Author: Freedomwat.ch Staff

This author has written 1563 articles

Yellen Says Negative Rates On The Table “If Outlook Worsened”

"As the market now diligently calculates the suddenly surging odds of a December rate hike, here's Yellen with a preview of what will happen once the rate hike cycle is aborted, just as it was aborted in Japan in August of 2000 when the BOJ also decided to send a signal how much stronger the economy is by hiking 25 bps, only to cut 7 months later and to proceed to monetize not only all net Japanese debt issuance a decade later, but to hold half of all equity ETFs. The good news: YELLEN SAYS SHE DOESN'T SEE NEED FOR NEGATIVE RATES NOW; YELLEN SAYS FED SEES ECONOMY ON STEADY PATH OF IMPROVEMENT; Because when have the Fed's forecasts before ever been wrong." Continue reading →

Continue ReadingYellen Says Negative Rates On The Table “If Outlook Worsened”

China Devaluation Is Blow to Cash-Strapped Argentina’s Reserves

"China’s devaluation couldn’t come at a worse time for Argentina. About a quarter of the country’s $33.7 billion of foreign reserves are now denominated in yuan, which suffered its biggest loss since 1994 on Tuesday. The move is eroding the cash Argentina uses to pay its debt and comes as the nation is effectively shut out of overseas bond markets and struggling to defend its slumping peso at home. The country’s yuan holdings have ballooned since it signed an $11 billion currency-swap agreement with the People’s Bank of China in July. In the unregulated market Argentines use to sidestep the government’s currency controls, the peso has sunk 12 percent in the past two months." Continue reading →

Continue ReadingChina Devaluation Is Blow to Cash-Strapped Argentina’s Reserves

Chinese Brokers Now Selling Margin Loan-Backed Securities

"Now, the PBoC will look to supercharge efforts to re-engineer a stock market bubble via leverage by pushing brokerages to issue ABS backed by margin loans. If brokerages simply offload the margin loan risk to investors and use the proceeds to fund still more margin lending which can also be turned into still more ABS, and so on, then the effect will be to pile leverage on top of leverage. What happens in the event the underlying stocks become completely illiquid (i.e. Beijing decides to suspend trading on three quarters of the market again)? The punchline: the senior tranche (which accounts for CNY475 million of the total CNY500 million deal) is rated AAA." Continue reading →

Continue ReadingChinese Brokers Now Selling Margin Loan-Backed Securities

China currency devaluation hits stocks; dollar gains on currency war fears

"China's 2 percent devaluation of the yuan on Tuesday pushed the U.S. dollar higher and hit Wall Street and other global equity markets as it raised fears of a new round of currency wars and fed worries about slowing Chinese economic growth. U.S. stock indices dropped more than 1 percent and stocks also fell in Asia and Europe as investors contemplated the implications of a move designed to support China's slowing economy and exports. Companies that sell to China were hit hard, with heavy equipment maker Caterpillar losing 3.13 percent and Germany's Volkswagen dropping 4 percent. Energy and materials shares also tumbled on China demand concerns." Continue reading →

Continue ReadingChina currency devaluation hits stocks; dollar gains on currency war fears

Former Fed chief Alan Greenspan warns of bond market bubble

"Alan Greenspan, who served as Fed chairman between 1987 and 2006, told Bloomberg: 'I think we have a pending bond market bubble. If we merely substitute the structure of equity prices, and we have the price of bonds, and instead of expected equity return we have expected interest rate return, that price earnings ratio is in an extraordinary unstable position.' Mr Greenspan, who has been criticised for fuelling the US housing bubble by keeping rates down in the early 2000s and failing to keep a closer eye on banks, said behavioural economics was playing a central role in investor decision making. Mr Greenspan also said oil prices had further to fall." Continue reading →

Continue ReadingFormer Fed chief Alan Greenspan warns of bond market bubble

Should Puerto Rico Shut Down Schools to Pay Its Debts?

"The hedge fund report, authored by a trio of former International Monetary Fund economists, noted that Puerto Rico’s education spending had risen 39 percent in a decade during which school enrollment actually fell by a quarter. Surely, there must have been some unnecessary fat in the system to cut. It's easy to understand why this might seem outrageous. Firing teachers in the middle of what's essentially a nine-year depression seems like a good way to further exacerbate Puerto Rican unemployment, possibly while sacrificing some childrens' educations." Continue reading →

Continue ReadingShould Puerto Rico Shut Down Schools to Pay Its Debts?

State Regulators Force Vermont’s Only Bitcoin ATM Offline

"Vermont's first digital currency ATM has been ordered closed by state regulators who say the company operating the cash machine is violating state law. The move by the Department of Financial Regulation has disappointed the tech enthusiasts who used the new currency service. PYC CEO Emilio Pagan-Yourno admits the company doesn’t have any Vermont-specific licenses. But he says his company is licensed federally through the Financial Crimes Enforcement Network (FinCEN). The letters from the department warn Blu-Bin and PYC that they may be in violation of the law. But they also seem to show a lack of clarity about what, exactly, the two companies are even doing." Continue reading →

Continue ReadingState Regulators Force Vermont’s Only Bitcoin ATM Offline

Australian inquiry says digital currencies are real money

"An Australian government inquiry will recommend treating digital currencies as money, simplifying tax for people who trade with them while forcing bitcoin exchanges to monitor customers for potential money laundering and terrorism financing activities. The Senate committee recommendations underscore governments' growing acceptance of the role of so-called 'cryptocurrencies' around the world. If implemented, the changes would align Australia with the United Kingdom and Spain by having people pay sales tax just once if they buy something with bitcoin, while leaving other nations like Sweden to fret over its true legal status. The changes would also match Australia with Canada and Singapore." Continue reading →

Continue ReadingAustralian inquiry says digital currencies are real money

There’s a Good Chance Your Bank Is Committing a Major Crime Right Now

"You probably will be very surprised to learn who aided and abetted the drug operation: it was US banking giant Wachovia. After an investigation that took years, Wells Fargo, which now owns Wachovia, paid a $160 million fine to settle the case. You might also be surprised to hear that Wachovia’s fine wasn’t an isolated case. Citibank was caught laundering money for a Mexican drug kingpin in 2001. American Express Bank admitted to laundering $55 million in drug money in 2007. And the FBI accused Bank of America of helping a Mexican drug cartel hide money in 2012. You’ve probably never heard these stories before. The big banks pay a lot of money to keep it that way." Continue reading →

Continue ReadingThere’s a Good Chance Your Bank Is Committing a Major Crime Right Now

The Fed Joins the War on Drugs

"The Federal Reserve is now in the business of enforcing the US government’s drug laws, even if that means making a mockery of both state governments’ right to set their own drug policies and the Fed’s own governing statutes. The Fed’s involvement in drug prohibition became official last month, when the Federal Reserve Bank of Kansas City informed Denver’s Fourth Corner Credit Union — a non-profit cooperative formed by Colorado’s state-licensed cannabis manufacturers — of its decision to deny its application for a master account. The Fourth Corner Credit Union isn’t taking this sitting down. On the contrary: it is suing the Federal Reserve Bank of Kansas City." Continue reading →

Continue ReadingThe Fed Joins the War on Drugs