Jay's Daily News

Gold may top $2,000 an ounce in the next decade, according to investor Jim Rogers. “People are printing money, gold is going up,” Rogers said in an interview, adding that he may increase his holdings. “There are plenty of reasons to buy gold when the time is right,” he said.

http://www.bloomberg.com/apps/news?p...d=apHDqYYmZCSI

Here's a video of Jim Rogers on Bloomberg today reiterating what the article says.

http://www.bloomberg.com/avp/avp.htm?N=av&T=Jim Rogers Says Gold Could Hit %242%2C000 Over Next Decade&clipSRC=mms://media2.bloomberg.com/cache/v8KNsKOhX2Bw.asf

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Democrats Weigh Tax On Financial Transactions

OCTOBER 10, 2009

By JOHN D. MCKINNON

WASHINGTON -- Taxing financial transactions on Wall Street is gathering support in high places.

With federal budget deficits soaring, policy makers and other advocates are eyeing the huge sums that could be raised as a way to cover the costs of new initiatives.

Labor unions, in particular the AFL-CIO, have proposed a financial-transactions tax as a way to defray costs of a health-care overhaul. Lawmakers have discussed a similar fee as a way to cover the cost of future financial oversight. Liberal advocates are pushing the tax to pay for new stimulus spending.

This week, the left-leaning Economic Policy Institute floated the idea of a national transaction tax that would raise $100 billion to $150 billion a year. The tax, at a rate of 0.1% to 0.25% of the value of the trade, would be levied on all financial transactions such as stock trades, but not on consumer transactions such as with credit cards.

Dollar Reaches Breaking Point as Banks Shift Reserves

Oct. 12 (Bloomberg) -- Central banks flush with record reserves are increasingly snubbing dollars in favor of euros and yen, further pressuring the greenback after its biggest two- quarter rout in almost two decades.

Policy makers boosted foreign currency holdings by $413 billion last quarter, the most since at least 2003, to $7.3 trillion, according to data compiled by Bloomberg. Nations reporting currency breakdowns put 63 percent of the new cash into euros and yen in April, May and June, the latest Barclays Capital data show. That’s the highest percentage in any quarter with more than an $80 billion increase.

World leaders are acting on threats to dump the dollar while the Obama administration shows a willingness to tolerate a weaker currency in an effort to boost exports and the economy as long as it doesn’t drive away the nation’s creditors. The diversification signals that the currency won’t rebound anytime soon after losing 10.3 percent on a trade-weighted basis the past six months, the biggest drop since 1991.

“Global central banks are getting more serious about diversification, whereas in the past they used to just talk about it,” said Steven Englander, a former Federal Reserve researcher who is now the chief U.S. currency strategist at Barclays in New York. “It looks like they are really backing away from the dollar.”

Jim Rogers on the Next 10 Years

by Heather Bell

I’m moving to China … possibly to live in a bunker. At least that was my inclination after listening to a presentation by Jim Rogers yesterday.

Now don’t get me wrong – Mr. Commodities wasn’t all doom and gloom. In fact, his talk was both informative and highly entertaining. But Rogers doesn’t sugarcoat things – he’s very matter-of-fact about his concerns and projections for the future. And most of them don’t bode well for the U.S.

I’ll be posting an interview with Jim Rogers on the site in the coming week, but for now, I just wanted to offer some highlights from his speech at ETF Securities' mini-conference and the Q&A that followed.

How Much Gold Does U.S Have in Its Reserves?

Following the link at the bottom it's interesting to compare with other countries in the world.

Dollar loses reserve status to yen & euro

By PAUL THARP
3:16 AM, October 13, 2009

Ben Bernanke's dollar crisis went into a wider mode yesterday as the greenback was shockingly upstaged by the euro and yen, both of which can lay claim to the world title as the currency favored by central banks as their reserve currency.

Over the last three months, banks put 63 percent of their new cash into euros and yen -- not the greenbacks -- a nearly complete reversal of the dollar's onetime dominance for reserves, according to Barclays Capital. The dollar's share of new cash in the central banks was down to 37 percent -- compared with two-thirds a decade ago.

Currently, dollars account for about 62 percent of the currency reserve at central banks -- the lowest on record, said the International Monetary Fund.

Bernanke could go down in economic history as the man who killed the greenback on the operating table.

Goldman Sachs average pay and bonus to hit £500,000

Simon English, Hugo Duncan and Jonathan Prynn
14.07.09


The age of the City mega-bonus returned today after investment bank Goldman Sachs unveiled £2 billion profits.

The Wall Street giant's 5,500 London staff can look forward to record average payouts of around £500,000 each at the end of the year from a global pot of £14 billion, the Standard has learned.
Senior executives working at the bank's European headquarters in Fleet Street will get bonuses of several million pounds each with the highest paid as much as £10 million.

Rivals such as Morgan Stanley, Deutsche Bank and Barclays also look set to pay bumper bonuses.

Critics said investment banks had “learned no lessons” from the mood of public outrage that followed last autumn's near total collapse of the world financial system.

Some MPs are demanding that bankers be hit with a punitive 90 per cent tax on bonuses. Vince Cable, Liberal Democrat Treasury spokesman, said: “This suggests that far too many people in the banking sector are going back to business as usual and appear to have learned no lessons from the past.” Critics claim the excessive risk-taking that caused the financial collapse was fuelled by lavish pay and bonuses.

The expected windfalls are bigger than forecast and come after Goldman's second quarter results smashed even the most bullish predictions.

Geithner Aides Reaped Millions Working for Banks, Hedge Funds

By Robert Schmidt

Oct. 14 (Bloomberg) -- Some of Treasury Secretary Timothy Geithner’s closest aides, none of whom faced Senate confirmation, earned millions of dollars a year working for Goldman Sachs Group Inc., Citigroup Inc. and other Wall Street firms, according to financial disclosure forms.

The advisers include Gene Sperling, who last year took in $887,727 from Goldman Sachs and $158,000 for speeches mostly to financial companies, including the firm run by accused Ponzi scheme mastermind R. Allen Stanford. Another top aide, Lee Sachs, reported more than $3 million in salary and partnership income from Mariner Investment Group, a New York hedge fund.

As part of Geithner’s kitchen cabinet, Sperling and Sachs wield influence behind the scenes at the Treasury Department, where they help oversee the $700 billion banking rescue and craft executive pay rules and the revamp of financial regulations. Yet they haven’t faced the public scrutiny given to Senate-confirmed appointees, nor are they compelled to testify in Congress to defend or explain the Treasury’s policies.

Wednesday, October 14, 2009

Congress Removes Authority to Ban Riskiest Derivatives Trades Because "There Was Concern That A Broad Grant To Ban Abusive Swaps Would Be UNSETTLING”



According to Bloomberg, the original draft of Barney Frank's derivatives legislation:

would have given the Securities and Exchange Commission and Commodity Futures Trading Commission joint authority to “prohibit transactions in any swap” that they determine “would be detrimental to the stability of a financial market or of participants in a financial market.”

Frank has now stripped that provision because it would be "unsettling":

“There was concern that a broad grant to ban abusive swaps would be unsettling,” Frank, chairman of the House Financial Services Committee, said today as the panel began action on his measure.

Unsettling to the economy?No.
Unsettling to the 5 banks which comprise the lion's share of the derivatives business.

Frank's revised bill fails to address the many concerns raised by the head of the CFTC (see this and this), and really does nothing to fundamentally reign in the credit derivatives which were largely responsible for crashing the economy.

Change?

Nope, nothing but hot air.

BofA Exec on Merrill Deal: "Screw the Shareholders"

by AVI KLEIN

Bank of America Corp. executives considering the company's purchase of Merrill Lynch & Co. last year admitted to one another that the deal meant "screw the shareholders" and that it was critical they not create an email trail that might come back to haunt them.

The exchanges were among emails and other documents the bank turned over to the House Committee on Oversight and Government Reform this week in an effort to answer questions about the controversial deal.

The committee, along with the attorney general of New York and the Securities and Exchange Commission, is investigating whether Bank of America misled shareholders when it neglected to tell them that it had promised to pay Merrill executives as much as $5.8 billion in bonuses once the deal was approved.

Finance's Five Fatal Flaws

The circle keeps going around...

"We must not spend virtually all of our reform efforts on the finance sector and assume that if we solve its defects we will have solved the other fundamental reasons why the real economy has remained so dysfunctional for decades. We need to be work simultaneously to fix finance and the real economy."

In today's NY Times

http://www.nytimes.com/2009/10/15/bu...change.html?hp

Here's an except from the article below. I'm not sure the effect of dark pools, if any, on the Forex market because it's already decentralized, but we've seen a noticeable drop in trading volume over the past year, so I thought this was noteworthy.

"Some of the new trading venues — “dark pools,” the industry calls them — are all but invisible, even to regulators. These stealth markets enable sophisticated traders to buy and sell large blocks of stock in secrecy at lightning speed, a practice that has drawn scrutiny from the Securities and Exchange Commission.

These upstarts are utterly unlike the old-school Big Board, which is struggling to make its way as a for-profit corporation after centuries of ownership by its seat-holding members. Last year, its parent company, NYSE Euronext, lost $740 million.

Wall Street’s judgment has been swift and brutal. Since January 2007, the share price of NYSE Euronext has lost nearly three-quarters of its value, even though stock trading over all has soared.

While the exchange has been under assault since the beginning of the decade, its decline has accelerated in recent years as aggressive competitors have emerged. Today, 36 percent of daily trades in stocks that are listed on the New York Stock Exchange are actually executed on the exchange, down from about 75 percent nearly four years ago. The rest of are conducted elsewhere, on new electronic exchanges or through dark pools."

That story of this fellow being arrested for stealing Goldman Sachs secrets wasn't a coincidence.

Goldman Sachs claimed that someone could have abused the markets if using that technology. What the hell do people think Goldman Sachs has been doing?

For those who don't recall. http://www.businessinsider.com/quant...formula-2009-7

German 'Wise Men' fear credit crunch in 2010

By Ambrose Evans-Pritchard, International Business Editor
Published: 7:31PM BST 15 Oct 2009

Germany's leading institutes have warned that the pace of economic recovery is "unsustainable" and that the country's banks may face a fresh crisis over the next year as bad debts surface in earnest.

'There is still a significant risk of further shocks to the international financial system,' said a joint report by the five 'Wise Men', a panel that advises the government.

Emergency action by the European Central Bank and authorities worldwide "averted a looming collapse" of Germany's banks over the Winter but lenders are still too frail to renew normal lending.

"Credit to non-financial firms has clearly been declining. Financial conditions are likely to worsen further. Banks are facing large write-offs on toxic debt and a rising toll of company insolvencies," it said.

The report said it was a serious error to pressure banks to raise capital ratios in the middle of a downturn, causing them to tighten lending standards. "There is a major danger that already tight financing conditions could lead to a credit crunch next year," it said.

The first round of the financial crisis hit the big banks and state Landesbanken, which had portfolios on US sub-prime debt and other traded assets. The next wave of victims may be the country's savings banks faced with the 'slow-burn' losses of loan defaults.


Foreclosures: 'Worst three months of all time'

By Les Christie, CNNMoney.com staff writer
Last Updated: October 15, 2009: 7:34 AM ET

Despite signs of broader economic recovery, number of foreclosure filings hit a record high in the third quarter - a sign the plague is still spreading.

NEW YORK (CNNMoney.com) -- Despite concerted government-led and lender-supported efforts to prevent foreclosures, the number of filings hit a record high in the third quarter, according to a report issued Thursday.

"They were the worst three months of all time," said Rick Sharga, spokesman for RealtyTrac, an online marketer of foreclosed homes.

Raj Rajaratnam Charged With Insider Trading

LARRY NEUMEISTER and CANDICE CHOI | 10/16/09 07:35 PM | http://www.huffingtonpost.com/images/v/ap_wire.png

NEW YORK — One of America's wealthiest men was among six hedge fund managers and corporate executives arrested Friday in a hedge fund insider trading case that authorities say generated more than $25 million in illegal profits and was a wake-up call for Wall Street.

Raj Rajaratnam, a portfolio manager for Galleon Group, a hedge fund with up to $7 billion in assets under management, was accused of conspiring with others to use insider information to trade securities in several publicly traded companies, including Google Inc.

U.S. Magistrate Judge Douglas F. Eaton set bail at $100 million to be secured by $20 million in collateral despite a request by prosecutors to deny bail. He also ordered Rajaratnam, who has both U.S. and Sri Lankan citizenship, to stay within 110 miles of New York City.

U.S. Attorney Preet Bharara told a news conference it was the largest hedge fund case ever prosecuted and marked the first use of court-authorized wiretaps to capture conversations by suspects in an insider trading case.
He said the case should cause financial professionals considering insider trades in the future to wonder whether law enforcement is listening.

"Greed is not good," Bharara said. "This case should be a wake-up call for Wall Street."

Joseph Demarest Jr., the head of the New York FBI office, said it was clear that "the $20 million in illicit profits come at the expense of the average public investor."

The Securities and Exchange Commission, which brought separate civil charges, said the scheme generated more than $25 million in illegal profits.

thanks for your updates o999

Bailout Helps Fuel a New Era of Wall Street Wealth

By GRAHAM BOWLEY
Published: October 16, 2009

Even as the economy continues to struggle, much of Wall Street is minting money — and looking forward again to hefty bonuses.

Many Americans wonder how this can possibly be. How can some banks be prospering so soon after a financial collapse, even as legions of people worry about losing their jobs and their homes?

It may come as a surprise that one of the most powerful forces driving the resurgence on Wall Street is not the banks but Washington. Many of the steps that policy makers took last year to stabilize the financial system — reducing interest rates to near zero, bolstering big banks with taxpayer money, guaranteeing billions of dollars of financial institutions’ debts — helped set the stage for this new era of Wall Street wealth.

Titans like Goldman Sachs and JPMorgan Chase are making fortunes in hot areas like trading stocks and bonds, rather than in the ho-hum business of lending people money. They also are profiting by taking risks that weaker rivals are unable or unwilling to shoulder — a benefit of less competition after the failure of some investment firms last year.

So even as big banks fight efforts in Congress to subject their industry to greater regulation — and to impose some restrictions on executive pay — Wall Street has Washington to thank in part for its latest bonanza.

China to carry out ten billion USD loans for SCO member states, premier says

2009-10-14 12:26:05 GMT2009-10-14 20:26:05 (Beijing Time) Xinhua English

BEIJING, Oct. 14 (Xinhua) -- China will carry out the announced ten billion U.S. dollars of loans for Shanghai Cooperation Organization (SCO) member states and continue to send trade and investment delegations to other members, said Premier Wen Jiabao Wednesday.

Wen also raised a seven-point proposal to enhance regional cooperation at the eighth prime ministers' meeting of the SCO member states in Beijing.

First, to deepen financial and monetary cooperation. China will enhance the exchanges of financial and monetary policies and improve the trade settlement payment system to promote international monetary system reform, to enhance the diversification and rationalization of the international system and to jointly safeguard financial stability.

Goldman Sachs' Black Magic, Here's How They Did It

Dylan Ratigan
October 16, 2009 03:04 PM

How did Goldman, Sachs & Co. -- saved a year ago by the US taxpayer -- magically make $3 billion in 3 months a year later?
This as the US dollar collapses, unemployment soars and foreclosures hit a record?
Here is the Goldman, Sachs & Co. revenue break down for the past 3 months:

 

1. Financial Advisory-M/A: 325 million.
2. Equity Underwriting: 363 million.
3. Debt Underwriting: 211 million.
4. Trading-Principal Investments: 10 billion.

Notice that 10 billion is much bigger than two or three hundred million made from the traditional Wall Street businesses.
That $10 billion is evidence of their magic trick. For we the taxpayer gave Goldman Sachs the following:

 

1. 10 Billion in TARP
2. 11 Billion from the Fed
3. 30 Billion from the FDIC
4. 13 Billion from AIG

For a grand total of almost $70 Billion (Goldman along with every other bank and AIG would have been defunct without this money).
Goldman at the apex of the crisis is delivered this money -- which they then use to borrow against at $20 or $30 for every $1. Which at 30x equals $2.1 trillion in available capital.
As one of the only banks in the world with money at the time, Goldman Sachs was able to buy billions in distressed assets around the world at record low prices -- only to watch $23.7 trillion in US taxpayer money be deployed during the past year to re-inflate the asset's values that Goldman had purchased with our tax money.
The question is not why did we bail out the banks.
The question is why did we give the banks billions of our money so they could then buy assets by the trillions with our money and they keep the profits?
The answer is Henry Paulson, former Goldman Sachs CEO who ran the US Treasury, and Tim Geithner, current Treasury Secretary who at the time ran the New York Federal Reserve, willingly delivered Goldman Sachs the $70 Billion -- with no strings attached.
So what can we do?

 

1. We must demand the return of those investment gains made with America's money - it was stolen from us and we can get it back. Demand Claw Backs - and not from the future but from the past - That is where our money is.
2. We must have an exchange for all credit derivatives -- the current version is riddled with loopholes that let banks avoid transparency by mobbing offshore and prohibiting government regulators from being able to force the use of the exchange by the banks.

So how do you do it?
Heed the Call!!!! Click Here: www.dylan.msnbc.com