HSBC cutting down on money laundering and applying same rules to Foreign States as private individuals ? What a novel concept ? ?
http://beforeitsnews.com/economy/2013/08/vatican-in-chaos-hsbc-tells-them-to-find-another-bank-2543236.html
from Daily Mail:
Diplomats in London have been thrown into chaos after Britain’s biggest bank, HSBC, sacked them as customers and gave them 60 days to move their accounts.
http://beforeitsnews.com/economy/2013/08/vatican-in-chaos-hsbc-tells-them-to-find-another-bank-2543236.html
from Daily Mail:
Diplomats in London have been thrown into chaos after Britain’s biggest bank, HSBC, sacked them as customers and gave them 60 days to move their accounts.
Their situation has been made far worse because other banks have been closing ranks and refusing to take their business. More than 40 embassies, consulates and High Commissions have been affected. Even the Vatican has been given its marching orders.
The Pope’s representative office in Britain, the Apostolic Nunciature, has banked with HSBC for many years but was told to find another bank. One diplomatic source said he believed HSBC feared being exposed to embassies after it was fined $2billion (£1.32billion) by US authorities last year.
Read More @ DailyMail.co.uk
The Pope’s representative office in Britain, the Apostolic Nunciature, has banked with HSBC for many years but was told to find another bank. One diplomatic source said he believed HSBC feared being exposed to embassies after it was fined $2billion (£1.32billion) by US authorities last year.
Read More @ DailyMail.co.uk
Source: The Independent
HSBC has asked foreign diplomats in London to close their accounts as part of efforts to reduce business risks.
Among those who have been asked to stop using the UK’s biggest bank are the Vatican, Papua New Guinea and the west African nation of Benin.
More than 40 embassies, consulates and high commissions are said to be affected, with their position made worse by other banks’ refusal to take their custom.
Read full article
August is traditionally Europe’s holiday month, with many government officials taking several weeks off. In the process, important initiatives are put on hold until the “great return” at the beginning of September. This year, there is another reason why Europe has pressed the pause button for August. With a looming election in Germany, few wish to undermine Chancellor Angela Merkel’s likely victory. Some of the recent economic news has seemed to justify this approach. Yet no one should be fooled. This summer’s sense of normality is neither natural nor necessarily tenable in the long term. It is the result of temporary and – if Europe is not attentive – potentially reversible factors. If officials do not return quickly to addressing economic challenges in a more comprehensive manner, the current calm may give way to renewed turmoil. In essence, Europe (and the West more generally) owes its recent tranquility to a series of experimental measures by central banks; consequently, the resulting surface calm masks still-worrisome economic and financial fundamentals.
While Europe, and especially Germany has been understandably "displeased" with having to provide billions in bailout upon bailout funding to Greece every year starting in 2010, all the more so following recent news that Greece has alreadyspent some 75% of its bank bailout cash with no discernible improvement in its economy to show for it, Europes' taxpayers will unlikely be any more pleased to learn that as of the end of June, a whopping €60 billion in past due taxes (an all time record) was owed by Greek businesses and individuals to the state. This is an amount that is 20% greater than the entire external cash handed over by the Troika to keep Greek banks afloat, and represents nearly 30% of imploding Greek GDP.
With PMIs picking up across Europe, the nations' 'leaders' are spreading the good word that the worst is over (again) and its all sunshine and unicorns from here. But it's not. As Cyprus' Anastasiades glibly comments on small improvements in their capital controls -amid collapsing deposits, bluntly ignoring the reality of a record implosion in the nation's home prices, the facts for the man on the street are dismal. The number of jobless people in the smallest EU nation jumped 32% year-over-year to its highest in the 19 years data has been collected.
HSBC has asked foreign diplomats in London to close their accounts as part of efforts to reduce business risks.
Among those who have been asked to stop using the UK’s biggest bank are the Vatican, Papua New Guinea and the west African nation of Benin.
More than 40 embassies, consulates and high commissions are said to be affected, with their position made worse by other banks’ refusal to take their custom.
Read full article
El-Erian Warns "Don't Be Fooled" By Europe's Tranquility
Submitted by Tyler Durden on 08/05/2013 - 20:49August is traditionally Europe’s holiday month, with many government officials taking several weeks off. In the process, important initiatives are put on hold until the “great return” at the beginning of September. This year, there is another reason why Europe has pressed the pause button for August. With a looming election in Germany, few wish to undermine Chancellor Angela Merkel’s likely victory. Some of the recent economic news has seemed to justify this approach. Yet no one should be fooled. This summer’s sense of normality is neither natural nor necessarily tenable in the long term. It is the result of temporary and – if Europe is not attentive – potentially reversible factors. If officials do not return quickly to addressing economic challenges in a more comprehensive manner, the current calm may give way to renewed turmoil. In essence, Europe (and the West more generally) owes its recent tranquility to a series of experimental measures by central banks; consequently, the resulting surface calm masks still-worrisome economic and financial fundamentals.Uncollected Greek Taxes Rise To Record €60 Billion, One Third Of Greek GDP
Submitted by Tyler Durden on 08/05/2013 - 15:18
While Europe, and especially Germany has been understandably "displeased" with having to provide billions in bailout upon bailout funding to Greece every year starting in 2010, all the more so following recent news that Greece has alreadyspent some 75% of its bank bailout cash with no discernible improvement in its economy to show for it, Europes' taxpayers will unlikely be any more pleased to learn that as of the end of June, a whopping €60 billion in past due taxes (an all time record) was owed by Greek businesses and individuals to the state. This is an amount that is 20% greater than the entire external cash handed over by the Troika to keep Greek banks afloat, and represents nearly 30% of imploding Greek GDP.Cyprus Unemployment Surges 32% Year-Over-Year
Submitted by Tyler Durden on 08/05/2013 - 14:22With PMIs picking up across Europe, the nations' 'leaders' are spreading the good word that the worst is over (again) and its all sunshine and unicorns from here. But it's not. As Cyprus' Anastasiades glibly comments on small improvements in their capital controls -amid collapsing deposits, bluntly ignoring the reality of a record implosion in the nation's home prices, the facts for the man on the street are dismal. The number of jobless people in the smallest EU nation jumped 32% year-over-year to its highest in the 19 years data has been collected.A run on the gold banking system is under way, Turk tells KWN
Submitted by cpowell on Mon, 2013-08-05 17:39. Section: Daily Dispatches
1:39p ET Monday, August 5, 2013
Dear Friend of GATA and Gold:
GoldMoney founder James Turk tells King World News today that the discovery by GoldMoney research directory Alasdair Macleod of the discrepancy in the Bank of England's custodial gold inventory reports adds to evidence that the fractional-reserve gold banking system is coming apart. The drain of gold from the Bank of England and the New York Commodities Exchange constitutes a run on the system, Turk says. An excerpt from the interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
In letter to Fed, Chilton blasts big banks' evasion of trading regulations
Submitted by cpowell on Mon, 2013-08-05 13:47. Section: Daily Dispatches
CFTC's Chilton Says He Won't Back Current Volcker Rule
By Lori Ann LaRocco
CNBC, New York
Monday, August 5, 2013
CNBC learned today Bart Chilton, commissioner of the Commodities Futures Trading Commission, has sent a letter to Federal Reserve Chairman Ben Bernanke urging the Fed to firmly draft the final Volcker Rule in a way that ensures banks can no longer speculate in commodity markets.
Chilton stressed in the letter it was critically important to have the rule which would define the scope of the bank's "risk-mitigating activity."
Five federal financial regulatory agencies, including Chilton's CFTC, must approve the rule before it is implemented.
CNBC has obtained a copy of the letter where Chilton outlined the basis of the proposed rule which "would provide clear guidelines for market participants and would appropriately narrow the definition of 'hedging' to conduct that is truly economically appropriate to risk reduction."
Chilton went on to say relying solely on compliance programs, documentation requirements, and performance metrics is "simply not enough" and "the final Volcker Rule needs a robust, comprehensive, and targeted definition of risk-mitigating activity in order to protect markets and consumers."
The commissioner warned a clear definition of such activity is needed because even with the Volcker Rule "tightly written" banks would continue to "engage in, and likely expand, their ownership of commodities and trading activity in commodities. ... The conflict of interest here is obvious and, left unchecked, could easily 'muddy up' the regulatory oversight of banks, and make the complex myriad bank ownership portfolios an unregulatable endeavor."
Chilton tells CNBC the proposed rule he sent the chairman is a Volcker Rule deal breaker. "I won't vote for a final Volcker Rule unless this language, or something substantially similar, is included in the final text."
This morning Chilton will be addressing his vote decision and the "conflicts of interest" in bank activity in commodities at a meeting of Amcot, the trade association of America's cooperative cotton growers, in Lake Tahoe, Calif.
Chilton said, "Unless this language is written to avoid it, this could blow a huge hole in the Volcker Rule and would obfuscate the intent of Congress and President Obama when the financial reform legislation became law in 2010."
It is not the first time Chilton has addressed this issue with the Fed chairman. In September 2012 he sent a letter to Bernanke regarding the implementation of the Volcker Rule and the need for clear cut guidelines.
Chilton added large investment banks may also be using this ownership of commodities, and the storage and delivery mechanisms to avoid certain regulations, like the Volcker Rule and speculative position limits.
"If the banks claim they have an actual interest in the physical commodity, they'll say they should be exempt from the ban on bank speculation." Chilton explained. "That's just another end run around rules. I don't know why banks can't just go back to being banks, making loans and helping to spur our economy."
Chilton tells CNBC that for weeks his office has been researching what kind of commodity assets the banks owned but it was extremely difficult, equating the search as a big black box.
"I'm a financial regulator; you'd think it would be a piece of pie to find a list of what they own, right?" Chilton asked. "After all, banks own commercial interests that can impact prices, and at the same time their trading desks are all over the very same markets. There are obvious conflicts of interest. I'm not saying there have been any violations of the law, but how would we even know?"
In today's speech, Chilton will reveal how the CFTC has found out that Morgan Stanley has ownership stakes in oil tankers and a fuel distributor. "And, of course, they also trade crude oil and other energy contracts." he added.
Other CFTC research revealed, parts of Citigroup, Goldman Sachs, and Bank of America own or have owed power plants. "They also trade energy contracts. And everybody's been talking about Goldman Sachs holding on to aluminum at warehouses they own," explained Chilton.
"Some say that's consequently driving the up the price of beer and soda while the bank collects storage fees. And, they trade aluminum. JPMorgan also owns similar warehouses, although they said last week they may get out of commodities. We'll see." he said. "Oh, and by the way, Barclays and JPMorgan are putting out hundreds of millions of dollars in restitution for getting caught rigging electricity prices."
Describing the data hunt in his speech as "sorta deja vu-ish" and reminiscent about the valuation of credit default swaps. Chilton warned that the fact even a regulator can't track down the information easily is "a big deal." "Tracking down this information should be an immediate responsibility of regulators," Chilton said.
In his speech Chilton went on to say, "We need to find out specifically -- and comprehensively -- what banks own relating to physical commodities. Furthermore, the basic ownership information should be transparent. It should be listed on the Federal Reserve's website or someplace where people can view it."
According to Fed data, Goldman Sachs, JPMorgan Chase, and Morgan Stanley held $35.2 billion in physical commodities at the end of last year.
The issue of bank ownership of commodities was the subject of hearings last week in the Senate. Sen. Sherrod Brown, D-Ohio, who chairs the Banking Subcommittee on Financial Institutions and Consumer Protection on the topic, has also urged the Fed to provide greater guidance on the clarity of what commodity activities the banks should be allowed to do.
The Federal Reserve also announced last week it might reconsider its decade-old policy that has allowed investment banks to diversify and own certain unrelated businesses such as participation in the physical commodity markets.
Chilton said he hopes the Fed reverses this policy. "It is flawed and if they don't, I hope Congress does so."
CFTC's Chilton wants banks out of commodities -- gold and silver too
Submitted by cpowell on Mon, 2013-08-05 12:55. Section: Daily Dispatches
Fed Should Reverse Commodity-Trading Policy, CFTC's Chilton Says
By Silla Brush
Bloomberg News
Monday, August 5, 2013
WASHINGTON -- The Federal Reserve should reverse a decade-old ruling that allows banks to trade physical commodities, said Bart Chilton, a Commodity Futures Trading Commission member.
The central bank's 2003 decision and subsequent ones allowed firms including Citigroup Inc., JPMorgan Chase & Co., and Morgan Stanley to expand into commodities markets. The Fed said last month that it's reviewing the policy amid Senate scrutiny of whether it allows Wall Street firms to control prices.
"I don't want a bank owning an electric service, or cotton, corn or feedlots," Chilton, a Democrat, said in a speech prepared for delivery today at a conference of U.S. cotton growers in Lake Tahoe, California. "I don't want banks owning warehouses, whether they have aluminum, gold, silver, or anything else in them." The Fed "can and should reverse" the policy, he said.
JPMorgan, the biggest U.S. bank by assets, said days after a congressional hearing on the matter last month that it's weighing whether to sell or spin off holdings in physical commodities. The 10 largest Wall Street firms reaped about $6 billion in revenue from commodities in 2012, including dealings in physical materials as well as related financial products, analytics company Coalition Ltd. said in a Feb. 15 report.
"The Federal Reserve regularly monitors the commodity activities of supervised firms and is reviewing the 2003 determination that certain commodity activities are complementary to financial activities and thus permissible for bank holding companies," Barbara Hagenbaugh, a Fed spokeswoman, said on July 19. She declined to elaborate.
Banks' ownership of commodity interests already has drawn scrutiny from the CFTC and the Securities and Exchange Commission, while U.S. Senate Democrats plan additional hearings on the issue.
CFTC Chairman Gary Gensler, declining to comment on specific investigations, said at a Senate hearing on July 29 that his agency has legal authority to pursue manipulation of markets for metals and other commodities. His agency has sent letters to companies asking them not to destroy documents relating to warehouses registered by exchanges such as the London Metal Exchange or Chicago Mercantile Exchange, according to a copy of the letter obtained by Bloomberg News.
Over the years the worlds' central banks have operated in lockstep and with a unified front. Friday, the Richmond Fed put out a paper highly critical of the European central bank for not "easing" enough. This is curious because first off the Richmond Fed surely did not go "rogue" on their own and put this paper out without permission so this was an "official" slap in Europe's face. Secondly, this was highly public and highly critical. This looks to me like something has gone bad behind the scenes (which we are not privy to yet) and the fingers are starting to point.
What cracks me up is that the Fed is screaming PRINT at the top of their lungs, can you imagine were they to have done this before 2008? "Printing" now is just "normal" and no one even thinks twice about it. Has it worked? The only question in my mind is how long will it be before sanity shows up uninvited and ruins the party. One thing that I really don't understand is why do this publicly? If you want the ECB to get with the program and print to reflate, why not do it through back channels and privately? This in my view brings "questions" into play that I am sure the Fed does not want asked pertaining to inflation and intentional debasement.
Do you remember a little over a year ago when Europe was still talking about "austerity"? Austerity is obviously no longer a choice, it was maybe 10 years ago but is no longer because of the debt buildup and mathematical unsustainability. The only thing that austerity would do is to expose just how broke everything really is. No, printing is "way out" and the perceived road to riches I can only believe that this finger pointing and public scolding of the ECB is to lay the groundwork to be able to say "it would have worked if Europe had listened to us ".
Now one must wonder what comes next. Does the ECB cave in and monetize? Do they verbally fight back and point out the obvious, that printing doesn't work AND destroys the currency? Will they respond publicly...or privately as WAS customary between central banks in the old days? Another thought to throw in is that the ECB has its strings pulled by Germany and the Bundesbank, didn't they just request that 300 tons of their Gold be shipped back to them...and were told "no, wait 7 years"? Can not getting their Gold back lead to "unity"... or mutiny ?
Unfortunately, the looming currency war is not confined to just the U.S. and Europe. Over the weekend Yau Yudong had more harsh words for the Dollar as the world's reserve currency and reported by Zerohedge http://www.zerohedge.com/news/
It is clear that the currency wars are heating up and also clear that sovereign nations are chewing up available Gold supply rapidly as they front run any systemic "change" that's coming. History has shown us that actual war has been used as a tool for both retribution AND by the powers that be to retain their power. The fact that nations are pointing fingers at other nations and doing it so that commoners can see is a very bad sign. You must ask yourself a question, "if nations themselves are stockpiling Gold...what is their reason?". These are all easy dots to connect and the disorder and distrust amongst nations and their central banks is a very important sign that should not be missed.
Regards, Bill H.
Did China Just Fire The First Salvo Towards A New Gold Standard?
Submitted by cpowell on Mon, 2013-08-05 17:39. Section: Daily Dispatches
1:39p ET Monday, August 5, 2013
Dear Friend of GATA and Gold:
GoldMoney founder James Turk tells King World News today that the discovery by GoldMoney research directory Alasdair Macleod of the discrepancy in the Bank of England's custodial gold inventory reports adds to evidence that the fractional-reserve gold banking system is coming apart. The drain of gold from the Bank of England and the New York Commodities Exchange constitutes a run on the system, Turk says. An excerpt from the interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Gold Anti-Trust Action Committee Inc.
In letter to Fed, Chilton blasts big banks' evasion of trading regulations
Submitted by cpowell on Mon, 2013-08-05 13:47. Section: Daily Dispatches
CFTC's Chilton Says He Won't Back Current Volcker Rule
By Lori Ann LaRocco
CNBC, New York
Monday, August 5, 2013
CNBC learned today Bart Chilton, commissioner of the Commodities Futures Trading Commission, has sent a letter to Federal Reserve Chairman Ben Bernanke urging the Fed to firmly draft the final Volcker Rule in a way that ensures banks can no longer speculate in commodity markets.
Chilton stressed in the letter it was critically important to have the rule which would define the scope of the bank's "risk-mitigating activity."
Five federal financial regulatory agencies, including Chilton's CFTC, must approve the rule before it is implemented.
CNBC has obtained a copy of the letter where Chilton outlined the basis of the proposed rule which "would provide clear guidelines for market participants and would appropriately narrow the definition of 'hedging' to conduct that is truly economically appropriate to risk reduction."
Chilton went on to say relying solely on compliance programs, documentation requirements, and performance metrics is "simply not enough" and "the final Volcker Rule needs a robust, comprehensive, and targeted definition of risk-mitigating activity in order to protect markets and consumers."
The commissioner warned a clear definition of such activity is needed because even with the Volcker Rule "tightly written" banks would continue to "engage in, and likely expand, their ownership of commodities and trading activity in commodities. ... The conflict of interest here is obvious and, left unchecked, could easily 'muddy up' the regulatory oversight of banks, and make the complex myriad bank ownership portfolios an unregulatable endeavor."
Chilton tells CNBC the proposed rule he sent the chairman is a Volcker Rule deal breaker. "I won't vote for a final Volcker Rule unless this language, or something substantially similar, is included in the final text."
This morning Chilton will be addressing his vote decision and the "conflicts of interest" in bank activity in commodities at a meeting of Amcot, the trade association of America's cooperative cotton growers, in Lake Tahoe, Calif.
Chilton said, "Unless this language is written to avoid it, this could blow a huge hole in the Volcker Rule and would obfuscate the intent of Congress and President Obama when the financial reform legislation became law in 2010."
It is not the first time Chilton has addressed this issue with the Fed chairman. In September 2012 he sent a letter to Bernanke regarding the implementation of the Volcker Rule and the need for clear cut guidelines.
Chilton added large investment banks may also be using this ownership of commodities, and the storage and delivery mechanisms to avoid certain regulations, like the Volcker Rule and speculative position limits.
"If the banks claim they have an actual interest in the physical commodity, they'll say they should be exempt from the ban on bank speculation." Chilton explained. "That's just another end run around rules. I don't know why banks can't just go back to being banks, making loans and helping to spur our economy."
Chilton tells CNBC that for weeks his office has been researching what kind of commodity assets the banks owned but it was extremely difficult, equating the search as a big black box.
"I'm a financial regulator; you'd think it would be a piece of pie to find a list of what they own, right?" Chilton asked. "After all, banks own commercial interests that can impact prices, and at the same time their trading desks are all over the very same markets. There are obvious conflicts of interest. I'm not saying there have been any violations of the law, but how would we even know?"
In today's speech, Chilton will reveal how the CFTC has found out that Morgan Stanley has ownership stakes in oil tankers and a fuel distributor. "And, of course, they also trade crude oil and other energy contracts." he added.
Other CFTC research revealed, parts of Citigroup, Goldman Sachs, and Bank of America own or have owed power plants. "They also trade energy contracts. And everybody's been talking about Goldman Sachs holding on to aluminum at warehouses they own," explained Chilton.
"Some say that's consequently driving the up the price of beer and soda while the bank collects storage fees. And, they trade aluminum. JPMorgan also owns similar warehouses, although they said last week they may get out of commodities. We'll see." he said. "Oh, and by the way, Barclays and JPMorgan are putting out hundreds of millions of dollars in restitution for getting caught rigging electricity prices."
Describing the data hunt in his speech as "sorta deja vu-ish" and reminiscent about the valuation of credit default swaps. Chilton warned that the fact even a regulator can't track down the information easily is "a big deal." "Tracking down this information should be an immediate responsibility of regulators," Chilton said.
In his speech Chilton went on to say, "We need to find out specifically -- and comprehensively -- what banks own relating to physical commodities. Furthermore, the basic ownership information should be transparent. It should be listed on the Federal Reserve's website or someplace where people can view it."
According to Fed data, Goldman Sachs, JPMorgan Chase, and Morgan Stanley held $35.2 billion in physical commodities at the end of last year.
The issue of bank ownership of commodities was the subject of hearings last week in the Senate. Sen. Sherrod Brown, D-Ohio, who chairs the Banking Subcommittee on Financial Institutions and Consumer Protection on the topic, has also urged the Fed to provide greater guidance on the clarity of what commodity activities the banks should be allowed to do.
The Federal Reserve also announced last week it might reconsider its decade-old policy that has allowed investment banks to diversify and own certain unrelated businesses such as participation in the physical commodity markets.
Chilton said he hopes the Fed reverses this policy. "It is flawed and if they don't, I hope Congress does so."
CFTC's Chilton wants banks out of commodities -- gold and silver too
Submitted by cpowell on Mon, 2013-08-05 12:55. Section: Daily Dispatches
Fed Should Reverse Commodity-Trading Policy, CFTC's Chilton Says
By Silla Brush
Bloomberg News
Monday, August 5, 2013
WASHINGTON -- The Federal Reserve should reverse a decade-old ruling that allows banks to trade physical commodities, said Bart Chilton, a Commodity Futures Trading Commission member.
The central bank's 2003 decision and subsequent ones allowed firms including Citigroup Inc., JPMorgan Chase & Co., and Morgan Stanley to expand into commodities markets. The Fed said last month that it's reviewing the policy amid Senate scrutiny of whether it allows Wall Street firms to control prices.
"I don't want a bank owning an electric service, or cotton, corn or feedlots," Chilton, a Democrat, said in a speech prepared for delivery today at a conference of U.S. cotton growers in Lake Tahoe, California. "I don't want banks owning warehouses, whether they have aluminum, gold, silver, or anything else in them." The Fed "can and should reverse" the policy, he said.
JPMorgan, the biggest U.S. bank by assets, said days after a congressional hearing on the matter last month that it's weighing whether to sell or spin off holdings in physical commodities. The 10 largest Wall Street firms reaped about $6 billion in revenue from commodities in 2012, including dealings in physical materials as well as related financial products, analytics company Coalition Ltd. said in a Feb. 15 report.
"The Federal Reserve regularly monitors the commodity activities of supervised firms and is reviewing the 2003 determination that certain commodity activities are complementary to financial activities and thus permissible for bank holding companies," Barbara Hagenbaugh, a Fed spokeswoman, said on July 19. She declined to elaborate.
Banks' ownership of commodity interests already has drawn scrutiny from the CFTC and the Securities and Exchange Commission, while U.S. Senate Democrats plan additional hearings on the issue.
CFTC Chairman Gary Gensler, declining to comment on specific investigations, said at a Senate hearing on July 29 that his agency has legal authority to pursue manipulation of markets for metals and other commodities. His agency has sent letters to companies asking them not to destroy documents relating to warehouses registered by exchanges such as the London Metal Exchange or Chicago Mercantile Exchange, according to a copy of the letter obtained by Bloomberg News.
Over the years the worlds' central banks have operated in lockstep and with a unified front. Friday, the Richmond Fed put out a paper highly critical of the European central bank for not "easing" enough. This is curious because first off the Richmond Fed surely did not go "rogue" on their own and put this paper out without permission so this was an "official" slap in Europe's face. Secondly, this was highly public and highly critical. This looks to me like something has gone bad behind the scenes (which we are not privy to yet) and the fingers are starting to point.
What cracks me up is that the Fed is screaming PRINT at the top of their lungs, can you imagine were they to have done this before 2008? "Printing" now is just "normal" and no one even thinks twice about it. Has it worked? The only question in my mind is how long will it be before sanity shows up uninvited and ruins the party. One thing that I really don't understand is why do this publicly? If you want the ECB to get with the program and print to reflate, why not do it through back channels and privately? This in my view brings "questions" into play that I am sure the Fed does not want asked pertaining to inflation and intentional debasement.
Do you remember a little over a year ago when Europe was still talking about "austerity"? Austerity is obviously no longer a choice, it was maybe 10 years ago but is no longer because of the debt buildup and mathematical unsustainability. The only thing that austerity would do is to expose just how broke everything really is. No, printing is "way out" and the perceived road to riches I can only believe that this finger pointing and public scolding of the ECB is to lay the groundwork to be able to say "it would have worked if Europe had listened to us ".
Now one must wonder what comes next. Does the ECB cave in and monetize? Do they verbally fight back and point out the obvious, that printing doesn't work AND destroys the currency? Will they respond publicly...or privately as WAS customary between central banks in the old days? Another thought to throw in is that the ECB has its strings pulled by Germany and the Bundesbank, didn't they just request that 300 tons of their Gold be shipped back to them...and were told "no, wait 7 years"? Can not getting their Gold back lead to "unity"... or mutiny ?
Unfortunately, the looming currency war is not confined to just the U.S. and Europe. Over the weekend Yau Yudong had more harsh words for the Dollar as the world's reserve currency and reported by Zerohedge http://www.zerohedge.com/news/
It is clear that the currency wars are heating up and also clear that sovereign nations are chewing up available Gold supply rapidly as they front run any systemic "change" that's coming. History has shown us that actual war has been used as a tool for both retribution AND by the powers that be to retain their power. The fact that nations are pointing fingers at other nations and doing it so that commoners can see is a very bad sign. You must ask yourself a question, "if nations themselves are stockpiling Gold...what is their reason?". These are all easy dots to connect and the disorder and distrust amongst nations and their central banks is a very important sign that should not be missed.
Regards, Bill H.
Did China Just Fire The First Salvo Towards A New Gold Standard?
Submitted by cpowell on Mon, 2013-08-05 13:47. Section: Daily Dispatches
CFTC's Chilton Says He Won't Back Current Volcker Rule
By Lori Ann LaRocco
CNBC, New York
Monday, August 5, 2013
CNBC, New York
Monday, August 5, 2013
CNBC learned today Bart Chilton, commissioner of the Commodities Futures Trading Commission, has sent a letter to Federal Reserve Chairman Ben Bernanke urging the Fed to firmly draft the final Volcker Rule in a way that ensures banks can no longer speculate in commodity markets.
Chilton stressed in the letter it was critically important to have the rule which would define the scope of the bank's "risk-mitigating activity."
Five federal financial regulatory agencies, including Chilton's CFTC, must approve the rule before it is implemented.
CNBC has obtained a copy of the letter where Chilton outlined the basis of the proposed rule which "would provide clear guidelines for market participants and would appropriately narrow the definition of 'hedging' to conduct that is truly economically appropriate to risk reduction."
Chilton went on to say relying solely on compliance programs, documentation requirements, and performance metrics is "simply not enough" and "the final Volcker Rule needs a robust, comprehensive, and targeted definition of risk-mitigating activity in order to protect markets and consumers."
The commissioner warned a clear definition of such activity is needed because even with the Volcker Rule "tightly written" banks would continue to "engage in, and likely expand, their ownership of commodities and trading activity in commodities. ... The conflict of interest here is obvious and, left unchecked, could easily 'muddy up' the regulatory oversight of banks, and make the complex myriad bank ownership portfolios an unregulatable endeavor."
Chilton tells CNBC the proposed rule he sent the chairman is a Volcker Rule deal breaker. "I won't vote for a final Volcker Rule unless this language, or something substantially similar, is included in the final text."
This morning Chilton will be addressing his vote decision and the "conflicts of interest" in bank activity in commodities at a meeting of Amcot, the trade association of America's cooperative cotton growers, in Lake Tahoe, Calif.
Chilton said, "Unless this language is written to avoid it, this could blow a huge hole in the Volcker Rule and would obfuscate the intent of Congress and President Obama when the financial reform legislation became law in 2010."
It is not the first time Chilton has addressed this issue with the Fed chairman. In September 2012 he sent a letter to Bernanke regarding the implementation of the Volcker Rule and the need for clear cut guidelines.
Chilton added large investment banks may also be using this ownership of commodities, and the storage and delivery mechanisms to avoid certain regulations, like the Volcker Rule and speculative position limits.
"If the banks claim they have an actual interest in the physical commodity, they'll say they should be exempt from the ban on bank speculation." Chilton explained. "That's just another end run around rules. I don't know why banks can't just go back to being banks, making loans and helping to spur our economy."
Chilton tells CNBC that for weeks his office has been researching what kind of commodity assets the banks owned but it was extremely difficult, equating the search as a big black box.
"I'm a financial regulator; you'd think it would be a piece of pie to find a list of what they own, right?" Chilton asked. "After all, banks own commercial interests that can impact prices, and at the same time their trading desks are all over the very same markets. There are obvious conflicts of interest. I'm not saying there have been any violations of the law, but how would we even know?"
In today's speech, Chilton will reveal how the CFTC has found out that Morgan Stanley has ownership stakes in oil tankers and a fuel distributor. "And, of course, they also trade crude oil and other energy contracts." he added.
Other CFTC research revealed, parts of Citigroup, Goldman Sachs, and Bank of America own or have owed power plants. "They also trade energy contracts. And everybody's been talking about Goldman Sachs holding on to aluminum at warehouses they own," explained Chilton.
"Some say that's consequently driving the up the price of beer and soda while the bank collects storage fees. And, they trade aluminum. JPMorgan also owns similar warehouses, although they said last week they may get out of commodities. We'll see." he said. "Oh, and by the way, Barclays and JPMorgan are putting out hundreds of millions of dollars in restitution for getting caught rigging electricity prices."
Describing the data hunt in his speech as "sorta deja vu-ish" and reminiscent about the valuation of credit default swaps. Chilton warned that the fact even a regulator can't track down the information easily is "a big deal." "Tracking down this information should be an immediate responsibility of regulators," Chilton said.
In his speech Chilton went on to say, "We need to find out specifically -- and comprehensively -- what banks own relating to physical commodities. Furthermore, the basic ownership information should be transparent. It should be listed on the Federal Reserve's website or someplace where people can view it."
According to Fed data, Goldman Sachs, JPMorgan Chase, and Morgan Stanley held $35.2 billion in physical commodities at the end of last year.
The issue of bank ownership of commodities was the subject of hearings last week in the Senate. Sen. Sherrod Brown, D-Ohio, who chairs the Banking Subcommittee on Financial Institutions and Consumer Protection on the topic, has also urged the Fed to provide greater guidance on the clarity of what commodity activities the banks should be allowed to do.
The Federal Reserve also announced last week it might reconsider its decade-old policy that has allowed investment banks to diversify and own certain unrelated businesses such as participation in the physical commodity markets.
Chilton said he hopes the Fed reverses this policy. "It is flawed and if they don't, I hope Congress does so."
CFTC's Chilton wants banks out of commodities -- gold and silver too
Submitted by cpowell on Mon, 2013-08-05 12:55. Section: Daily Dispatches
Fed Should Reverse Commodity-Trading Policy, CFTC's Chilton Says
By Silla Brush
Bloomberg News
Monday, August 5, 2013
WASHINGTON -- The Federal Reserve should reverse a decade-old ruling that allows banks to trade physical commodities, said Bart Chilton, a Commodity Futures Trading Commission member.
The central bank's 2003 decision and subsequent ones allowed firms including Citigroup Inc., JPMorgan Chase & Co., and Morgan Stanley to expand into commodities markets. The Fed said last month that it's reviewing the policy amid Senate scrutiny of whether it allows Wall Street firms to control prices.
"I don't want a bank owning an electric service, or cotton, corn or feedlots," Chilton, a Democrat, said in a speech prepared for delivery today at a conference of U.S. cotton growers in Lake Tahoe, California. "I don't want banks owning warehouses, whether they have aluminum, gold, silver, or anything else in them." The Fed "can and should reverse" the policy, he said.
JPMorgan, the biggest U.S. bank by assets, said days after a congressional hearing on the matter last month that it's weighing whether to sell or spin off holdings in physical commodities. The 10 largest Wall Street firms reaped about $6 billion in revenue from commodities in 2012, including dealings in physical materials as well as related financial products, analytics company Coalition Ltd. said in a Feb. 15 report.
"The Federal Reserve regularly monitors the commodity activities of supervised firms and is reviewing the 2003 determination that certain commodity activities are complementary to financial activities and thus permissible for bank holding companies," Barbara Hagenbaugh, a Fed spokeswoman, said on July 19. She declined to elaborate.
Banks' ownership of commodity interests already has drawn scrutiny from the CFTC and the Securities and Exchange Commission, while U.S. Senate Democrats plan additional hearings on the issue.
CFTC Chairman Gary Gensler, declining to comment on specific investigations, said at a Senate hearing on July 29 that his agency has legal authority to pursue manipulation of markets for metals and other commodities. His agency has sent letters to companies asking them not to destroy documents relating to warehouses registered by exchanges such as the London Metal Exchange or Chicago Mercantile Exchange, according to a copy of the letter obtained by Bloomberg News.
Over the years the worlds' central banks have operated in lockstep and with a unified front. Friday, the Richmond Fed put out a paper highly critical of the European central bank for not "easing" enough. This is curious because first off the Richmond Fed surely did not go "rogue" on their own and put this paper out without permission so this was an "official" slap in Europe's face. Secondly, this was highly public and highly critical. This looks to me like something has gone bad behind the scenes (which we are not privy to yet) and the fingers are starting to point.
What cracks me up is that the Fed is screaming PRINT at the top of their lungs, can you imagine were they to have done this before 2008? "Printing" now is just "normal" and no one even thinks twice about it. Has it worked? The only question in my mind is how long will it be before sanity shows up uninvited and ruins the party. One thing that I really don't understand is why do this publicly? If you want the ECB to get with the program and print to reflate, why not do it through back channels and privately? This in my view brings "questions" into play that I am sure the Fed does not want asked pertaining to inflation and intentional debasement.
Do you remember a little over a year ago when Europe was still talking about "austerity"? Austerity is obviously no longer a choice, it was maybe 10 years ago but is no longer because of the debt buildup and mathematical unsustainability. The only thing that austerity would do is to expose just how broke everything really is. No, printing is "way out" and the perceived road to riches I can only believe that this finger pointing and public scolding of the ECB is to lay the groundwork to be able to say "it would have worked if Europe had listened to us ".
Now one must wonder what comes next. Does the ECB cave in and monetize? Do they verbally fight back and point out the obvious, that printing doesn't work AND destroys the currency? Will they respond publicly...or privately as WAS customary between central banks in the old days? Another thought to throw in is that the ECB has its strings pulled by Germany and the Bundesbank, didn't they just request that 300 tons of their Gold be shipped back to them...and were told "no, wait 7 years"? Can not getting their Gold back lead to "unity"... or mutiny ?
Unfortunately, the looming currency war is not confined to just the U.S. and Europe. Over the weekend Yau Yudong had more harsh words for the Dollar as the world's reserve currency and reported by Zerohedge http://www.zerohedge.com/news/
It is clear that the currency wars are heating up and also clear that sovereign nations are chewing up available Gold supply rapidly as they front run any systemic "change" that's coming. History has shown us that actual war has been used as a tool for both retribution AND by the powers that be to retain their power. The fact that nations are pointing fingers at other nations and doing it so that commoners can see is a very bad sign. You must ask yourself a question, "if nations themselves are stockpiling Gold...what is their reason?". These are all easy dots to connect and the disorder and distrust amongst nations and their central banks is a very important sign that should not be missed.
Regards, Bill H.
Did China Just Fire The First Salvo Towards A New Gold Standard?
Submitted by cpowell on Mon, 2013-08-05 12:55. Section: Daily Dispatches
Fed Should Reverse Commodity-Trading Policy, CFTC's Chilton Says
By Silla Brush
Bloomberg News
Monday, August 5, 2013
Bloomberg News
Monday, August 5, 2013
WASHINGTON -- The Federal Reserve should reverse a decade-old ruling that allows banks to trade physical commodities, said Bart Chilton, a Commodity Futures Trading Commission member.
The central bank's 2003 decision and subsequent ones allowed firms including Citigroup Inc., JPMorgan Chase & Co., and Morgan Stanley to expand into commodities markets. The Fed said last month that it's reviewing the policy amid Senate scrutiny of whether it allows Wall Street firms to control prices.
"I don't want a bank owning an electric service, or cotton, corn or feedlots," Chilton, a Democrat, said in a speech prepared for delivery today at a conference of U.S. cotton growers in Lake Tahoe, California. "I don't want banks owning warehouses, whether they have aluminum, gold, silver, or anything else in them." The Fed "can and should reverse" the policy, he said.
JPMorgan, the biggest U.S. bank by assets, said days after a congressional hearing on the matter last month that it's weighing whether to sell or spin off holdings in physical commodities. The 10 largest Wall Street firms reaped about $6 billion in revenue from commodities in 2012, including dealings in physical materials as well as related financial products, analytics company Coalition Ltd. said in a Feb. 15 report.
"The Federal Reserve regularly monitors the commodity activities of supervised firms and is reviewing the 2003 determination that certain commodity activities are complementary to financial activities and thus permissible for bank holding companies," Barbara Hagenbaugh, a Fed spokeswoman, said on July 19. She declined to elaborate.
Banks' ownership of commodity interests already has drawn scrutiny from the CFTC and the Securities and Exchange Commission, while U.S. Senate Democrats plan additional hearings on the issue.
CFTC Chairman Gary Gensler, declining to comment on specific investigations, said at a Senate hearing on July 29 that his agency has legal authority to pursue manipulation of markets for metals and other commodities. His agency has sent letters to companies asking them not to destroy documents relating to warehouses registered by exchanges such as the London Metal Exchange or Chicago Mercantile Exchange, according to a copy of the letter obtained by Bloomberg News.
Over the years the worlds' central banks have operated in lockstep and with a unified front. Friday, the Richmond Fed put out a paper highly critical of the European central bank for not "easing" enough. This is curious because first off the Richmond Fed surely did not go "rogue" on their own and put this paper out without permission so this was an "official" slap in Europe's face. Secondly, this was highly public and highly critical. This looks to me like something has gone bad behind the scenes (which we are not privy to yet) and the fingers are starting to point.
What cracks me up is that the Fed is screaming PRINT at the top of their lungs, can you imagine were they to have done this before 2008? "Printing" now is just "normal" and no one even thinks twice about it. Has it worked? The only question in my mind is how long will it be before sanity shows up uninvited and ruins the party. One thing that I really don't understand is why do this publicly? If you want the ECB to get with the program and print to reflate, why not do it through back channels and privately? This in my view brings "questions" into play that I am sure the Fed does not want asked pertaining to inflation and intentional debasement.
Do you remember a little over a year ago when Europe was still talking about "austerity"? Austerity is obviously no longer a choice, it was maybe 10 years ago but is no longer because of the debt buildup and mathematical unsustainability. The only thing that austerity would do is to expose just how broke everything really is. No, printing is "way out" and the perceived road to riches I can only believe that this finger pointing and public scolding of the ECB is to lay the groundwork to be able to say "it would have worked if Europe had listened to us ".
Now one must wonder what comes next. Does the ECB cave in and monetize? Do they verbally fight back and point out the obvious, that printing doesn't work AND destroys the currency? Will they respond publicly...or privately as WAS customary between central banks in the old days? Another thought to throw in is that the ECB has its strings pulled by Germany and the Bundesbank, didn't they just request that 300 tons of their Gold be shipped back to them...and were told "no, wait 7 years"? Can not getting their Gold back lead to "unity"... or mutiny ?
Unfortunately, the looming currency war is not confined to just the U.S. and Europe. Over the weekend Yau Yudong had more harsh words for the Dollar as the world's reserve currency and reported by Zerohedge http://www.zerohedge.com/news/
It is clear that the currency wars are heating up and also clear that sovereign nations are chewing up available Gold supply rapidly as they front run any systemic "change" that's coming. History has shown us that actual war has been used as a tool for both retribution AND by the powers that be to retain their power. The fact that nations are pointing fingers at other nations and doing it so that commoners can see is a very bad sign. You must ask yourself a question, "if nations themselves are stockpiling Gold...what is their reason?". These are all easy dots to connect and the disorder and distrust amongst nations and their central banks is a very important sign that should not be missed.
Regards, Bill H.
No comments:
Post a Comment