By Pam Martens and Russ Martens: September 14, 2020 ~ This is the perfect litmus test of just how little mainstream media knows about the dangerous Wall Street banks. Last Thursday, the fact-checking website, Logically, outed Jason Gelinas, who was living a secret-life as a promoter of the conspiracy group, QAnon, while also holding down a Senior V.P. technology position at Citigroup, a giant Wall Street bank that played a key role in the financial and economic collapse of 2008. But instead of headlining the story as “Citigroup V.P Outed as QAnon Promoter,” dozens of headlines described Gelinas as “NJ Man.” (Check out the “NJ Man” headlines here.) As far as we’re aware, there is no context in which the state of New Jersey would be relevant to this story, but there certainly is relevance when it comes to Citigroup. Citigroup has remained strangely silent about the matter, declining to … Continue reading →

By Pam Martens and Russ Martens: September 12, 2020 ~  So far this year, the mega Wall Street bank, Citigroup, has lost 37 percent of its market value – outpacing peer banks like Morgan Stanley, Goldman Sachs, JPMorgan Chase and Bank of America. (See chart below.) Then there was the fat finger in August in the back office of Citigroup that wired $900 million by mistake to pay off the entire principal balance of a Revlon bond instead of making just the payment of interest on the bond. Citigroup is now embroiled in lawsuits with the Revlon lenders, attempting to get them to return the money. According to Institutional Investor, “a total of $526.4 million has yet to be returned” as of August 27. The lenders are refusing to return the funds to Citigroup on the basis that Revlon owed them the money anyway because Revlon had improperly changed the … Continue reading →

By Pam Martens: September 10, 2020 ~ Leave it to those good ole white men of wealth and privilege to know when to cut and run. President George W. Bush and his Treasury Secretary, Hank Paulson, (former CEO of Goldman Sachs) handed the smoldering ruins of the U.S. economy to the first Black president in the history of the U.S., Barack Obama, on January 20, 2009. That was right in the midst of the Great Financial Crisis and just four months after some of the most iconic names on Wall Street had either collapsed or were forced into shot-gun marriages. We wrote the following in May 2008 during the runup to the election: “Wall Street, known variously as a barren wasteland for diversity or the last plantation in America, has defied courts and the Equal Employment Opportunity Commission (EEOC) for decades in its failure to hire blacks as stockbrokers. Now … Continue reading →

By Pam Martens and Russ Martens: September 10, 2020 ~ This article was updated at 3:40 p.m. today. See Editor’s note below. ~ Every Wall Street bailout program that the Fed has created since September 17 of last year has, according to the Fed, been ostensibly created to somehow help the average American. According to the Fed’s Term Sheet for the Term Asset-Backed Securities Loan Facility (TALF), it’s going to “help meet the credit needs of consumers and businesses by facilitating the issuance of asset-backed securities.” Not to put too fine a point on it, but asset-backed securities and related derivatives are what blew up Wall Street in 2008, creating the worst economic downturn, at that point, since the Great Depression. According to the Fed’s TALF transaction data, it has made $2.6 billion in total loans. Forty-six percent of that money, $1.2 billion, went to a company that has 4 … Continue reading →

By Pam Martens and Russ Martens: September 9, 2020 ~ The mega banks on Wall Street joined the tech wreck yesterday as illustrated on the chart above. The selloff in these banks can be attributed to, primarily, the selloff in the price of crude oil – which suggests the banks will be forced to increase loan loss reserves as the threat of more bankruptcies among debt-strapped U.S. oil producers increases. Domestic crude oil, known as West Texas Intermediate or WTI, had a $41 handle on Friday on the Nymex. Yesterday, that turned into a $36 handle – a decline of 12 percent from Friday. A WTI handle below $40 is panic-time for U.S. independent oil producers who are deep in debt and struggling to avoid bankruptcy. The big summer driving season that was expected to boost crude demand was officially over the day after Labor Day. But, in fact, a … Continue reading →

By Pam Martens and Russ Martens: September 9, 2020 ~ The Dow Jones Industrial Average closed with a loss of 632 points yesterday (a 2.25 percent decline) while the Nasdaq erased 465 points for a loss of 4.11 percent. As Wall Street witnessed its most vicious correction since March over the past three consecutive trading sessions, a curious thing happened at the Fed. The Fed’s repo loan money spigot which had churned out more than $9 trillion cumulatively to the trading houses of Wall Street from the inception of the bailout program on September 17, 2019 to our tally in mid-March of this year, pumped out nary a drop of cold cash in repo loans as the market swooned. Big zeros in loans provided by the Fed populated their data sheets on all three days of the selloff. However, to comfort Wall Street with the knowledge that the Fed is … Continue reading →

By Pam Martens and Russ Martens: September 8, 2020 ~ Last week there was a big buzz among financial media outlets regarding the Japanese conglomerate, SoftBank. According to unnamed sources who spoke to the Financial Times, over the past few months SoftBank has paid about $4 billion in premiums, buying call options on individual U.S. technology stocks. The Financial Times called SoftBank the Nasdaq Whale and said its call buying had “stoked the fevered rally in big tech stocks before a sharp pullback” at the end of last week. A call option on an individual stock is a derivative that gives the buyer the right, but not the obligation, to purchase the actual stock at a specified price (strike price) over a specified time period. According to the Financial Times, the call options purchased by SoftBank gave it exposure to approximately $30 billion in the stock of big tech companies. … Continue reading →

By Pam Martens and Russ Martens: September 4, 2020 ~ There were ghosts of the dot.com bust of 2000 to 2002 on every trading screen yesterday. The Nasdaq composite index fell 4.96 percent to close at 11,458.10 but the carnage in many of the underlying stocks was far worse. Notably, 50 stocks in the tech-heavy Nasdaq dropped 9 percent or more yesterday, including some of this year’s highfliers. One of those highfliers was Zoom Video Communications (ZM). Zoom closed on the first day of trading this year at $68.72; flew to $457 by September 1; lost 9.97 percent yesterday to close at $381.32 – still showing more than a quintupling of its market value in a span of eight months. That stock has a nose-bleed-worthy price-to-earnings ratio of 474. While much of the focus has been on the bubble in the big tech names like Alphabet (parent of Google), Amazon, … Continue reading →

By Pam Martens and Russ Martens: September 3, 2020 ~ Happy New Year – here’s your eviction notice. That’s how tens of millions of struggling Americans have been set up to fail as the one percent on Wall Street, propped up by unlimited money from the Fed, ring in the New Year with Tiffany flutes of Dom Perignon in their Greenwich mansions. According to a recent study published by The Aspen Institute, 30 to 40 million Americans will be at risk of eviction over the next several months. The Centers for Disease Control and Prevention (CDC) has been dragged into the eviction morass because Democrats and Republicans in Congress cannot find common ground on a meaningful plan. On Tuesday, the CDC issued an order that bans landlords from evicting tenants that cannot afford to pay rent due to a pandemic-related job loss or income reduction. The CDC action follows an … Continue reading →

By Pam Martens and Russ Martens: September 2, 2020 ~  Members Exchange (MEMX), a brand new stock exchange, has announced that it will begin live trading of select stocks for the first time on September 21 with a full phase-in on September 29. Criminal histories are, apparently, no barrier to running a stock exchange in the United States to the deeply conflicted way of thinking of the Securities and Exchange Commission (SEC), which issued its approval to operate the exchange on May 5. Investors in the new stock exchange are some of the most serially-charged Wall Street banks, including JPMorgan, Goldman Sachs, and UBS, along with the hedge fund, Citadel Securities. BlackRock, which is up to its neck in the Federal Reserve’s deeply conflicted bailout programs, is also an investor, as is the high-frequency trading firm, Virtu Financial, and others. JPMorgan Chase has been criminally investigated by the U.S. Department … Continue reading →