[QUOTE=Fusion_power;304334]You read a glow job about Iceland and actually believe that things have improved immensely.[/QUOTE]

Having just visited Ireland and Iceland, in my limited conversations with folks Iceland is much better off than Ireland. Everyone in Ireland bemoans the huge debt cloud they are living under - they see a hopeless future. Iceland devalued and took a nasty recession and inflation hit, but citizens there are (relatively-speaking) much more optimistic about their future.

[QUOTE=Fusion_power;304334]/ot/
Ewmayer, I just want a reality check. Have you been checked for dementia lately?

1. You think there is such a thing as a freely-functioning global market.[/QUOTE]

My statement "I would prefer to let freely-functioning global markets..." was meant to imply no such thing - the post-WW2 regime of ever-more central-bank power, ever-less pegging of money to actual economic production, ever-more addiction to bank money creation by way of leveraged lending/securitization/hypothecation and now, never-ending government bailouts of the overleveraged speculators have gone in precisely the opposite direction.

My statement was meant in the "this is the only direction which offers to break the vicious cycle of bank/government entwinement" sense. As legendary market-analyst and investment-newsletter writer Jim Grant said [url=www.zerohedge.com/news/jim-grant-must-watch-capitalism-alternative-what-we-have-now]back in May[/url], [i]"Capitalism is an alternative for what we have now. I highly recommend it."[/i]

As it is with debt, so it is with currency manipulation - more of it ain't the cure for already-way-too-much of it.

---------------------------

Reuters has an analysis of some interesting - not necessarily in a good way - trends in community-level banking:

[url=www.reuters.com/article/2012/07/09/us-communitybanks-loans-idUSBRE86805020120709?feedType=RSS&feedName=domesticNews]Analysis: Ranks of tight-fisted community banks surge(Reuters)[/url]: [i]Union County Savings Bank in Elizabeth, New Jersey, is profitable with few problem loans and a capital ratio that would make a too-big-to-fail bank drool.[/i]
[quote]Donald Sims, who has run Union County Savings Bank for 40 years, said it is a difficult time to even find a loan to make a competitive bid on. He cited keen competition from big banks, who dominate residential lending in and around Elizabeth, New Jersey, a port town of about 125,000.

His bank doesn't do business lending.

"I have not been in the position to present that face to the public," Sims said. "We don't have the infrastructure."

The lender is a mutual savings bank with $1.5 billion in assets and no direct owners. Instead, depositors have an interest in the net worth of the institution formed in 1883 to promote thrift and home ownership. But most of its $10.4 million profit in 2011 came from interest off government-backed bonds, not loans.[/quote]
So even with US Govt bonds rates plunging as a result of the global flight-to-safety trade and Fed-mandated perma-ZIRP, such banks are still finding it more attractive to in effect hoard cash than make loans. That does not bode well for economic recovery and jobs creation, since such banks do a disproportionate amount of small-business lending (40%) and small businesses similarly create a disproportionate share of new jobs (64%).

I think of small banks as a weird American perversion; as the UCSBank chief says, he's trying to sell mortgages while being unable to offer rates competitive with his much larger competition, and unsurprisingly not selling any.

Has anyone got the statistics for how many jobs at a small business endure more than a couple of years? If there's some incentive for people to set up a nail salon employing their sisters (creates two jobs!) which goes bust six months later because nobody wants their nails painted by their sisters, you get four jobs created per year without any actual benefit.

"Many Wall Street executives say wrongdoing is necessary: survey"

[URL]http://finance.yahoo.com/news/many-wall-st-execs-says-050334637.html[/URL]

[quote]. . .

A quarter of Wall Street executives see wrongdoing as a key to success, according to a survey by whistleblower law firm Labaton Sucharow released on Tuesday.

In a survey of 500 senior executives in the United States and the UK, 26 percent of respondents said they had observed or had firsthand knowledge of wrongdoing in the workplace, while 24 percent said they believed financial services professionals may need to engage in unethical or illegal conduct to be successful.

Sixteen percent of respondents said they would commit insider trading if they could get away with it, according to Labaton Sucharow. And 30 percent said their compensation plans created pressure to compromise ethical standards or violate the law.

"When misconduct is common and accepted by financial services professionals, the integrity of our entire financial system is at risk," Jordan Thomas, partner and chair of Labaton Sucharow's whistleblower representation practice, said in a statement.

. . .[/quote]

[QUOTE=cheesehead;304392]"Many Wall Street executives say wrongdoing is necessary: survey"

[URL]http://finance.yahoo.com/news/many-wall-st-execs-says-050334637.html[/URL]
[i]
Sixteen percent of respondents said they would commit insider trading if they could get away with it[/i][/QUOTE]
...and the other eighty-four percent are lying.

-------------------------

Another MF Global-style "strictly segregated client funds magically vanished" [url=http://www.zerohedge.com/news/futures-brokerage-pfg-best-freezes-accounts-following-discovery-accounting-irregularity]incident happened yesterday[/url]. This time the amounts are in the mere hundreds of millions, though, so probably falls under misdemeanor laws ... oh wait, I forgot about the No Penalty for Financial Firm Crimes amendment to the US Constitution, the one the government is strictly observing even though it has not been officially proposed yet. Not even a misdemeanor, then. Carry on ... clients should simply STFU and pick a better brokerage next time.

-------------------------

More on the central-bank currency-manipulation theme: ZH's Bruce Krasting has a piece describing the pickle in which the SNB's latest head finds himself:

[url=www.zerohedge.com/contributed/2012-07-08/it-aint-priced]It Ain't Priced In[/url]
[quote]Swiss reserves jumped an incredible CHF 59B ($61B) in June. The only question in my mind is, “How long can this last?” Switzerland can’t increase reserves on an unlimited basis; they can’t absorb Euro60B a month.

The current boss at the Swiss National Bank (SNB), Thomas Jordan is responsible for the Peg policy that is behind the unwanted reserve creation. It’s important to remember that Jordan is relatively new to the job. He stumbled into the hot seat when the former head of the SNB, Philippe Hildebrand’s wife got nailed trading currency when she shouldn’t have been.

Jordan is a well-educated technocrat who is also an old hand at the SNB. He inherited the currency peg policy from Hildebrand, but history will mark his name in the books if the policy fails. I’m sure that Jordan is aware of this. What’s his state of mind?

Jordan doesn't have the full support of the government behind him. The same domestic politics that successfully dumped Hildebrand are working against Jordon.

If Switzerland is to maintain the current 1.2000 peg to the Euro, there has to be something more in the offing. The endless intervention is not going to work. The FX market is much bigger than the capacity of the SNB. The only option left for Jordon is exchange controls and a complete shutdown of the Swiss border. Jordon has hinted that these steps are coming on several occasion in the past month.

When Switzerland adopts exchange controls, the rest of Europe will soon follow. What will be the global market response from these measures? It will scare the crap out of capital. I think exchange controls will bring a panic; there is no safe place to hide in a panic.[/quote]

1. Ernst, it is funny you post about Iceland and then ask why does SNB not less the CHF appreciate. Well, Iceland allowed massive inflows of forex into the country. The Krona appreciated many-fold. And see what happened. Who is to say the same fate will not befall CH?

2. ZeroHedge is incorrect about SNB and foreign reserves. Unlike BoE in 1992 the SNB is trying to devalue its currency. if the rest of the world wants CHF it can print as much as it wants and build its forex reserves indefinitely. Look at the JPY. Would anyone have imagined ten years ago that it would be under 80 today? The BoJ prints and prints and it can't get the JPy to go down.

3. George is right on about the Iceland/Ireland comparison. It is ironic in the extreme because the then finance minister of Ireland had in 2008/2009 justified the ruinous bank guarantee here by saying that we don't want to end up like Iceland. Iceland is in a much much better place than Ireland.

[QUOTE=ewmayer;304407]Carry on ... clients should simply STFU and pick a better brokerage next time.[/QUOTE]

The money's gone, so that seems a perfectly reasonable policy; you should not have a chunk of your fortune large enough that you'd be troubled by its loss invested in a tiny Iowa futures brokerage wholly owned by its manager.

At least in a colossal publicly-traded thoroughly-audited bank it's less likely that criminal actions will take all the capital.

[QUOTE]At least in a colossal publicly-traded thoroughly-audited bank it's less likely that criminal actions will take all the capital[/QUOTE]

I don't know whether to agree with you or to do an Ewmayer reality check. Maybe some of both. As long as governments bail out the tbtf's, your money is safest with them. But at some point the tbtf's will be left holding the bag a la J.P. Morgan with the "investment" losses. At that point, all you have is another MF Global on your hands. No amount of audits will stop that from happening.

Saw this on CNN earlier today re the Higgs Boson. "some ppl say it's silly to put so much money in something few people understand. Presumably those ppl also avoid banks."

DarJones

[b]Friday Funnies, Wednesday Edition:[/b]

[url=http://theautomaticearth.com/Finance/libor-was-a-criminal-conspiracy-from-the-start.html]Liborgate captured in a single picture[/url]

See? Barclays was being up--front about the Libor rate-rigging all along ... everyone just *assumed* their Ads were about mortgages.

Beneath the amusing picture in the above article is avery good timeline illustrating that the rate-rigging has been an pen secret for years, and that the UK pols are no less bank-owned than their US co-conspirators on Capitol Hill:
[quote]Please note, this WSJ article is over 4 years old. It was there for everyone to see, for all regulators, for all politicians, and for the British Bankers Association. Not only did nobody act on it, the BBA actively intervened to have negative reports thrown out. It threatened Scott Peng at Citigroup, Gillian Tett at the Financial Times, and who knows who else. That's a good job for British parliament: find out where the BBA intervened to let the fraud persist. Don't count on the MPs doing it, though. They're too busy, as we speak, covering their own asses.

In a closely related side note, there's a nice and very illustrative piece in the Telegraph on [url=http://blogs.telegraph.co.uk/finance/thomaspascoe/100018367/revealed-why-gordon-brown-sold-britains-gold-at-a-knock-down-price/]why Gordon Brown sold Britain's gold for as cheap as he could sell it for[/url].

The answer is banks, again. Banks that were shorting gold to such an extent in 1999, entangled in the gold-yen carry trade, that they would have gone under if Brown hadn't squandered away the British people's legal assets from under their very noses. Gordon complied. He even made a pre-announcement, making sure the price would drop further before the gold was auctioned off.

The underlying idea: Letting banks go belly up would have been disastrous. Stealing from the people who voted him in office would, apparently, not. A decade and change on, that is still what obviously drives any and all meaningful political decisions. Nothing has changed. And we are to believe this time is different? Can we at least put Gordon Brown on trial, so he can justify robbing the British people of many billions of pounds so he could please his banker friends?

In Britain the Serious Fraud Office has announced it will start a criminal probe into the Libor shame. The first question that popped into my mind was if it announced that just to hinder a parliamentary investigation - and/or other probes - , over which it has preference. [u]You see, the SFO has a very bad reputation in Britain, where it's nicknamed the Serious Farce Office, for the same reasons many US regulators do stateside: they never achieve anything, no-one ever goes to jail for their shenanigans.[/u] The SFO and SEC and all those institutions are sort of like the drivers of the get-away car, dressed in police uniforms: their function is to make sure the perpetrators clear the scene in time.[/quote]

Meanwhile, the latest estimate on the JPM "whale of a trade" loss is up to $5 Bln. Good thing their client accounts are "strictly segregated", and "the regulators are on the job", etc.

[QUOTE=ewmayer;304239]...Anyway, all this phony talk of "job creation" caused the following epithet to pop into my mind, which seems quite apt in its reference to a different phony pursuit:

"Jobs Creationists"

Both Romney and Obama are JCs par excellence.[/QUOTE]

I just saw this earlier post while catching up on the financial news. Very good, but wouldn't "Jobs Creationists" imply Intelligent Design? Not sure I'm seeing the "intelligent" part...

Norm

[QUOTE=Spherical Cow;304490]I just saw this earlier post while catching up on the financial news. Very good, but wouldn't "Jobs Creationists" imply Intelligent Design? Not sure I'm seeing the "intelligent" part...[/QUOTE]That's the part where they pretend to agree with the common delusion that POTUS has extensive sway over the economy.