By Pam Martens and Russ Martens: September 16, 2019 ~ According to the amended prospectus filed with the Securities and Exchange Commission to alert the public to the thousands of warts with malignant possibilities sprouting out of the office rental company, WeWork, which plans to offer its shares to the public for the first time, JPMorgan Chase will receive something no other underwriter is getting in this deal: a cool $50 million extra as a “structuring fee.” On top of that, of course, the bank will also get the fat underwriting fees that the other banks involved in the IPO get. That’s just one of the many curious ways that JPMorgan Chase stands out in its relationship with WeWork. (The parent of WeWork, The We Company, is actually offering the shares to the public.) As it turns out, quite a few of JPMorgan Chase’s commercial real estate clients who have … Continue reading →

By Pam Martens and Russ Martens: September 13, 2019 ~  During last evening’s Democratic debate, Senator Bernie Sanders said this: “You’ve got three people in America owning more wealth than the bottom half of this country.” According to Politifact, Sanders is basing this claim on a 2017 study done by the Institute for Policy Studies which put the richest three Americans’ wealth as follows (based on the Forbes list of billionaires at that time): Bill Gates of Microsoft with $89 billion; Jeff Bezos of Amazon with $81.5 billion; and Warren Buffett of Berkshire Hathaway with $78 billion — for a total of $248.5 billion. That wealth figure contrasts with the $245 billion owned by the bottom 50 percent of Americans according to the 2016 Survey of Consumer Finances conducted by the Federal Reserve. (The Fed’s survey is conducted every three years and the 2019 study has not yet been released.) But … Continue reading →

By Pam Martens and Russ Martens: September 12, 2019 ~ Yesterday the U.S. House of Representatives’ Subcommittee on Investor Protection, Entrepreneurship, and Capital Markets held an extremely timely hearing titled: “Examining Private Market Exemptions as a Barrier to IPOs and Retail Investment.” The thrust of the hearing was the negative impact that the ballooning private equity market is having on the dramatically shrinking pool of publicly traded stocks and the good of society in general. As the WeWork IPO train wreck plays out in the media, showing how two of the most sophisticated banks on Wall Street, JPMorgan Chase and Goldman Sachs, were set to bring this 9-year old office rental company to the public markets via an IPO, despite outrageous conflicts of interest by WeWork’s founder and CEO and a proposed valuation that turns out to have been off the mark by tens of billions of dollars, it was … Continue reading →

By Pam Martens and Russ Martens: September 11, 2019 ~  On May 6 of this year, Wall Street On Parade predicted that Senator Elizabeth Warren, now rising rapidly in her bid for President, would be targeted by Wall Street in an effort to derail her campaign. Yesterday, that Wall Street campaign officially began. CNBC’s Jim Cramer and David Faber discussed on TV how they are hearing from Wall Street bank executives that Warren must be stopped. On the same day, September 10, 2019, Bloomberg News, which is majority owned by billionaire Michael Bloomberg, whose $52.4 billion net worth derives from leasing his data terminals to thousands of Wall Street trading floors around the globe, ran this headline: “Richest Could Lose Hundreds of Billions Under Warren’s Wealth Tax.” Obviously, that wouldn’t sit too well with Michael Bloomberg, who has frequently penned his own OpEds for his financial news empire. But the … Continue reading →

By Pam Martens and Russ Martens: September 10, 2019 ~ Citigroup released an analyst’s note yesterday stating that “We expect spot gold prices to trade stronger for longer, possibly breaching $2,000 an ounce and posting new cyclical highs at some point in the next year or two.” Gold was last on a record-breaking streak in 2011 when it shot through handles of $1500, $1600, $1700 and $1800 from April through August of that year. On an intraday trading basis, gold reached a high of $1,917.90 an ounce on August 23, 2011 and another intraday high of $1923.70 on September 6, 2011. Gold then spent the next five years trading back down to the $1100 range. As the chart above indicates, gold has been moving decidedly higher this year, up 16.9 percent from January 2, 2019 to yesterday’s close. At 9:16 this morning, gold was trading at $1,504.40 an ounce. Is … Continue reading →

By Pam Martens and Russ Martens: September 9, 2019 ~ On January 26, 2018 the Dow Jones Industrial Average set a new record high of 26,616.71. Despite setting new highs multiple times thereafter, the moves were so negligible on a percentage basis that the reality is that the stock market has been a real dog over the past year and a half. This past Friday, the Dow closed at 26,797.46. That’s a meager 180.75 points, or less than a one percent move, in 19 months. That’s not exactly the stuff that retirement dreams are built on. But if you’re a typical American who has to rely on headlines or TV sound bites to tell you what’s going on in the market because you’re too busy working long hours, running the kids to dentist appointments and soccer games, doing grocery shopping and laundry on the weekends, then you may have been … Continue reading →

By Pam Martens and Russ Martens: September 6, 2019 ~ Based on every meaningful investigation into the epic financial crash of 2008 that resulted in the worst economic crisis in the U.S. since the Great Depression, derivatives that were concentrated at Wall Street’s largest banks played a central role in the crisis. And yet, 11 years later, neither Federal regulators nor Congress have meaningfully reined in these risks. Three years ago we reported on President Obama’s press conference of March 7, 2016 where Obama overtly misled the American people about how Wall Street banks were complying with the 2010 Dodd-Frank financial reform legislation that mandated that the banks’ trillions of dollars in dangerous derivatives be centrally cleared rather than traded as opaque private contracts between two counterparties. President Obama stated during this press conference that “you have clearinghouses that account for the vast majority of trades taking place.” That wasn’t … Continue reading →

By Pam Martens and Russ Martens: September 5, 2019 ~ If your bank is under a criminal probe for potentially rigging gold and silver markets, it doesn’t help your case to have $50 million in fake gold bars sitting in your vaults. Nonetheless, this is what Reuters reported last week: “In the last three years, bars worth at least $50 million stamped with Swiss refinery logos, but not actually produced by those facilities, have been identified by all four of Switzerland’s leading gold refiners and found in the vaults of JPMorgan Chase & Co., one of the major banks at the heart of the market in bullion, said senior executives at gold refineries, banks and other industry sources.” Last month there was another bizarre story making the wires about JPMorgan Chase owning a ship that was raided and found to contain 20 tons of cocaine. (See With Three Felony Counts … Continue reading →

By Pam Martens and Russ Martens: September 4, 2019 ~  On July 29, those savvy market watchers at Themis Trading posted a report on their blog about how a Republican Senator from Louisiana (about 1400 miles from Wall Street) had taken a peculiar interest in the long-delayed system that would shine a bright light on who might be rigging stock trading on any particular day. The system is called the Consolidated Audit Trail (CAT) and the Securities and Exchange Commission has been stalling its creation for the entire 85 years the SEC has existed and been charged with investor protection. The idea of the CAT is to spot illegal and manipulative trading and pinpoint exactly what firms and individuals are placing the trades by looking at real-time data. A stock market without a CAT is nothing more than a thinly disguised wealth transfer system for the one percent and, apparently, … Continue reading →

By Pam Martens and Russ Martens: September 3, 2019 ~ One year ago, investors could have purchased a one-year U.S. Treasury Bill with a yield of 2.47 percent. As of this past Friday’s closing price of the Dow Jones Industrial Average, the Treasury Bill would have beaten the performance of the Dow over the past year by more than three-quarters of a point (not taking into account dividends on the Dow stocks). On Friday, August 31, 2018, the Dow closed at 25,964.82. This past Friday, August 30, 2019, the Dow closed at 26,403.28 That’s a gain of 438.46 points in a year or a return of 1.68 percent versus earning 2.47 percent on a T-bill. You would have been saved yourself the agony of living through the 800-point market plunge on August 14 and the 3746-point rout in the Dow from the close of trading on November 30, 2018 until … Continue reading →