By Pam Martens and Russ Martens: January 8, 2016  Yesterday, Wharton Finance Professor Jeremy Siegel appeared on CNBC to make a prediction that the S&P 500 index would experience a 10 percent upside by the end of this year. You might want to evaluate that prediction against what Professor Siegel also believes to be the U.S. situation with China. In answer to a question as to why the economic situation in China won’t weigh on the U.S., Siegel said: “We export very little to China” (see second video at this link). That statement, in fact, is false. According to detailed data from the U.S. Census Bureau, China is our third largest source of exports, at $106.1 billion through November – behind only Canada and Mexico. Ruptures in the stock market in China have now cratered U.S. stocks twice in the past six months. Thanks to spillover from China, the first … Continue reading →

By Pam Martens and Russ Martens: January 7, 2016  While you were sleeping, things got decidedly uglier in global markets. The Chinese stock market was only able to stay open for 29 minutes before it hit its ridiculously low limit-down of 7 percent and shut down for the balance of the trading session. (U.S. stock markets require a loss of 20 percent before they cease trading for the day.) That sent global investors wanting to lighten up on equities into European markets which saw red across the board. With the overnight rout, global stock markets have now lost approximately $2.5 trillion this week – and it’s only Thursday. Further declines in the price of crude oil added to the angst with the cumulative losses marking the worst ever New Year’s start for oil. The U.S. domestic benchmark, West Texas Intermediate (WTI), at one point dropped below a $33 handle. China … Continue reading →

By Pam Martens and Russ Martens: January 6, 2016 Presidential candidate Senator Bernie Sanders of Vermont gave a speech yesterday that is destined to go down in the history books of this era, further enshrining him as one of the most courageous voices of our time. Sanders promised to break up the serially criminally-inclined banks on Wall Street and reinstate the Glass-Steagall Act to drive a permanent stake through the heart of too-big-to-fail. But if you watched either his official campaign’s YouTube video of his speech or the one provided by volunteers for his campaign, three key passages of what he said have gone missing from the video. We were able to reconstruct the full speech as delivered by transcribing the three missing sections from a YouTube video posted by the PBS Newshour which, notably, had no gaps in its video. (Watch the PBS video of the speech at the … Continue reading →

By Pam Martens and Russ Martens: January 5, 2016  From Riyadh to Tehran, Shanghai to Frankfurt, investors had plenty to sweat about yesterday. The culmination of this perfect storm landed in U.S. stock markets yesterday where the Dow Jones Industrial Average was shortly after 11 a.m. off by more than 450 points. The Dow closed the day down 276 points after some kindly buying support exceeding $1 billion from unknown sources came in to prop up the market at the close. The first weekend ahead of Monday’s stock market open got off to a bad start with trouble spots that are likely to challenge markets throughout this year. Saudi Arabia (a country that still refuses to grant women licenses to drive a car) engaged in mass executions of 47 people, one of whom was a Shia Muslim cleric, Sheikh Nimr al-Nimr. This set off wild protests in Iran, which has … Continue reading →

By Pam Martens and Russ Martens: January 4, 2016 Call them astroturf organizations or neoliberal think tanks or corporate front groups – it all adds up to the same thing: big corporate bucks are engaged in a vicious propaganda war to recast the 2008 financial crash and its depression-like aftermath as the product of big government meddling rather than corporate lobbyists strong-arming deregulation of banking and Wall Street. The corporate cartel simply cannot allow mandates for tough new regulations to gain footing in Washington, otherwise the multi-decade work of the Kochtopus goes poof. (Kochtopus is short-hand for the political and front group money machine run by billionaire brothers, Charles and David Koch.) The Koctopus now has its knickers in a twist over the release of the movie, The Big Short, directed by Adam McKay and based on the bestselling book by Michael Lewis, a former Wall Street insider. Prior to … Continue reading →

By Pam Martens and Russ Martens: December 31, 2015 Confidence in America can impact the strength of the U.S. dollar, the willingness of foreigners to invest their capital here in our markets and real estate, and our diplomatic relations with other nations. With each passing day of his candidacy, Donald Trump drags his country – the one he claims to want to make great again – deeper into the embarrassing caricature of a land where billionaires are unfettered to run wild with both their money and their mouths. For example, it’s not every day that a major U.S. ally is set to debate whether it will ban a U.S. Presidential candidate from entering their country. That ignominious milestone now goes to Donald Trump, courtesy of the United Kingdom. According to a report out this morning from the BBC, following more than 500,000 people signing a Parliamentary e-petition, a Parliamentary committee … Continue reading →

By Pam Martens and Russ Martens: December 30, 2015  Yesterday Larry Summers penned an opinion piece for the Washington Post, lecturing Senator Bernie Sanders of Vermont, a Presidential candidate, on what Sanders should actually be saying in his own op-eds about reforming the Federal Reserve.  No one will ever accuse Larry Summers of being short on arrogance. After promising the American people in 1999, as Treasury Secretary in the Bill Clinton administration, that pushing through the repeal of the Glass-Steagall Act would be “the right framework for America’s future financial system,” then watching that system collapse as a result of that repeal just nine years later in the worst economic upheaval since the Great Depression, one would think Summers would find some obscure hole in academia and crawl into it. Instead, Summers went on to become President of Harvard where, in 2005, he suggested at an economics conference that women … Continue reading →

By Pam Martens and Russ Martens: December 29, 2015  Senator Elizabeth Warren, Democrat of Massachusetts, has breathed new life into bolstering Americans belief in our Democratic system of government and the notion that one good man or good woman can make a meaningful difference in Congress. Senator Warren was the driving force behind the creation of the Consumer Financial Protection Bureau which has opened a robust two-way dialogue and redress system with the American people regarding the financial crimes being inflicted on them – otherwise known as Wall Street’s institutionalized wealth transfer system – while it is simultaneously under relentless assault by corporate attack dogs masquerading as Republican members of Congress. It was Senator Warren in 2013 that informed us that the so-called Independent Foreclosure Reviews to settle the claims of 4 million homeowners who had been illegally foreclosed on by the bailed out Wall Street banks were a sham. The … Continue reading →

By Pam Martens and Russ Martens: December 28, 2015  Eric Holder, who stepped down this year as the U.S. Attorney General after six years in office, rejoined the law firm he had left to accept the top slot at the Justice Department. That firm is Covington & Burling, which operates a revolving door between the Justice Department and its own front door. In addition to Holder, Lanny Breuer, who headed up the Justice Department’s criminal division under Holder, also returned to Covington & Burling after a devastating report by ABC’s Frontline on how his division had failed to seriously investigate crimes on Wall Street. Making the round trip between the Justice Department and Covington & Burling in 2010 was Steven Fagell, former deputy chief of staff at the criminal division, and Jim Garland, former deputy chief of staff to Attorney General Eric Holder. Dan Suleiman, former deputy chief of staff to … Continue reading →

By Pam Martens and Russ Martens: December 23, 2015  Exactly one year ago today, the headline story at Wall Street On Parade was titled: “Oil Crash: Don’t Believe the Happy Clatter.” We explained that there was a “mushrooming false narrative taking over the business airwaves” predicting that the rapid price decline in oil would lower gas prices at the pump, fueling a healthier consumer with more disposable income and thus a more robust economy for 2015. Our counter prediction was that the oil price collapse “will decidedly not lead to a more robust economy in the United States for very long.” This was our reasoning at the time: “This isn’t a little speed bump in oil prices. This is one of the most dramatic and rapid crashes in a key industrial commodity in history. Since June, the price of West Texas Intermediate (WTI), the domestic crude oil produced in the … Continue reading →