Monday, October 27, 2014

Having read the ECB stress test, I am stressed

I cannot tell you the relief this tweet gave me. Maybe it was hand relief – I’m not sure – but as Eckhart Tolle would write, ‘It is the end of all pain’. For now I can sleep safe in the knowledge that Greek banks have little shortfall on a dynamic basis. Oh joy.
I mean, let’s get real here: if the ECB says the basis of dynamic fall is not only short but little, then surely we have nothing to worry about. Er, um, well…here’s another tweet:
3eurobankOh dear, or something. Three Cypriot banks…that’s all of them, isn’t it?
And two Belgian banks….don’t the Belgians have an economy 78% focused on running the EU?
Monte del Peische is, as I write, appointing outside advisors to help it look for a merger partner. This makes me wonder what the chances might have been of success had the Führerbunker appointed IG Farben to look for a Jewish American consortium with which to partner in May 1945.
And all this, we’re told, is an exercise through which (as one very sound observer suggests) ‘The ECB wants you to believe that the European banking sector is safe and sound’. No shit.
In pursuit of that aim, I can report that the capital shortfall of €25bn revealed at 25 euro area banks in 2013 has now been reduced to €15bn in 2014.
Just one problem: in carrying out this stress-test, the ECB unearthed an addditional €136bn in non-performing exposures…..which does cast something of a long, dark shadow across the €10bn shortfall improvement Thing.
I’m sorry folks, but this stress test is hoist by its own facade. It is a charade. A canard. A Cunard liner launched under the name of SS Titanic.
I am more than delighted to point out that this Slogpost borrows heavily for its maths upon this site.

Why You Need To Own Gold Before It’s Too Late

Ron Paul on the Federal Reserve Conspiracy – Trillions of Dollars in Debt to Ourselves

Italy is in terminal decline, and no one has the guts to stop it

The Rome Opera House sacked its entire orchestra and chorus the other day. Financed and managed by the state, and therefore crippled by debt, the opera house — like so much else in Italy — had been a jobs-for-life trade union fiefdom. Its honorary director, Riccardo Muti, became so fed up after dealing with six years of work-to-rule surrealism that he resigned. It’s hard to blame him. The musicians at the opera house — the ‘professori’ — work a 28-hour week (nearly half taken up with ‘study’) and get paid 16 months’ salary a year, plus absurd perks such as double pay for performing in the open air because it is humid and therefore a health risk. Even so, in the summer, Muti was compelled to conduct a performance of La Bohème with only a pianist because the rest of the orchestra had gone on strike.
After Muti’s resignation, the opera house board did something unprece-dented: they sacked about 200 members of the orchestra and chorus, in a country where no one with a long-term contract can be fired. It was a revolutionary — dare one say Thatcherite? — act. If only somebody would have the guts to do something similar across the whole of the Italian state sector. But nobody will. Italy seems doomed.
The latest panic on global stock markets has reminded the world of the vulnerability of the euro, and this week pundits in the British press have been busy speculating about France’s possible collapse. Hardly anyone bothers to fret about Italy any more, even though last week its exchanges took the second biggest hit after Greece. Italy’s irreversible demise is a foregone conclusion. The country is just too much of a basket case even to think about.
Italy’s experience of the European monetary union has been particularly painful. The Italians sleepwalked into joining the euro with scarcely any serious debate, and were so keen to sign up that they accepted a throttlingly high exchange rate with the lira. The price of life’s essentials, such as cigarettes, coffee and wine, doubled overnight while wages remained static — though back then jobs were still easy to find and money easy to borrow. But when the great crash happened, Italy, as a prisoner of a monetary union without a political union, was unable to do anything much about it, and could not even resort to the traditional medicine of currency devaluation.
The only path to recovery permitted by Brussels and Berlin — that of austerity — has been counterproductive because it has only been skin-deep. If austerity is to stimulate growth, it must be done to the hilt, which inevitably involves terrible suffering and the risk of mass agitation. No Italian politician can stomach that.
Italy can’t blame all its problems on monetary union, however. The euro did not cause the catastrophe, but it deprived Italy of a means to combat it and exposed its fatal structural weaknesses.
Source and full piece: Nicholas Farrell, The Spectator, 25 October 2014

One in five Eurozone banks struggling with financial problems

The European Central Bank says one in five Eurozone banks is grappling with financial problems with Italy’s banks hit hardest by the ongoing crisis.
The ECB said on Sunday that 13 of Europe’s top banks have failed an in-depth review of their finances and need to increase their capital buffers against losses by 10 billion euros (USD 12.5 billion).
“A total of 25 billion capital shortfalls were identified across 25 participating banks as a joint result of the AQR (Asset Quality Review) and the stress test,” ECB Vice President Vitor Constancio said, adding, “Out of the 25, 12 banks have already taken measures in 2014 that are enough to cover their shortfall.”
“There are then 13 banks that still have either to exactly apply their restructuring downsize as it is foreseen in their plans with the European Commission, or they will have to come up with ways to increase their capital,” he added.
Constancio made the statement based on a crunch audit aimed at preventing a repeat of the financial crisis that nearly led to the euro’s collapse.
The ECB, however, said 25 banks still need 25 billion euros to guarantee themselves against any future crises.
The worst results were seen in Italy, where nine banks failed, as well as in Greece and Cyprus with three each.
Even Germany, which has been doing well with exports, is witnessing a slowing growth on the back of weak investment.
The ECB has been criticized for similar stress tests, carried out by the EU in 2010 and 2011, which gave a pass to banks that later needed bailouts.
Source: Press TV, 26 October 2014

Amazon’s Leading Indicator Of Profitless Prosperity: Year 2000 Redux?

Wolf Richter,
In December 1999, it started crashing, a leading indicator of investor exasperation. Now it’s down 33% from its February high .
This shouldn’t surprise anyone, but by the way the stock plunged after Amazon announced its blistering third quarter loss, it seems plenty of people got caught with their pants down. The stock is now off 12% in after-hour trading as I’m writing this. But what the dickens were people expecting? That Amazon would make money, like normal mature retailers?
Heck no. That would be too uncool for Amazon. Amazon doesn’t need to make money.
Revenues rose 20% from a year ago to $20.6 billion, yet it lost $437 million. That’s about ten times what it lost in the quarter a year ago. With the current loss, the financial year-to-date sinkhole is $455 million.
But Amazon is no slouch. It finagled $205 million in income tax benefits, graciously provided for by hapless taxpayers. Its loss before income taxes is actually $634 million.
You have to read through four paragraphs of its press release, praising sundry metrics, before you get to the first mention of the word “loss.” If, exasperated by this much hype, you stop reading, you’d probably be better off.
And then there’s CEO Jeff Bezos holding forth on how they’re going to do this and that:
As we get ready for this upcoming holiday season, we are focused on making the customer experience easier and more stress-free than ever. In addition to our already low prices, we will offer more than 15,000 Lightning Deals with early access to select deals for Prime members, hundreds of millions of products across dozens of categories, curated gift lists like Holiday Toy List and Electronics Holiday Gift Guide, new features like….
Yada-yada-yada. It’s the same song and dance we’ve been hearing for years. How about explaining to exasperated shareholders how Amazon is going to make a net profit?
Well, after an eternal list of doodads, thingamajigs, and services that Amazon has already rolled out or will roll out, it finally gets to the part of how it is going to make a net profit.
Um, it’s not going to make a net profit.
It explains: “Operating income (loss) is expected to be between $(570) million and $430 million, compared to $510 million in fourth quarter 2013.”
Here’s the thing: Aside from being a range that extends all the way from Kabul to Seattle, even at the optimistic top end of making an operating profit of $430 million, Amazon would remain in its financial sinkhole for the year.
Its net loss so far this year is $455 million. And the Q4 net profit, if any, is going to be lower than the operating profit. So in all likelihood, 2014 is going to be another red-ink year. It barely made money in 2013 ($274 million, a rounding error for a company with $74.5 billion in revenues). It lost $39 million in 2012. It made $631 million in 2011. This isn’t exactly an improving trend.
Now don’t get me wrong. I’ve been a satisfied customer of Amazon for fifteen years or so. I also published two books – BIG LIKE andTESTOSTERONE PIT – using Amazon’s services, and I have no complaints about how that worked. Amazon does a lot of things very well, and some things better than anyone else out there. It also uses and abuses its increasing heft in the market place to stifle competition and create a monopoly. It’s not cool, but hey, all big companies strive to do that. A monopoly is the corporate wet dream.
But Amazon doesn’t give a hoot about its stockholders. Never has. To heck with them. It clearly has no intention of making money. And it doesn’t have to because shareholders are still buying the shares. Even today, though at a much lower price.
The stock is now changing hands at $275 a share, as I’m writing this, a 52-week low, and down almost 33% from its all-time high in January of $408. Maybe shareholders are finally waking up to reality. And then there are memories: Amazon started crashing in December 1999, three months before the rest of the Nasdaq did. It was a leading indicator of investor exasperation. It didn’t take all that long before Amazon was down 80%.
And why the heck did Daimler just now turn its supposedly strategic investment, and one of the hottest stocks, into cash? What does it know that we don’t? Read…. Daimler Closes Tesla Hedge, Dumps Shares, Grabs Cash, Runs


Copper is in the dangerzone

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Copper is in the : full story: 

Corporate buyback tailwind winding down (via Yardeni)

View image on Twitter
Corporate buyback tailwind winding down (via Yardeni)

The “Save our Swiss gold” initiative is incompatible with the EUR/CHF peg

by Sober Look
This is every gold bull’s dream. The Swiss just might force their central bank to begin accumulating massive amounts of gold via the so-called “Save our Swiss gold” referendum. The Swiss National Bank (SNB) unwound a large portion of its gold holdings prior to the financial crisis and now it could be forced to buy it back over the next five years. Here is what the accumulation is likely to look like assuming the rest of the balance sheet stays constant.
Source: SNB
If the proposal passes in November, the SNB will also need to repatriate its physical gold holdings stored abroad (particularly in the US and the UK) back to Switzerland. The most difficult part of the law is that once the SNB buys any gold, it would no longer be permitted to sell the holdings at any time.
The law would require the SNB to hold at least 20% of its assets in gold (from less than 8% currently), likely forcing the central bank to unwind some of its foreign reserves.
Source: SNB
To understand why the SNB would need to sell its FX reserves, let’s start with a bit of background. The reason the SNB’s foreign reserves are so elevated is to a large extent the result of the 2008 financial crisis and more importantly the Eurozone crisis. Since the default of Lehman and through the euro area debt turbulence, depositors/investors moved assets out of the Eurozone into Switzerland. They feared a potential collapse of EMU banks, haircuts on euro-denominated deposits (which is what ultimately happened in Cyprus), and even the breakup of the euro – followed by redenomination back to pre-euro currencies and devaluation of the lira, drachma, escudo, etc.
Many moved assets to the relative safety and independence of the Swiss franc, which resulted in Swiss currency’s sharp appreciation against the euro (the chart below shows the euro depreciating against the franc).

The currency spike made Swiss products/services much more expensive in the Eurozone, driving Switzerland toward recession.
Moreover, the currency strength had generated deflation in Switzerland that was as severe as what we saw right after the financial crisis.
The Swiss National bank had to arrest the franc’s appreciation, which it did by imposing a currency peg to the euro. But in order to maintain the peg while everyone wanted to buy the Swiss franc, the SNB was forced to do the opposite – sell the franc and buy the euro. That’s why the SNB foreign reserves spiked during the eurozone crisis (see post from 2012) – with nearly half the reserves in euro.
Now back to the situation with the SNB’s gold holdings. It’s unlikely that the SNB would use Swiss francs to buy gold if forced to do so.  That’s because the SNB would need to “print” the currency (similarly to the Fed buying treasuries via QE), which would result in the central bank’s balance sheet expanding. But gold reserves would have to stay at 20% of total assets, forcing the SNB to buy more gold than planned due to larger balance sheet.
That means the central bank would need to sell something and replace it with gold in order to avoid unwanted balance sheet expansion. The SNB is therefore likely to sell foreign currencies, particularly the euro. And that could potentially put pressure on the EUR/CHF peg discussed above by weakening the euro.
Furthermore, if there is another “run on the euro” and the SNB is forced to defend the peg by buying more euros, the central bank would be also forced to buy more gold (by selling the euros). Such downward pressure on the euro is actually quite possible, should the ECB embark on a new QE effort on order to arrest disinflationary pressures.
In such a situation, large market participants would simply go long gold while shorting massive amounts of euro against the Swiss franc (possibly via options). If the SNB buys a great deal of euros to keep the peg fixed, it would also be forced to buy gold. In such a scenario the traders win on the gold appreciation. If the SNB gives up the peg and no longer buys gold, the euro falls sharply against the franc and the traders win – again. The peg becomes unsustainable.
The “Save our Swiss gold” initiative is therefore simply incompatible with the longer term EUR/CHF stability objectives.
Over the long run, the inability to sell any gold could in theory force the SNB’s balance sheet to be 100% gold. If the central bank assets for example grow to 5 times the current size (with the 20% rule in place), and then shrink back to their original size, the Swiss National Bank would be holding nothing but gold. It would no longer have the ability to do much of anything, especially address deflationary pressures.
What’s the likelihood that the “Save our Swiss gold” proposal passes? According to the GFS Bern poll for the November 30th referendum, 44% of respondents currently support it, 39% are against it and 17% are not yet decided. This is obviously too close to call, but the possibility of a “yes” vote is now quite real.


Rising debt/GDP not exclusively a euro zone problem.

Rising debt/GDP not exclusively a euro zone problem. US debt/GDP 2007: 62% 2013: 101% UK debt/GDP 2007: 43% 2013: 91%

Cognitive Elite – The Jewish Ghetto, Gaza and Detroit


Gilad Atzmon’s Talk

A Study of Jewish Identity Politics, offers a theory of cognitive ability distribution to explain Zionism, Jewishness, anti-semitism, and identity politics generally. September 29, 2014 video by Joe Friendly

This could be the “scariest” test for U.S. stocks in years

From Chris Kimble at Kimble Charting Solutions:

The S&P 500 has remained above rising support line (1) for nearly 5 years.
The decline in stock prices this month took the S&P below this support line and below its 100-Day Moving Average (DMA) for the first time in years.
The rally in prices over the past week now has the S&P kissing the underside of this old support line and its 100DMA, at the same time right now.
Bulls might be a little scared that this dual kiss of resistance could end up being a high in prices.
When is comes to importance, this is “Munster-sized” to see whether the bulls or bears win at this key price point!

Elderly are better off in Romania than Britain: Shock UK pensioner poverty statistics

BRITAIN's pensioners are some of the worst off in the EU and are at a greater risk of falling into poverty than those in Eastern Europe. 

Old man looking sad with head in his handsCurrently there are 1.7million living below the breadline [GETTY]
Some 15 countries come ahead of the UK when it comes to levels of poverty in the over-65s, according to a new report by the International Longevity Centre (ILC-UK).
The UK is performing worse than countries like Romania, Poland and Latvia, despite being the second richest in the Union.
A failing state pension system and low employment later in life has left 1.7million OAPs living below the breadline, experts say.
Some 16.1 per cent of British pensioners live in relative poverty, while Romania has just 15.4 per cent and Latvia has 13.9 per cent.
Germany, Austria, Spain, Denmark, Poland, Ireland, France, Norway, Slovakia, Luxembourg, the Czech Republic, Hungary and the Netherlands are all performing better than the UK.
Austerity cutbacks have meant those aged between 50 and 65 are struggling to remain in jobs until pensionable age, leaving them with less time to save for the future.
As many as 1.5 million over-50's were pushed out of work over the last eight years due to a combination of redundancy, ill health or forced early retirement, according to research by the Prince of Wales' Initiative for Mature Enterprises.
A spokeswoman for ILC-UK, said: “We could learn a lot from Europe, which is why we used the report to compare ourselves with our neighbours.
“The state pension is being squeezed and it is difficult for people to keep saving when earnings aren’t rising but their costs are increasing.”
Charities have called for the government to do more to support those in need.
It’s scandalous that so many older people in the UK are living in poverty and unable to afford decent food or a warm home
Caroline Abrahams
Caroline Abrahams, Charity Director at Age UK, said: “It’s scandalous that so many older people in the UK are living in poverty and unable to afford decent food or a warm home. Many pensioners live on very low, fixed incomes and have been walking a tightrope in recent years as food and utility bills have escalated.
“The government must do more to get vital money benefits to those who need extra support but a comprehensive national strategy is also urgently needed.”
The report, which will be released by ILC-UK next week, also shows the UK state pension is only 31.9 per cent of the average wage, meaning middle-income earners will experience a sharp drop in their standard of living if they have no other provisions.
Government sources argue the UK has a different system, with a focus on private pensions.
Experts argue that the poorest, who have no savings, are being let down.
Pensions expert Ros Altmann said: “The UK has one of the lowest state pensions in the developed world. “We rely heavily on private pensions but those who don’t have the chance to save, who maybe lose their job or, like many women, don’t have the chance to generate a larger state pension, are left living in poverty.
“If you can’t work you lose twice over. You have no income and you have no opportunity to save for the future.”
The Department of Work and Pensions are switching to a less complicated single-tier pension system as of next year in a bid to ensure the elderly receive what they are entitled to.
Auto-enrolment, where people automatically join a company pension scheme when they start a new job, was also introduced by the Coalition two years ago.
Minister for Pensions Steve Webb said:  “The Triple Lock means the basic State Pension is now at the highest percentage of earnings since 1992 – and we are helping today’s workers to save for a comfortable retirement with 4.7m workers now automatically enrolled into a workplace pension.“To help older workers, we have extended the right to flexible working, outlawed forced retirement and our Fuller Working Lives initiative is challenging outdated stereotypes.”


Keiser Report: Sinking British Ship

UK profit warnings at highest level since 2008

Tesco Tesco profits slumped for the first half of the financial year

Profit warnings by UK-listed firms have risen to their highest summer level in six years, according to a new report.
The report, by the consultancy firm EY, said quoted firms issued 69 profit warnings in the third quarter of 2014, up from 56 in the same period in 2013.
It is the highest level for the three-month period to 30 September since 2008, the forecaster added.
Supermarket giant Tesco was among the companies to issue profit warnings during the period.
Profit warnings are issued by companies quoted on a stock market to alert investors that profits will be lower than expected.
The survey said that despite a rise in economic input, firms were facing crowded and competitive markets.
It also said bargain-hunting customers, rapid structural change and, until recently, a strong pound had hampered progress.
'Perfect storm' EY head of restructuring for UK and Ireland Alan Hudson said: "New entrants, new technologies and shifting consumer behaviour continue to challenge established business models and nowhere is this more visible right now than in food retailing.
"The pressure on sales and margins is largely focused on established supermarkets, struggling to adapt to the move away from the big weekly shop and the challenge posed by an expanding group of warehouse, supermarket and high street discounters."
Six retailers issued warnings during the period covered, up from two in the second quarter and the highest number in three years.
The report said the sector faced big changes, despite retail sales rising throughout most of the summer.
Next Next also issued a profit warning during the period
The construction and materials industry issued a high number of warnings because older contracts have come under intense margin pressure due to rising costs.
Five warnings were issued in the sector, the highest total since the second quarter of 2012.
'Struggling to adapt' Mr Hudson added: "Contractors have found themselves in a 'perfect storm' of low-margin legacy contracts and rising costs.
"During the recession, many contractors priced aggressively in response to competitive pressures and the need to at least to cover their overheads and retain critical mass for better times."
EY capital transformation leader for Europe, Middle East, India and Africa, Keith McGregor, said: "Profit warnings have continued apace from the third into the fourth quarter.
"This implies that at best companies and markets are misreading the post-crisis economy and are struggling to adapt to rapid structural changes, and at worst have once again over-estimated the pace and nature of this recovery."


The desperation of retailers grows by the day. I head to Wal-Mart and Giant in Harleysville every Sunday morning at 7:00 am. to do my weekly grocery shopping. I go to Wal-Mart at opening to avoid the freaks we see weekly on the People of Wal-Mart post. The workers at Wal-Mart are only a small step above the customers. They can barely communicate, rarely look you in the eye, and generally act like they are prisoners in an asylum.
I’m in winter/bad times ahead prep mode. I had a load of fire wood delivered yesterday which I wheelbarrowed to the back yard and stacked with my already decent sized stack. Last week I took an empty propane canister back to Wal-Mart to replace it with a full canister. That would give me three full propane tanks. I left the empty tank outside next to the propane cage and went in to pay. The old lady cashier with the gravelly smoker voice told me she would call for someone to get me a new tank.
I went over the cage and patiently waited for a Wal-Mart drone to come out, unlock the propane cage and give me a full tank. Two minutes, five minutes, and eventually ten minutes go by with no one coming out to help me. The cashier pokes her head out the door and shrugs her shoulders and says no one is responding to her calls. What a well oiled machine they have at Wal-Mart. Eventually the old lady abandoned her cashier post and in a painstakingly slow manner proceeded to unlock one bin after another until she found a full tank. I’m sure a line of unhappy customers were piling up at the only register in the garden center while she spent ten minutes getting me my propane tank.
A transaction that should have taken five minutes from start to finish ended up taking closer to twenty five minutes, with another five or six customers also dissatisfied with their extra long wait. This is a perfect example of how not to do business. Maybe Wal-Mart’s problems are bigger than households having less to spend. They are attempting to maintain their profit margins by reducing staff hours, hiring low quality people, and paying them shit wages. In the short run it may keep profits higher, but in the long-run customers will go elsewhere. Except most of the elsewhere stores closed up years ago when Wal-Mart arrived and underpriced them into bankruptcy.
My shopping experience at Giant is generally pleasant. The staff are nice, competent, and have been there for years. They know what they are doing and serve you with a smile. But their store is part of a worldwide conglomerate, so things have changed for the worse over the last four months. They renovated the entire store, creating bigger aisles and moving stuff around. That’s annoying, but after a while you figure out where they moved the stuff you want. The real negative change was the dreaded “Everyday Low Pricing”. This weasel phrase means you will be paying more. This is what the Apple idiot CEO – Ron Johnson – did at JC Penney. It put them on a rapid path to bankruptcy.
The weekly sale items at Giant have virtually disappeared. This has coincided with the drastic increase in beef, pork and fresh produce prices. Since “Every Day Low Pricing” went into affect our weekly grocery bill has gone up 20%. And I am buying far less beef and more chicken. In the past I would stock up on sale items and put beef, pork and whatever was on sale in our storage area freezer. Now I am stuck buying what we need that week. No bargains, just fully priced food items. Be forewarned, whenever you see a store announce “Everyday Low Pricing” you are getting screwed.

The Boos Begin in August & Bells Start Jingling in October

The desperation of Wal-Mart and most of the other mega-retail chains is no more clearly evident than in their relentlessly ridiculous acceleration of holiday marketing displays. I was flabbergasted when I saw Halloween candy, decorations and costumes in row after row BEFORE Labor Day at my local Wal-Mart. Selling Halloween candy two months before Halloween is idiotic and a sure sign of desperation. Retailers have run out of merchandising ideas. I wouldn’t even consider buying Halloween candy until the week before Halloween. Do Wal-Mart freaks of the week actually buy Halloween merchandise in September?

Holidays used to be special occasions that lent a sense of sales urgency for retailers for a week or two, to pump up sales. Now Wal-Mart and the rest of the dying retailers have Christmas, Easter, Fourth of July, and Halloween displays up for 80% of the year. There is no sense of urgency to buy. From September 1 though October 31 there are rows and rows of bags of corporate produced chemicals disguised as candy. I suppose the obese masses buy this crap in anticipation of Halloween, tell themselves they’ll only take one, and then shovel the entire bag down their gullets.
So last week, still a full two weeks before Halloween, Wal-Mart had already converted their entire garden center into a Christmas wonderland of cheap mass produced Chinese cookie cutter Christmas decorations and lights that will blow out after three hours of use. They had also converted aisles at the front of the store to Christmas displays. Who the hell shops for Christmas crap in October? There is nothing like having cheap Chinese Christmas crap available for over two months to create a sense of urgency to buy. Wal-Mart and the rest of the mega-retailers have got nothin. They have no original merchandising ideas. They don’t even try anymore. They source low quality goods from China and compete solely on price. I can’t wait for the Easter candy to appear on Wal-Mart’s shelves in late December.

Black Thanksgiving

Black Friday is dead. Long live Black Thanksgiving. The riots and stampedes by the ignorant masses for toasters and HDTVs on Black Friday are now being replaced by retailers and malls across America opening at 6:00 pm on Thanksgiving. It actually seems fitting. How better to give thanks for our mass consumption, debt financed, materialistic, iGadget addicted society than to open stores on Thanksgiving. Spending time with family is overrated anyway. If you had to spend six hours with cousin Eddie and aunt Bethany, you’d be looking forward to an early opening at Macy’s.
The bullshit message from the mega-retailers is: “We’re not opening on Thanksgiving out of desperation or greed. We’re doing it simply to satisfy the demands of our customers”. It’s a racist national holiday anyway. We should be going to an Indian run casino on Thanksgiving to make up for our past sins. Opening stores and forcing workers to work on Thanksgiving is pathetic, disgusting and a truly desperate measure in this consumer empire in decline. The law of diminishing returns has been invoked upon the mega-retailers that dominate our suburban sprawl paradise.
These retailers can start holiday merchandising three months before the actual holiday. They can open their doors on Thanksgiving, Easter and Christmas. It’s nothing more than shuffling the deck furniture on the Titanic. We’ve allowed bankers, politicians and corporate titans to financialize our economy, gutting the once thriving middle class, sending manufacturing jobs overseas, and convincing the clueless masses that consumer goods purchased with debt is equal to wealth. But, we’ve reached the point of no return. There are 248 million working age Americans and 102 million of them are not employed. Of the 146 million working Americans, 82 million of them make less than $30,000 per year.

While retailers have added billions of square feet since 1989, real median net worth is 5% lower over 24 years. Retailers are attempting to get blood from a stone. The stone is in debt, approaching retirement with no savings and dead broke.

We have one entity that deserves the most credit for destroying the American Dream. Real median household income is lower than it was in 1989. The 2008 collapse was caused by the easy money bubble machine at the Federal Reserve. We had the opportunity to hit the reset button, implement rational economic and monetary policies, take our lumps, and make the banking culprits pay for their crimes. Instead, the easily manipulated masses believed the Wall Street storyline and allowed the Federal Reserve and feckless politicians to save the banking cabal with extreme money printing and debt creation. This has pushed the middle class closer to the breaking point, while further enriching the oligarchs. The Federal Reserve saved their owners and lured the masses further into debt.

The Fed, Wall Street, and Washington DC have successfully driven consumer debt to an all-time high, blasting through the $3 trillion level. Declining real incomes and rising debt are a sure recipe for success.

Our entire economic paradigm is built upon desperate measures. Zero interest rates, $3 trillion of QE, systematic accounting fraud, fudged economic data, and doling out subprime loans to auto renters and University of Phoenix wannabes have failed to revive our moribund economy. Delusions don’t die easily. But they do die. We are reaching the limit of this delusionary dream built upon debt, denial, and deception. Make sure you wolf down that Thanksgiving feast before 5:00 pm. There are HDTV’s to fight for at 6:00 pm.

Another Deutsche banker and SEC enforcement attorney ‘commits suicide’

Back on January 26, a 58-year-old former senior executive at German investment bank behemoth Deutsche Bank, William Broeksmit, was found dead after hanging himself at his London home, and with that, set off an unprecedented series of banker suicides throughout the year which included former Fed officials and numerous JPMorgan traders.
Following a brief late summer spell in which there was little if any news of bankers taking their lives, as reported previously, the banker suicides returned with a bang when none other than the hedge fund partner of infamous former IMF head Dominique Strauss-Khan, Thierry Leyne, a French-Israeli entrepreneur, was found dead after jumping off the 23rd floor of one of the Yoo towers, a prestigious residential complex in Tel Aviv.
Just a few brief hours later the WSJ reported that yet another Deutsche Bank veteran has committed suicide, and not just anyone but the bank’s associate general counsel, 41 year old Calogero “Charlie” Gambino, who was found on the morning of Oct. 20, having also hung himself by the neck from a stairway banister, which according to the New York Police Department was the cause of death. We assume that any relationship to the famous Italian family carrying that last name is purely accidental.
Deutsche Bank
Here is his bio from a recent conference which he attended:
Charlie J. Gambino is a Managing Director and Associate General Counsel in the Regulatory, Litigation and Internal Investigation group for Deutsche Bank in the Americas. Mr. Gambino served as a staff attorney in the United Securities and Exchange Commission’s Division of Enforcement from 1997 to 1999. He also was associated with the law firm of Skadden, Arps, Slate Meagher & Flom from 1999 to 2003. He is a frequent speaker at securities law conferences. Mr. Gambino is a member of the American Bar Association and the Association of the Bar of the City of New York.
As a reminder, the other Deutsche Bank-er who was found dead earlier in the year, William Broeksmit, was involved in the bank’s risk function and advised the firm’s senior leadership; he was “anxious about various authorities investigating areas of the bank where he worked,” according to written evidence from his psychologist, given Tuesday at an inquest at London’s Royal Courts of Justice. And now that an almost identical suicide by hanging has taken place at Europe’s most systemically important bank, and by a person who worked in a nearly identical function – to shield the bank from regulators and prosecutors and cover up its allegedly illegal activities with settlements and fines – is surely bound to raise many questions.
The WSJ reports that Mr. Gambino had been “closely involved in negotiating legal issues for Deutsche Bank, including the prolonged probe into manipulation of the London interbank offered rate, or Libor, and ongoing investigations into manipulation of currencies markets, according to people familiar with his role at the bank.”
He previously was an associate at a private law firm and a regulatory enforcement lawyer from 1997 to 1999, according to his online LinkedIn profile and biographies for conferences where he spoke. But most notably, as his LinkedIn profile below shows, like many other Wall Street revolving door regulators, he started his career at the SEC itself where he worked from 1997 to 1999.

13 European Banks Don't Have Enough Money To Survive A Financial Crisis

Euro burning ecb 
In this Nov. 3, 2011 file photo, activists of the Occupy Frankfurt movement have set up a fire near the Euro sculpture in front of the European Central Bank in Frankfurt, Germany.
The European Central Bank said on Sunday that 25 eurozone banks showed a capital shortfall, after a year-long review of finances for 130 of the largest banks in the euro area.
The assessment goes through Dec. 31, 2013. Since then, 12 of the 25 banks have already covered their capital shortfall, which totals €25 billion, the ECB said. That means 13 banks still do not have enough money to whether a financial crisis.
The banks with existing shortfalls, which have not been named, now have two weeks to submit plans to the ECB detailing how the firms plan to raise capital. The banks will have nine months to cover the shortfall, the ECB said.
Out of the 25 banks, Cyprus, Greece, Portugal, and Italy have the proportionally highest shortfall, the report said. You can see Italy leads the pack in the pie graphs below.
ECB Stress Tests
In a statement, the ECB said, “By identifying problems and risks, [the review] will help repair balance sheets and make the banks more resilient and robust. This should facilitate more lending in Europe, which will help economic growth.”