Baltic Dry Index. 781 +16
LIR Gold Target by 2019: $30,000. Revised due to QE programs.
Goldman Sachs Group Inc. will pay its employees an
average of $399,506 for 2012, up 9% from a year ago, but is sharing the cash
with fewer of them.
The firm is known for rewarding its bankers and
traders with the highest payouts on Wall Street. Indeed, employees at the
corporate and investment bank at J.P. Morgan Chase & Co., which also
reported earnings and pay details on Wednesday, stand to take home average
compensation of $216,928, down slightly from $217,600 for 2011.
WSJ 17/01/2013
We invite our generous LIR readers to donate
to our fund to help rescue the impoverished banksters at JP Morgan, who are
down $672 in 2012 compensation from 2011. Astute regular readers of the LIR
know only too well, that in banksterland, lifestyle never goes down. Like the
Fed’s balance sheet, bankster lifestyle costs only go up, year after year. For
the once well heeled banksters at once proud JPM, this is an unbearable
disgrace. We urge our readers to spare a thought for the shame and ignominy now
sweeping the bankster halls of JP Morgan, where banksters are in grave danger
of losing the trophy wife, the summer home in the Hamptons, the chauffeured limousine
to heliport, for the commute back to the rented mansion in Greenwich Connecticut.
Oh, the humanity!
Ebenezer Squid, with
apologies to Herbert Morrison.
January 16, 2013, 7:03 p.m. ET
Dimon Takes a 'Whale' of a Pay Cut
J.P. Morgan Chief's Compensation Halved After Trading Debacle; Bank Posts Record Net Income in 2012
J.P. Morgan Chase JPM +1.01
& Co. directors cut Chief Executive James Dimon's pay by 50% for
2012, as the board took management to task for a trading debacle that cost the
nation's largest bank more than $6 billion.
More
Now back to the tragedy of austerity Euroland,
where more wealth and souls are destroyed every day. Repeat after Barroso, Van Rompuy,
Merkel, Hollande, Uncle Tom Cobley and all, “let them eat cake,” it’s in Great Britain’s interest to remain a
steerage passenger in the sinking RMS Europa-Titanic. Stay long physical
precious metals.
"Those entrapped by the herd instinct are drowned in the deluges of history. But there are always the few who observe, reason, and take precautions, and thus escape the flood. For these few gold has been the asset of last resort."
Antony C. Sutton
Europe drawn into global currency wars as slump deepens
The world is edging closer to all out currency conflict as Europe’s politicians join a chorus of policy-makers across the globe pushing for devaluations to fight for market share.
Jean-Claude
Juncker, EuroGroup chief, has signalled that Europe is no longer willing to be
the last economic player holding the toxic parcel of an over-valued exchange
rate, describing the euro as “dangerously high” after its three-month surge
against the dollar, yuan and yen.
The
comments follow warnings by two French ministers this month that the strong
euro is holding back efforts to pull the France out of deep industrial slump.
Alexei
Ulyukayev, deputy head of Russia’s central bank, said the tilt in EMU policy
marks a new escalation as every major bloc of the global economy tries to drive
down its exchange rate at the same time. “We are now on the threshold of very
serious currency wars,” he said.
Korea has
asked the G20 take a stand against beggar-thy-neighbour policies in Moscow next
month, accusing Japan and the West of covert debasement through loose money.
Japan’s
premier Shinzo Abe kicked off the latest skirmishes by threatening to change
the Bank of Japan’s statute unless it agrees to launch a monetary blitz and
weaken the yen. The euro has rocketed by 20pc against the yen since July. “This
will soon start to hurt core Euroland and Germany. The Japanese compete in the
same export niche of cars, machine tools and electronics,” said Hans Redeker
from Morgan Stanley.
----Julian Callow from Barclays said the trade-weighted euro has risen 6pc since the third quarter of 2012. If sustained, this will lop around 0.4pc off eurozone GDP this year at a time when the economy is already contracting. The jobless rate has reached a record 11.8pc, rising to 26.6pc in Spain.
The ECB
has so far refused to take action to curb euro strength, standing aloof as
Japan, the US, Britain, Switzerland, Norway, New Zealand and Korea itself,
among others, try to steer their currencies lower.
----Pressure for
action is mounting as the slump deepens. A string of countries have downgraded
their forecasts over recent days. Portugal’s central bank expects contraction
of 1.9pc this year. The Netherlands said Dutch GDP will fall 0.5pc. Germany
slashed its forecast from 1pc to 0.4pc.
More
http://www.telegraph.co.uk/finance/financialcrisis/9807092/Europe-drawn-into-global-currency-wars-as-slump-deepens.html
January 16, 2013, 7:20 a.m. ET
Euro-Zone Bank Plan Could Get Watered Down
BRUSSELS—One
of the euro zone's most significant commitments last year aimed at containing
its financial crisis—a plan to allow the bloc's bailout fund to directly boost
the capital of banks in countries facing debt troubles—could be undermined by
technical complications and second thoughts by some governments.
In
meetings this week, the head of the bloc's bailout fund told senior finance
ministry officials that allowing the fund to directly recapitalize banks would
deplete its lending capacity much faster than extending loans to governments,
the fund's usual role, two euro-zone officials said.
----In June, euro-zone leaders promised to cut the "vicious circle" linking a government's finances to that of its banks that had already pushed Ireland into a full-blown bailout and that risked doing the same to much larger Spain.
Leaders
said they would set up new euro-zone-wide surveillance of banks, in which the
European Central Bank, equipped with new powers, would spot lenders' weaknesses
earlier. Once in place, the bloc's bailout fund, the European Stability
Mechanism, would be able to directly recapitalize failing banks.
That
would mean governments in financial trouble wouldn't have to bankrupt
themselves by borrowing billions of euros on behalf of their banks; instead,
the ESM would become a direct shareholder in rescued institutions, spreading
the risks to all euro members vulnerable to losses on those investments.
But since
June, some of the euro zone's richest members, including Germany and the
Netherlands, have gotten cold feet about taking on responsibility for their
weaker neighbors' banks, especially for problems stemming from before the ECB
will take over bank supervision next year.
How to
deal with these so-called "legacy assets" was at the center of talks
in Brussels this week, where senior euro-zone finance ministry officials sought
to set out some of the key parameters for bank rescues as the currency union
switches from the old to the new surveillance system.
According
to two officials, there was near consensus that national governments would
remain responsible for ensuring that banks have enough capital to fulfill new
international requirements for a core Tier 1 ratio of capital to risk-weighted
assets of 4.5%. If necessary, the officials said that would be achieved by
forcing losses on private investors, with the government having to raise the
remaining money.
More
In America what’s good for the goose is good for the gander, it seems. Will malicious state sponsored viruses become the curse of the 21st century?
Hoist with one’s own petard.
Malicious virus shuttered U.S. power plant -DHS
Jan 16 (Reuters) - A computer virus attacked a turbine control system at a U.S. power company last fall when a technician unknowingly inserted an infected USB computer drive into the network, keeping a plant off line for three weeks, according to a report posted on a U.S. government website.The Department of Homeland Security report did not identify the plant but said criminal software, which is used to conduct financial crimes such as identity theft, was behind the incident.
It was introduced by an employee of a third-party contractor that does business with the utility, according to the agency.
DHS reported the incident, which occurred in October, along with a second involving a more sophisticated virus, on its website as cyber experts gather at a high-profile security conference in Miami known as S4 to review emerging threats against power plants, water utilities and other parts of the critical infrastructure.
In addition to not identifying the plants, a DHS spokesman declined to say where they are located.
Interest in the area has surged since 2010 when the Stuxnet computer virus was used to attack Iran's nuclear program. Although the United States and Israel were widely believed to be behind Stuxnet, experts believe that hackers may be copying the technology to develop their own viruses.
More
We end for the day is Asia, where the spat between
China and Japan over the uninhabited Diaoyu Islands is heating up. After China
announced a plan to survey the islands, Japan’s ultra right wing nationalists
called for Japan’s forces to stop them.
China alert to Japanese Diaoyu Islands escalation
BEIJING,
Jan. 16 (Xinhua) -- A Chinese Foreign Ministry spokesman said Wednesday that
China is on high alert for Japan escalating tensions over the Diaoyu Islands.
Spokesman
Hong Lei made the remarks in response to media reports saying Japanese Defense
Minister Itsunori Onodera on Tuesday expressed a stance of handling Chinese
jets entering airspace over the Diaoyu Islands with international standards.
"China
has taken note of relevant reports. The patrol conducted by China's public
service ships and planes in waters and airspace of the islands is a normal
performance of duty to exercise jurisdiction," Hong said.
He also
reiterated China's opposition to Japanese planes and vessels entering the
waters and airspace of the Diaoyu Islands.
Relations
between Japan and China have soured since the Japanese government said it would
"purchase" part of the Diaoyu Islands in the East China Sea in 2012.
China insists that the islands are part of its inherent territory.
"Until government administrators can so identify the interests of government with those of the people and refrain from defrauding the masses through the device of currency depreciation for the sake of remaining in office, the wiser ones will prefer to keep as much of their wealth in the most stable and marketable forms possible - forms which only the precious metals provide."
Elgin Groseclose
At the Comex silver depositories Wednesday final figures were: Registered 37.98
Moz, Eligible 114.28 Moz, Total 152.26 Moz.
Crooks and
Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Trust me, I’m a bankster. This derivative contract will be good for you!
I can resist anything but temptation.
Deutsche Bank, with apologies to Oscar Wilde.
Deutsche Bank Derivative Helped Monte Paschi Mask Losses
By Elisa Martinuzzi & Nicholas Dunbar - Jan 17, 2013 5:00 AM GMT
Deutsche Bank AG (DBK) designed a derivative for Banca Monte dei Paschi di
Siena SpA at the height of the financial crisis that obscured losses at the
world’s oldest lender before it sought a taxpayer bailout. Germany’s largest bank loaned Monte Paschi about 1.5 billion euros ($2 billion) in December 2008 through the transaction, dubbed Project Santorini, according to more than 70 pages of documents outlining the deal and obtained by Bloomberg News. The trade helped Monte Paschi mitigate a 367 million-euro loss from an older derivative contract with Deutsche Bank. As part of the arrangement, the Italian lender made a losing bet on the value of the country’s government bonds, said six derivatives specialists who reviewed the files.
“I can’t understand why any financial institution would engage in a trade like this for legitimate objectives,” said Frank Partnoy, a former derivatives trader at Morgan Stanley (MS) and now a professor of law and finance at the University of San Diego who read the files. “They shouldn’t ever be doing that.”
The transaction shows how investment banks devised opaque products that years later are leaving companies and taxpayers with losses. From the Greek government to the Italian town of Cassino, borrowers have lost money on bets that were skewed in banks’ favor. In December, an Italian judge convicted bankers at four firms, including Deutsche Bank, of fraud in arranging an interest-rate swap for the city of Milan.
The Frankfurt-based lender’s investment-banking unit, run by Anshu Jain until his appointment as co-chief executive officer in June, also is being probed over alleged interest-rate rigging and has been criticized by German lawmakers.
Monte Paschi
(BMPS), founded in 1472, sought a 1.9 billion-euro bailout from the Italian
government in 2009 and last year requested more funds after it became the
nation’s only lender to fail the minimum capital requirement set by European
regulators. CEO Fabrizio Viola, 55, requested an additional 500 million euros,
bringing the total cost of the bailout to 3.9 billion euros, after the lender
said in November that structured financings linked to government securities had
soured.
----Monte
Paschi never disclosed the effect of the 2008 deal in its annual reports.
More
"We need only take our heads out of the sand to see clearly that interventionism not only has failed to provide the promised something-for-nothing, but has led to all sorts of undesirable consequences. Indeed, many are just beginning to realize that we are moving towards disaster even though we have been on a wrong heading for decades."
Leonard Read
The monthly Coppock Indicators finished December:
DJIA: +100 Down. NASDAQ: +123 Unch. SP500: +129 Up.
All three indexes are giving different
signals. A time for caution.
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