EurAnalysis

Well, I am off. Cya tomorrow. And think of what child is trying to tell you .

T

Maybe Grant Williams has the answer. I just received his bible now. I'm going to read it. You can read it too.

Here it is

"Things That Make You Go Hmmm"

the above in red is the precise mechanism by which these elements squeeze the money and transfer wealth from poor to rich.

where does the ECB get the 1300, they get it out of thin air.when they lend it at 100%usury [when u compound its many time more than that]yes wealth do get destroyed but under the system one living its only poor and middle classes wealth suffer keeping whole 0.0000001%.

I love this guy Grant Williams.

Europe has finally come up with a solution to fix the problem they've been looking at for two years... and here it is.

Europe creates a fund (the ESM) into which all the countries of the Eurozone—including those who are already bankrupt—are obliged to promise to contribute. The ESM is then allowed to lever the promises in that fund (not the cash; the promises) through borrowings from the ECB (an institution
which is, incidentally, the single largest holder of the debt of those bankrupt peripheral European countries in the world) in order to buy yet more debt from those same peripheral, bankrupt European countries which will, in turn, lower borrowing costs and stabilize markets.

Attached Image

hi guys, hope all is well

i can see not people in room BUT has anyone been offered money to start a thread on FF. I just had long call asking me to do so. i do not think anyone is playing a prank but i can guess what they are up to. Anyway take care all good trading when it opens.

My brokers Mt4 closed below 1.2300, but xe.com is showing 1.2319. Any idea about current rate apart from xe? Thanks.

hi bud, i closed at 12320 or broker did, no idea about now as i do n ot normally trade over weekend

Thanks Bill, I have short positions open from 1.2360.

have you any idea about the Indicator named,,, AWESOME OSCILLATOR,,, I can show a chart if you want, its similar to a histogram as used in directional movement. I have 3 trader friends and thay are all away so i cannot ask them. take care

Hi Billy. Why would anyone offer someone money to start a thread on FF? Where is the economic gain in doing so?

http://www.wallstreetinsightsandindi...th-revisiting/

Glass-Steagall is a Dream Worth Revisiting

Jul 29th, 2012 | By Shah Gilani


There’s a dream keeps returning, like rain to the sea.
There’s a fire ever burning in the souls of the free.
There’s a lifetime of learning that it’s all been in jest.
And at the end of your journey, it’s like you never left.
~ Dave Mason

Those lyrics are great. They apply to a lot of things in life.
That includes me seeing the legendary Traffic singer/songwriter and guitarist Dave Mason recently, after last seeing him 10 years ago. He was once again at Stephen Talkhouse in Amagansett, New York, and I saw him with some old friends two weeks ago.

Besides being a legend, he’s a really good man.

He’s supporting Wounded Warriors and other projects, like Work Vessels for Veterans, which helps support veteran entrepreneurs trying to get their business dreams off the ground. I urge you all contribute to help the incredibly brave men and women in our armed forces who sacrifice so much and get so little in return.

We did our part that night by bidding up the price and winning a signed guitar that Dave Mason was auctioning, as he is doing at other shows.
Here’s a picture of Dave in the middle, me on the right, and one of my best friends, Dr. Mark Kot, the real Hamptons doctor (yeah, they made a TV show based on him) on the left.
http://www.wallstreetinsightsandindi...s/0729wsii.JPG
But I digress. Although it’s for a good cause. We can never do enough for our troops!

There’s another dream that’s returning today. And it is one that many of you have been actively dreaming about.

Glass-Steagall.
Like rain to the sea, the fallout from the implosion of too-big-to-fail banks that poisoned our capital markets and economy may, God willing, help resurrect the Depression-era legislation that separated commercial banks from investment banks.

I’ve been calling for that for years now. And almost all of you are soldiering with me in that camp.

Well, it seems we may now have a new general to lead us.

Sandy Weill, the architect of TBTF behemoth Citicorp, and the former lieutenant general leading the charge to wipe out the last remnants of Glass-Steagall in 1999, just made an unbelievable about-face.

On CNBC on Wednesday, Weill made headlines when, as a guest host he said that while he was right in 1999, things have proven that he’s not right any more, and commercial banks and investment banks should be separated.

In no uncertain terms, he’s advocating the resurrection of Glass-Steagall. Hallelujah!

He’s not the first of the old guard that once pushed a future full of giant supermarket banks, also known as “universal” banks, to rethink where that’s gotten us.

John Reed, the former chairman and CEO of Citibank – before it was merged into Sandy Weill’s Travelers giant insurance conglomerate that owned Salomon Smith Barney to create Citicorp – spoke out in 2009. So did Phillip Purcell, the former chief executive of Morgan Stanley, and David Komansky, the former head honcho at Merrill Lynch. It seems that these former “bigger-is-better” banking legends are second-guessing their vision of a boundaryless future of banks without borders.

Our new general has singlehandedly changed the dialogue by bringing the past into focus and honestly calling out the deregulators to admit they were wrong, as he was.

That is leadership.



Who cares about the past? So what if he was at the forefront of the TBTF movement? He’s seen the error of his ways, and we all need to thank him for his honesty and for saying exactly what he said, which was that, “creativity, ingenuity and brainpower of the people (bankers) is much more important than size.”

With regard to what I believe is the greatest problem facing the U.S. right now, the public’s lack of confidence in our capital markets and banks, Weill said this: “By creating an environment where we can attract the kinds of people to be leaders, the system would create leadership again in American financial institutions,” and “they’d do a helluva lot better than the ones that just have big balance sheets; and that’s always been the case.”

Now, that’s a dream worth returning to.

Shah

hi bud, i have no idea why anyone should ask but i can have a good guess. They might be touting for business ie, checking out the visitors AND keeping an eye on me. Several months ago i was approached by a company to trade for them but i turned them down and i honestly do not think it is them again. anyway i am happy doing what i do. I still told them to trade simple lol. take care buddy

I use it as a form of volume indicator. When there is volume in forex the red or green bars get larger. When there is hardly any volume it is hard to even tell the green and red apart. Some others who use technicals better than I do could probably give you a clearer answer.

Yes Bill, AWESOME OSCILLATOR is a good indicator for bearish or bullish divergences etc. But I quit trading in smaller TFs so no longer using it. You require any copy of that?

thankyou for the answer, i was beginning to think it was my broker gizmo. It looks good for early entries but as of yet i have not tried it out . take care

thankyou bud, i was just checking it out. i am always learning and if i get more edge with an entry i am all for it.

All you need to do is read it. I will be glad to answer any follow up questions. It is a brilliant article.

http://www.acting-man.com/?p=18686

Some Snippets:

Central Banks Are Chomping At the Bit

July 26, 2012 | Author Pater Tenebrarum


Perpetual 'QE'


In recent days, numerous central bank bureaucrats have given us hints that another round of pump priming is more or less imminent. It started with John Williams, president of the San Francisco Fed who mused about 'QE without a limit'. The FT reported:

„The US will make little progress tackling high unemployment before 2014 unless the Federal Reserve eases policy further, one of the central bank’s leading officials has warned in the run-up to a meeting next week where the option of “QE3” will be on the table.

The comments by John Williams, president of the Federal Reserve Bank of San Francisco, show how the weak economy is pushing the central bank towards action to support growth.
[…]

If the Fed launched another round of quantitative easing, Mr Williams suggested that buying mortgage-backed securities rather than Treasuries would have a stronger effect on financial conditions. “There’s a lot more you can buy without interfering with market function and you maybe get a little more bang for the buck,” he said.

He added that there would also be benefits in having an open-ended programme of QE, where the ultimate amount of purchases was not fixed in advance like the $600bn “QE2” programme launched in November 2010 but rather adjusted according to economic conditions.
“The main benefit from my point of view is it will get the markets to stop focusing on the terminal date [when a programme of purchases ends] and also focusing on, ‘Oh, are they going to do QE3?’” he said. Instead, markets would adjust their expectation of Fed purchases as economic conditions changed.“

http://ads.investingchannel.com/adta...76128158736%3F

(emphasis added)
Mr. Williams, so the FT, is thought to be 'close to the center of gravity' on the FOMC. We take this to mean that he has the helicopter pilot's ear.
So if indeed the Fed were to embark on 'open-ended QE' that is predicated on developments in the vaunted 'economic data', or putting it differently, is dependent on recent economic history (a method also known as 'driving forward with one's eyes firmly fixed on the rear-view mirror'), what happens if said data fail to improve?

Will the Fed then just keep printing forever and ever? As an aside, financial markets are already trained to adjust their expectations regarding central bank policy according to their perceptions about economic conditions. There is a feedback loop between central bank policy and market behavior.

This can easily be seen in the behavior of the US stock market: recent evidence of economic conditions worsening at a fairly fast pace has not led to a big decline in stock prices, as people already speculate on the next 'QE' type bailout. This strategy is of course self-defeating, as it is politically difficult for the Fed to justify more money printing while the stock market remains at a lofty level.

Of course the stock market's level is officially not part of the Fed's mandate, but the central bank clearly keeps a close eye on market conditions. Besides, the 'success' of 'QE2' according to Ben Bernanke was inter alia proved by a big rally in stocks. Such increases in stock prices are seen as a spur to spending, as the perceived wealth of stockholders increases. In the view of Bernanke and his colleagues, spending is what it's all about. The central bank chief holds that we can consume ourselves to prosperity. It follows from this that one should also be able to print and deficit spend oneself to prosperity, but oddly enough, it hasn't worked thus far. A reason to revisit long-cherished beliefs? Not at all! We must 'do more' of what hasn't worked thus far.

Snippet:

What Printing Money Does – The Credit Cycle versus Government Directed Inflation

Of course money is not 'neutral'. If the Fed were to increase everyone's money holdings pro rata by the exact same percentage on the same day, then it would be clear to all that it would make no difference – nobody would be any richer, and merchants would raise all prices by this exact percentage on that very day. We would expect them to, and they would be foolish not to do it.

However, money enters the economy at discrete points. This has redistributive effects, as the early receivers will profit at the expense of later receivers. It also means that a price revolution will inevitably occur: it is irrelevant whether 'CPI' rises or not. Prices will be altered relative to one another. Once the money has percolated through the economy, the price structure will be different from what it was before and from what it would have been absent the inflation.

If commercial banks create new deposits by granting credit, then to the extent that such credit creation is new money from thin air 'backed' by fractional reserves, we will experience the usual trade cycle: factors of production will be drawn to higher order goods production at the expense of the middle and later stages of the production structure and once the boom is underway, consumption will increase as illusory accounting profits are spent. Capital will be ultimately be consumed. The inter-temporal coordination between production and consumption will be disturbed, as the fiduciary media that come to the loan market lower interest rates and create the false impression that the pool of voluntary real savings is larger than it really is. More distant stages will tend to be added to production structure, i.e. very long term investment projects that suddenly appear to be profitable. However, the real resources to bring these projects to fruition do not really exist – eventually many of them will have to be abandoned (countless ghost towns in Spain are testament to this fact). It will also invariably turn out that businesses have invested in the wrong lines. Whether they disagree with actual consumer demand or must be abandoned for lack of complementary capital, countless malinvestments will inevitably be unmasked when the boom ends.

The case of a central bank and government directed inflation is slightly different. If banks lend to money from thin air to businesses and consumers, the market interest rate will tend to be depressed below the societal rate of time preference. The business cycle briefly outlined above will result. Since a feature of the business cycle is that a production structure is erected the length of which can not be supported by the economy's pool of real funding – a production structure that ties up more consumer goods than it releases – we speak of intertemporal discoordination. The discoordination is between consumption and production schedules: had consumers really saved more, then it would be clear that they are abstaining from consumption in the present with the aim of being able to consume more in the future. But the market interest rate is falsified. It only appears as though they were abstaining from present consumption, in reality their desire to save and thus their consumption schedule has not changed. However, the lower interest rate interferes with production – a lengthened production structure will require more time to produce consumer goods. If sufficient savings were indeed available, it would eventually produce more consumer goods than previously. In an artificial credit cycle, the expected future consumer demand will never materialize.

If banks lend directly to the government (a process which the buying of securities by the Fed aids and abets), then the government spends those funds directly. It does not offer them as loans to businesses, it spends them on government consumption. This will also distort the production structure, but the disturbance will be an intra-temporal discoordination. Certain business branches that are favored by government largesse will see rising prices and will be induced to expand. The result will once again be a production structure that fundamentally disagrees with the wishes of consumers. A good example of this are the failed investments in 'green energy' the government has undertaken in the course of its stimulus program. These projects certainly squander scarce resources that could be put to better use in satisfying actual consumer wants. Profit and loss accounting for such projects is a fiction. We have discussed examples of these failed projects in more detail here (scroll down to 'Stimulus Fail').
Ludwig von Mises explains the process as follows (in Human Action, p. 568):

Snippet:


The ECB's and BoE's Failure to Inflate The Money Supply


Contrary to the Fed, both the BoE an the ECB have been unable to spur money supply inflation since the crisis in the euro area began. Banks are under pressure and are calling in loans in an attempt to shrink their overleveraged balance sheets. Moreover, in the euro area, they find themselves constrained in making loans to governments that are themselves at risk of insolvency and can no longer print their own money. These governments in turn are forced to adopt austerity measures, so there is no way for additional money to enter the economy in the absence of private sector credit expansion and concurrent reductions in government spending.

Countries like Spain that have experienced massive credit booms and malinvestment orgies prior to the onset of the crisis are therefore feeling the full brunt of the contraction that follows on the heels of such a bubble. Unfortunately this has so far not meant that unsound credit was liquidated. The euro-system still allows for the surreptitious funding of de facto insolvent banks via ELA (emergency liquidity assistance) and moreover enables deposit flight and current account deficits that are financed with central bank money through TARGET-2. This blunts the severity of the economic downturn only marginally, but it clearly delays its resolution.

Although ECB board members including Mario Draghi himself often reiterate that they 'see no risk of deflation' for the euro area, the risk is far greater in the euro area than in the US. They refer to prices and not the money supply, but as we have often pointed out, money supply inflation has slowed to a crawl after the initial burst in growth following the 2007/8 GFC. In the UK, year-on-year money TMS growth has fallen to zero, while the broader measure M4 has declined by 3.5% over the past year. In the euro area, year-on-year growth of money TMS stands at 3.4% as of June which is an interim high actually, as even lower growth was observed throughout 2011.

Closing Snippet:



Presumably at least some people at the central banks must be aware of this and are likely thinking about ways to counter it. After all, deflation is thought to be 'bad'. The BoE is introducing a scheme in concert with the treasury that is designed to spur lending to businesses by allowing the banks to discount corporate loans with the central bank.

The ECB is mulling various other methods of prodding banks into increasing their inflationary lending. Among the measures considered is the lowering of the deposit rate into negative territory, this is to say imposing a penalty rate for holding excess reserves with the central bank. The lowering of the deposit rate to zero at the last ECB meeting was apparently only the first step, but it has already shown why this method probably won't work.

The banks have simply transferred excess reserves to their current accounts in the euro system. This combines operational flexibility with the same degree of safety, while from an interest rate standpoint the situation is the same: they get zero. Investors are even prepared to endure penalty rates of varying sizes by lending short term funds to certain governments such as Germany's and Switzerland's at negative interest rates. They pay a small price for perceived 'safety', while at the same time placing a bet on eventual currency appreciation.

Note also that excess reserves are the equivalent of cash assets to the banks. If the central bank imposes a negative interest rate on such holdings, and e.g. imposes a limit on the amounts that can be held in the current account facility, the banks may simply begin to hoard vault cash. While this is inconvenient, there is no legal impediment to such an operation. We would certainly see an increase in the money supply then, as the currency component would climb, but if this money is simply put into vaults to gather dust, then it may as well sit on the ECB's deposit facility – this is to say it would have to be considered as remaining outside of the economy. This would change only if depositors became nervous about the euro's future purchasing power and began to withdraw money in order to spend it before it loses its value.

The latest proposal – which to be sure is not new, but was hitherto considered 'DOA' – was voiced by Austrian central bank governor and member of the ECB council Ewald Nowotny, who appears to be warming to the idea to give the planned ESM bailout facility a banking license. This would allow the bailout vehicle to function as the ECB's 'QE' arm, as it could for instance buy the bonds of Spain and Italy, and then rediscount them with the central bank and pyramid new loans atop the ones it can extend by using its own capital.
Bloomberg reports:

“European Central Bank council member Ewald Nowotny said there are arguments in favor of giving Europe’s rescue fund a banking license, reviving the debate on bolstering its firepower as leaders face the prospect of a full- scale Spanish bailout.

“I think there are pro arguments for this,” Nowotny, who heads Austria’s central bank, said in an interview in his office in Vienna yesterday. “There are also other arguments, but I would see this as an ongoing discussion,” he said, adding he’s “not aware of specific discussions within the ECB at this point.”

Granting a banking license to Europe’s permanent bailout fund, the European Stability Mechanism, would give it access to ECB lending, easing concerns that its 500 billion-euro ($602.5 billion) cash pot won’t be enough if Spain or Italy require aid. While ECB President Mario Draghisaid on May 24 that such a move amounts to the central bank financing governments, which is prohibited by European Union law, publicly-owned credit institutionssuch as the European Investment Bankare exempt.

“It is not something that is only in the field of monetary policy, so this is part of a broad discussion,” Nowotny said. He declined to elaborate.”

(emphasis added)
In other words, even though Mario Draghi asserts that giving the ESM a banking license would contravene the prohibition of central bank funding of governments, there is already an example of a publicly-owned, EU-run institution that indeed has such a license. To be sure, the EIB does not buy government securities, but it lends not only to businesses in the EU, it also supports government sponsored investments.

We conclude from the above that the debate over the banking license for the ESM is not quite dead yet – it was merely in a state of temporary catatonia. The rather non-committal sounding mentioning of the possibility by Nowotny was enough to shave nearly 40 basis points off Spain's 10 year government bond yield within minutes. It is quite possible that this was a 'trial balloon' to see how the markets would react. One must not forget, the things that are fed to the mainstream media are rarely unplanned off-the-cuff remarks, there is quite often a definitive aim behind them.

http://www.acting-man.com/blog/media...ld-candles.gif

Spain's 10 year government bond yield, a weekly candlestick chart. The long upper shadow was produced in intraday trading on Wednesday; yields had initially shot up to 7.73%, but then closed at 7.36% - click for better resolution.



Addendum: A Few Interesting Charts


Below are a few charts we have come across that we believe our readers may find interesting. UK GDP fell rather unexpectedly sharply, and the pound fell with it. Recent food price increases have yet to spark the interest of a wider swathe of the internet population. Germany's business confidence is in steep decline and lastly, gold looks like it may break higher in dollar terms soon.

http://www.acting-man.com/blog/media...hart-jan25.gif

The intraday move in the British pound after the release of GDP data showing a rather severe contraction on Wednesday - click for better resolution.

http://www.acting-man.com/blog/media.../inflation.png

Agricultural prices versus Google searches for 'food inflation'. A curious gap has opened up.

http://www.acting-man.com/blog/media...ss-climate.gif

Germany's IFO business climate indexes. All three indexes have declined to lower lows.

That's not a good enough reason. It makes no sense. Why pay you to start a thread on FF when there are already so many FF threads loaded with posters that they can pick from. Either it's a prank or perhaps you misunderstood them.

ADD: Oh and I must add that commercial solicitation in the FF non-commercial forums is a violation of the rules. Anyone caught doing it could be banned.