill. First, there are many politicians who think it is their prerogative and theirs alone to revise the constitution and view the National Assembly and the Constitutional Council elected by the people and appointed by parliament as intruders on their turf. Second, many politicians rightly worry about their reelection prospects under ‘one person, one vote’. Third, many politicians fear losing their clout with more frequent use of national referenda, and also fear exposure under a new freedom of information act. For example, a crucial telephone conversation between the prime minister and the governor of the Central Bank in the days before the crash in 2008 is still being kept secret even if a parliamentary committee has demanded to hear a recording of it. Last but not least, many vessel owners dislike the prospect of being deprived of their privileged and hugely profitable access to the common-property fishing grounds. As a matter of public record after the crash, politicians and political parties were handsomely rewarded by the banks before the crash. It does not take a rocket scientist to figure out that vessel owners must have likewise treated politicians and political parties generously in the past, an umbilical cord that many politicians clearly want to preserve.

In sum, it was clear that in a secret ballot the constitutional bill would never have had a chance of being adopted by parliament, not even after the national referendum on the bill on 20 October 2012 where 67% of the electorate expressed their support for the bill as well as for its main individual provisions, including national ownership of natural resources (83% said Yes), direct democracy (73% said Yes), and ‘one person, one vote’ (67% said Yes). But the parliament does not vote in secret. In fact, 32 out of 63 members of parliament were induced by an e-mail campaign organized by ordinary citizens to declare that they supported the bill and wanted to adopt it now. Despite these public declarations, however, the bill was not brought to a vote in the parliament, a heinous betrayal – and probably also an illegal act committed with impunity by the president of the parliament. Rather, the parliament decided to disrespect its own publicly declared will as well as the popular will as expressed in the national referendum by putting the bill on ice and, to add insult to injury, hastily requiring 2/3 of parliament plus 40% of the popular vote to approve any change in the constitution in the next parliament, meaning that at least 80% voter turnout would be required for a constitutional reform to be accepted in the next session of parliament. The politicians apparently paid no heed to the fact that under these rules Iceland’s separation from Denmark would not have been accepted in the referendum of 1918. In practice, this means that we are back to square one as intended by the enemies of the new constitution. There is faint hope that the new parliament will respect the will of the people if the outgoing one failed to do so despite its promises. In her farewell address, the outgoing Prime Minister, Jóhanna Sigurðardóttir, declared this to be the saddest day of her 35 years in parliament.

MAKES ME WONDER WHAT THE RESPONSE WOULD BE TO A US CONSTITUTIONAL CONVENTION....

[Demeter]

15. Bankers’ Court Wins Could Come Back to Haunt Them APRIL 2013

I'M NOT HOLDING MY BREATH....

http://www.bloomberg.com/news/articles/2013-04-03/bankers-court-wins-could-come-back-to-haunt-them

Banks and their lawyers have found a surprisingly effective way to stymie financial reform: Kill new rules in the courts. It’s a strategy that may cripple regulators, undermine the legitimacy of the judicial system and ultimately come back to haunt the banks. Litigators working for the financial industry have been scoring some important victories, using the courts to block rules required by the Dodd-Frank Wall Street Reform and Consumer Protection Act. Notably, the U.S. Court of Appeals for the D.C. Circuit struck down a Securities and Exchange Commission rule that would have given shareholders more say in the selection of corporate directors, on the grounds that the regulation lacked adequate cost-benefit analysis. A lower court struck down a Commodity Futures Trading Commission rule imposing position limits on traders because of supposedly ambiguous wording.

The courts are likely to keep playing an outsized role in financial regulation. This is bad news for those seeking reform. There are three reasons the courts are going to be stacked in favor of industry, making them particularly useful for lobbyists who want to weaken Dodd-Frank.

First, an asymmetry exists in the types of claims that courts will accept. As David Arkush, an attorney at Washington-based law firm Gupta Beck PLLC, put it: “Businesses nearly always have standing to challenge rules that affect them. But if you’re someone who benefits from a rule and thinks it should be stronger, it’s much harder to get into court.” That’s a much less reform-friendly balance than the rule-making process, which requires regulators to read and weigh comments from all sides equally.

Second, litigation is a blunt and unpredictable weapon with the power to gut whole sections of financial reform, as opposed to merely watering them down. It’s very hard for regulators to anticipate exactly what parts of their rules lawyers will challenge, and how the courts will react. Judges are simply showing up at the end of a long process and giving a thumbs-up or a thumbs-down ruling, with little clarity or guidance to influence policy makers and no institutional back and forth. As opposed to lobbying, which aims to change legislation at the margin, court challenges block laws completely. There may never be position limits for commodity derivatives, and the SEC has shelved proxy access.

Third, the threat of litigation has a chilling effect that individual lobbying successes do not. It puts pressure on regulators to take more time writing the rules, to make them longer and more complicated, and to tilt them in favor of industry so that it won’t sue. The potential for courts to take issue with specific word choices, or to set unpredictable requirements for cost-benefit analysis, hang like a sword of Damocles over the whole rulemaking process. In a recent Washington Monthly article, the journalist Haley Edwards describes how litigation risk tips the balance of power at regulatory agencies toward those who want less aggressive reforms, even to the point of paralysis. A single director showing doubts, or a single negative cost-benefit report, can significantly increase the risk that a rule won’t survive the unpredictable challenges of the courts.

MORE

[Demeter]

16. Yellen Said to Plan Skipping Jackson Hole Conference This Year

FED SENDING A SIGNAL? THIS ISN'T THE FIRST NO-SHOW...

http://www.bloomberg.com/news/articles/2015-05-26/yellen-said-to-plan-skipping-jackson-hole-conference-this-year

Federal Reserve Chair Janet Yellen plans to skip the annual gathering of economists and policy makers in Jackson Hole, Wyoming, this year, a spokeswoman for the central bank in Washington said.

Yellen will participate in the Kansas City Fed’s symposium from time to time in the future as part of a speaking schedule that includes a variety of venues and events, the spokeswoman said on Tuesday.

This year’s gathering will look at inflation dynamics and monetary policy. The symposium will be held from Aug. 27 through Aug. 29.

[Demeter]

17. Goldman New Cop Is FBI Agent Who Put Away Madoff, Rajaratnam

http://www.bloomberg.com/news/articles/2015-05-26/goldman-s-new-cop-is-fbi-agent-who-put-away-madoff-rajaratnam

The FBI agent who oversaw the Bernard Madoff investigation and helped pioneer the use of wiretaps that yielded dozens of insider-trading convictions is now working for Goldman Sachs Group Inc.

Patrick Carroll, 50, joined the bank after almost a quarter century with the Federal Bureau of Investigation, the latest in a line of former feds who’ve moved to Wall Street firms. He is a vice president in Goldman Sachs’s compliance, surveillance and strategy group, part of a division overseen by Alan Cohen, global head of compliance.

While Carroll’s FBI career spanned bank robberies and organized crime, he’s best known for being at the investigative center of securities-fraud cases ranging from Madoff and billionaire fund manager Raj Rajaratnam to a $554 million Ponzi scheme used to buy expensive teddy bears.

His appointment comes as regulators and prosecutors are tightening scrutiny of financial institutions, sometimes charging banks as corporate defendants and imposing billions of dollars in fines following guilty pleas.

***********

A native New Yorker with a Joe Friday “just the facts” style, Carroll became an agent in 1991, after stints at Lehman Brothers and Merrill Lynch, in a bureau push to hire people with financial backgrounds following the savings-and-loan crisis. He got Series 7 and Series 63 licenses soon after graduating from Fordham University.

He rose to become supervisor of one of the New York FBI’s two squads investigating white-collar crimes, eventually overseeing as many as 25 agents.

In 2003 the FBI unveiled Carroll’s 18-month undercover securities-fraud case called “Operation Wooden Nickel.” It borrowed law enforcement techniques commonly used against drug cartels and mobsters.

To unearth fraud in the foreign currency markets, he sent an undercover agent posing as a corrupt trader to work in an exchange and used cooperating witnesses to record brokers in boiler rooms, banks and interbank forex brokerages. Almost 50 traders were arrested for cheating thousands of investors in rigged trades. At least 40 were convicted.

*******************


Carroll says he already knew many people at Goldman Sachs, having worked with “their compliance for many years.” His leaving was motivated by a desire for a new challenge after 25 years at the FBI, he said.

Given the fate of former employers Lehman Brothers and Merrill Lynch, he added with a wry smile, “I haven’t told the FBI this, but every place I’ve left has crumbled.”

[Hotler]

19. After reading this I wonder....

which bank Obama will end up at???????