Implode-Explode Heavy Industries news feed

Russia has reserves to ride out sanctions - assuming no panic

Fri, 01 Aug 2014 14:02:41 GMT

``Mathematically Russia has enough reserves to hold out for at least two years before Western sanctions start to choke the economy, but it must avoid reawakening the "sleeping dragon" of investor panic.''

Russia And India Begin Negotations To Use National Currencies In Settlements, Bypassing Dollar

Fri, 01 Aug 2014 13:43:07 GMT

``India agreed to create a task group to work out a mechanism for using national currencies in settlements. And so another major bilateral arrangement is set up that completely bypasses the dollar.''

‘Dark pool' probes suck in big two Swiss banks

Fri, 01 Aug 2014 13:35:17 GMT

``Swiss banking giants UBS and Credit Suisse have confirmed that they are among a number of banks that have come under the scrutiny of a United States-led investigation into so-called ‘dark pool' trading. ''

Rickards: 6 Major Flaws in the Fed's Economic Model

Fri, 01 Aug 2014 13:34:51 GMT

``Yellen's zero interest rate policy constitutes massive theft from savers. Applying a normalized interest rate of about 2% to the entire savings pool in the U.S. banking system compared to the actual rate of zero, reveals a $400 billion per year wealth transfer from savers to the banks from the zero rates. This has continued for five years, so the cumulative subsidy to the banking system at the expense of everyday Americans is now over $2 trillion. This hurts investment, penalizes savers and forces retirees into inappropriate risk investments such as the stock market. Yellen supports this bank subsidy and theft from savers.''

US judge Thomas Griesa schedules new hearing for Friday (today)

Fri, 01 Aug 2014 13:25:36 GMT

``After negotiations between the Argentine government and vulture funds, led by US Special Master Daniel Pollack, failed New York District Judge Thomas Griesa called for a new hearing between the parties for tomorrow at 12 pm (Argentina time).''

Big Banks' ‘Too-Big-to-Fail Subsidy' Is Waning, GAO Finds

Fri, 01 Aug 2014 13:18:26 GMT

``The largest U.S. banks enjoyed lower funding costs than smaller rivals during the 2008 economic crisis although that advantage has declined in recent years, according to a report from a government watchdog.''

Dow Erases 2014 Gain Amid Global Selloff as Exxon Tumbles

Thu, 31 Jul 2014 22:22:48 GMT

``U.S. stocks joined a global selloff, erasing the year's gains in the Dow Jones Industrial Average, as Exxon Mobil Corp. to Micron Technology Inc. tumbled amid weaker corporate results... The Fed is stepping out of the way and the market's valuation is high enough that people are quick to take profit," Wayne Wilbanks, who oversees $2.5 billion as chief investment officer at Wilbanks, Smith & Thomas Asset Management LLC in Norfolk, Virginia, said in a phone interview. ''

Bank of America ordered to pay $1.27 billion for 'Hustle' fraud

Thu, 31 Jul 2014 17:22:35 GMT

``A federal judge on Wednesday ordered Bank of America Corp to pay a $1.27 billion penalty for fraud over shoddy mortgages sold by the former Countrywide Financial Corp. U.S. District Judge Jed Rakoff in Manhattan ruled after a jury last October found the second-largest U.S. bank liable for the sale by Countrywide of defective loans to government-controlled mortgage companies Fannie Mae and Freddie Mac''

Japan June output falls at fastest pace since March 2011 quake

Thu, 31 Jul 2014 17:20:58 GMT

``In unusually frank language, a METI spokesman said the data showed shipments of goods fell for five consecutive months - a pattern similar to the last time Japan was in recession in the middle quarters of 2012.''

Global QE ends as China opens second front in bond tapering ("Ending", or switching to stocks?-Ed.)

Thu, 31 Jul 2014 17:20:24 GMT

The study said the Chinese central bank, PBOC, and others had become "major players on world equity markets", effectively fuelling stock bubbles in much the same way they previously fuelled credit bubbles. "It appears that PBOC itself has been directly buying minority equity stakes in important European companies," it said.
It is possible that central banks are simply rotating from bonds into equities, deemed less vulnerable to a bond sell-off if inflation picks up again. Mr Nordvig said Nomura's data capture all of the flows and these show that pace is slowing. "I would miss it only if the money was being funnelled into a secret sovereign wealth fund," he said.''

U.S. stocks slide on worries about Fed rate policy

Thu, 31 Jul 2014 16:25:34 GMT

``"Markets love certainty and right now there is too much uncertainty about the Fed's trigger points for raising rates. Instead of looking at one number, such as the unemployment rate, the Fed is looking at a mosaic of data points. Investors are unsure what the Fed would consider a tolerable level of higher inflation," said Hooper. Weekly jobless claims rose slightly less than expected a week after hitting a 14-year low. However the employment cost index rose due to a larger-than-expected increase in wages. Many analysts watch for wage inflation as a precursor to inflation.''

Argentine Bonds Sink After Default; Swaps Holders Seek Ruling

Thu, 31 Jul 2014 15:10:24 GMT

``The International Swaps & Derivatives Association said it will rule on whether credit-default swaps on Argentina have been triggered. The nation missed a deadline yesterday to pay $539 million in interest after two full days of negotiations in New York failed to produce an accord with creditors from its last default in 2001. A U.S. judge ruled that the payment couldn't be made unless those investors, including Elliott and Aurelius Capital Management LP, got the $1.5 billion they're owed.''

Russian parliament may revise all international agreements over Yukos case

Wed, 30 Jul 2014 20:46:46 GMT

``The decision of The Hague arbitration court on the Yukos oil company has sparked active debate in the Russian parliament on the revision of all Russia's international agreements for their possible denunciation... The official dismissed as absurd the grounds the [Hague] gave for its verdict. The court linked its decision to the violation by Russia of an article of the EU Energy Charter. Russia had signed the Charter in 1994, but never ratified it. He said, "It's not so much the issue of the quality of Dutch justice and the negative political background at the moment of the verdict passing, as the issue of quality of Russia's legal stance and the work of legal advisers who represented the country's interests.''

Levitin: US Courts' Hearing of Argentine Bond Case is Folly

Wed, 30 Jul 2014 20:44:38 GMT

``The blame for Argentina's impending default lies primarily with the U.S. courts, not with the distressed debt investing community... By humoring the NML litigation, U.S. courts have gotten themselves into a high-stakes game of chicken with a sovereign state. This is a game the U.S. courts cannot and should not win. It's a basic prudential principle that courts abstain from cases where they lack the ability to administer an appropriate remedy. In this case, the courts cannot administer an appropriate remedy. The U.S. courts may be able to prevent, or at least impede, Argentina's other bondholders from being paid, but they cannot force Argentina to pay NML on its defaulted bonds.''

U.S. homeownership at 18-year low in second quarter

Wed, 30 Jul 2014 14:06:16 GMT

``Homeownership in the United States fell again in the second quarter to the lowest level since the third quarter of 1995, suggesting many Americans are becoming renters. The seasonally adjusted homeownership rate fell to a seasonally adjusted 64.8% from 65.0% in the first quarter, the Commerce Department said Tuesday.''

WSJ Reporter, in New Book: "The Entire United States Market Has Become One Vast Dark Pool"

Wed, 30 Jul 2014 14:04:58 GMT

`` I argue in this book that the entire United States stock market has become one vast dark pool. Orders are hidden in every part of the market. And the complex algorithm AI-based trading systems that control the ebb and flow of the market are cloaked in secrecy. Investors -- and our esteemed regulators -- are entirely in the dark because the market is dark." ''

Axel Merk: Fed Won't Be Able To Yank Real Interest Rates Above Zero; Gold Will Benefit

Wed, 30 Jul 2014 14:03:21 GMT

``To make a long story short, yes, nominal rates may be rising. But don't count on real rates moving up, let alone into positive territory, anytime soon. Indeed, I fear inflation may be picking up much faster than interest rates. In that environment, Draghi's predictions of rates becoming more negative over time will very much apply to the greenback as well. ''

JPMorgan Paying $650K to Settle CFTC Charges

Wed, 30 Jul 2014 13:54:27 GMT

``JPMorgan Chase will pay $650,000 to settle charges by federal regulators that it filed inaccurate reports on the trading positions of some of its large customers.''

How Argentina's Default May Trigger $29 Billion in Claims

Wed, 30 Jul 2014 13:53:42 GMT

``By defaulting tomorrow, Argentina may trigger bondholder claims of as much as $29 billion -- equal to all its foreign-currency reserves. If the overdue interest on Argentina's dollar-denominated securities due 2033 isn't paid by July 30, provisions in bond indentures known as cross-default clauses would allow the nation's other debt holders to also demand their money back immediately.''

Gold-for-Bitcoin Trading, Gold-Backed Bitcoins, Explode on the Scene

Tue, 29 Jul 2014 20:48:06 GMT

This topic comes in the form of a pair of articles. The first is Gold for bitcoin new fad as e-currency count nears 500-mark

``According to bitcoin traders, the stabilisation in bitcoin rates is making the case stronger for exchanging them for gold that currently trades at less than USD 1,300 per ounce or about Rs 28,000 per 10 grams in India... Some firms and traders have begun aggressively selling bitcoins in exchange of gold, while new websites and portals are cropping up almost every day to cash in on this new frenzy, according to industry players. ''

The second is Gold Bugs Meet Bitcoin Believers to Supplant the Dollar:

``"A staunch person who believes in the gold standard says bitcoin is valueless and ultimately a Ponzi scheme, and people who didn't dig gold but really got bitcoin would say that this is ridiculous, it's just a dumb metal," Anthem Hayek Blanchard, chief executive officer of Anthem Vault Inc., the company behind the Independence Coin, said in an interview. "We don't need to fight. We can coalesce."