Category Archives: Uncategorized

By Pam Martens and Russ Martens: February 9, 2016  Tomorrow, Janet Yellen will scurry over to the Rayburn House Office Building to give her semi-annual testimony to the House Financial Services Committee, now under the control of a deeply paranoid Republican majority when it comes to the Federal Reserve. (Not that some of that paranoia isn’t justified.) There is no question that Yellen will face hostile questioning from Republicans on the Committee, as she has in the past, although the questions tend to venture far afield from the real financial threats to U.S. stability. Most Democrats, on the other hand, are so wedded to holding up the Dodd-Frank financial reform legislation as their grand achievement after the 2008 crash that they refuse to look out the window and see the equity capital of the Wall Street mega banks currently in a death spiral as the same banks invent ever more … Continue reading →

By Pam Martens and Russ Martens: February 8, 2016  Senator Richard Shelby (R-Alabama), the Chair of the U.S. Senate Banking Committee, has announced a hearing on March 3 at 10:00 a.m. to examine “Regulatory Reforms to Improve Equity Market Structure.” To appropriately conduct that hearing, all the lights should be turned out in the hearing room and the senators and witnesses should have to fumble and stumble their way to their seats in the dark, since that’s what American investors have been forced to do since the 2008 crash – a tortuously long seven years of make-believe financial reform. Following the 1929 crash, whose economic impact was also swift and devastating, the Senate Banking Committee spent the years of 1932 through 1934 holding comprehensive hearings and investigations on the structure of the stock market. The hearings unraveled, day by day, the frauds that the Wall Street titans of that era … Continue reading →

By Pam Martens and Russ Martens: February 7, 2016  Last Wednesday something noteworthy happened on Wall Street. Four of the largest Wall Street banks, each holding trillions of dollars in derivatives, hit new 12-month lows in intraday trading. The banks are Bank of America, Citigroup, Goldman Sachs and Morgan Stanley. The banks recovered a little ground by the end of the week. These banks have two other things in common: they have been spending billions buying back their own stock and they all received bailouts during the 2008 crash. Over the past six years, publicly traded companies in the Standard and Poor’s 500 Index have bought back $2.7 trillion of their own shares according to Bloomberg data. There are four major problems with this strategy: much of the buybacks are financed with debt; some of the buybacks simply offset insider selling or stock awards to executives; none of the money … Continue reading →

By Pam Martens and Russ Martens: February 5, 2016  The Hillary Clinton presidential campaign has a new strategy to get Senator Bernie Sanders to shut up about the unseemly mountains of money Wall Street has showered on her and Bill Clinton throughout their careers: in campaign funds, in speaking fees, in home mortgages, and in donations to their charity, the Clinton Global Initiative. (Details here.) The new strategy is to effectively socialize Sanders to silence by embarrassing him every time he brings up the subject. Before Clinton took the stage last night at the MSNBC Democratic Debate at the University of New Hampshire in Durham, her Press Secretary, Brian Fallon, and Campaign Manager, Robby Mook, met with reporters from Bloomberg News to complain about Sanders’ innuendos that Hillary Clinton can be bought by Wall Street. According to a report at Bloomberg, Fallon stated at a Bloomberg Politics breakfast earlier yesterday … Continue reading →

By Pam Martens and Russ Martens: February 4, 2016 Last night ABC began its two-part series on the Bernie Madoff fraud. Viewers will be reminded about how investment expert, Harry Markopolos, wrote detailed letters to the SEC for years, raising red flags that Bernie Madoff was running a Ponzi scheme – only to be ignored by the SEC as Madoff fleeced more and more victims out of their life savings. Today, there are two equally erudite scribes who have jointly been flooding the SEC with explosive evidence that some Exchange Traded Funds (ETFs) that trade on U.S. stock exchanges and are sold to a gullible public, may be little more than toxic waste dumped there by Wall Street firms eager to rid themselves of illiquid securities. The two anonymous authors have one thing going for them that Markopolos did not. They are represented by a former SEC attorney, Peter Chepucavage, … Continue reading →

By Pam Martens and Russ Martens: February 3, 2016  Most folks don’t realize that on Monday, September 23, 2013, Goldman Sachs began trading as one of the 30 stocks in the Dow Jones Industrial Average Index (Dow). Because the Dow is stock-price weighted and Goldman sports a very high price, it has an outsized impact on point gains and losses in the index. As of yesterday’s close, Goldman Sachs is the priciest stock in the Dow, despite its plunging price of late. Yesterday, the Dow lost 295.64 points and Goldman Sachs was a major contributor to the decline, losing 4.98 percent of its share price to close at $151.70. If this keeps up, it might not be too long before you see Goldman yanked from the Dow. The percentage loss in Goldman yesterday was notable on multiple fronts. First, its percentage decline was 3.18 percent more than the loss in the … Continue reading →

By Pam Martens and Russ Martens: February 2, 2016  Billionaires went to bed very cranky last night and are likely awakening to irritable bowel syndrome this morning. What has been working swimmingly well for them since the 2010 Citizens United decision was handed down by the U.S. Supreme Court, allowing the super wealthy to dump unlimited sums of money into Super Pacs to sway the outcome of elections, just had a wrench thrown into the gears. Voters in Iowa gave a resounding thumbs down to Jeb Bush and his massive Super Pac spending, giving him an embarrassingly low 2.8 percent of the Republican vote. According to data made available by BloombergBusiness (see chart below), Bush’s campaign spent $9.8 million in the final three months of last year while his Super Pac spent an astounding $54.3 million in the final six months of 2015. Also embarrassing for the billionaires giving to … Continue reading →

By Pam Martens and Russ Martens: February 1, 2016  Wall Street, based in New York City, collapsed the U.S. financial system under the weight of its own corruption in 2008. We’ve just come off another year of unprecedented corruption on Wall Street, topped off with two major U.S. banks, Citigroup and JPMorgan Chase, pleading guilty to felony counts for rigging foreign currency trading. Elsewhere in the state of New York, the heads of both legislative branches, Dean Skelos, the Senate Majority Leader, and Sheldon Silver, Speaker of the Assembly, were convicted on corruption charges in the waning days of 2015.  Last evening, the CBS investigative news program, 60 Minutes, produced video evidence that 15 out of 16 lawyers in New York City were willing to discuss strategies with a potential client for laundering dirty money into the U.S. financial system through shell companies. In short, New York State is facing … Continue reading →

By Pam Martens and Russ Martens: January 31, 2016 Today’s digital edition of The New York Times captures the essence of the cancer eating away at our democracy: a leading newspaper is endorsing a deeply tarnished candidate for the highest office in America while a major Wall Street bank that has played a key role in her conflicted candidacy runs a banner ad as if to salute the endorsement. The slogan on Citigroup’s ad, “cash back once just isn’t enough,” perfectly epitomizes the frequency with which the Clintons have gone to the Citigroup well. According to the Center for Responsive Politics, among the top five largest lifetime donors to Hillary’s campaigns, Citigroup tops the list, with three other Wall Street banks also making the cut: Goldman Sachs, JPMorgan Chase and Morgan Stanley. (The monies come from employees and/or family members or PACs of the firms, not the corporation itself.) Hillary … Continue reading →

By Pam Martens and Russ Martens: January 29, 2016  There is quite a bit of inchoate dissonance as to whether JPMorgan Chase is a good investment. Recently, banking analyst Mike Mayo called JPMorgan Chase the “Lebron James of banking.” Lebron James is a famous basketball player who has won a lot of great awards for doing great things, including Olympic Gold. JPMorgan Chase is a bank that has, since Jamie Dimon took the helm as CEO on January 1, 2006, received a deferred prosecution agreement for two felony counts from the U.S. Justice Department for facilitating the Bernie Madoff Ponzi scheme and just last May agreed to a felony count for rigging foreign currency markets. In addition to the felony counts, there has been a serial stream of settlements for everything from rigging electricity markets to ripping off members of the U.S. military. We don’t know why Mike Mayo would … Continue reading →