By Pam Martens and Russ Martens: May 23, 2024 ~ Exactly how long is it going to take federal banking regulators to figure out that “move fast and break things” – the business model of Silicon Valley financial technology (fintech) startups and their voracious venture capital backers – is the last thing that Americans want to be integrated into the FDIC-insured bank where they hold their money to pay their mortgage and to buy food to feed their children. After one form of fintech – crypto – hastened the demise of several FDIC-insured banks in the spring of last year, handing billions of dollars in losses to the FDIC’s Deposit Insurance Fund, a rational person might have thought that federal banking regulators would have moved rapidly to shut down this lunatic banking model. But no. The story becomes ever more surreal today. Below is the desperate plea filed on Tuesday with … Continue reading →

By Pam Martens and Russ Martens: May 22, 2024 ~ Two U.K. regulators, the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA), announced this morning that they have leveled fines totaling $78.5 million against Citigroup’s European trading arm, Citigroup Global Markets Ltd. (CGML). See here and here. The fines relate to a $300 billion flash crash in European stock markets on May 2, 2022. Citigroup is the parent of the fourth largest federally-insured bank in the United States, Citibank.  During the 2008 financial crisis, Citigroup imploded and became a 99-cent stock because of its high-risk market activities. It received over $2.5 trillion in bailouts and cumulative loans – the largest bailouts in global banking history. The U.K. regulators have today put the blame for that May 2, 2022 flash crash on a trader on Citigroup Global Markets’ Delta One trading desk, who, according to the regulators’ scenario, entered a … Continue reading →

By Pam Martens and Russ Martens: May 21, 2024 ~ Yesterday, at 10:08 a.m., Senator Sherrod Brown, a Democrat from Ohio and the Chair of the Senate Banking Committee, sent out a shocking emailed statement to the press indicating that Brown was “calling on the President to immediately nominate a new Chair who can lead the FDIC at this challenging time and for the Senate to act on that nomination without delay.” By 6:27 p.m. the Associated Press was reporting that Martin Gruenberg would step down as Chair of the FDIC and President Joe Biden would announce his nomination to replace him “soon.” The Brown statement was a gut punch to every engaged American and journalist who actually understands what’s at stake here. It was not only a back stab to Gruenberg, it was a back stab to Brown’s highly-respected colleague on the Senate Banking Committee, Senator Elizabeth Warren, who has … Continue reading →

By Pam Martens and Russ Martens: May 20, 2024 ~ Last Thursday, in a stunning 7-2 win for the little guys and gals in America, the U.S. Supreme Court handed down its decision in Consumer Financial Protection Bureau et al v Community Financial Services Association of America, Ltd., et al. Making the decision all the more stunning, it was written by Clarence Thomas, the sitting justice who has been under withering attack in the press for selling out to special interests. (There is speculation that the Thomas name is on the decision to quiet the media uproar against him.) The two dissenting votes came from Justices Samuel Alito (target of a ProPublica investigation in 2023) and Neil Gorsuch, around whom conflicts of interest controversy is also swirling. The Consumer Financial Protection Bureau (CFPB) has been the target of Wall Street lobbyists since before its birth under the Dodd-Frank financial reform legislation … Continue reading →

By Pam Martens and Russ Martens: May 16, 2024 ~ Foreign central banks and sovereign wealth funds are required under U.S. law to report their publicly-traded U.S. stock positions no later than 45 days after the end of each calendar quarter, if those stock holdings reach $100 million or more. This is done on Form 13F, which is filed with the Securities and Exchange Commission (SEC). Sophisticated traders, algorithms at the big trading houses on Wall Street, and giant hedge funds mine that data to spot bullish or bearish signals they might be able to trade on. Unfortunately, for reasons we haven’t been able to unleash from the tight grip of the SEC over many years, some of the central banks and sovereign wealth funds with massive holdings in U.S. stocks do not report their holdings, or, the SEC is granting them confidentiality. One sovereign wealth fund that has been reliably … Continue reading →

By Pam Martens and Russ Martens: May 14, 2024 ~ In 2020, Netflix released a documentary series titled “Filthy Rich,” based on the book by the same name. The series examined how sex trafficker Jeffrey Epstein was able to continue to enjoy his wealth and power even after Palm Beach, Florida police had built a case that he had sexually-assaulted more than a dozen young girls – many from public schools in middle-class areas surrounding the mansions of Palm Beach. A sweetheart deal between the Florida State Attorney and the U.S. Department of Justice allowed Epstein to serve just 13 months in jail from June 2008 to July 2009, most of it in a work release program in which he was driven to an office daily by his chauffeured limousine. Epstein was allowed to be on the loose for another decade until the Department of Justice was embarrassed into arresting Epstein … Continue reading →

By Pam Martens and Russ Martens: May 13, 2024 ~ On Friday, the Federal Reserve released its semiannual Supervision and Regulation Report on banks. Commercial real estate loans at banks – particularly on office properties – continued to rank high on the Fed’s list of concerns. The Fed included the chart above showing that delinquency rates on office property loans held by the banks had skyrocketed from just over 1 percent at the end of 2022 to over 8 percent as of December 31, 2023. (The red text and arrow have been added by Wall Street On Parade.) Banks are major lenders to the commercial real estate (CRE) market, providing almost $3 trillion in financing. According to a February 27 report from S&P Global, as of the end of the fourth quarter of 2023, two megabanks dwarfed all others in their commercial real estate loan exposure. JPMorgan Chase Bank NA, the … Continue reading →

By Pam Martens and Russ Martens: May 9, 2024 ~ The swampiest trading house on Wall Street, Goldman Sachs, issued a press release on Tuesday which was revolting – even to Wall Street veterans who are familiar with its scandalous history. (See Related Articles below.) The press release stated that “Rob Kaplan will rejoin the firm as Vice Chairman of Goldman Sachs and a member of the Management Committee. He will be a member of the Executive Office and will be based in Dallas.” Robert (Rob) Kaplan is the man who scandalized the Dallas Fed and the Federal Reserve (the central bank of the United States) by flagrantly serving his own trading interests and violating financial reporting rules while trading like a hedge fund kingpin in S&P 500 futures for his own account during a declared National Emergency in 2020 (from the COVID-19 pandemic) while he was President of the Dallas … Continue reading →

By Pam Martens and Russ Martens: May 8, 2024 ~ Yesterday, the Big Law firm Cleary Gottlieb released its so-called “independent review” of charges of sexual harassment at the Federal Deposit Insurance Corporation (FDIC). Although no employee is charging Martin Gruenberg, the Chair of the FDIC, with sexual harassment, Cleary Gottlieb seems to go out of its way to paint Gruenberg in a negative light in the report – 108 times in fact. Gruenberg held the deciding vote at the FDIC last July when the bank regulator approved moving forward with proposed new rules to significantly raise the capital levels at the megabanks on Wall Street, particularly those holding trillions of dollars in derivatives off their balance sheet. These include the same banks that secretly received $16 trillion in cumulative emergency loans from the Federal Reserve from December 2007 to July 2010 because they were undercapitalized and teetering on insolvency, as … Continue reading →

By Pam Martens and Russ Martens: May 7, 2024 ~ Last Wednesday, JPMorgan Chase, the publicly-traded parent of the largest federally-insured bank in the United States as well as a five-count felon, revealed in a filing with the Securities and Exchange Commission that on top of the $348 million it paid out in March to two of its banking regulators for sketchy trading violations involving “billions” of trades on 30 global trading venues, it “expects to enter into a resolution with a third U.S. regulator that will require the Firm to, among other things, pay a civil penalty of $100 million….” (See “Trading Venues Investigations” on page 168 of the SEC filing at this link.) JPMorgan Chase did not name this third regulator but Bloomberg News reported that it is the Commodity Futures Trading Commission. The two federal banking regulators that imposed the trading fines in March are the Office of the … Continue reading →