Search Results for: JPMorgan

By Pam Martens and Russ Martens: June 27, 2019 ~ On July 18 of last year, the U.S. Department of Justice indicted two Merrill Lynch precious metals traders, Edward Bases and John Pacilio, charging them each with one count of conspiracy to commit wire fraud affecting a financial institution and one count of commodities fraud each.  Pacilio was further charged with five counts of spoofing. (Spoofing is where a trader uses a high-speed computer to issue a rapid barrage of buy or sell orders, with no intention of executing the trades, in order to mislead the market and gain an advantage for his own position in the market.) On Tuesday of this week, a unit of Merrill Lynch was given a deferred prosecution agreement in the same matter by the Justice Department in exchange for an agreement to cooperate. Merrill also agreed to pay a measly $25 million in fines … Continue reading →

By Pam Martens and Russ Martens: June 26, 2019 ~ Some decades back, the late MIT economist Lester Thurow wrote this: “Essentially, the economic problem is like that of the wolf and the caribou. If the wolves eat all the caribou, the wolves also vanish.” What Thurow did not take into consideration is that if the wolf pack is large enough, it can survive for quite a while by turning on other wolf packs. That’s what is happening right now on Wall Street. The wolves are at war with each other. The New York Stock Exchange and Nasdaq have filed a lawsuit against the Securities and Exchange Commission and are slinging mud in court at a former, long-tenured JPMorgan Chase executive, Brett Redfearn, who now polices them at the SEC. We’ll get to all that in a moment, but first some background. It all started when the stock exchanges decided … Continue reading →

By Pam Martens and Russ Martens: June 25, 2019 ~ In her 2007 book, Tulipmania: Money, Honor, and Knowledge in the Dutch Golden Age, Anne Goldgar writes that “the f1000 one might pay in January 1637 for one hypothetical Admirael van der Eyck bulb,” could have bought “a modest house in Haarlem,” or “nearly three years’ wages” of a master carpenter. Comparing that to U.S. dollars in 2007, the year her book was released, Goldgar says it would be like one tulip bulb selling for $12,000. Goldgar notes that as historians have looked back, the tulip mania of the 1630s in Holland has become a “byword for idiocy.”  She quotes from a passage written in 1648 by the historian Theodorus Schrevelius: “I don’t know what kind of angry spirit was called up from Hell…Our Descendants doubtless will laugh at the human insanity of our Age, that in our times the … Continue reading →

By Pam Martens and Russ Martens: June 20, 2019 ~ Futures on the Dow Jones Industrial Average are up early this morning by more than 200 points. But the 10-year U.S. Treasury has also had a big rally, which dropped its yield overnight to just below 2 percent. The 10-year Note yield below 2 percent suggests a serious slowdown in the U.S. economy. That’s not something corporate stocks should be cheering about. The continuing aberrations in the U.S. stock market suggest a malfunctioning stock market structure and the first place to look is Dark Pools, which are unregulated stock exchanges run by the same mega Wall Street banks that blew up the U.S. financial system in 2008 and received the largest taxpayer bailout in U.S. history. Apparently unbeknown to the Securities and Exchange Commission (SEC), when Goldman Sachs changed the name of its big Dark Pool that trades here in … Continue reading →

By Pam Martens and Russ Martens: June 19, 2019 ~  In response to the stunning announcement from Facebook that it is planning to launch a cryptocurrency, Congresswoman Maxine Waters, the Chair of the House Financial Services Committee, issued the following statement yesterday: “Facebook has data on billions of people and has repeatedly shown a disregard for the protection and careful use of this data. It has also exposed Americans to malicious and fake accounts from bad actors, including Russian intelligence and transnational traffickers. Facebook has also been fined large sums and remains under a Federal Trade Commission consent order for deceiving consumers and failing to keep consumer data private, and has also been sued by the government for violating fair housing laws on its advertising platform. “With the announcement that it plans to create a cryptocurrency, Facebook is continuing its unchecked expansion and extending its reach into the lives of … Continue reading →

By Pam Martens and Russ Martens: June 18, 2019 ~ President Donald Trump has now tied his campaign, and himself, up in ticker tape. On June 15 the sitting President of the United States Tweeted the following message: “The Trump Economy is setting records, and has a long way up to go….However, if anyone but me takes over in 2020 (I know the competition very well), there will be a Market Crash the likes of which has not been seen before! KEEP AMERICA GREAT” First, since the stock market lost 90 percent of its value from 1929 to 1932 and the President is calling for “a Market Crash the likes of which has not been seen before,” he is effectively predicting that the stock market will lose 91 percent or more of its value. (Even for raging bears, that’s quite a stretch.) But since it’s the billionaires and multi-millionaires who … Continue reading →

By Pam Martens and Russ Martens: June 17, 2019 ~ U.S. stock markets have historically been challenged by corrupt actors. But there have been two extreme periods of corruption in the history of U.S. stock markets. One period occurred in the lead up to the 1929 stock market crash when Wall Street cartels were forming pools to wildly manipulate stock prices. That period led to an economic calamity known as the Great Depression. It also led to two years of intense hearings in the U.S. Senate to investigate the structure of the stock market, followed by intense legislative reforms including the Glass-Steagall Act, the Securities Act of 1933 and the Securities Exchange Act of 1934. The second period was the lead up to the 2008 stock market crash which led to the economic collapse known as the Great Recession. In that period, like 1929, Wall Street banks were allowed to … Continue reading →

By Pam Martens and Russ Martens: June 14, 2019 ~ According to the Federal Deposit Insurance Corporation (FDIC), as of September 30, 2018 there was a total of $13.6 trillion in deposits at all 5,397 Federally insured banking and savings institutions in the U.S. but just nine mega banks represented 40 percent of all domestic deposits. Those nine are the insured banking units of the holding company for JPMorgan Chase with $1.3 trillion in domestic deposits; Bank of America at $1.36 trillion; Wells Fargo with $1.27 trillion; Citigroup at $504 billion; U.S. Bancorp $314 billion; Morgan Stanley $181 billion; BB&T $161 billion; Goldman Sachs $130 billion; and State Street $108 billion. Unfortunately, the FDIC’s Deposit Insurance Fund had only $100.2 billion as of September 30, 2018 to cover losses should any of those trillion-dollar-banks fail – which means they can’t fail and have thus become known as too-big-to-fail, even as they continue to take … Continue reading →

By Pam Martens and Russ Martens: June 13, 2019 ~ Dark Pools are opaque stock trading platforms operated by the largest Wall Street banks and other firms. They are, effectively, stock exchanges but have been given exemptions by the Securities and Exchange Commission (SEC) from having to register as a stock exchange or to submit to more rigorous oversight by the SEC. The rationale for the existence of Dark Pools owned by the mega banks has escaped the public since these are the same banks that are serially fined for abusing the public’s trust and rigging other markets like foreign exchange, Libor, and the Nasdaq stock market in the 1990s. Their conduct was so bad in the Nasdaq matter that they were forced to submit to having their trading phone calls taped and reviewed by regulators. Wall Street On Parade has written extensively about the highly suspect transactions that are … Continue reading →

By Pam Martens and Russ Martens: June 10, 2019 ~ On Friday markets digested the nonfarm payrolls report from the U.S. Labor Department showing a weak job growth in May of just 75,000. That news adds to a myriad of other economic data, including a slowdown in durable goods orders, that suggest a deceleration of the U.S. economy. The Atlanta Fed’s closely watched GDPNow indicator is showing a very weak 1.4 percent forecast for the second quarter of this year. The 10-year U.S. Treasury note has duly noted the deceleration in the economy and has fallen from a yield of 2.9 percent since the middle of December to 2.08 percent at Friday’s close. The yield of the U.S. Treasury has an inverse relationship to its price. That is, as the market value of the Treasury note rises, the yield declines. Thus, as the perception grows that the U.S. economy is … Continue reading →