Category Archives: Uncategorized

By Pam Martens: March 26, 2014 There’s a few Golden Rules that most Wall Street traders intuitively know never to cross: “Don’t fight the Fed,” “Cut your losses short and let your profits run,” “Never pick a fight with people who buy ink by the barrel,” and the one coined just last week: “Don’t bet against the folks with a military budget larger than the next ten biggest spenders combined.” Of course, traders have egos and can sometimes forget the basics. The London Whale traders at JPMorgan elected not to cut their losses short and let them run to $6.2 billion, which led to press ink by the barrel, multiple Congressional hearings, indictments of traders, a $920 million settlement by JPMorgan and the trials have yet to start. Now, once again, it seems that common sense has escaped the Masters of the Universe on Wall Street. Last Tuesday, Jay Carney, … Continue reading →

By Pam Martens: March 25, 2014 Last week the Wall Street Journal ran an in-depth review by two financial experts on when one should begin taking Social Security benefits – at age 62 at a reduced rate; at age 70 when one qualifies for the maximum payment based on salary history; or at some point in between? The article gets off on fine footing, explaining the basics: “It shouldn’t surprise anyone that how long you live is one of the biggest factors in determining whether your decision is the right one. To calculate a person’s monthly payments, the Social Security Administration looks at lifetime earnings, their age when they start to collect, and their average life expectancy at that age. Say you are a 65-year-old man who starts receiving benefits. Up until the age of 84 (your average life expectancy), you will have earned more in total than if you … Continue reading →

By Pam Martens and Russ Martens: March 24, 2014 Families of young JPMorgan Chase workers who have experienced tragic deaths over the past four months, have been kept in the dark on many details, including the fact that the bank most likely held a life insurance policy on their loved one – payable to itself. Banks in the U.S., as well as other corporations, are allowed to make multi-billion dollar wagers that their profits from life insurance policies on employees will outstrip the cost of paying premiums and other fees. Early deaths help those wagers pay off. According to the December 31, 2013 financial filing known as the Call Report that JPMorgan made with Federal regulators, it has tied up $10.4 billion in illiquid, long term bets on the death of a large segment of its employees. The program is known among regulators as Bank Owned Life Insurance or BOLI. … Continue reading →

By Pam Martens: March 20, 2014 The head of the Bank of England (BOE), Mark Carney, who also chairs the G20’s Financial Stability Board, has a very different view from the U.S. Fed on how to exit stimulus programs. Carney is credited with successfully guiding Canada, where he previously served as head of the central bank, through the worst of the global financial crisis from 2008 to 2010. Does Carney know something that monetary policy wonks in the U.S. don’t or does the Fed know something the rest of us don’t? In her debut press conference yesterday after taking the reins at the Federal Reserve Board of Governors on February 3 of this year, Janet Yellen jolted markets with the assessment that the Fed’s mammoth, monthly bond buying program, known as quantitative easing (QE), might end as early as this fall. Then, when asked how long after that the Fed … Continue reading →

By Pam Martens and Russ Martens: March 19, 2014 Kenneth Bellando, age 28, was found outside his East Side apartment building on March 12 in what the New York Post is calling “an apparent suicide” despite an ongoing police investigation into the matter. The building from which Bellando allegedly jumped was only six stories – by no means ensuring that death would result – providing the police with an additional reason to investigate for foul play. The young Bellando, who had previously worked for JPMorgan Chase himself, was the brother of John Bellando, who was named in the Senate Permanent Subcommittee on Investigations’ report on how JPMorgan had hid losses and lied to regulators in the London Whale derivatives trading debacle that resulted in losses of at least $6.2 billion. Congressional outrage was heightened by the fact that JPMorgan was gambling in London in high risk and illiquid derivatives using … Continue reading →

By Pam Martens: March 18, 2014 In case you haven’t figured it out yet, there is a right way and a wrong way to help yourself to other people’s money on Wall Street. The right way propels you into the one percent replete with mansions and yachts, your name memorialized on buildings, a golden parachute, an office and car for life fronted by defrauded shareholders and regular invitations to appear on CNBC and lecture others on how to structure the financial system. Then there’s the wrong way – as Gary Foster found out the hard way in June 2012 when he was sentenced to eight years in the slammer for embezzling more than $22 million from Citigroup and compounding his lack of etiquette in the most unforgiveable fashion – he wired the funds to Citigroup’s arch rival, JPMorgan Chase. Foster broke multiple etiquette rules for stealing money on Wall Street. … Continue reading →

By Pam Martens: March 17, 2014 Stanley Fischer did not get a proper vetting at his Senate Banking confirmation hearing last Thursday to serve as Vice Chairman of the Federal Reserve Board of Governors. Of the 22-member Senate Banking Committee, only five Senators, outside of the Chair and Ranking Member, showed up to question Fischer. Questions should have focused on Fischer’s ties to Citigroup, the serially corrupt mega bank which collapsed into the arms of taxpayers in 2008, requiring a bailout of $45 billion in equity infusions, $300 billion in asset guarantees to stop a run on the bank, and over $2 trillion in below market rate loans from the Federal Reserve to prop it up. Of the five regular Committee members questioning Fischer, all Democrats, only one, Senator Elizabeth Warren, brought up his ties to Citigroup and the bank’s insidious relationship with government and regulators. We’ll get to that … Continue reading →

By Pam Martens: March 13, 2014 The warning signs are piling up that the U.S. economy is stalling and the feeble measures of the President to address this economic slowdown with executive signings are too little too late. Congress needs to put partisan bickering aside and open its eyes to an onslaught of data pointing to an economy hitting a brick wall. For five years now, the executive branch and Congress have been living under the Wall Street-imposed delusion that flooding the big banks with liquidity (bailouts and years of quantitative easing) would promote job growth in the private sector and restore good jobs to the middle class. What it restored instead were rising bonuses for a limited, elite set of the financial sector who have used that flood of cash to make highly leveraged, high risk wagers in trading venues around the world while exacerbating income inequality in the … Continue reading →

By Pam Martens: March 12, 2014 Mark Carney, the head of the Bank of England, and other officials from the BOE were put through a five hour marathon of questioning yesterday by Parliament’s Treasury Select Committee covering everything from how long the BOE plans to continue Quantitative Easing (QE), to the potential for Scotland to vote for its independence, to what it knew and when it knew it about the rigging of the Foreign Exchange market by colluding global banks. The bombshell of the day, however, did not occur during the session on the Foreign Exchange scandal, which is stacking up to be a more serious matter than the rigging of the Libor interest rate benchmark which occurred under the nose of the Bank of England and the British Bankers Association. (London now seems to be in competition with itself for the prize of the century for overseeing the rigging … Continue reading →

By Russ Martens and Pam Martens: March 11, 2014 Questions continue to mount over why a rash of suspicious deaths among executives in the financial services industry are occurring now when the worst of the crisis, layoffs, bankruptcies and bailouts occurred over five years ago – or at least Federal officials keep assuring us that the worst is over. The underlying concern is that we still cannot get a clear assessment of global financial risks because of what we can’t see: the interconnectedness of global banking; offshore banking; off balance sheet vehicles; and regulatory arbitrage where U.S. financial institutions move high risk operations to foreign locales with light-touch regulators. It now emerges that there are significant financial ties between JPMorgan Chase, which experienced three suspicious deaths of employees in their 30s in January and February of this year, and two Swiss insurers where a suspicious executive death occurred in August … Continue reading →