Category Archives: Uncategorized

By Pam Martens and Russ Martens: March 2, 2020 ~ Despite assurances from the Trump administration that the overall risk to Americans from the coronavirus is “low,” public concern grew over the weekend as New York State reported its first known case of the coronavirus in the most populous city in the country, New York City, where a woman in her 30s who had traveled to Iran tested presumptively positive, meaning the CDC still has to confirm the results. Also over the weekend, the first two deaths were reported in Washington State and new coronavirus cases were announced in Oregon, Rhode Island, and Florida. Other U.S. states with coronavirus cases include California, Illinois, Wisconsin, Arizona and Massachusetts. On Saturday, the Governor of Washington State declared a State of Emergency after a man there died from the virus after community transmission, and 50 residents and staff at a skilled nursing facility, … Continue reading →

By Pam Martens and Russ Martens: February 28, 2020 ~ Going into Thursday morning, February 27, this was the situation on Wall Street: The stock market, as measured by the Dow Jones Industrial Average, had already lost a total of more than 2,000 points in the prior three days of trading; Stock futures were showing a big loss at the open of trading on Thursday; News reports had proliferated overnight of the coronavirus spreading around the globe as well as a case in California suggesting it was now loose in the community. For most folks, that would have been enough bad news to digest with their morning coffee. But it wasn’t for the folks at Goldman Sachs. At 8:12 a.m. yesterday morning, CNBC ran the above graphic and headline: “Goldman sees zero earnings growth for US companies this year because of coronavirus.” Bank of America also apparently felt it was … Continue reading →

By Pam Martens and Russ Martens: February 27, 2020 ~ The Dow Jones Industrial Average was down by 960 points this morning and then began to stage a strong rally. That rally unraveled on news that came out of the press conference held by California Governor Gavin Newsom. The Governor, a Democrat, seemed to go out of his way to stress that his administration has been working closely with the Trump administration in addressing the coronavirus outbreak. He refused to criticize Trump when questioned by reporters. What did become quite clear, however, as reporters drilled down to the situation on the ground in California, is that the state has taken in 800 repatriated Americans from countries with coronavirus outbreaks, has received thousands more passengers on domestic flights from suspect countries, while it currently has just 200 tests kits from the CDC to test for the virus. Newsom told reporters that … Continue reading →

By Pam Martens and Russ Martens: February 27, 2020 ~ During the financial panic of 1907, John Pierpont Morgan corralled the money men of New York together and convinced them to join him in bailing out teetering financial institutions in order to calm the panic in the markets. His plan worked. Flash forward to today. Jamie Dimon is Chairman and CEO of the bank that bears John Pierpont Morgan’s name: JPMorgan Chase. The bank is the largest federally-insured bank in the U.S. with $1.6 trillion in deposits. It has more than 5,000 bank branches across America accepting the life savings of moms and pops. But JPMorgan Chase is also the largest trading and derivatives house on Wall Street – a dangerous, combustible mix as it proved so well in 2012 when it lost $6.2 billion of depositors’ money making wild gambles in derivatives in London. On Tuesday of this week, … Continue reading →

By Pam Martens and Russ Martens: February 26, 2020 ~ Each year the Federal Reserve comes up with a hypothetical, severely adverse economic scenario against which it evaluates the ability of Wall Street’s mega banks to weather the storm. Called “stress tests,” this year’s severely adverse scenario features a severe global recession, unemployment of 10 percent, elevated stress in corporate debt markets and commercial real estate, along with a bank’s major counterparty defaulting if it has significant derivatives trading exposures. The stress test results are typically disclosed in June by the Fed with an immediate announcement by the banks (that get the green light from the Fed) about how many billions of dollars they plan to spend on stock buybacks and dividend increases to artificially boost their share prices. What the Federal Reserve has not planned for in its stress test is a global recession (which was looking entirely likely … Continue reading →

By Pam Martens and Russ Martens: February 25, 2020 ~ If the federal government wants to quarantine the most dangerous threat to the financial health of the United States, it will impose a lockdown and decontamination of the federally-insured banks that are holding tens of trillions of dollars in derivative trades. Yesterday, the stock market rout outed the worst of these actors. While the Dow Jones Industrial Average fell a hefty 1,031.61 points, that was only a 3.56 percentage point loss. The S&P 500 was off by 3.35 percent. The decline in the broader averages looks tame compared to what happened to some of the biggest banks on Wall Street and their derivative counterparties. Morgan Stanley tanked by 5.23 percent; Citigroup was off by 5.12 percent; while Bank of America closed down 4.74 percent. JPMorgan Chase and Goldman Sachs magically trimmed their losses during the trading day, closing down 2.69 … Continue reading →

By Pam Martens and Russ Martens: February 24, 2020 ~ One month ago former presidential candidate Hillary Clinton confirmed to Hollywood Reporter Lacey Rose that the remark she had made in a recent documentary that “nobody likes” Senator Bernie Sanders was still her assessment of the situation. That assessment was silly a month ago and became even more nonsensical yesterday morning as newspapers landed in driveways across America showing a massive win for Sanders in the Nevada caucuses, including big support from both whites and minorities.  According to Newsweek, Sanders’ win in the Nevada Caucuses on Saturday “made political history.” He became the first presidential candidate, from either party, “to win the popular vote in all three early states in a competitive primary.” But Sanders didn’t simply win Nevada – he crushed the contest. With 88 percent of the vote now in, Sanders has captured 47.1 percent of the county … Continue reading →

By Pam Martens and Russ Martens: February 21, 2020 ~ At 10:52 a.m. yesterday, the Dow Jones Industrial Average which was trading at a level of 29,348, began a bungee-style plunge. By 11:32 a.m. the market landed with a thud at a level of 29,013. Then the stock market began an equally inexplicable climb, closing the day down just 128 points. This is what is known as a “Flash Crash,” a sudden plunge in the market with no reliable explanation. No one on Wall Street has yet to offer a convincing explanation for the plunge. An early attempt to pass it off to worries about the coronavirus was easily dispelled because the news report of rising infections from the virus came much earlier than the plunge in the market. Our chart research also shows that the plunge was not related to the coronavirus because Procter & Gamble, a component of … Continue reading →

By Pam Martens and Russ Martens: February 20, 2020 ~ Michael Bloomberg reaffirmed for those who have turned off the news since January 20, 2017 that no one, not even his own mock debate team, dares to tell a powerful billionaire what he doesn’t want to hear. And that’s one of the key reasons that billionaires are so dangerous to high public office – they hear only their own voice. Bloomberg’s performance on the Democratic Debate stage last night was painfully embarrassing. It was like watching an overly-hyped downhill skier, in his first appearance at the U.S. Olympics, trip on his skies getting off the chair lift and slide down the mountain on his belly – making a few awkward groans on the way down. Voters across the country who had been inundated with Bloomberg’s $409 million in advertisements (ten times what Senator Bernie Sanders has spent) were likely shaking … Continue reading →