Monday, March 11, 2013

Have Americans Given Up on Saving for Retirement?

In the wake of the Great Recession, retirement-minded Americans are feeling an unprecedented amount of futility. They are undersaved and — worse — see little reason to do anything about it.
That’s the alarming conclusion in a new report from the Deloitte Center for Financial Services, which found that 60% of preretirees believe health care costs will consume their savings no matter how much they save. Similarly, 39% believe investment returns won’t be high enough to provide decent retirement income regardless of how much they manage to put away.
Deloitte found exasperation at every turn: 58% don’t have a retirement plan; nearly 40% don’t know what an annuity or mutual fund is; and 20% expect to rely purely on Social Security for their retirement needs. More than half don’t trust anyone’s advice.
(MORE: Avoid Getting Stung by the Affordable Care Act)
Collectively, we seem to be throwing the towel. It’s not difficult to understand why, to be sure. After a sharp pullback in 2008 and ’09, stocks are only now touching levels they first reached in the late 1990s. So the market has been dead money for nearly 15 years if you bought then and simply held on. A lot of folks who were on track with savings at, say 45, have fallen way behind and now they are 60. This helps explain why so many boomers now plan to work past their normal retirement age of 66 or 67.
Meanwhile, housing is finally making a comeback. But real estate values in most markets are nowhere near the levels seen in 2007. And historically low interest rates are behind the spreading feeling that decent retirement income is a pipe dream.
The high cost of health care, and slowly disappearing coverage for retirees, further fuel the growing sense of retirement futility. Extend Health found in a survey that adequate health insurance coverage was retirees’ top concern and that the share of those worried about “having enough money to pay out-of-pocket medical expenses” had doubled in the past five years.
One out of two workers says they will delay retirement solely to keep their health plan, reports the Employee Benefit Research Institute (EBRI); 1 in 4 says they would retire earlier than currently planned if they were guaranteed access to health insurance.
(MORE: Dow Jones Closes at Record High — So What?)
Only 18% of workers are employed at firms that offer health coverage to early retirees, down from 29% in 1997, EBRI reports. Between 1997 and 2010, the percentage of retirees over age 65 with retiree health benefits fell to 16% from 20%.
With an economic recovery under way, and housing rebounding and stocks verging on new highs, perhaps the sense of futility will ease before we all slip into a coma. Let’s hope so, because giving up isn’t the answer.

Ex-Fed Gov. Mishkin, Other Experts: Fed Easing Could Lead to ‘Surge in Inflation’

The buildup of government debt could force the Federal Reserve to ease to a point where inflation runs rampant, says former Fed Governor Frederic Mishkin.

Mushrooming government debt can engender “a fiscal crunch [that] would force a central bank to pursue inflationary policies, a situation that's called fiscal dominance,” he writes in The Wall Street Journal, along with David Greenlaw of Morgan Stanley; James Hamilton of the University of California, San Diego; and Peter Hooper of Deutsche Bank.

If the Fed doesn’t go on a money-printing spree, thereby monetizing the debt, interest rates would rise since private lenders demand higher rates, they maintain.

Editor's Note:
'It’s Curtains for the US' — Hear Unapologetic Warning from Prophetic Economist.

Such higher rates would cause an economic contraction, the experts write. “Indeed, without monetization, the government could end up defaulting on its debt.”

That means the Fed would have to buy more and more Treasurys “by printing money, eventually leading to a surge in inflation,” the foursome says.

In addition, rising interest rates could force the Fed to incur major losses on its holdings of Treasurys and mortgage-backed securities.

And that could render the central bank unable to make payments to the Treasury, the economists say. “This could subject the institution to a loss of credibility in financial markets and to political attacks.

“With sufficient political will, the U.S. government can avoid fiscal dominance and achieve long-run budget sustainability by gradually reining in spending on entitlement programs such as Medicare, Medicaid and Social Security, while increasing tax revenue by broadening the base,” they write.

“The political will to put the fiscal house in order has not yet been summoned — but should be the highest priority of this country's elected officials.”

Some already think the Fed has gone too far in its easing, including Steve Forbes, chairman of Forbes Media.

“Like steroids in baseball, it ultimately wrecks the player,” he tells CNBC. “The government is making it easier to borrow money for mortgage-backed securities and the like, and small businesses, households have a hard time getting credit.”

Editor's Note: 'It’s Curtains for the US' — Hear Unapologetic Warning from Prophetic Economist.

© 2013 Moneynews. All rights reserved.

Wall Street disaster plan: Trade without humans

The New York Stock Exchange (NYSE) is preparing contingency plans wherein computers will replace outcry auctioning in case another disaster, such as terrorism or severe weather, forces the closure of trading in downtown Manhattan.
NYSE Euronext is preparing to submit details of the plan, which would permit computers to take securities to market just as human traders have done on Wall Street for the last 221 years, to the US Securities and Exchange Commission, The Wall Street Journal reported on the weekend.
The disaster plan would move trades on the NYSE to a fully-computerized sister system, called Arca, while Wall Street’s famed floor traders would be out of harm’s way. The transferal to Arca would make it the ‘primary market’, responsible for setting opening and closing prices for securities, the US business daily reported.
"The NYSE has to look at an extreme scenario in which the exchange would not be able to open or close and doing that in an electronic format is something they have [discussed]," Jonathan Corpina, senior managing partner at NYSE member firm Meridian Equity Partners Inc, told the Wall Street Journal.
Wall Street experienced in October 2012 its first weather-related closure in more than 120 years when Hurricane Sandy swept up the US East Coast (Since 1885, the Wall Street trading floor has been closed 12 days due to weather conditions, according to exchange records). While it is difficult to put a price tag on what these closures cost investors, dozens of companies were forced to postpone earnings reports because of the storm.

CIA militaristic tool of Wall Street capitalism: US activist

The CIA is the military arm of the Wall Street cartels which dictate US capitalistic policies throughout the world, an American political activist tells Press TV



“That’s what the CIA is all about. It is an armed wing of the capitalist government of the United States, which serves the Wall Street. That’s what, it is plain and simple,” said Caleb Maupin in a Saturday interview.

“All over the world wherever people are demanding justice and fighting for things people want like peace, jobs, democracy and equality, the CIA goes in to defend the interests of Wall Street, to assassinate, to murder and to commit chaos and crimes,” he pointed out.

Maupin was making the remarks in the wake of the US Senate confirmation of John Brennan, the top White House adviser on the so-called war on terror and purported architect of Washington’s drone operations, as the next director of the CIA on Thursday.

Washington uses assassination drones in several countries, claiming that they target “terrorists.” According to witnesses, however, the attacks have mostly led to massive civilian casualties.

The London-based Bureau of Investigative Journalism says between 2,627 and 3,457 people have been killed by US drones in Pakistan since 2004, including between 475 and nearly 900 civilians.

“There is nothing particularly new about John Brennan’s policies and his love of assassinating people. The CIA is a terrorist organization that functions to serve the Wall Street monopolists,” Maupin said.

He pointed to CIA’s international crimes sponsored by the Wall Street as a reason behind the emergence of anti-capitalism Occupy movements in the US and in the world’s major cities since September 2011.

The American activist underscored the “need to stand with the people of the world against the Wall Street and bankers and fight for peace, jobs, democracy, equality and all the things that the CIA attempts to rob from people around the world.”


'You don’t have to live in Burnley to bank like Dave': Lend-to-save invites borrowers and savers to go online

A new updated series on the ‘Bank of Dave’ revealed last week how people in Burnley, Lancashire, queued around the block to be a customer of the ‘bank’ – either to put their money away and garner a five per cent rate, or borrow money.
The Channel Four programme, following businessman Dave Fishwick and his brave banking plans, shines the spotlight on problems customers and small businesses face when it comes to dealing with banks.
High street banks have had their reputations tarnished in recent years, with the reluctance to lend, tales of poor customers service and scandals, such as mis-sold Payment Protection Insurance (PPI) and rigging LIBOR rates, all denting confidence. 
Bank of Dave: Dave Fishwick has captured the imagination of the country with his Channel Four programme
Bank of Dave: Dave Fishwick has captured the imagination of the country with his Channel Four programme
Dave has successfully captured the imagination of the country with a return to consumer orientated local banking – ‘by the community, for the community’ – with profits going to charity. 
His simple plan is to pay a savings rate of 5 per cent, and lend money to businesses and people who need it and who he has assessed will pay him back.
That proved to be a raging success, yet the Financial Services Authority at first refused to meet him and then tried to shut him down.
Dave has been inundated with requests from people asking him to open up a branch of his ‘bank’ in other parts of the country, only to be left disappointed. He is just one man after all.
But there is an alternative – lend-to-save, otherwise known as peer-to-peer (P2P) lending. It has become a popular concept in the last couple of years.
It works by matching investors, who are looking for a more competitive rate of return on their money, with those lending to those who want to borrow, usually at far lower APR rates than high street providers – and this is exactly the model 'Bank of Dave' uses.
Those who do borrow money have to meet strict criteria. This means default rates tend to remain extremely low compared to other loan providers.
But the fact remains that in return for lend-to-save's higher rewards you are taking on a risk that is not involved in a savings account.
The three major players in the industry, FundingCircle, RateSetter and Zopa, have been attracting swathes of investors through decent rates offered online.
FundingCircle is advertising an 8.8 per cent rate and RateSetter 7.4 per cent, before defaults and fees, while Zopa is offering 5.5 per cent after fees. 
Dave’s blueprint has already been a hit online in the form of these lend-to-save firms, according to the boss of RateSetter, who speaks exclusively to This is Money…

‘Bank of You isn’t as far away as you might think’

Rhydian Lewis: RateSetter boss says Bank of Dave concept is in action online
Rhydian Lewis: RateSetter boss says Bank of Dave concept is in action online
Comment by Rhydian Lewis, founder of RateSetter
Just before you up sticks and move to Lancashire, you might be surprised to know that Dave’s blueprint for a bank already exists elsewhere, and has done for some time: online and available to all, in the form of P2P platforms.
For, after all his struggles against Financial Services Authority red tape, that is exactly what Dave has created; a P2P company with a shop front, taking deposits from Burnley Savers and lending it directly to people or small businesses.
The same process applies online, with RateSetter matching smarter savers with credit-worthy individuals, ensuring everyone gets what has been agreed.
Ask any of the 250,000 who are currently using P2P lending in this country why they do so and the chances are you will get a response similar to those that Dave makes throughout the show.
They are the same reasons why we set RateSetter up in 2010. Historic low interest rates by the Bank of England, and banks reluctance to lend or offer fast and flexible low cost loans, mean borrowers and savers are looking elsewhere.
Savers in particular are crying out for fair rates and a return to banking in its purest form – without being penalised for the mistakes of other parts of the business or wider economy, and without subsidising the overheads that accompany running a branch in every town and city. And lending to save is an attractive proposition to achieve five per cent or better, with the risks carefully managed by the operator.
There are differences of course: the Bank of Dave is reliant on Dave’s largesse, as well as his personal approach to assessing creditworthiness.
RateSetter undertakes credit checks in the same way as a bank, using credit reference data, and only approves a relatively small percentage of applicants.
The local nature of the Bank of Dave is a great strength, and creates valuable local reinvestment and support; online peer-to-peer lending can match a borrower in Bournemouth with a lender in Leeds.
But the fundamentals remain the same: bringing people together to give them a better and fairer deal. Even Dave’s Guarantee – that he will personally cover any losses incurred by savers – is similar to RateSetter’s compensation fund that reimburses Lenders and has ensured that everyone has received every penny of capital and interest they have expected.
Dave’s battle with regulation throughout the series echoes that of online peer-to-peer companies – albeit for different reasons. While Dave struggles against the mountain of red-tape, RateSetter and other members of the P2P Finance Association have actively proposed more regulation.
Why? We think it is important that all P2P companies which offer financial products to consumers and small businesses are run in a way that ensures maximum safety for consumers.
The announcement by Treasury that P2P will indeed be regulated from 2014 is a victory for consumers, not regulators: a regulated P2P industry will bring even more security and transparency for consumers, and ensure that operators are sensible and credible businesses.
In 2013 RateSetter has already matched well over £10million between borrowers and lenders, yet continues to provide that efficient service you might feel is missing from your banking provider.
The Bank of You isn’t as far away as you might think. 
Lend-to-save: RateSetter has seen growth of 10% each month in loan volume in the last 12 months
Lend-to-save: RateSetter has seen growth of 10% each month in loan volume in the last 12 months

You will not get savings deposit protection but RateSetter does have a provision fund

At present, lend-to-save firms are not covered by the Financial Services Compensation Scheme (FSCS). This protects savers to the tune of £85,000 per institution if it goes bust.
They also do not benefit from the £50,000 FSCS investing protection. This covers loss arising from bad investment advice, poor investment management or misrepresentation, or alternatively when an authorised investment firm goes out of business and cannot return investments or money.
The way to think of lend-to-save is that it is an investment that offers savings-style rates. There is no guarantee you will get your money back, but the three big players involved we highlight here have put a lot of work into making sure borrowers do not default, make public their records and have many happy customers.
The three major lend-to-save firms set up the P2P Finance Association last year, which has a strict code of practice, including minimum capital requirements and other systems and controls.
None of the smaller lend-to-save firms have joined due to the stringent criteria.
The Association announced in December that the industry will be regulated by new financial body the Financial Conduct Authority (FCA) – but it remains to be seen whether this will include any protection on investors’ money.
However, RateSetter does have the added bonus of a ‘provision fund’ which the other two lend-to-save firms don’t have in place. Every borrower pays into this pot and if they miss a payment, the fund is called on to cover the lender.
The fund – currently sitting close to £1million – has met every claim that has been asked of it, RateSetter says.
It also takes a cautious approach to who can borrow, declining 85 per cent of all applications. For this reason, it says, it has the lowest default rates in the P2P sector.

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Elizabeth Warren Demands Jail for HSBC ‘Money Launderers’

Reader Supported News – by Chris Good, ABC News
Elizabeth Warren has a question: How much money does a bank have to launder before people go to jail?
Warren, the Democratic senator from Massachusetts and financial-regulatory maven, posed that question numerous times to financial regulators at a Senate Banking Committee hearing Thursday on banks and money laundering.
In December, U.S. Justice Department officials announced that HSBC, Europe’s largest bankwould pay a $1.92 billion fine after laundering $881 million for drug cartels in Mexico and Colombia. At the time, the Justice Department disputed accusations that it views some banks as too big to prosecute.
The two regulators, Under Secretary for Terrorism and Financial Intelligence David S. Cohen and Federal Reserve Governor Jerome H. Powell, deflected Warren’s questions, saying that criminal prosecutions are for the Justice Department to decide.
“If you’re caught with an ounce of cocaine, the chances are good you’re going to jail. If it happens repeatedly, you may go to jail for the rest of your life,” an exasperated Warren said, as she wrapped up her questioning. “But evidently, if you launder nearly a billion dollars for drug cartels and violate our international sanctions, your company pays a fine and you go home and sleep in your own bed at night – every single individual associated with this – and I just think that’s fundamentally wrong.”

RBS tries to dodge the spotlight on fat cat pay as 95 staff get over £1m

RBS revealed on Friday night it has paid packages of more than £1million to 95 staff, with one mystery banker receiving more than £5million and nine paid more than £3million.
The timing of the disclosures, which were only made after the markets closed yesterday, undermined claims by the state-backed bank that it is being more transparent on pay.
RBS also tried to dodge the spotlight by making its revelation on the same day as Barclays gave details of its multi-million pound packages for top staff, with 428 high-flying employees there receiving more than £1million.
RBS boss: Stephen Hester gave up his bonus for 2012 but received a £1.2million basic salary
RBS boss: Stephen Hester gave up his bonus for 2012 but received a £1.2million basic salary
Barclays chief executive Antony Jenkins was awarded a £2.6million package, including a £1.47million long term incentive award.  
The bonanza at both banks came after they were forced to pay hefty fines for Libor interest rate-rigging and to make multi-billion pound write-offs for PPI mis-selling.
RBS has also been in the firing line for IT meltdowns that have played havoc with customer accounts, the most recent of which happened only this week.
Details of the hundreds of casino banking millionaires – who are cashing in despite the economic downturn – were given in the two banks’ annual reports.
The documents for the first time broke down the number of people in different wage brackets.
Liberal Democrat peer Lord Oakeshott said: ‘RBS paid their four fattest cats £21million of our money last year, with 95 people paid over a million.
‘They’re the best paid public sector workers by a mile, in a bank that keeps letting down the public by failing to lend. Let’s end this nonsense and nationalise RBS now.’
Stephen Hester, the chief executive of RBS, gave up his bonus for 2012 but received a £1.2million basic salary, £420,000 cash in lieu of pension and a long term incentive plan that could deliver up to £1.6million in three years’ time.
In addition, this week he received a £700,000 share windfall from a bonus awarded in 2010.
Ellen Alemany, the boss of the US division, outstripped him with £3.8million pay and bonus and a long term incentive that could yield almost £1million.
Some 368 of senior ‘code’ staff – who could have an influence on the risk profile of the bank – received average pay and perks worth £701,000.
But the average member of staff received just £34,000.
Although the bank argues it has scaled back on pay and bonuses, these payments come after it unveiled a £5.2billion loss for last year.
They are also being doled out amid calls for RBS to be dismantled from Sir Mervyn King, who this week urged the government to ‘face up to reality’.
The Bank of England governor said ministers should split RBS into a good bank to lend to the economy and a bad bank containing all its toxic assets and loans.
RBS (up 3p to 306.2p) has insisted it is showing restraint on bonuses.
More information on RBS  shares at

UK workers suffer sharpest wage fall of any developed country as business leaders warn the pain is far from over

British workers have seen their wages plummet faster than any other workforce in a developed economy, a new study reveals today.
Real wages dropped by 4.5 per cent between 2007 and 2011, leaving workers with smaller incomes at a time of rising costs for basic necessities such as food, fuel, gas and electricity - not to mention housing costs.
This marks a considerably sharper squeeze than the 2.7 per cent fall in Italy or 0.7 per cent drop in Japan, according to the report from the TUC.
Squeezed incomes: British workers have seen their wages plummet further than any other developed country, according to the TUC
Squeezed incomes: British workers have seen their wages plummet further than any other developed country, according to the TUC
Meanwhile wages in Australia and Canada grew by 6.9 per cent and 5.4 per cent respectively.
The bulk of the decline was seen in 2011, the Coalition’s first full year in office, when wages shrank by 3.5 per cent – nearly twice as fast as in Spain, the second worst-performing economy that year.
The figures come as British business groups warned today that conditions in the UK economy are likely to remain tough for some time.

The British Chambers of Commerce has cut its economic growth forecast for this year to 0.6 per cent from a previous prediction of one per cent.
The BCC said the forecasts underline the challenges facing the UK economy, calling for the Chancellor to use his Budget later this month to deliver ‘radical measures’ to encourage businesses to create jobs, invest and export.
How we compare: Real wage growth between 2007 and 2011 in the world's top ten developed countries
How we compare: Real wage growth between 2007 and 2011 in the world's top ten developed countries
UK manufacturers also said conditions remained difficult, with weak market conditions both home and abroad.

The wage figures highlight the extent to which the recession and subsequent economic stagnation has squeezed the incomes of ordinary workers, the TUC said.

It added that the government’s austerity programme has made the squeeze on living standards even tighter by cutting vital tax credits and welfare support for low and middle-income families.

How Britain's wage growth compares to other G7 nations (Source: TUC)
How Britain's wage growth compares to other G7 nations (Source: TUC)
'While most countries have suffered periods of negative wage growth, no-one has witnessed such a marked decline as the UK,’ said TUC general secretary Frances O’Grady

'This government’s blind obedience to self-defeating austerity has ensured that we are leading the way when it comes to the squeeze on living standards. 

'Businesses desperately need people to spend money but employees are cutting back as their wages are squeezed. And the public sector, far from making up the gap, is being slashed too.

'Unless we get stronger economic growth with rising real wages consumer spending will remain weak and the economy will continue to flat-line.'

However David Cameron was set today to reiterate his commitment to the austerity drive designed to reduce the deficit, saying that the alternative is being plunged ‘back into the abyss’.

‘I know some people think it is being stubborn to stick to a plan, that somehow this is just about making the numbers add up with no care whatsoever for what it means for people affected by the changes we make,’ he said.
‘But nothing could be further from the truth. My motives for sticking to the plan are exactly about doing the right thing to help families and businesses.’
In a significant boost for Mr Cameron’s strategy, Tony Blair backed spending cuts yesterday – a rare intervention into domestic politics.
He said he believes reducing the deficit is more important than ‘left versus right’.

Shadow Treasury Minister Cathy Jamieson, said of the wage figures: 'These shocking figures show that a flatlining economy under David Cameron and George Osborne has led to a sharp fall in living standards since 2010. We are losing in the global race with the biggest decline in real wages of any of the world's top ten economies.
Challenges ahead: The Prime Minister, speaking during Prime Minister's Questions yesterday, will admit that the challenges facing the economy are 'huge'
Challenges ahead: The Prime Minister, speaking during Prime Minister's Questions yesterday, will admit that the challenges facing the economy are 'huge'
‘Urgent action is needed in this month's Budget to kick-start our stagnant economy and help people on middle and low incomes struggling with the rising cost of living.
'The top rate tax cut for millionaires should be cancelled and a new lower 10p starting rate of tax introduced to help millions on middle and modest incomes, and to boost growth we need to bring forward infrastructure investment, build thousands of affordable homes and give tax breaks to small firms taking on extra workers.’
Graph showing GDP estimates and revisions from the last quarter of 2008 to the end of 2012 (Source: ONS)
Graph showing GDP estimates and revisions from the last quarter of 2008 to the end of 2012 (Source: ONS)
While average wages have fallen, non-executive chairmen of top companies received average pay rises of 6 per cent last year, taking their earnings to almost £400,000, another study has revealed.
Pay analysts Incomes Data Services (IDS) said non-executive pay among FTSE 100 firms on average ranged from £270,000 in technology businesses to over £500,000 in oil and gas companies.
Average fees for non-executive directors (NEDs) increased by 4 per cent last year to £64,000 - double the amount of 12 years ago.

Wells Fargo Typo Victim Dies in Court

On the morning of Dec. 19, 2012, in a Torrance courtroom, Larry Delassus' heart stopped as he watched his attorney argue his negligence and discrimination case against banking behemoth Wells Fargo.
Debbie Popovich at the garden she worked on with Larry Delassus
Debbie Popovich at the garden she worked on with Larry Delassus

His death came more than two years after Wells Fargo mistakenly mixed up his Hermosa Beach address with that of a neighbor in the same condo complex. The bank's typo led Wells Fargo to demand that Delassus pay $13,361.90 ­— two years of late property taxes the bank said it had paid on his behalf in order to keep his Wells Fargo mortgage afloat.
But Delassus, a quiet man who suffered from the rare blood-clot disorder Budd-Chiari syndrome and was often hospitalized, didn't owe a penny in taxes.
One of his neighbors, whose condo "parcel number" was two digits different from Delassus', owed the back taxes.
In a series of painfully tragic events, Wells Fargo relied on its typographical error to double Delassus' mortgage — from $1,237.69 to $2,429.13 — as its way of recouping the $13,361.90 in taxes Delassus didn't owe. Delassus, a retiree living on a $1,655 check, couldn't meet the mysteriously increased mortgage. He stopped paying, and soon was far behind on his mortgage.
Delassus and his attorney did not discover until May 2010 that a mis-entered number had dragged Delassus into this spiral. As court documents obtained by L.A. Weekly show, after admitting its error, Wells Fargo foreclosed on Delassus anyway and sold his condo.
Delassus had to move to a tiny apartment in an assisted-living home in Carson.
Friends say he didn't die of heart disease that day in court, as the coroner found. He was, they believe, killed by a system so inhumane that it could not undo a devastating piece of red tape the system itself created.
"He was very sensitive," says close friend Debbie Popovich, 59. "He was a very good person. He was kind of shy, and he had a really good sense of humor — really, he was a very simple guy who just liked to work and do his thing."
In 1995, Delassus bought condo No. 105 at 320 Hermosa Beach Ave. The building, a white-stucco affair with blue trim, on a busy road with a grassy divider, is unremarkable, but a view of the Pacific glints in through the beach-facing windows.
A neighbor, who gave her name only as Kelly, says Delassus participated in the homeowners association and helped around the complex. But the Navy veteran from St. Louis often was sick from Budd-Chiari syndrome, which made simple tasks difficult and could cause mental confusion.
"Larry loved his home," Kelly says. "He wanted to die in that house."
Delassus got the first odd letter from Wells Fargo on Jan. 29, 2009. It informed him that Wells' tax service provider, First American Real Estate Tax Service, "reported delinquent taxes for the property located at: 320 Hermosa Beach Avenue 105."
Delassus, told that he owed taxes of $13,361.90 for 2007 and '08, was baffled. His attorney Anthony Trujillo, a friend and next-door neighbor, says Delassus was actually six months ahead on his taxes, which he paid directly to L.A. County.
On March 9, 2009, according to court documents, the bank informed Delassus that it was doubling his monthly mortgage payment to $2,429.13 to recoup the $13,361.90 in taxes.
"He came to me and told me what was going on" a couple of months later, Trujillo says. At that point, neither man knew that a bank typo was to blame. In December 2009, Wells Fargo notified Delassus that it intended to foreclose.
Then in May 2010, Trujillo discovered the erroneous fine print in Wells Fargo's original 2009 letter to Delassus — the "parcel number" off by two digits and belonging to somebody else.
In court documents later, Wells Fargo attorney Robert Bailey of Anglin Flewelling Rasmussen Campbell & Trytten LLP admitted the bank's mistake: "Wells Fargo paid the amount it determined was owed to the County Assessor: approximately $10,500. This was a mistake. The $10,500 was the tax amount owed on a neighboring property, not Plaintiff's." (Bailey did not address the discrepancy between $13,361 and $10,500.)
Bailey added: "In September, 2010 Wells Fargo acknowledged its error in paying the taxes on Plaintiff's neighbor's property and corrected it." By then, however, Delassus was so far behind on his mortgage payments wrongly doubled by Wells Fargo that the bank refused to let him resume his $1,237.69 installments, Trujillo says. He faced a sizable "reinstatement" cost — which is often the past due amount plus fees.
In an unsettling new twist, Delassus couldn't get Wells Fargo to tell him how much his reinstatement cost was. Later, in a videotaped deposition, Trujillo asks Michael Dolan, a litigation-support manager for Wells Fargo: "So Plaintiff was never provided with the reinstatement amount after the bank discovered its error, correct?"
Dolan responds, "That is correct."
Delassus and Trujillo — who is a business litigator but not a mortgage attorney — could have sought help from the Consumer Financial Protection Bureau, or from the Comptroller of the Currency in Washington, D.C., says Brian Hubbard, spokesman for the comptroller's office. But neither man knew about this outside help.
On Jan. 19, 2011, Trujillo videotaped Delassus on the phone, quietly speaking to a Wells Fargo representative. (Wachovia merged with Wells Fargo in December of 2008.) "Wachovia's never sent me how much my monthly payments would be, if that includes escrow or anything," Delassus says to the bank. "I'm kind of in the dark here. Reinstatement ... what would that be?"
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Look at the graph to see the evidence of global warming

Met Office data show only a tiny change in world temperatures

The figures on warming don't match the hype
The figures on warming don't match the hype Photo: NASA
Readers of this column do not need to be reminded why it is so important for us to know whether the world is truly in the grip of runaway global warming, or whether this belief has all been based on a colossal misreading of the scientific evidence. One reason why it is so vital for us to understand this, of course, has been all those devastating political responses to this fear, which promise to change our way of life out of recognition.
Just in Britain alone, paying for our Climate Change Act is officially due to cost us up to £18 billion a year. It is now driving our entire national energy policy, threatening us with ever more crippling bills, power blackouts, and the sight of our countryside being covered in ever more giant wind factories. In convincing the world that we must make such a dramatic response to man-made climate change, nothing has been more persuasive than those graphs that purport to show global temperature soaring to dangerous levels.
That iconic “hockey stick” graph, showing temperatures recently shooting up into the stratosphere, may now have been discredited. But just as important have been all those graphs showing how temperatures have changed in recent decades. These have the effect of greatly exaggerating those changes, by narrowly focusing just on what are called temperature “anomalies”, showing how they have risen and fallen round their average level in the past 30-odd years.
What the graphs do not show is the actual level of global temperature, as it is measured above freezing point. In other words, they leave out by far the greater part of the total picture. So the respected Canadian environmental writer, Lawrence Solomon, recently had the bright idea of publishing in his Financial Post newspaper column a graph showing the temperature changes of the past 15 years in proper perspective, using figures from the most prestigious of all official temperature records, compiled by the UK Met Office and its Hadley Centre.
The result, as can be seen here, is startling. By including that huge part of the data usually left out, we see that the line looks virtually flat. The actual changes look relatively so small, compared with those rises and falls of several whole degrees the world survived in the past, that any idea that we are facing catastrophic warming pales into insignificance. In recent months, even such fanatical proponents of the warmist orthodoxy as Rajendra Pachauri, chairman of the UN’s Intergovernmental Panel on Climate Change, James Hansen of Nasa, and the Met Office have all had to concede that since 1997, the warming trend has stalled virtually to a standstill. Of course, there was a modest temperature rise in the 20th century, as a continuation of the warming that began 200 years ago as the world naturally emerged from those centuries of cooling known as the Little Ice Age. But the 0.5C rise between 1976 and 1998 was no greater than the 0.5C rise between 1910 and 1940 (with 35 years of cooling between them, so that the net rise in the past century has been only 0.8C).
Yet it was on that modest rise in the 1980s and 1990s that the whole of the greatest and most expensive scare in history was launched on its way, with all the terrifying political and economic consequences we see around us today. The very last people to recognise this, alas, will be our politicians, because they seem incapable of looking properly at the evidence. The price we are all increasingly having to pay for their gullibility is incalculable.

Debenhams joins the big squeeze as retailers force cuts and payment delays on suppliers

Textiles: Smaller companies are experiencing cash-flow problems due to their larger counterparts delaying payments
Textiles: Smaller companies are experiencing cash-flow problems due to their larger counterparts delaying payments
Department store giant Debenhams has been slammed for forcing some of its suppliers to cut their prices by at least two per cent, and even backdating reductions for orders that are already agreed.
Debenhams has hit other suppliers by delaying their payments to 120 days instead of 90.
The squeeze on Britain’s high streets is driving some big retailers to raise the pressure on smaller suppliers to cut prices, increasing the pain of the downturn for those least able to cope, say critics.
Debenhams last week issued a profit warning that led to its shares falling by 14 per cent. It blamed poor weather, in particular snow, for a fall in sales in January. As a result it is predicting pre-tax profits of £120million for the first six months of the year, down from the £130million that analysts were expecting.
Last month, fashion chain Monsoon was fiercely criticised for delaying payment to suppliers from 60 days to 90 days and forcing them to discount their bills by four per cent.
In December last year, mobile phones giant O2, owned by Spain’s Telefonica, ratcheted up payment times from 60 to 90 days to a staggering 180 days.
Late payment and the huge pressure it puts on small businesses is becoming an increasingly vexed issue. Experts estimate that suppliers are waiting for £36billion in outstanding payments.
A survey by Lloyds Banking Group found that 35 per cent of small and medium-sized firms were suffering cash flow problems as a result of larger companies delaying payment.

One supplier told Financial Mail: ‘We are being used like an extension of a retailer’s overdraft facility. It’s a cheap and easy way for them to boost profit margins in the short term. But in the long term all it does is drive suppliers out of business and kill off innovation.’
He said that two years ago Debenhams offered to pay invoices early – but only if suppliers agreed to a price cut.
Last month the Government appointed Christine Tacon as the first Groceries Adjudicator, to ensure suppliers were not bullied into accepting retrospective changes to contracts. But the watchdog’s remit applies only to supermarkets.
Getting tough: Debenhams is pushing for a 2 per cent price cut from suppliers
Getting tough: Debenhams is pushing for a 2 per cent price cut from suppliers
In January, Business Minister Michael Fallon launched a drive to increase the number of FTSE 100 and 250 companies signed up to the Prompt Payment Code, under which they pledge to stick to agreed payment terms. Since launching the campaign, the number of FTSE 350 companies signed up to the code has risen by more than a third to 132.
However, the code itself has come under criticism, with experts pointing out that there is no requirement for companies that are signed up to pay quickly, only to pay within the time stated. So businesses with payment terms of 180 days could still belong to the code.
In an email sent to a number of suppliers, Debenhams said: ‘There is an expectation that we will get a minimum cost price reduction of two per cent across all ranges, and that this will be retrospectively applied across all orders due for delivery from March 4th 2013 onwards’. It gave firms until last Friday to respond.
Debenhams defended the decision to force some suppliers to offer a discount, as well as the move to 120-day payment.
It said: ‘We work in close partnership with our suppliers and seek to build mutually beneficial long-term relationships with them.
‘Last week one of our buyers wrote to eleven suppliers of bed linen asking for a small discount on current and future orders, reflecting the strong performance of the product categories they  supply. It is not unusual for retailers to ask for improved terms when larger orders are being placed.
Holding back: O2 is delaying payments to suppliers by up to 180 days - increased from 90
Holding back: O2 is delaying payments to suppliers by up to 180 days - increased from 90
Demand: Monsoon is increasing its delay in paying suppliers from 60 to 90 days
Demand: Monsoon is increasing its delay in paying suppliers from 60 to 90 days
‘Since 2007 our standard terms have been 120 days. Where suppliers have not been on these standard terms, we have been gradually moving them on to them.’
While Debenhams has denied that the decision to force suppliers to discount their goods is part of a wider change in strategy or terms, the Forum of Private Business is sceptical.
Spokesman Rob Downes said: ‘Are we to believe this was a one-off by a rogue buyer, or can other small businesses who supply Debenhams with popular lines expect similar underhand treatment in future?
‘Debenhams is keen to stress that this isn’t indicative of any wider policy. But this isn’t a company with a great track record for looking after suppliers by paying promptly.
‘These sound like desperate measures by a firm which only last week announced a huge dip in profits, and quite brazenly now wants to share the pain with suppliers.’

The International Monetary System & The Future Of Money

MIND BLOWING lecture by Shiekh (not Sheikh) Imran Hosein on the how & why of the inevitable collapse of the dollar and the paper money system.
If you – like me, are not into (organized) religion, you should skip the first 10 minutes and start the video at 10:30.
(And of course, when you’re not completely satisfied – but you will be, a refund of your valuable time is guaranteed under the GLP No Nonsense Act of 1876)

Credit Card Debt Explained With a Glass of Water

A World’s Record: More Than 30% of U.S. Population Unemployed

The number of Americans designated as “not in the labor force” in February was 89,304,000, a record high, up from 89,008,000 in January, according to the Department of Labor. This means that the number of Americans not in the labor force increased 296,000 between January and February.
The Bureau of Labor Statistics (BLS) labels people who are unemployed and no longer looking for work as “not in the labor force,” including people who have retired on schedule, taken early retirement, or simply given up looking for work.
The increase marks the second month in a row, after rising in January from 88.8 million in December. Those not in the labor force had declined in December from 88.9 million in November.
89 million not in the labor force =  29%, give or take, assuming the US population is 310,000,000 + official unemployment 7.7%

Another all-time high for the Dow.

First the scoreboard:
Dow: 14,390, +61.4 pts, +0.4 percent
S&P 500: 1,551, +6.9 pts, +0.4 percent
NASDAQ: 3,244, +12.2 pts, +0.3 percent

Bank compensation up in 2012 despite cutback efforts

Traders work on the floor of the New York Stock Exchange near the Goldman Sachs stall July 16, 2010. REUTERS/Brendan McDermid
Reuters-by Laura Noonan 

(Reuters) – Compensation at the world’s biggestbanks rose last year, with 35 of them spending a combined 10 billion euros ($13.1 billion) more on staff than in 2011, figures compiled by Reuters show.
Bankers’ remuneration has rarely been out of the spotlight over the last five years, as the industry’s powerhouses were rescued from the brink during the financial crisis with hundreds of billions of taxpayers’ dollars.
Policymakers have since fought to curb the bonuses they say encouraged excessive – and sometimes catastrophic – risk-taking.
Capping absolute pay levels is off-limits for regulators, but banks have talked a lot about cutting staff costs.
Reuters analyzed the 2012 results reported by banks in the benchmark EuroStoxx 600 index and their U.S. competitors and found staff costs rose to 275 billion euros across the group.
Two thirds of the banks analyzed increased compensation per person, though several attributed this at least in part to redundancy issues. The compensation ratio – the industry’s preferred yardstick, which measures staff expenses against revenue – was up for 18 of the 35 banks.
Philippe Lamberts, a Belgian MEP who has also been outspoken on bank pay and supported a cap on bank bonuses recently agreed by members of the European Parliament, says the figures prove that, left to their own devices, banks do not reduce pay.
“To me it confirms that what we are doing on the remuneration front is necessary,” said Lamberts, referring to efforts to restrict remuneration through bonus rules and other provisions in a European Union package of bank regulations.
A recent survey from recruitment agency Morgan McKinley showed that bank staff who changed jobs in London in January enjoyed average pay rises of 23 percent.
But banks baulk at the suggestion they are paying staff more, saying things are more complex than the figures suggest.
U.S. retail banking giant Wells Fargo, however, was comfortable with the fact that per-person compensation went up about 2 percent last year and stands at the equivalent of 83,000 euros, placing the bank at the middle of the compensation table.
“We support our team members as a competitive advantage and are committed to compensating them based on performance,” a spokeswoman said. The bank recorded pretax earnings of 28.5 billion euros in 2012, up from 23.7 billion euros in 2011.
Among other banks, it was not uncommon for per-person compensation to outstrip the rise in pretax profits. In eight of those where per-person compensation rose, pretax profit fell.
In another three cases, per-capita compensation went up, even though the banks actually recorded losses.
Banks say the figures can be deceptive. They have been cutting jobs, with 93,000 shed across the group in 2012, falling heaviest on some of the loss makers. The lay-offs incur redundancy costs that are grouped in with overall staff compensation, which also includes pensions and payroll taxes.
The per-head figures used are based on year-end headcount, since several banks have not released average headcount figures and declined to provide them to Reuters.
That means that if a significant number of staff left in the year, the per-person staff costs are overstated. Since year-end headcount is also used to calculate per-person costs for 2011, however, when banks also mostly laid off staff, the broad figures provide a consistent basis for comparison.
Where average headcount figures are available, these can show material differences. Bank of Ireland, still 15 percent state-owned, does disclose them, showing the bank’s per-person compensation rose just under 4 percent. Year-end figures overstate it at 9.5 percent. Even so, it was a year when the bank’s losses rose more than tenfold to 2.1 billion euros.
The highest per-head rise using year-end figures is Danske Bank, where Reuters figures show an 11 percent rise.
“The figures do not reflect actual developments in pay for Danske Bank employees,” said Bent Jespersen, senior vice president at the Danish bank.
Jespersen said a union deal to increase wages 1 percent, plus “minor individual adjustments”, pushed pay up. Staff departures also hit headcount, the bank said, a factor also cited by Switzerland’s Banque Cantonale Vaudoise, which had the fourth highest increase in compensation per capita.
At Deutsche Bank, where per-head costs rose 5.9 percent, a spokeswoman said the figures included an element of deferred bonuses granted in 2009. Deutsche Bank also booked significant severance payments over the year, she said.
Investment banking giant Goldman Sachs, which saw an 8.8 percent rise, had the third-highest increase in per-head payroll costs. Goldman, which declined comment, also tops the table for highest average pay, at the equivalent of 310,000 euros, based on average euro/dollar exchange rates for 2012.
A source at another investment bank included in the analysis pointed out that their average staff costs were not comparable with banks that had large retail operations, where staff costs are lower. It said compensation ratios were more revealing.
For Goldman, pretax profit growth of 82 percent easily beat the rise in average compensation, and its compensation ratio actually fell to 38 percent in 2012 from 42 percent in 2011.
But across all the banks analyzed, the compensation ratio came in at just under 36 percent, up from 34 percent in 2011.
Sony Kapoor, managing director of think-tank Re-Define, which advises lawmakers on issues including banks, said European policymakers had examined restricting compensation ratios.
“It was very hard to apply at an aggregate level,” he said, pointing out that it was difficult to set a level that would capture the diverse operations of different kinds of banks.
Though some will admit to enjoying the fruits of an improved remuneration climate, the feeling that they are being hard done by is hanging over the bank towers of London’s Canary Wharf.
On New York’s Wall Street it is a similar story.
A senior executive at one of the biggest U.S. banks said traders and bankers have been comparing their pay packages to 2009, a banner year for Wall Street profits and bonuses.
Even those who performed well and got bigger bonuses last year feel they are not being compensated adequately, he said.
Policymakers say bankers are being paid too much based on the levels shown in the Reuters data, where average compensation costs per head were 87,400 euros across 3.25 million staff.
Shareholders are pushing for more of banks’ returns to be channeled to them, and less to staff. MEP Lamberts said governments that have bailed out banks should force pay cuts.
“People get very angry about it in state-supported banks because they think, ‘That’s our money here; why are they still being paid so much?’” said UK MEP Sharon Bowles, who chairs the European Parliament’s Economic and Monetary Affairs Committee.
But not everyone agrees that less is better, including Federation of European Employers’ head Robin Charter.
“What politicians and bureaucrats have always ignored is that high remuneration levels in the financial sector – and especially substantial variable payments – serve to minimize fraud levels, retain talent, drive high performance and encourage continuity of employment.”
(Additional reporting by Lauren Tara LaCapra and Himanshu Ojha in New York and Anjuli Davies and Sinead Cruise in London.; Reporting By Laura Noonan; Editing by Alexander Smith and Will Waterman)

Beppe Grillo about the money system - Stand up show 1998 - English / Deu...

Bulgarians protesters demand stop of state railway sale

Waving national flags and chanting "Mafia" and "Let's get our the state back" about 600 protesters blocked all railway tracks at the central station in Sofia.

World Bulletin / News Desk
Hundreds of Bulgarian anti-corruption demonstrators took to the streets for a fourth straight Sunday, demanding a halt to the planned selloff of the state railway's cargo unit and an audit of all privatisation deals.
Street demonstrations brought down the centre-right government of Boiko Borisov last month and have continued since then, although numbers were smaller on Sunday, indicating protests may be losing steam.
The Balkan country is headed towards early election on May 12 with Borisov's party and Socialists neck-to-neck in opinion polls, making it likely that forming a government will be difficult and political uncertainty will continue.
Early on Sunday a 53-year old father of five who set himself on fire last month in desperation from poverty in the central town of Radnevo died from his burns, becoming the third victim of self-immolation since the protests started.
With average monthly salaries of just 400 euros ($520) and pensions half of that, Bulgarians have the lowest living standards in the EU. They blame consecutive governments for doing too little to improve their lives and fight rampant crime and corruption.
Waving national flags and chanting "Mafia" and "Let's get our the state back" about 600 protesters blocked all railway tracks at the central station in Sofia. About 1,000 people blocked rail tracks in the Black Sea city of Varna.
"The deal should be put off until there is a working government and parliament, so that the process be transparent and citizens can exercise controls," said Ivailo Vasilev, one of the organisers of the protest in Varna, referring to the planned privatisation of the cargo unit of railway operator BDZ.
Bulgaria is awaiting binding bids for the sale of the unit by March 12 in a deal estimated at about 100 million levs ($66.38 million). Proceeds will be used to ease BDZ's debts and allow it to tap a new loan from the World Bank.
But protesters fear the sale could be corrupt and lead to mass layoffs. They called on President Rosen Plevneliev, who is to form an interim government next week, to carry out an audit in all selloffs since the fall of communism two decades ago.
Dozens of people blocked the road to neighbouring Greece near the city of Blagoevgrad in protest against high utility bills and monopolies. Protests were held in at least 15 other cities.
The outgoing government cut electricity prices by an average of 7 percent and has launched a process to revoke the licence of power distributor CEZ, but these steps have failed to quell public discontent.
Plevneliev has pledged to appoint a technocrat caretaker government that will maintain fiscal stability.
($1 = 1.5066 Bulgarian levs) ($1 = 0.7703 euros)

February employment report masks depth of US jobs crisis

By Andre Damon
The number of jobs in the US grew by 236,000 in February, and the official unemployment rate fell to its lowest level since 2008, according to the Labor Department’s latest jobs report released Friday.

The media jumped on the jobs total—significantly higher than the 165,000 that had been predicted—to proclaim an economic turnaround, while the Obama White House said the report indicated that “the recovery that began in mid-2009 is gaining traction.”
In reality, the jobs gained are a drop in the bucket compared to those lost during the recession. In the downturn that started in 2008, the US economy lost 8.9 million jobs, and if previous economic trends had continued, another 5.9 million jobs would have been added. Since the end of 2009, the economy has added only 5.7 million jobs.
At February’s rate of job growth, the US economy would not get back to the pre-recession level of unemployment until 2017.
By and large, the new jobs created pay much less than those lost during the crash. According to Friday’s figures, average hourly earnings for production workers have risen by only 2 percent over the past year, a figure wiped out by rising prices.
In addition to paying lower wages, an increasing number of new jobs are part time. Compared to late 2007, 5.8 million fewer people in the US are now working full time, but 2.8 million more are working part time. The share of people working part-time has grown from 16.9 percent at the start of the recession to 19.2 percent today.
Even as payrolls increased in February, a significant number of people simply stopped looking for work and dropped out of the labor force. With 130,000 people dropping out of the workforce, the labor force participation rate fell to 63.5 percent, the lowest level in over three decades.
The percentage of the population that is employed fell from 63.3 percent in February 2007 to 58.5 percent in February 2010. This figure has stayed essentially unchanged at that level since then, with the latest figure coming in at 58.5 percent.
Long-term unemployment has likewise increased significantly in the most recent report. The percentage of unemployed people who have been out of work for more than half a year hit 40.2 percent in February, up from 38.1 in January. At the end of December 2007, this figure stood at 17.4 percent.
The latest jobs report came after a surprise drop in the United States’ gross domestic product in the fourth quarter of 2012, which was revised up to a growth of only 0.1 percent. The combined economies of the advanced industrial countries in that quarter shrank by 0.2 percent.
The US public sector once again shed jobs in February, losing 10,000 positions. Since June 2009, 742,000 state, local, and federal jobs have been eliminated, half of those in public education.
The slashing of government jobs is only likely to intensify with last week’s passage of $1.2 trillion in ‘sequester’ job cuts. According to the Congressional Budget Office, the imposition of the sequester will result in 750,000 job losses, and significantly increase the unemployment rate.
Friday’s US jobs report appeared the same day the DOW Jones Industrial average hit the highest level in its history. The corporate cash hoard has likewise reached a new record, hitting an estimated $1.79 trillion in the fourth quarter of last year, up from $1.77 trillion in the previous quarter. Instead of investing the money, however, companies are using it to buy back their own stock and pay out record dividends.
Corporations have sharply increased dividend payments to investors. The New York Times reported Friday that S&P 500 companies are expected to pay over $300 billion in dividends this year, a sharp increase over last year’s payout of $282 billion. American corporations bought back $117.8 billion in their own stock last month, the highest total on records going back to 1985.
“Corporations are flush with cash and that cash sitting in the corporate coffers is earning next to nothing,” Rob Leiphart, an analyst at Birinyi, told the Times. “Companies have to do something with it.”
The rise in corporate stock buy-backs harkens back to the period prior to the 2008 crash. As the Times noted, “Similar buyback activity occurred the last time stocks hit record highs. During the housing boom that ended in 2007, S&P 500 companies ramped up their share buybacks to what were the highest levels in history.”
After four years of “recovery,” the US economy is nowhere near its pre-recession level of unemployment. Instead of investing in production, major corporations, flush with cash and with their stock at record levels, are paying out dividends and inflating their own stock values.
These actions work to further enrich the financial elite, which has seen its wealth increase dramatically with the rise of the stock market. This is made possible in large measure by the US Federal Reserve’s vastly expansionary monetary policy, which is throwing $85 billion a month into financial markets and ultimately into the coffers of the super-rich.
The unprecedented combination of mass unemployment, falling wages and an influx of free money from the Federal Reserve has led to a boom in corporate profits, which have set records for three years in a row. In the third quarter of 2012, corporate profits as a percentage of the total economy were 14.2 percent, the highest level on record going back to 1950, while the share of national income that went to workers, 61.7 percent, was at its lowest level in nearly five decades.

Fed Injects Record $100 Billion Cash Into Foreign Banks Operating In The US In Past Week

Those who have been following our exclusive series of the Fed's direct bailout of European banks (here, here, here and here), and, indirectly of Europe, will not be surprised at all to learn that in the week ended February 27, or the week in which Europe went into a however brief tailspin following the shocking defeat of Bersani in the Italian elections, and an even more shocking victory by Berlusconi and Grillo, leading to a political vacuum and a hung parliament, the Fed injected a record $99 billion of excess reserves into foreign banks. As the most recent H.8 statement makes very clear, soared from $836 billion to a near-record $936 billion, or a $99.3 billion reserve "reallocation" in the form of cash - very, very fungible cash - into foreign (read European) banks in one week.

Furthermore, as we first showed, virtually all the "reserves" created by the Fed end up allocated as cash at commercial banks operating in the US: both domestically-chartered (small and large), but more importantly, foreign. And of the $1.884 trillion in very fungible cash parked in various domestic and international US banks, just half of it, or $949 billion is actually allocated to US banks. The other half, or $936 billion, is parked within, again, very fungible cash accounts of foreign (read European) banks operating in the US. This is shown in the chart below (green area is cash of foreign banks), and what is also shown is the total change in the Fed's excess reserves, which proves, once more, that the Fed continues to fund European banks with hundreds of billions in cash on a week by week basis. And what is perhaps most important, is that of the $250 billion in new reserves created under QEternity, all of it has gone to foreign (read European) banks.

It may anger American to learn that by the time the Fed is done with QEternity (if ever), all of the newly created cash will have gone to mostly European banks. Because with every passing week, whatever new reserves are created by the Fed in exchange for monetizing the US deficit, end up as cash solely at European banks: a sad reality we have seen non-stop since the advent of QE2 when US bank cash balances remained relatively flat in the ~$800 billion range, and every incremental dollar went straight to Europe.
As a reminder, we don't know how, via assorted shadow banking and other repo pathways, these banks manage to use said cash in other fungible activities. Recall that as we said, "So whether European banks will continue buying the EURUSD, or redirect their Fed-cash into purchasing the ES outright, or invest in other even riskier assets, remains unknown." It is also unknown is the Fed's reserves, reappearing as cash, and then siphoned over to European bank HoldCo via payables, is then used by, say, Italian and Spanish banks to purchase BTPs and Bonos, and give the impression that all is well. Because unlike before, keeping the EURUSD high is not as critical any more. But what is critical is to give the impression that Italian and Spanish sovereign risk is contained. And after all, let's not forget that as of January, Italian bank holdings of Italy state bonds just hit a record of EUR200 billion.
Is it possible that the Fed, in all its generosity, transferred over several hundred billion over to these same Italian banks, courtesy of the cover provided by QE, so that the same Italian banks may monetize Italian bank bonds? And the same for Spain. Any wonder then that we got news of how flyingly great Spanish and Italian bond auction were in the past week?
After all, in Europe Germany has a heart attack whenever anyone perceives the ECB as monetizing, or even greenlighting the monetization of local sovereign bonds. But Germany has never said what it thinks about the Fed, indirectly, doing the same, using Italian and Spanish banks as conduits.
Finally, while we don't know what the cash is being used for, we know that sooner or later, sometime around December 2013, when European, pardon, foreign bank holdings of US reserves, i.e., USD cash, hits well over $1.5 trillion, and when the Interest on Excess Reserves starts going up and the Fed is directly providing tens of billions in interest payment to European banks, some Americans may be angry to quite angry with that development.
But for now, everyone is blissfully unaware and even if they were, nobody cares. Why just look at the Dow Jones Industrial Average: how can one possibly allege that all is not well with the world...
Source: H.8

Every “Record” Dow Jones Point Costs $200 Million In Federal Debt

Source: Zero Hedge

The past week brought us history: on Tuesday, GETCO and Citadel’s HFT algos were used by the Primary Dealers and the Fed to send the Dow Jones to all time highs, subsequently pushing it to new all time highs every single day of the week, and higher on 8 of the past 9 days: a 5ish sigma event. But there is never such a thing as a free lunch. And here is the invoice: in the past 5 days alone, total Federal Debt rose from$16.640 trillion to $16.701 trillion as of moments ago: an increase of $61 billion in five days, amounting to $198,697,068 for every of the 307 Dow Jones Industrial Average points “gained” this week. Because remember: US debt is the asset that allows the Fed to engage in monetization and as a result, hand over trillions in fungible reserves to banks… mostly foreign banks.

From Debt to the Penny:
Every Record Dow Jones Point Costs $200 Million In Federal Debt total%20debt
The good news is that debt is no longer and issue, and only the level of the stock market matters. Because if the wealth effect at $16.7 trillion and a record DJIA is staggering, just wait until the Obama administration takes the debt to $22 trillion in under 4 years.
At that point, nobody will have ever ever have had more money. Sadly, at some point, all that money will be used to buy a loaf of bread….

End Of the Road Documentary - How money Became Worthless

End Of the Road Documentary - How money Became... by dede15v

Iraq May Be Broken, But It Is Our Political Class That Is Bankrupted

Virtually nothing has been learned, and now history is repeating itself

By George Galloway

March 10, 2013 "Information Clearing House" - "The Independent" --   The finest of all journalists in the English-speaking world, Claud Cockburn, said:
“Believe nothing until it has been officially denied.” This basic rubric of the trade was all but abandoned a decade ago in the run-up to the war on Iraq, when every official claim was assumed to be true and those who denied it were treated as bad, or even mad. One honourable exception was Cockburn’s son, Patrick, in The Independent, an exception continued in his magisterial look back in anger in this newspaper over the past week. If journalism is history’s first draft, then Patrick Cockburn’s work on Iraq will prove to be close to the finished article.
I mention this not just because I remain bitter at the role of the fourth estate in helping to bring about such slaughter and, a decade later, such ongoing misery in Iraq. But because virtually nothing has been learned, and history is repeating itself over and over again – in Libya, Mali, Syria.
Bob Dylan said in “Stuck Inside of Mobile With the Memphis Blues Again” that “you have to pay to get out of, going through all this twice...”. For the most part, the bill continues to be paid by others, and elsewhere. For now.
Even for someone with my experience, such militarised mendacity can still take the breath away. How many times did you read and listen in the past few days to pontificating pundits tell you that Hugo Chavez had “wrecked” the Venezuelan economy, without a whiff of self-consciousness about the state of our own and that of the United States? That Chavez’s Venezuela was a “divided” society; as if Bush, Obama, Cameron, and Osborne led governments of national unity?
To briefly recap; a huge right-wing conspiracy was mounted 10 years ago to manufacture a case to wage aggressive war (pace Nuremberg, the “ultimate crime”) upon Iraq. It involved government ministers (some still swilling around profitably in the detritus they created); intelligence agencies and the spin doctors controlling them; craven parliamentarians scarcely worthy of the name; and a veritable army of scribblers, autocue readers, laptop bombardiers and think-tankers.
Add a sprinkling of useful idiots calling themselves “liberals”, and the blue touchpaper was lit. A million died, thousands of them British and American. Millions spread as refugees around the world. A country was dismembered, never to be reassembled. Extremism cascaded around the world, blowing itself up even aboard London buses.
The whole “humanitarian” show is best remembered in the pictures from Abu Ghraib. A female American soldier, cigarette dangling from her curling lip, leading a hooded naked Iraqi prisoner like a dog on a chain. Piling naked helpless Iraqi prisoners on top of each other and forcing them to commit indecent acts, videoing it all for the entertainment of the barracks later. Those tempted to imagine this was American exceptionalism should read the proceedings of the London court this week where, inter alia, we learned of the Iraqi corpse who may or may not have walked into British custody alive, but who surely was handed back to his family minus his penis. It doesn’t get much uglier than this, especially when it’s all dressed up in the livery of liberal “intervention”.
Millions of us knew that it would end this way, even before it became clear that the entire conspiracy was built on the tower – bigger than Babel – of lies around “weapons of mass destruction”. There were none. But the weapons of mass deception deployed by the conspirators remain in fine fettle. And none of them has even been properly inspected yet. No one has been held to account; not a single head has rolled. Except those of a million Iraqis.
When the Chilcot Inquiry was announced, I denounced it in Parliament as a parade of establishment duffers, two of whom at least had been among the intellectual authors of the disaster, one of whom had described Bush and Blair as the Roosevelt and Churchill de nos jours. I pointed out that there was not a single legal personality on the Inquiry, or a soldier. And not a Douglas Hurd or a Menzies Campbell among them either. That no one could be summoned, nor their papers either. That no one would be testifying under oath. That must have been three years ago now. Little did I know that the Chilcot report would be as slow in coming as the judgement day.
Iraq is broken now, and as Cockburn’s recent reports show, Iraqi hearts haven’t mended either. It was a disaster, the greatest British policy failure since the First World War.
But for as long as its lessons are not learned, the Iraqis will not be the last such victims. The Iraq war bankrupted the British and American political class. They no longer speak for the people they claim to represent. Few believe any longer anything they say. Long before Leveson summed up the venality of much of the media – the echo chamber of that class – the people were abandoning that media in droves. Like our other institutions – the banks and the police, to name but two – their credibility stands in ruins. Devastated even more starkly than were Fallujah, Amariyah and Baghdad.
Saddam’s presidential palaces turned out to be bare, but not as bereft as the democratic political leaders who propelled him to the gallows. The trap door has opened for them. And they are still falling.
George Galloway is the Respect MP for Bradford West
Twitter: @georgegalloway