...

Internal bank documents and court records show that shortly before the financial crisis began, UBS apparently sold securities to the city of Leipzig for which the risks were almost impossible to calculate, earning a sizeable profit in the process. "The supposed transaction only served the purposes of banks and criminal racketeers and is null and void, as far as we are concerned," says current Leipzig Mayor Burkhard Jung, a member of the center-left Social Democratic Party (SPD).

What we have is effectively the entire financial community (backed by the entire choir of the Corporate Media) engaging in a George Soros-like "bash and buy" in the gold market. But it goes much deeper than that; bringing us back to the word "desperation."

In Indonesia the issue is the initial driver of protests is the removal of a fuel subsidy.

In Brazil, it's over an increase in bus fares, as well as general frustration over inequality, and the money being spent on next year's World Cup.

Both -- along with other emerging markets -- are experiencing slowing economies, sharply weakening currencies, rising interest rates, and generally a squeeze related to both financial and structural conditions.

...

Frankly, I view the present course of monetary policy as reckless - not because it threatens inflation (which I don't think it will for several years), but because it diverts scarce capital away from productive investment and toward speculative activities; because it fails to act on any economic constraint that is actually binding here, so has little hope of providing the economic "support" that it purports to offer; because decades of historical evidence provide no basis to expect a material "wealth effect" from stock values to the economy; because the policy lowers hurdle rates and encourages borrowing for unproductive purposes - including stock buybacks at record highs (and there is no evidence that buybacks are a good indication of value); because it punishes the elderly on fixed incomes; because it perpetuates a bubble-bust cycle created by Fed intervention, which is not the medicine but the very poison itself; and because moving to the left on the liquidity preference curve will likely be as painful as moving to the right has been pleasant. Meanwhile, we'll continue along a studied, disciplined course over the remainder of this market cycle, considering a broad ensemble of evidence that has been validated across market cycles throughout history. Our views will change as that evidence does.

...

The dilemma now is that officials are in what Sylvester Eijffinger, a professor of financial economics at Tilburg University in the Netherlands, likens to what old maps would call "terra incognita" -- the Latin for "unknown land."

In the case of the Fed, while good communications are vital for controlling markets, they're complicated by the officials themselves not knowing when to exit, disagreeing over the right timing to do so and political pressure to hold back.

You mean these hacks don't know what the !@$% they are doing? Big surprise around these parts. But we can see why markets would be a little upset at the revelation...

The IRS, under heavy pressure to help Washington out of its budget quagmire by chasing down an estimated $300 billion in revenue lost to evasions and errors each year, will start using "robo-audits" of tax forms and third-party data the IRS hopes will help close this so-called "tax gap." But the agency reveals little about how it will employ its vast, new network scanning powers.

...

Orr, a bankruptcy attorney brought in by the state of Michigan to clean up the city's finances, repeated after the meeting that he sees a 50/50 chance of a bankruptcy filing.

It would be a first for a major U.S. city as New York, Philadelphia and Cleveland all avoided formal bankruptcy filings during their financial difficulties.