IEHI Feed: The Hedge Fund Implode-o-Meter

Europe Opens $80 Trillion Shadow Banking Pandora's Box: Will Seek To Collapse Repo "Collateral Chains"

Fri, 24 May 2013 23:04:57 GMT

`` Bloomberg has just reported that Europe may begin a crackdown on that most important credit money conduit: the $80 trillion+ global shadow banking system, by effectively collapsing collateral chains, and by making wanton asset rehypothecation a thing of the past, permitted only with express prior permission, which obviously will never come''

BRICS risk 'sudden stop' as dollar rally builds - Ambrose Evans-Pritchard

Fri, 24 May 2013 21:24:41 GMT

``Stripped bare, the BRICS miracle is really about China, and even the Politburo has run into diminishing returns after ramping up credit from $9 trillion to $23 trillion in four years. At best China will have settle for more pedestrian growth, but it too is at the mercy of the Fed.''

Veteran fears 'beginning of the end' for Japan as bond market buckles

Fri, 24 May 2013 20:58:44 GMT

The Bank of Japan (BoJ) intervened with $20bn (£13bn) to drive down yields again but the failure to ensure an orderly debt market has started to rattle investors.
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Richard Koo from Nomura, an expert on Japan's Lost Decade, said the sell-off in recent days has shown that the BoJ may not be able to hold down yields "no matter how many bonds it buys". This could lead to a "loss of faith in the Japanese government" and the "beginning of the end" for its economy, if handled badly.
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Mr Koo said the BoJ has undermined the "market structure" that has kept Japan's bond market stable for 20 years, and invited an attack by short sellers.

John Butler - Insider Anecdotes of Official Forex Manip. via Gold

Fri, 24 May 2013 20:45:07 GMT

As the professor explained in his comments, covert, non-coordinated interventions would probably leave a ‘footprint', that is, they would take place at times of low market liquidity and tend to continue until an important chart pattern has emerged that encourages speculators to reverse the previous market trend, thereby initiating a new one in line with the intervention's objectives.
Looking around various FX rates, there is some evidence that covert intervention has been taking place in Asia. Occasional, sharp overnight moves on unusually high volume have taken place in the Korean won, Taiwan dollar, Indonesian rupiah, Malaysian ringitt and Vietnamese dong.

Sounds a lot like what we here have guessed at, though really it is blindingly obvious to anyone willing to take more than a cursory look at the evidence; only a panglossian media and partisan Wall Street could pretend otherwise.

Time to give up on the CFTC (In light of Gold Manip.) - Bron Suchecki

Fri, 24 May 2013 19:16:16 GMT

``Gene notes that hedge members have a bona fide hedger exemption "to sell more than the limit, but not without filing paperwork with the exchange" which means that "whoever blew out the gold market on April 12 is already known to the CFTC (and what documentation they used to back up their trade)."''

The Essence of Hilsenrath | The Wall Street Examiner

Fri, 24 May 2013 10:41:54 GMT

``And now I understand what the great Yogi meant when he said, "When you come to a fork in the road, take it."''

Watch out. The mortgage securities market is at it again

Fri, 24 May 2013 04:21:40 GMT

``Instead of loosening standards to appease the industry, regulators should make it virtually impossible for securitizers to escape having skin in the game. The consumer bureau's lending standards are helpful, but financial accountability can be a much more powerful tool to discourage irresponsible lending. Securitization's skewed incentives transformed home ownership from the American dream to a Brothers Grimm nightmare. We need to make sure it never happens again. ''

Hilsenrath Hits The Tape: Ignore Everything I Said Two Weeks Ago

Thu, 23 May 2013 13:47:20 GMT

``The irony here is that Hilsenrath is correct, but for another far simpler reason: the Fed simply can not shut down bond buying, at least not voluntarily, without crashing bond the stock market, and the perception that the economy is doing well (it isn't), just because the S&P hits new all time highs day after day.''

Robin Hood in reverse -- gold being taken down to make the rich richer

Thu, 23 May 2013 09:54:38 GMT

``At some stage all this will turn around and perhaps we'll see paper gold and silver purchases in similarly strong amounts designed to drive prices up again and make huge profits foir the big money again. That's how the major financial players with virtually unlimited resources can make squillions of dollars at the expense of people's investment savings and pension funds. It's all part of the great capitalistic rich-get-hugely-richer game and the legislators seem powerless to stop it -- if indeed they want to as they themselves are often an integral part of the process. ''

Hedge Funds In Record Gold Short Position

Thu, 23 May 2013 09:43:36 GMT

``As the following chart of the day from Bloomberg shows, as of this week, hedge funds have made "the biggest bet ever" against gold by taking Comex gold shorts to all time highs.''

Japan's Nikkei dives 7.3% in spectacular U-turn

Thu, 23 May 2013 09:38:48 GMT

Japanese shares suffered their worst losses in more than two years on Thursday after data showing an unexpected contraction in Chinese manufacturing activity added to worries the Federal Reserve could downscale its bond purchases.
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The slump came after a surge in Japanese government bond yields, which forced the Bank of Japan to offer 2 trillion yen ($19 billion) in funds to calm investor nerves. The central bank announced the fund-supplying operation after 10-year JGB yields soared to their highest level in more than a year, citing "the unreasonable increase" in volatility.

Too-Big-To-Jail Dogs Obama's Justice Department As Government Documents Raise Questions

Thu, 23 May 2013 04:42:43 GMT

``It also may put further pressure on the Justice Department to strengthen future prosecutions. Recently, instead of filing criminal charges against large financial groups, federal prosecutors have begun to file criminal cases against subsidiaries. Observers including lawyers at Weil, Gotshal & Manges LLP, a top defense firm, have warned that Justice may expand its limited use of criminal indictments in part due to public pressure.''

Foreclosure Victims Protesting Wall Street Impunity Outside DOJ Arrested, Tasered

Thu, 23 May 2013 04:40:46 GMT

``Protesters scolded Holder's remarks as they marched from Freedom Plaza to the main entrance of the Justice Department, which was barricaded by DC police and officers from DHS. After a handful of impassioned speeches, several struggling homeowners jumped the barricade. Officers quickly retreated into the building and shut the door. Before long, the barricade was torn down and hundreds of protesters flooded the exterior around the main entrance where they banged on the door and shouted, "Eric Holder, come on out!"''

BofA, JPMorgan Chase Say They've Fulfilled National Mortgage Settlement Obligations: Report

Thu, 23 May 2013 04:09:39 GMT

``BofA and JPMorgan's assertions that they've fulfilled their obligations under the settlement aren't official, as Joseph Smith, the monitor for the deal, hasn't reviewed them yet, according to the LA Times. Wells Fargo also claims to be 90 percent of the way done fulfilling its obligations.
The banks' claims that they've met their end of the bargain may not be enough for struggling homeowners as countless criticisms have arose in the wake of the settlement. ''

SAC's Cohen Said to Mull Deal That Would Shut Hedge Fund

Wed, 22 May 2013 14:10:10 GMT

``Cohen has discussed an agreement under which his SAC Capital Advisors LP would admit wrongdoing but wouldn't be prosecuted unless it broke the law again, said the person, who asked not to be named because the talks are private. As part of the deal, known as a deferred prosecution agreement, Cohen would close the Stamford, Connecticut-based firm to outside investors and make it a family office that manages his personal fortune. SAC Capital probably would also pay a fine.''

EU Committee Approves Bail-In Law

Wed, 22 May 2013 14:06:16 GMT

``On Monday, a group of European lawmakers in the house's economics committee voted that, from 2016, large depositors in the European Union might suffer losses if a bank gets into serious trouble, echoing a deal in Cyprus where wealthy depositors were hit hard at two banks to save the country from bankruptcy.''

Paulson Sold Gold Miners, Bought Family Dollar in Quarter

Wed, 22 May 2013 14:05:17 GMT

``Paulson & Co., which manages $18 billion out of New York, exited its $32 million stake in Barrick Gold Corp. (ABX), the world's biggest gold producer by sales, and reduced holdings in other mining companies, according to a regulatory filing yesterday. The firm bought a $295.3 million stake in Family Dollar Stores Inc. (FDO), $192.9 million in Hess Corp. shares, and a $44.2 million stake in Citigroup Inc. (C)'' - Looks like Paulie threw in the towel...

Richard Russell on the Bizarre Market; Crude Manipulations

Wed, 22 May 2013 13:45:40 GMT

``I've never seen so much money being sloshed about. Nor have I ever seen so much news of corruption and criminal activity.... I think the gold miners will fly once gold gets over 1500. This crunch job on gold is the crudest manipulation job I've ever seen.''

Ron Rosen - Silver To Soar A Stunning 400% & Gold $1,500 In 10 Months

Wed, 22 May 2013 13:38:08 GMT

``So we've hit the bottom and now we are headed higher, and there is no limit as to how high gold and silver can go from here. Looking back, this will be seen as the greatest opportunity of all if someone has the guts to get in the market now...'' -- I'm not sure how he is so confident the cartel couldn't find another way to suppress the metals for another year, but submitted for your consideration anyways...

Blockbuster in Gold - Ted Butler

Wed, 22 May 2013 13:27:41 GMT

I believe that the big buyer of the 10 million ounces of gold liquidated in the GLD was JPMorgan, either alone or with other collusive commercial banks... by having the gold redeemed out of the trust and the metal being purchased (instead of shares), stock reporting requirements are evaded. A single holder, perhaps working with a few collusive partners, have come to own what is, effectively, almost a quarter of the world's largest gold stockpile and no one is the wiser.
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When you include what came out of the ETFs and exchange warehouses it adds an additional 15 million ounces. Together that totals 30 million ounces ($45 billion). Options and over-the-counter derivatives transactions could double that amount. This likely brings the total of their purchases to 50 million ounces ($75 billion). This sound like a huge number but it's quite manageable for these big banks and it represents a small fraction of the total derivatives market.
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If, as I contend, JPMorgan picked up at least 20 million gold ounces they shook out from the GLD and elsewhere, a $300 dollar gold rally will net them $6 billion in ill-gotten gains on that position alone. It could be much more if they are more ruthless in creating higher prices. Generally, with these crooks they usually exceed what you think they are capable of.