Global Debt Time Bomb explodes soon

[TacAir]

So badly decayed now, thatTime, Inc put this up from two French photogs that traveled over to capture the destruction.

A quote from one of the captions at the link you posted: "Developers hope to convert the building to residential units by 2010"

People fleeing the Euro are coming to US in droves - snapping up real estate.
Odd that, the Japanese bought real estate back in the day because they had too much money - this time around, folks are just trying to keep what they have.

Makes me wonder how crappy the current US RE market would look w/o all the Euro dough pouring in...

[Blacksmith]

People fleeing the Euro are coming to US in droves - snapping up real estate.

Certain places are amazingly cheap right now compared to ten years ago. If you have the cash now is a great time to buy.

[Pilsung]

http://market-ticker.org/akcs-www?post=208144

“Sometimes Being Responsible Means*****ing People Off”

By Janet Tavakoli – July 3, 2012

Last week, Gillian Tett of the Financial Times wrote how five years previously, she and her fellow journalists were intimidated into backing off of a huge story about banks manipulating LIBOR. This is the London Interbank Offered Rate set by a poll of leading banks to determine the benchmark interest rate referenced by many home mortgage loans, floating rate notes, collateralized debt obligations, and many other financial instruments:

“At the time, this sparked furious criticism from the British Bankers’ Association, as well as big banks such as Barclays; the word “scaremongering” was used. But now we know that, amid the blustering from the BBA, the reality was worse than we thought. As emails released by the UK Financial Services Authority show, some Barclays traders were engaged in a constant and pervasive attempt to rig the Libor market from 2006 on, with the encouragement of more senior managers. And the British bank may not have been alone.”

(“LIBOR Affair Shows Banking’s Big Conceit,” Financial Times, June 28, 2012.)

At the heart of the allegations is what appears to be a blasé criminal conspiracy within Barclays. Moreover, Tett is correct. Barclays is far from alone.

Unfortunately, the intimidation was a success. The BBA and Barclays chose their word carefully, because accusing journalists of “scaremongering” suggests they are irresponsible sensationalist hacks. In essence, through lies and intimidation, they threatened to ruin careers.

The Financial Times backed off. As a result, the best coverage of the ongoing scandal came from a controversial blog with mostly anonymous writers called ZeroHedge. It pounded on the story harder than mainstream financial media. Not only are other banks implicated in the scandal, the Bank of England, a bank regulator, is also implicated.

[SlobberToofTigger]

The entertaining part is this is not really news. The British banking and insurance industries have been making their money since their currency lost its reserve status by rigging the world market. Everyone knows it but no one cares because if you are in the know you can make money off of it as well...

[Pilsung]

The parallels between today and the events of the 1930s seem to grow stronger with each passing day.

http://www.guardian.co.uk/world/2012/ju ... of-marxism

Capitalism is in crisis across the globe – but what on earth is the alternative? Well, what about the musings of a certain 19th-century German philosopher? Yes, Karl Marx is going mainstream – and goodness knows where it will end.

Class conflict once seemed so straightforward. Marx and Engels wrote in the second best-selling book of all time, The Communist Manifesto: "What the bourgeoisie therefore produces, above all, are its own grave-diggers. Its fall and the victory of the proletariat are equally inevitable." (The best-selling book of all time, incidentally, is the Bible – it only feels like it's 50 Shades of Grey.)

Today, 164 years after Marx and Engels wrote about grave-diggers, the truth is almost the exact opposite. The proletariat, far from burying capitalism, are keeping it on life support. Overworked, underpaid workers ostensibly liberated by the largest socialist revolution in history (China's) are driven to the brink of suicide to keep those in the west playing with their iPads. Chinese money bankrolls an otherwise bankrupt America.

The irony is scarcely wasted on leading Marxist thinkers. "The domination of capitalism globally depends today on the existence of a Chinese Communist party that gives de-localised capitalist enterprises cheap labour to lower prices and deprive workers of the rights of self-organisation," says Jacques Rancière, the French marxist thinker and Professor of Philosophy at the University of Paris VIII. "Happily, it is possible to hope for a world less absurd and more just than today's."

That hope, perhaps, explains another improbable truth of our economically catastrophic times – the revival in interest in Marx and Marxist thought. Sales of Das Kapital, Marx's masterpiece of political economy, have soared ever since 2008, as have those of The Communist Manifesto and the Grundrisse (or, to give it its English title, Outlines of the Critique of Political Economy). Their sales rose as British workers bailed out the banks to keep the degraded system going and the snouts of the rich firmly in their troughs while the rest of us struggle in debt, job insecurity or worse. There's even a Chinese theatre director called He Nian who capitalised on Das Kapital's renaissance to create an all-singing, all-dancing musical.

[dogbane]

An interesting blog post about oil prices as a bellwether for the state of the global economy:
http://www.theoildrum.com/node/9293#more

[DialM]

Ohhhhh, central bank hat trick today! Not coordinated of course. No, nothing to see, move along.

[Pilsung]

Cash-strapped municipalities have long used their police forces to generate revenue through BS traffic stops, red light cameras, private prisons, etc. Now the Nevada Highway Patrol is accused of training K-9 dogs to falsely alert on "drug runners" allowing their cars and assets to be seized. If truth is the first casualty of war, law enforcement and judicial integrity may be the first casuality of tax and revenue shortfalls.

http://privateofficernews.wordpress.com ... ficer-com/

LAS VEGAS NV June 27 2012 – A group of Nevada Highway Patrol troopers and a retired police sergeant have filed a racketeering complaint against the NHP and Las Vegas Metro Police in U.S. District Court.

The complaint alleges that after then-Gov. Jim Gibbons approved a K-9 program to target drug runners on Nevada’s highways, Nevada Highway Patrol Commander Chris Perry intentionally undermined the program.

The complaint alleges that the drug-sniffing dogs used by troopers in the program were intentionally being trained to operate as so-called trick ponies, or dogs that provide officers false alerts for the presence of drugs.

The dogs were being trained to alert their handlers by cues, instead of by picking up a drug’s scent by sniffing, the complaint said. When a dog gives a false alert, this resulted in illegal searches and seizures, including money and property, the complaint said.

The 103-page complaint alleges that Perry, along with others, used the K-9s to undermine the program to systematically conduct illegal searches and seizures for financial benefit.

The complaint also alleges the defendants, which also includes the state’s Public Safety Department and individuals in NHP and Metro, were involved in a Federal RICO conspiracy, also known as the Federal Racketeer Influence and Corrupt Organizations Act.

NHP, Metro and the state have not returned calls from 8 News NOW for comment.

Allegations also include corruption, abuse of office and official cover ups.

[TacAir]

Cash-strapped municipalities have long used their police forces to generate revenue through BS traffic stops, red light cameras, private prisons, etc. Now the Nevada Highway Patrol is accused of training K-9 dogs to falsely alert on "drug runners" allowing their cars and assets to be seized. If truth is the first casualty of war, law enforcement and judicial integrity may be the first casuality of tax and revenue shortfalls.

http://privateofficernews.wordpress.com ... ficer-com/

LAS VEGAS NV June 27 2012 – A group of Nevada Highway Patrol troopers and a retired police sergeant have filed a racketeering complaint against the NHP and Las Vegas Metro Police in U.S. District Court.

The complaint alleges that after then-Gov. Jim Gibbons approved a K-9 program to target drug runners on Nevada’s highways, Nevada Highway Patrol Commander Chris Perry intentionally undermined the program.

The complaint alleges that the drug-sniffing dogs used by troopers in the program were intentionally being trained to operate as so-called trick ponies, or dogs that provide officers false alerts for the presence of drugs.

The dogs were being trained to alert their handlers by cues, instead of by picking up a drug’s scent by sniffing, the complaint said. When a dog gives a false alert, this resulted in illegal searches and seizures, including money and property, the complaint said.

The 103-page complaint alleges that Perry, along with others, used the K-9s to undermine the program to systematically conduct illegal searches and seizures for financial benefit.

The complaint also alleges the defendants, which also includes the state’s Public Safety Department and individuals in NHP and Metro, were involved in a Federal RICO conspiracy, also known as the Federal Racketeer Influence and Corrupt Organizations Act.

NHP, Metro and the state have not returned calls from 8 News NOW for comment.

Allegations also include corruption, abuse of office and official cover ups.

Since this thread is about money/dough.ducats/etc....

"Traces of cocaine taint up to 90 percent of paper money in the United States, a new study finds.

A group of scientists tested banknotes from more than 30 cities in five countries, including the United States, Canada, Brazil, China, and Japan, and found "alarming" evidence of cocaine use in many areas.

U.S. and Canadian currency had the highest levels, with an average contamination rate of between 85 and 90 percent, while Chinese and Japanese currency had the lowest, between 12 and 20 percent contamination.

The findings were presented yesterday at the 238th National Meeting of the American Chemical Society in Washington, D.C.

Study leader Yuegang Zuo of the University of Massachusetts in Dartmouth said that the high percentage of contaminated U.S. currency observed in the current study represents nearly a 20 percent jump in comparison to a similar study he conducted two years ago."

As an aside, there is so much funny money running around here, that I check large bills I get from the bank at the teller's window.

[Pilsung]

http://www.zerohedge.com/news/rbs-glitc ... operations

It seems IT professionals around the world are #failing as the 'glitch' that affected millions of account holders in the UK has leaped the channel and spread across Europe to infect Sberbank - which just happens to be the largest Russian bank. Via Bloomberg:

•*SBERBANK CARDS NOT WORKING IN RUSSIA, ABROAD, COMPANY SAYS
•*SBERBANK SAYS WORKING TO RESOLVE TECHNICAL MALFUNCTION :SBER RU
and from Interfax:

RUSSIA-SBERBANK-CARDS-MALFUNCTION MOSCOW. July 6. (Interfax) – Sberbank of Russia (RTS: SBER) has suspended credit and debit card operations due to a technical malfunction, the bank told Interfax. “All cards are not being serviced,” it said.

How many times did these glitches occur among the world's largest and likely highest paid IT services groups before the European financial crisis pulled back the curtain and showed the proximity of the liquidty cliff for so many of the 'biggest' banks in the world?

Sberbank just happens to be the biggest Russian bank...

[Pilsung]

http://www.zerohedge.com/news/spain-may ... a?tw_p=twt

The last few days have seen some rather concerning central-planning actions by Argentina. Fresh from their nationalization of Spain's YPF, not only did they "forbid individuals from buying dollars for savings" issuing a statement allowing dollars to be used for "travel, mortgages, and to send family members traveling abroad if they they run out of money"; but now we hear of the forced action on Argentina's banks to lend out 5% of deposits at rates well below inflation estimates in the next six months (or else). As Reuters notes, "The move... marks an escalation in [President Christina Fernandez] war on private enterprise which may spread further." It should be noted just how far central banks are willing to go (strong-arming banks into subsidized loans to businesses) and it would absolutely not surprise us if this is precisely where the US is heading as command economies become the new normal globally.

Via Reuters:

NEW YORK, July 6 (Reuters Breakingviews) - Fresh from nationalizing YPF, President Cristina Fernandez now wants to strong-arm banks into subsidizing loans to businesses. The move shouldn't have too big an impact on bank profits, but it marks an escalation in her war on private enterprise which may spread further.

CONTEXT NEWS- The administration of Argentina's President Cristina Fernandez ordered banks on July 5 to lend companies 15 billion pesos ($3.3 billion) by the end of the year at rates well below private inflation estimates. The regulation would force the banks to lend 5 percent of the financial sector's $67.6 billion in private sector deposits.

- The central bank announced the new regulation following Fernandez's public statements that banks would have to lend cheaply to businesses to help bolster a flagging economy.

- The decision comes shortly after the government nationalized the country's largest oil company, YPF, claiming that it wasn't investing enough in producing oil.

- Latin America's third-largest economy grew 8.9 percent in 2011 but growth is slowing sharply due to sluggish global conditions and surging costs at home.

- Shares in financial institutions fell following the announcement. BBVA Banco Frances shares lost 4.9 percent, while Grupo Financiero Galicia's dropped 5.5 percent. These contributed to the country's MerVal index of leading stocks closing down 1.87 percent on July 5.

- Reuters: Argentina gives banks 6 months to grant new loans

[Pilsung]

http://www.dailymail.co.uk/news/article ... dated.html

Thousands were left out of pocket yesterday after the Royal Bank of Scotland was at the centre of a new computer meltdown.

About 100,000 customers of Thinkbanking, whose accounts are held by RBS, did not have their balances updated because of a technical problem.

The hitch came a fortnight after the RBS computer breakdown left millions of customers of NatWest, owned by RBS, unable to access their cash.

[raptor]

Spain is seeing rates of 7% today for its bonds today.

http://www.bloomberg.com/quote/GSPG10YR:IND

[raptor]

The FDIC closed a bank and one of the officers took off...with $17 million.



http://www.cbsnews.com/8301-201_162-574 ... 7-million/

[raptor]

Another case of fraud. It is odd that this has not seen more press.

http://finance.yahoo.com/news/pfgbest-m ... 33638.html

Basically $200 million just "disappeared".

[phil_in_cs]

Another case of fraud. It is odd that this has not seen more press.

http://finance.yahoo.com/news/pfgbest-m ... 33638.html

Basically $200 million just "disappeared".

You have to wonder what impact on investors willingness to invest all these cases have. At one point - you have to put your money somewhere, but if you can't trust the folks you're investing with you have much to worry about beyond a specific stock or fund.

[solrac7]

Spain increases the sales tax to 21% http://www.cnbc.com/id/48144383
- The Prime Minister says " These measures are not pleasant, but they are necessary. Our public spending exceeds our income by tens of billions of euros," Rajoy told parliament." How soon before the shoe drops and we have this here? Except ours is trillions instead of billions. Will our sales tax go to 50%? Those questions are rhetorical...
Cb

[SlobberToofTigger]

Another case of fraud. It is odd that this has not seen more press.

http://finance.yahoo.com/news/pfgbest-m ... 33638.html

Basically $200 million just "disappeared".

You have to wonder what impact on investors willingness to invest all these cases have. At one point - you have to put your money somewhere, but if you can't trust the folks you're investing with you have much to worry about beyond a specific stock or fund.

Is why I gave up and bought cows. If all goes well I make money. If things do not go well I eat steak.

[Pilsung]

http://www.zerohedge.com/news/jpm-admit ... s#comments

Back on May 30 we wrote "The Second Act Of The JPM CIO Fiasco Has Arrived - Mismarking Hundreds Of Billions In Credit Default Swaps" in which we made it abundantly clear that due to the Over The Counter nature of CDS one can easily make up whatever marks one wants in order to boost the P&L impact of a given position, this is precisely what JPM was doing in order to boost its P&L? As of moments ago this too has been proven to be the case. From a just filed very shocking 8K which takes the "Whale" saga to a whole new level. To wit: 'the recently discovered information raises questions about the integrity of the trader marks, and suggests that certain individuals may have been seeking to avoid showing the full amount of the losses being incurred in the portfolio during the first quarter. As a result, the Firm is no longer confident that the trader marks used to prepare the Firm's reported first quarter results (although within the established thresholds) reflect good faith estimates of fair value at quarter end."

As a result of this, regulators who now are only 3 years behind the curve, are most likely snooping to inquire not only how JPM did it (call us: we can brief you in 2 minutes), but who else has been doing this? Hint: everyone.

Because in other words, we have just discovered that the two key components of the entire CDS market: the LIBOR base and market "marks" have been bogus at best, and realistically, fraud. And one wonders why no bank ever will let CDS trade on an exchange...

[Ten Eight]

http://www.zerohedge.com/news/jpm-admits-cio-group-mismarked-hundreds-billions-cds-effort-artificially-boost-profits#comments

Back on May 30 we wrote "The Second Act Of The JPM CIO Fiasco Has Arrived - Mismarking Hundreds Of Billions In Credit Default Swaps" in which we made it abundantly clear that due to the Over The Counter nature of CDS one can easily make up whatever marks one wants in order to boost the P&L impact of a given position, this is precisely what JPM was doing in order to boost its P&L? As of moments ago this too has been proven to be the case. From a just filed very shocking 8K which takes the "Whale" saga to a whole new level. To wit: 'the recently discovered information raises questions about the integrity of the trader marks, and suggests that certain individuals may have been seeking to avoid showing the full amount of the losses being incurred in the portfolio during the first quarter. As a result, the Firm is no longer confident that the trader marks used to prepare the Firm's reported first quarter results (although within the established thresholds) reflect good faith estimates of fair value at quarter end."

As a result of this, regulators who now are only 3 years behind the curve, are most likely snooping to inquire not only how JPM did it (call us: we can brief you in 2 minutes), but who else has been doing this? Hint: everyone.

Because in other words, we have just discovered that the two key components of the entire CDS market: the LIBOR base and market "marks" have been bogus at best, and realistically, fraud. And one wonders why no bank ever will let CDS trade on an exchange...

I used to work for J.P Morgan. This sums it up nicely, and is only the tip of the iceberg.

Edit: http://www.jsmineset.com/2012/01/30/the ... -us-banks/

[Pilsung]

http://www.zerohedge.com/news/spanish-b ... n#comments

Contrary to popular delusions, money flows in Spain are once again deteriorating rapidly, with the country's bank borrowings from the ECB soaring by €50 billion in June according to the Bank of Spain, the second highest ever, to a record €337 billion. While this is bad for Spain, it is good for Italy, which saw its June ECB borrowings rise by only €9 billion, to a record €281 billion, although well below Spain's total - something Italy, which led Spain in ECB borrowings since mid-2011 will be delighted to hear. What however, is rather curious, is that the Spanish TARGET2 net liability soared to €371 billion (-€40 billion in autonomous factors accounting for the lower total number), forcing the ongoing implicit German bailout of the periphery to accelerate to a record €729 billion as noted previously. As a result, for the first time ever, Spanish TARGET2 liabilities represented over half of total Germany TARGET2 claims. Just as we predicted several months ago, German funding of peripheral current account balances is the only "source of capital" for these countries in what is rapidly becoming the latest 'flow of funds' mercantilist scheme, one which can only sustain for so long by definition. In the meantime, now that we are in the exponential phase of the TARGET2 blow out, expect the next German update to indicate well over €2 billion per day in implicit European bailout spending.

[Pilsung]

http://www.zerohedge.com/news/ombs-stoc ... al-endgame

To those on the hill and elsewhere who suggest this growing 'fiscal cliff' and 'debt ceiling' crisis will all get solved, former Office of Management and Budget (OMB) Director David Stockman tells Bloomberg TV that "they will punt, punt, punt and kick the can with partial solutions driven by eleventh hour crisis-based extensions that will go on for the whole of the next term!" When asked whether this economy will be mired in the doldrums, he rather ominously states "it will be worse, because we will be in recession" and notes that when the lame ducks re-look at the budget numbers with a realistic recession (instead of the current assumption of no recession within 12 years) it will be far worse and in a political environment where 'we cannot possibly raise taxes - and we cannot possibly cut spending'. With a 78% disapproval rating for the 'do nothing' Congress, Stockman is surprised that 16% somehow approve - approve of what? His warning is that unlike in past periods, today "we are completely paralyzed, there is an ideological divide on taxes and entitlement like we've never had before" and while he realizes that "the debt problem doesn't become a debt problem until the market suddenly have a wake up call and realize that if the Fed doesn't keep printing, it's game over."

[SeerSavant]

http://www.telegraph.co.uk/finance/comment/jeremy-warner/9404196/World-economy-heads-for-another-perfect-storm.html

For the best part of the last year, the US has seemed immune to Europe’s woes, but now cracks are beginning to emerge. With the recovery fading, the US may even have slipped back into negative growth in the second quarter, though that still remains a minority view. Even so, most anticipate at best anaemic growth of little more than 1pc in annualised terms, and that’s before we encounter the dreaded “fiscal cliff”, which could suck as much as 4pc out of US output.
The effect would be so extreme that, for that reason alone, the IMF assumes the politicians won’t allow it happen. Instead, the IMF comforts itself with the prediction that some kind of political consensus will eventually be reached that extends temporary tax cuts and prevents the deep automatic spending cuts due to kick in at the end this year.
Perhaps this is correct. The American political system has a habit of going to the wire on these issues but, to paraphrase Winston Churchill, can in the end always be counted on to do the right thing, once everything else has been tried. That’s what happened during the debt ceiling crisis of early last year.

Unless something drastic happens, like the previous posts have stated, It appears to be, in fact, another round of kick the can...

I don't think that anyone has enough clout in office or otherwise to do what needs to be done anymore...


I typed in "good news in the economy" into google, and it autocorrected my text into a blue color font...

[Blacksmith]

I don't think that anyone has enough clout in office or otherwise to do what needs to be done anymore...

Is clout the VABeach word for balls?