What Could Possibly Go Wrong

Tens of thousands of government workers hired to roll out Obamacare

"State offices that will run insurance exchanges are hiring tens of thousands, either on staff or through outsourcing firms. Federal agencies that are key to implementing the law, such as the Internal Revenue Service, plan to hire thousands more, and private non-profit groups backed by the White House are dispatching thousands of newly hired staffers and volunteers into the field. HHS spent $394 million through last March on contracts to set up state insurance exchanges it will run, according to a GAO report this week. Experts say at least 2.7 million younger, healthier people need to sign up to make the exchanges work financially." Continue reading →

Continue ReadingTens of thousands of government workers hired to roll out Obamacare

Bond Market Sell-Off Causes Stress in $2 Trillion ETF industry

"A wave of selling caused many exchange traded funds to tumble below the value of their underlying assets as a bond market sell-off caused stress in the $2 trillion ETF industry. Emerging-markets ETFs were among the worst affected, as investors took fright that the end of Federal Reserve monetary easing would lead to outflows from developing countries. The selling also caused disruptions in the plumbing behind several ETFs. Citigroup stopped accepting orders to redeem underlying assets from ETF issuers, after one trading desk reached its allocated risk limits. State Street said it would stop accepting cash redemption orders for municipal bond products from dealers." Continue reading →

Continue ReadingBond Market Sell-Off Causes Stress in $2 Trillion ETF industry

Investors Say: “Mises Was Right!”

"Bernanke made a comment about the possibility of changing this policy later in 2013, but only if the economy continues to grow. The financial media headlined this statement. Stock markets immediately tanked. Why? Because investors believe that the world’s economic recovery is dependent on the $1 trillion counterfeiting operation, no matter what the general economic statistical indicators say. They do not trust the FOMC’s judgment in assessing these indicators. They do not trust anything except counterfeit money. In short, they are becoming implicit Austrian School economists. They see that mass monetary inflation has rigged the capital markets." Continue reading →

Continue ReadingInvestors Say: “Mises Was Right!”

Bill Bonner: All Hell Breaks Loose!

"The Dow fell -353 points. Gold lost $87 an ounce. What does this tell us? It shouts a warning: Ben Bernanke is losing control. He desperately wants inflation. He's getting deflation instead. He wants low interest rates; yet rates are rising. Bernanke is now getting the worst kind of deflation – sluggish price increases against a backdrop of rising interest rates. This is the exact opposite of what the Fed wants... and needs. Its strategy is to hold interest rates down while it pushes up consumer and asset prices. Instead, the debt gets heavier as yields rise. Backs ache. Legs buckle. Nerves crack." Continue reading →

Continue ReadingBill Bonner: All Hell Breaks Loose!

Ted Cruz: Will Obama do background checks before giving arms to Syrian rebels?

"In a tweet called the 'zinger of the day' by Twitchy, Sen. Ted Cruz, R-Texas, wondered Tuesday if President Obama would conduct background checks before giving arms to Syrian rebels. 'Anyone know if President Obama intends to perform background checks on the Syrian rebels before providing them weapons?' he asked. As of this writing, the short message has been retweeted 6,480 times. Polls released Monday show that an overwhelming majority of Americans do not support plans to arm the rebels, Breitbart.com said. Part of the problem, John Nolte said, is 'the fear that the new boss will be an awful lot like the old boss.'" Continue reading →

Continue ReadingTed Cruz: Will Obama do background checks before giving arms to Syrian rebels?

Syrian rebels say they have received anti-tank and anti-aircraft missiles

"Syrian rebels have received heavy weapons -- including anti-tank and anti-aircraft missiles -- from 'brotherly nations that support the Syrian revolution,' a rebel spokesman said Friday. Free Syrian Army political and media coordinator The White House has not publicly specified what steps it would take to support members of Syria's opposition, though sources have told CNN that small arms, ammunition and possibly anti-tank weapons would be part of the assistance package. The White House announcement this month that it was increasing the 'size and scope' of its material support to Syrian rebels came after months of political debate over the U.S. role in the conflict." Continue reading →

Continue ReadingSyrian rebels say they have received anti-tank and anti-aircraft missiles

Britain’s Co-operative Bank faces nationalisation if junior bondholders reject ‘haircut’

"The Co-operative Bank's rescue recapitalisation needs the support of £1.05bn – or around 80pc – of the holders of £1.3bn of its junior debt or the lender could end up being nationalised. A group of pensioners and other retail investors in the Cooperative Bank are facing massive losses under the rescue. Holders of £370m of permanent interest bearing shares (PIBS) issued by the Co-op and Britannia Building Society before its takeover are expected to have their coupons cancelled, making them effectively worthless. Roughly 7,000 retail investors will be affected and the bank said that, on average, they held less than £1,000 in these bonds." Continue reading →

Continue ReadingBritain’s Co-operative Bank faces nationalisation if junior bondholders reject ‘haircut’

Central Bank Injects Cash After China Money Rates Jump to Records

"The People’s Bank of China added 50 billion yuan ($8.2 billion) to the financial system today after a cash squeeze drove money-market rates to record highs. The sum was supplied to a single lender through 'targeted liquidity operations' and more banks were in talks to obtain financing. A PBOC press official said he was unaware of the matter. Bank of China Ltd. announced on its microblog that it made all payments on time today and has never had a capital default. A spokesman for Industrial & Commercial Bank of China Ltd. declined to comment on whether the lender received any financing from the central bank." Continue reading →

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Tired German bank employee naps on keyboard, transfers $293 million

"An obviously tired German bank employee fell asleep on his keyboard and accidentally transformed a minor transfer into a 222 million euro ($293 million) order, a court heard. The Hessen labour court heard that the man was supposed to transfer just 62.40 euros from a bank account belonging to a retiree, but instead 'fell asleep for an instant, while pushing onto the number 2 key on the keyboard' — making it a huge 222,222,222.22 euro order. The bank discovered the mistake shortly afterwards and corrected the error. The case was taken to court by the man’s 48-year-old colleague who was fired for letting the mistake slip through when verifying the order." Continue reading →

Continue ReadingTired German bank employee naps on keyboard, transfers $293 million

They Think You’re Naïve…

"When it comes to the financial markets, Bernanke is, without a question, the most powerful man in the world. On May 22, he suggested that the Fed may soon reduce the size of its money-printing program, known as QE. Since then, the market has experienced a small meltdown. More than $2.5 trillion has already been erased from the value of global equities. Some analysts think the Fed announcing the end of QE would be a good thing. They think it would indicate the Fed is confident the economy is strong enough to operate without stimulus. The only problem is the Fed is thinking about ending QE for a reason that has nothing to do with healthy economic growth." Continue reading →

Continue ReadingThey Think You’re Naïve…