Currency Newswire » admin

Is Bernanke Hiding A Smoking Gun?

admin — Thu, 01 Jul 2010 17:06:21 +0000

A Republican senator said Tuesday that documents showing Federal Reserve Board Chairman Ben Bernanke covered up the fact that his staff recommended he not bailout AIG are being kept from the public. And a House Republican charged that a whistleblower had alerted Congress to specific documents provide “troubling details” of Bernanke’s role in the AIG bailout.

Sen. Jim Bunning (R-Ky.), a Bernanke critic, said on CNBC that he has seen documents showing that Bernanke overruled such a recommendation. If that’s the case, it raises questions about whether bailing out AIG was actually necessary, and what Bernanke’s motives were.

Fed Made Taxpayers Junk-Bond Buyers

admin — Thu, 01 Jul 2010 16:48:08 +0000

Federal Reserve Chairman Ben S. Bernanke and then-New York Fed President Timothy Geithner told senators on April 3, 2008, that the tens of billions of dollars in “assets” the government agreed to purchase in the rescue of Bear Stearns Cos. were “investment-grade.” They didn’t share everything the Fed knew about the money.

The so-called assets included collateralized debt obligations and mortgage-backed bonds with names like HG-Coll Ltd. 2007-1A that were so distressed, more than $40 million already had been reduced to less than investment-grade by the time the central bankers testified. The government also became the owner of $16 billion of credit-default swaps, and taxpayers wound up guaranteeing high-yield, high-risk junk bonds.

US Lobby Group Formed For High-Frequency Traders

admin — Wed, 30 Jun 2010 21:05:26 +0000

The Futures Industry Association on Wednesday said it formed a new lobby group to represent high-frequency trading firms that have come under heightened scrutiny for trading practices that may have contributed to Wall Street’s May 6 “flash crash.”

The lobby, the Principal Traders Group (PTG), represents a who’s who of high-frequency traders, including Getco LLC and Allston Trading. It is chaired by Donald Wilson, who heads top Chicago futures trading firms DRW Trading. Most of the 24 member firms are based in Chicago.

The group’s formation is in response to “the demonization of speculation,” said FIA President John Damgard. FIA, which represents banks, exchanges and others in the futures industry, is the umbrella organization for the new lobby, but will not run it day to day.

Read more about high-frequency trading…

Liquidnet Promoting Dark Pool in New Zealand

admin — Wed, 30 Jun 2010 20:59:09 +0000

A US firm which specialises in “dark pools” trading is hoping to increase the number of international fund managers trading in New Zealand listed securities by bringing its electronic trading service here.

The type of trading is called “dark pools” because it allows investors to trade anonymously with prices only made public once trading is complete.

Liquidnet, which already operates in 36 markets including Australia, will open its New Zealand business next Tuesday allowing institutional investors who trade large blocks of shares to be connected with its 650 global members.

GBP/USD Hits Fresh 3-Day Low

admin — Wed, 30 Jun 2010 20:56:00 +0000

The pound fell to a fresh 3-day low against the U.S. dollar on Wednesday, after official data showed that U.S. private sector employment fell more than expected in June.

GBP/USD hit 1.4965 during European afternoon trade, the pair’s lowest since June 25; the pair subsequently consolidated at 1.4970, shedding 0.62%.

USD/JPY Tests Daily Lows

admin — Wed, 30 Jun 2010 20:51:02 +0000

USD/JPY moved away from 88.70 and fell to test daily lows around 88.35 after Moody’s put on review Spain’s Aaa rating. The pair is still moving in a narrow range between 88.70 and 88.35 but weakened after the Yen gained momentum across the board following the announcement and a decline in US stocks.

Read more about the Dollar and the Yen…

EUR/USD Retreating Again

admin — Wed, 30 Jun 2010 20:46:08 +0000

Having reached an intraday high around 1.2297 in the past hour, EUR/USD is again retreating from the 1.2300 area, despite market is on risk aversion mood.

Strength of the common currency comes from crosses such as EUR/CHF and EUR/GBP short covering, after past journeys’ slump, pulled them to multi years or even historical lows.

Some profit taking of sellers amid strong gains reached yesterday are supporting the case. However, euro is still unable to overcome static resistance against greenback, the above mentioned 1.2300 zone.

Russia Buys 22 Tons Of Gold In May

admin — Wed, 30 Jun 2010 20:42:43 +0000

Ten days ago we reported the most recent data on gold reserve holdings as presented by the World Gold Council, where we pointed out that Russia had purchased 27.6 tons of gold in the most recent reporting period, bringing its total to 668.6 tons.

It appears Russia is only getting started. According to the latest IMF data, in the period between April and May, Russia added another 22.5 tons, bringing its May total to a fresh record of 703.1 tons. As BusinessWeek reports, Russia “has added gold every month since at least February.” At the same time, The International Monetary Fund’s gold holdings fell by 15.25 metric tons (490,286 ounces).

North Korea Warns Accident Could Start War

admin — Wed, 30 Jun 2010 20:38:51 +0000

North Korea warned Tuesday that any accidental clash during an upcoming US-South Korea naval exercise could spark war, as tensions remained high over the sinking of a South Korean warship.

Minju Josun, the cabinet’s official daily, accused the South and its US ally of “fabricating” facts about the sinking to incite a war against the communist state.

Russian Intelligence Found Gold Market Info Valuable

admin — Wed, 30 Jun 2010 05:04:40 +0000

Russian spies in the United States whose arrest was announced Monday last year conveyed information about the gold market that the Russian security service considered “very valuable” and forwarded to the Russian finance ministry and ministry of economic development, according to the criminal complaint filed by the FBI with U.S. District Court in New York.

The gold angle in the story was highlighted in reporting Monday night by the Economic Policy Journal, based in Washington, D.C.

Perhaps most interesting for GATA’s purposes, the FBI’s criminal complaint suggests that the spies obtained the gold market information through “a prominent New York-based financier” who is a political fund raiser and a friend of a U.S. Cabinet member. Would a New York-based financier have valuable information about the gold market if the U.S. government wasn’t using New York financial houses for gold market intervention purposes?

Panel Examines Role of Derivatives in Crisis

admin — Wed, 30 Jun 2010 04:59:45 +0000

The complex instruments at the heart of the financial meltdown, and the way two giant companies were wrapped around them and entwined with each other, are being examined by the special panel investigating the origins of the economic crisis.

The Financial Crisis Inquiry Commission is turning its focus to derivatives at two days of hearings starting Wednesday. On the hot seat will be former executives of American International Group Inc., the insurance conglomerate saved from collapse by a $182 billion taxpayer bailout, and current officials of Goldman Sachs Group Inc., the finance powerhouse that has been one of Wall Street’s biggest derivatives dealers.

Traded in an opaque global market valued at around $600 trillion, derivatives have caught a big part of the blame for the financial crisis that ignited in late 2008. The value of derivatives hinges on an underlying investment or commodity — such as currency rates, oil futures or interest rates. The derivative is designed to reduce the risk of loss from the underlying asset.

Circuit Breaker Stops Trades of Citigroup

admin — Wed, 30 Jun 2010 04:56:33 +0000

An experimental circuit breaker for stock markets that was put in place after last month’s so-called flash crash kicked in for the second time on Tuesday after an erroneous trade caused a sudden plunge in the price of Citigroup shares.

Trading in the shares of Citigroup, one of the most heavily traded stocks in the United States, was paused for five minutes at 1:03 p.m. after an over-the-counter trade of about 8,821 shares was posted at a price of $3.3174, or 12.7 percent lower than the $3.80 price of the previous trade.

The trade was later canceled, according to Nancy A Condon, a spokeswoman for the Financial Industry Regulatory Authority, which regulates brokerage firms. Even so, Citigroup shares closed 5 percent lower for the day, at $3.79.

Read more about high-frequency trading…

Barclays to Launch Europe Equities Dark Pool

admin — Wed, 30 Jun 2010 04:52:58 +0000

Barclays Plc’s (BARC.L) investment bank arm said it plans to launch a European “dark pool” trading platform, building on its U.S. platform as part of plans to expand its equities business globally.

Rival banks such as Morgan Stanley (MS.N) and Credit Suisse (CSGN.VX) already run in-house European “dark pools”, electronic platforms that allow buyers and sellers of large orders of shares to avoid revealing pre-trade information and signalling their intentions to the rest of the market.

Getco Launches a Dark Pools Arm in Europe

admin — Wed, 30 Jun 2010 04:50:25 +0000

Getco, one of the largest US market-making firms, will today formally launch a type of “dark pool” share trading platform in Europe.
Dark pools match trades anonymously with prices posted only after trades are done.

The move highlights the inroads that US firms are making into the region’s fragmented equity markets.

The Chicago firm has been increasingly active in trading in European equity and derivatives markets since opening a London office in 2004. It owns a stake in Chi-X Europe, the pan-European equities platform.

Time to Shut Down the Federal Reserve?

admin — Wed, 30 Jun 2010 04:44:11 +0000

Like a mad aunt, the Fed is slowly losing its marbles.

Kartik Athreya, senior economist for the Richmond Fed, has written a paper condemning economic bloggers as chronically stupid and a threat to public order.

Matters of economic policy should be reserved to a priesthood with the correct post-doctoral credentials, which would of course have excluded David Hume, Adam Smith, and arguably John Maynard Keynes (a mathematics graduate, with a tripos foray in moral sciences).

“Writers who have not taken a year of PhD coursework in a decent economics department (and passed their PhD qualifying exams), cannot meaningfully advance the discussion on economic policy.”

Don’t you just love that throw-away line “decent”? Dr Athreya hails from the University of Iowa.

GBP USD Holds Steady

admin — Wed, 30 Jun 2010 04:40:02 +0000

The Pound Dollar exchange rate is 0.364% lower with 1 GBP = 1.5053 USD at 1:15 PM in London.

The GBP USD rate has turned around since the Election and hit the turbo button after the Emergency Budget. The 900-pip rise since mid-May has propelled the rising 21-day moving average up through the 50-day version.

USD/JPY Rises to 88.60

admin — Wed, 30 Jun 2010 04:37:31 +0000

The Dollar moved away from the lows of the day against the Yen and rose to 88.60, recovering from 88.26, fresh 7-week low. The Yen also moved away from the highs of the day against European currencies as the downside rally in Wall Street paused.

Euro Losses Continue

admin — Wed, 30 Jun 2010 04:35:11 +0000

Classic risk off trading saw EUR/USD falling to 1.2150 before stabilizing. We see euro losses continuing, and next key level is 1.2110, break of which would target the year’s low at 1.1877.

Weak China data was followed by very weak U.S. consumer confidence report, and markets are nervous about the expiry of ECB’s one-year lending facility.

The Fed Bashes Bloggers

admin — Tue, 29 Jun 2010 15:26:27 +0000

Some Fed economist (with a hard-earned Ph.D mind you) named Kartik Athreya (who lasted at Citigroup as an associate Vice President for a whopping 7 months before getting sacked in 1998 only to find solace for his expiring unemployment benefits in the public sector) has written the most idiotic “research” piece to come out of the Federal Reserve since 1913, and the Fed has written a lot of idiotic research since then – after all you don’t destroy 98% of the dollar’s purchasing power in 97 years with non-idiotic research.

But this just takes the cake. In “Economics is Hard. Don’t Let Bloggers Tell You Otherwise” Kartik says: “I argue that neither non-economist bloggers, nor economists who portray economics —especially macroeconomic policy— as a simple enterprise with clear conclusions, are likely to contribute any insight to discussion of economics and, as a result, should be ignored by an open-minded lay public.”

Alas, all Kartik achieves is to convince the general public that feeding Fed “economists” alcohol after midnight and letting them directly upload their resultant gibberish to the Fed’s broad RSS feed the second they think they have a coherent thought, is generally a disastrous idea.

The Global Political Awakening

admin — Tue, 29 Jun 2010 15:24:07 +0000

There is a new and unique development in human history that is taking place around the world; it is unprecedented in reach and volume, and it is also the greatest threat to all global power structures: the ‘global political awakening.’ The term was coined by Zbigniew Brzezinski, and refers to the fact that, as Brzezinski wrote:

“For the first time in history almost all of humanity is politically activated, politically conscious and politically interactive. Global activism is generating a surge in the quest for cultural respect and economic opportunity in a world scarred by memories of colonial or imperial domination.[1]”

It is, in essence, this massive ‘global political awakening’ which presents the gravest and greatest challenge to the organized powers of globalization and the global political economy: nation-states, multinational corporations and banks, central banks, international organizations, military, intelligence, media and academic institutions. The Transnational Capitalist Class (TCC), or ‘Superclass’ as David Rothkopf refers to them, are globalized like never before. For the first time in history, we have a truly global and heavily integrated elite. As elites have globalized their power, seeking to construct a ‘new world order’ of global governance and ultimately global government, they have simultaneously globalized populations.