Search Results for: JPMorgan

By Pam Martens and Russ Martens: September 2, 2015 The Dow Jones Industrial Average plunged 469.6 points yesterday for a loss of 2.84 percent but Wall Street banks and trading firms took a far heavier bruising. Business media have been placing the blame for global stock market convulsions on China’s slowing economy, devaluation of its currency and seemingly unstoppable selloffs in its wildly inflated stock market. There would seem to be much more to this story than we know so far to explain the outsized fall in Wall Street bank stocks. Yesterday, with the Dow losing 2.84 percent, the major names on Wall Street fared as follows: Citigroup, down 4.75 percent; Bank of America, down 4.65 percent; Wells Fargo, down 4.39 percent; JPMorgan Chase, down 4.13 percent; Morgan Stanley, down 3.86 percent; and Goldman Sachs, down 3.44 percent. The Blackstone Group, a private equity firm with significant involvement in China, … Continue reading →

By Pam Martens and Russ Martens: August 27, 2015  That big so-called rally at the market close yesterday was not a rally but a short squeeze. That’s when the hedge funds that have put on short positions size up the amount of stock for sale at the close of trading and, if the amount is light, they decide to close out their short positions by buying stock to cover. On Tuesday, there was approximately $3.5 billion in orders to sell at the close, resulting in the late day selloff. Yesterday, there was only about $500 million to sell, making it risky to hold short positions, thus the short squeeze driving the Dow up 619 points at the close. Expect to see a lot more of these spikes, up or down, in the last two hours of trading. Assessing just how large the bubble has grown in U.S. markets as a … Continue reading →

By Pam Martens and Russ Martens: August 24, 2015 After an 8.5 percent plunge in China’s Shanghai Composite Index on Monday (bringing its loss for the month to a negative 21 percent), a drop in the U.S. Dollar and the U.S. crude oil benchmark, West Texas Intermediate, slipping below $39 a barrel, futures on the Dow Jones Industrial Average at 8:27 a.m. are flashing an ugly opening in New York, with a potential loss of as much as 648 points. (That could materially change before the market opens at 9:30 a.m.) Mainstream media seem obsessed with what actions the central bank of China might take to stem the rout while also focused on debating if this means a rate hike from the Fed is off the table. The Fed, unfortunately, can only talk about hiking or not hiking since it’s fired all its bullets and has no rate cuts to … Continue reading →

By Pam Martens and Russ Martens: August 20, 2015 Judging by the speed at which U.S. billionaires are going unfiltered on the airwaves and in print, the U.S. may soon find itself indelibly defined as a nation of well-heeled meatheads. Yesterday we reported on billionaire Sandy Weill, whose crackpot idea of a financial supermarket and rollback of the Glass Steagall Act resulted in his becoming a billionaire despite the implosion of his creation, Citigroup, in 2008.  Citigroup became the largest banking bailout in U.S. history and a catalyst for the largest U.S. downturn since the Great Depression. Now in their twilight years, Weill and his wife, Joan, have nothing better to do than attempt to gut a dead man’s will in order to chisel Joan’s name into the façade of Paul Smith’s College, a 1,000-student campus in New York’s Adirondack mountains. As the Weill article evolved, reflecting a life-long pattern … Continue reading →

By Pam Martens and Russ Martens: August 4, 2015 The Dodd-Frank financial reform legislation just celebrated its fifth anniversary on July 21 and the gaping holes it left in the promise to protect our Nation from another systemic financial crash are becoming clearer every day. No other agency has done more to highlight these growing risks than the Office of Financial Research (OFR), created under Dodd-Frank as a unit of the U.S. Treasury. In its most recent report, it provides the stunning news that private hedge funds in the U.S. now control one-third of all assets under management in the financial services industry – a stunning $4.1 trillion when leverage is included. In February of this year, OFR released a jaw-dropping report showing dangerous levels of systemic and interconnected risk among some of the same Wall Street players that held pivotal roles in the crash of 2008. The report found … Continue reading →

By Pam Martens and Russ Martens: August 3, 2015 William D. Cohan has joined Paul Krugman and Andrew Ross Sorkin at the New York Times in pushing the patently false narrative that the repeal of the Glass-Steagall Act in 1999 had next to nothing to do with the epic Wall Street collapse of 2008 and the greatest economic calamity since the Great Depression. (See related articles on Krugman and Sorkin below.) The New York Times has already admitted on its editorial page that it was dead wrong to have pushed for the repeal of Glass-Steagall but now it’s dirtying its hands again by publishing all of these false narratives about what actually happened. In a July 30 column, Cohan ridicules Senators Elizabeth Warren and John McCain over their introduction of legislation to restore the Glass-Steagall Act to separate insured deposit banks from their gambling casino cousins, Wall Street investment banks. … Continue reading →

By Pam Martens and Russ Martens: July 29, 2015 Your humble editor and publisher of Wall Street On Parade might have had a little something to do with a growing mutiny in Congress. Back on November 4, 2012 and again on July 25, 2013, we blew the whistle on an obscene, secret entitlement program between the Fed and the too-big-to-fail banks: a century old program where every year, boom or bust, despite the overall level of interest rates in the markets, the Fed pays out a risk-free, guaranteed 6 percent dividend to its member banks. (All Fed member banks get the dividend but the lion’s share goes to the biggest Wall Street banks because their capital dwarfs all other banks.) Now, after more than a hundred years, there’s a plan in Congress to shrink that payout to 1.5 percent and fix our crumbling roads with the savings. Only banks with … Continue reading →

By Pam Martens and Russ Martens: July 22, 2015 We truly pity the earnest stockbroker today. Imagine trying to have a sensible conversation with your client about what’s going on in world markets when almost nothing makes sense anymore. It is an inherent underpinning of “free markets” that they must remain open for trading during regular market hours unless there is a catastrophic event like war or a terrorist attack. Even after the Tuesday, September 11, 2001 event when planes flew into two World Trade Center towers, leaving much of lower Manhattan covered in rubble and a jungle of tangled, destroyed electronic cables, the New York Stock Exchange reopened the following Monday. But here we are with no war (other than a war of words) and no terrorist attack and yet Greece’s stock market has been closed for more than three weeks. China is officially reporting that it is experiencing … Continue reading →

By Pam Martens and Russ Martens: July 1, 2015 Greece has two things in common with bankrupt or teetering parts of the United States: it took advice and money from Wall Street while paying huge fees; now the catastrophic results of that bad advice is falling on the backs of the poor and most vulnerable citizens. In fact, we’re all Greeks now. From the $1.2 trillion in student debt now on the backs of U.S. college students, a growing number of whom are turning to prostitution to keep up, to teetering Puerto Rico, the bankruptcy of Jefferson County, Alabama in 2011, Detroit’s bankruptcy in 2013, Wall Street was on hand to grease the skids or set the train wreck in motion. As Greece pensioners line up outside of banks today to receive a fraction of their monthly pension, Puerto Rico has acknowledged it can’t pay its $72 billion in debt … Continue reading →

By Pam Martens and Russ Martens: June 29, 2015 Greece has just a tad more population, at 11 million, than New York City and its boroughs. But this morning, it has caused hundreds of billions of dollars to be erased from stock and bond markets around the world. The situation in Greece this morning is as follows: banks and the Athens Stock Exchange have been closed until at least July 6, following a breakdown in talks between Greek Prime Minister Alexis Tsipras and the country’s creditors. The July 6 date stems from the vote in the Greek parliament over the weekend to hold a July 5 referendum allowing Greek citizens to vote on the austerity program offered by creditors in exchange for extending more loans to Greece. As a result of a run on the banks as the talks disintegrated, capital controls have now been imposed in Greece, allowing Greek … Continue reading →