Category Archives: Uncategorized

By Pam Martens and Russ Martens: October 20, 2014  It took 200 years of hard data in a bestselling book by Thomas Piketty, awesome graphs and charts in Robert Reich’s documentary, “Inequality for All,” and years of scolding from Wall Street on Parade, but Fed Chair Janet Yellen has finally, and correctly, arrived at the idea that the nation’s economic ills are deeply rooted in the fact that U.S. “income and wealth inequality are near their highest levels in the past hundred years.” That was the message Yellen delivered on Friday in a speech at the Federal Reserve Bank of Boston, replete with stomach-churning figures from the Fed. Make no mistake about it, coming at the end of a week that saw dramatic up and down spikes in the stock market – Yellen was sending a pivotal message to the Wall Street wealth hoarders – your billionaire standing could be … Continue reading →

By Pam Martens and Russ Martens: October 16, 2014 If you happened to be sitting behind a trading screen on Wall Street in late August and September 1998, you’ve likely been having some déjà vu over the past seven trading sessions. Intraday rallies continue to fail; there is a thundering stampede into Treasuries; rumors are buzzing about hedge funds in trouble; waves of selling pressure suggest wholesale dumping to meet margin calls. If you needed any more evidence that there is some serious stuff going on behind the scenes on Wall Street, you got it in yesterday’s stock market open. Within minutes the Dow Jones Industrial Average had plunged 370 points in a panic selling spree as buyers went on strike. The Dow was down as much as 458 points in early afternoon before trimming its loses before the final bell to close at a minus 173 points. It’s all … Continue reading →

By Pam Martens and Russ Martens: October 15, 2014  New York City has 8.4 million people living in its boroughs. But when it comes to defending those charged with financial crimes, it’s a very small, clubby world of people who are either related to each other or have worked together in the past. And this clubby group has one more thing in common: most of its members seem to be lavishing huge campaign contributions on U.S. Senator Charles (Chuck) Schumer of New York – a man who is in a position to recommend Federal Judge appointments and the Justice Department’s U.S. Attorney who will prosecute the financial crimes – or not. These are the findings in a new on-line book, JPMadoff: The Unholy Alliance Between America’s Biggest Bank and America’s Biggest Crook, being offered free as a chapter a month by attorneys Helen Davis Chaitman and Lance Gotthoffer. (Chaitman is … Continue reading →

By Pam Martens and Russ Martens: October 14, 2014 Yes, there is a wall of worry that the stock market is no longer climbing but is now descending. The greatest worry, that makes all others pale in comparison, is that the U.S. central bank, the Federal Reserve, has nothing left in its monetary arsenal but one bullet – Fed-Speak, otherwise known as spin. After three bond buying programs known as Quantitative Easing (QE) flooded Wall Street with bountiful amounts of play money while failing to significantly lift wages or economic growth, the U.S. central bank now has a balance sheet that has quadrupled since the 2008 crisis to $4.4 trillion. That it would be allowed to engage in QE4 in the next crisis is highly doubtful since QEs have proven to be financial bubble makers, income inequality makers and of little help to the average citizen. Equally problematic, the Fed … Continue reading →

By Pam Martens and Russ Martens: October 13, 2014 It was only a matter of time until the evidence became irrefutable that the only way out of a global deflation on the order of the Great Depression was to address the fact that 571 U.S. billionaires simply don’t have enough hours in the day to spend adequate money to buy enough goods that would require the restocking of shelves, create new factory orders and thereby ramp up job hiring to keep a nation of 317 million people afloat. A nation where the top 10 percent reaps more than 50 percent of the income is doomed to end up in the quicksand of deflation, dragging down the rich along with everyone else. The Federal Reserve’s timidity to address this reality since the crisis of 2008, as the national debt ballooned and its own balance sheet quadrupled, has now put it in … Continue reading →

By Pam Martens and Russ Martens: October 10, 2014 Here’s the action of the Dow Jones Industrial Average on Tuesday, Wednesday and Thursday of this week: down 273 points; up 274.8 points; down 334.97 points. In the span of a week the stock market has taken investors on a stomach-churning roller-coaster ride and futures are pointing to a weak open this morning. What’s rattling the market? Headlines have incorrectly simplified the worry to concerns on global growth. But that inadequately explains the underlying fears that are causing the gyrations and sending the timid to the exits. Wall Street On Parade will have an in-depth analysis of the core issues this coming Monday.

By Pam Martens: October 9, 2014 There were some interesting moves in the Chicago futures markets yesterday that might have been an effort to instill fear in traders that were short the market ahead of the release of the Fed’s minutes slated for unveiling at 2 p.m. Getting the party started early could induce panic short covering if the Fed minutes suggested a dovish approach to raising interest rates – which indeed they did. The stock market had been down as much as 55 points around the 11 a.m. hour but began a gradual advance ahead of the release, with a surge to close up 274.8 points higher on the Dow Jones Industrial Average. Looking a bit psychotic, that move of more than 329 points peak to trough followed by just one day a loss of 273 points in the Dow. Eric Hunsader, chart watcher and computer whiz who heads … Continue reading →

By Pam Martens and Russ Martens: October 8, 2014 In July 2013 and again this past January, the U.S. Senate’s Subcommittee on Financial Institutions and Consumer Protection, part of Senate Banking, convened hearings to get a handle on the extensive physical commodity holdings of Wall Street banks. At the January hearing, Senator Sherrod Brown, chair of the Subcommittee, told hearing participants that “the six largest U.S. bank holding companies have 14,420 subsidiaries, only 19 of which are traditional banks.” At the time of the July 2013 hearing, Morgan Stanley, one of the nation’s largest retail brokerage firms, an investment bank, as well as an FDIC insured depository bank, owned sprawling crude oil operations. Congress had been aware of Morgan Stanley’s foray into the oil business since at least 2009 when 60 Minutes reported that Morgan Stanley had acquired the capacity to store 20 million barrels of oil. Ostensibly as a … Continue reading →

Pam Martens and Russ Martens: October 7, 2014 In the mid 1980s, there was a different King and a different oil minister in Saudi Arabia than present today, but, other than that, the threat of an oil price war within the ranks of OPEC has all the hallmarks of early 1986. Typically, cartels like OPEC are supposed to act in unison on prices. But last Wednesday, Saudi Arabia’s state-owned oil company, Saudi Aramco, stunned world oil markets by acting alone in cutting its official crude price by $1 per barrel for November deliveries to its Asian customers. It also dropped its price by approximately 40 cents per barrel to U.S. and European customers. If this is the opening salvo of a replay of 1986, be forewarned that crude oil prices plunged by over 50 percent in less than eight months in that era. The Saudi oil minister in 1986 was … Continue reading →

By Pam Martens and Russ Martens: October 6, 2014 America’s central bank, the Federal Reserve, has a credibility problem and a management crisis unique to its unusual structure. If the Chair of the Federal Reserve Board of Governors, Janet Yellen, had any real management powers, she would have immediately asked William Dudley, President of the New York Fed, to step down after internal tape recordings revealed that his staff rubber stamps “legal but shady” deals at the big Wall Street banks it supervises. “Legal but shady” and patently illegal dressed up as just shady deals collapsed this Nation’s financial system only six years ago and continues to depress the country’s economic growth. The tapes were released by former New York Fed bank examiner, Carmen Segarra, via the public interest web site ProPublica and public radio’s “This American Life.” Segarra is suing the New York Fed, charging that she was terminated … Continue reading →