SP 500 and NDX Futures Daily Charts - VIX

Late day rally on light volumes brought US stocks back to nearly unchanged, or slightly higher.

Nader and Fein: "America's Lawless Empire"

"When bad men combine, the good must associate; else they will fall one by one, an unpitied sacrifice in a contemptible struggle."

Edmund Burke

Chris Whalen: JPM and the Banks Have the MF Global Money And the Status Quo Is Protecting Them

"But please, to our friends in the Big Media, could we stop saying that we don't know the location of the missing $1.6 billion of client funds from MF Global? The money is safe and sound at JPM and other counterparties. As with Goldman Sachs et al and American International Group, the banks have been bailed out at the cost of somebody else. And the various agencies of the federal government are complicit in the fraud...

The effort by former New Jersey governor and MF Global CEO Jon Corzine to save his firm by stealing customer funds seems to warrant further discussion, yet instead we have silence...

So why is it that the Large Media have such trouble reporting this story? The fact seems to be that the political powers that be in Washington are protecting JPM CEO Jamie Dimon from a possible career ending kind of stumble with respect to MF Global."

Chris Whalen, Institutional Risk Analyst

Chris Whalen at The Institutional Risk Analyst lays out the entire MF Global scandal in a few plain words, taking the Wall Street demimonde to task in the process.

It is nice to see that someone who occasionally appears on the mainstream media can tell the truth on this. Usually one has to look for sources overseas, small cafes, and the occasional economic maverick to hear what really happened.

But in quiet whispers, the Street knows the truth, that the money was stolen, not once but twice.   And even these hard cases are shocked.  The first time by MF Global and from the very top, and then afterwards in the courts and the regulatory bodies that used the bankruptcy to take the funds from the customers and give them to the creditors.

And it does stink to high heaven. But the clean up men are giving the evidence a thorough scrubbing while justice waits, Chicago-style.

It has placed a chill on those trading in the US markets. Even they are frightened of such lawlessness. They can't help but wonder, who's next?   And how far will they go?

Please distribute this as widely as possible.

"Where is the lost customer money? At JP Morgan Chase and other banks, or course. See, "How JP Morgan and George Soros Ended Up with MF Global Customer Money", www.clearingandsettlement.com.

So why is it that the Large Media have such trouble reporting this story? The fact seems to be that the political powers that be in Washington are protecting JPM CEO Jamie Dimon from a possible career ending kind of stumble with respect to MF Global. By stuffing the commodity customers of the broker dealer via an equity bankruptcy resolution supervised dutifully by SIPIC, JPM and Soros apparently get to benefit at the expense of the commodity customers of MF Global. This situation stinks to high heaven and everyone on the Street we've spoken to about the matter knows it. As the article above notes:

"Rather than being treated as a bankruptcy of a commodities brokerage firm under sub-chapter IV of the Chapter 7 bankruptcy law, MF Global was treated as an equities firm (sub-chapter III) for the purposes of its bankruptcy, and this is why the MF Global customer money in so-called segregated accounts "disappeared".

The effort by former New Jersey governor and MF Global CEO Jon Corzine to save his firm by stealing customer funds seems to warrant further discussion, yet instead we have silence.

Here's a question: When is Corzine going to be indicted for securities fraud and other high crimes and misdemenors? The answer seemingly is that the Obama Justice Department is afraid to go there. Thus the fraud at MF Global continues and Washington does nothing to inconvenience the banksters as customer funds are expropriated.

But please, to our friends in the Big Media, could we stop saying that we don't know the location of the missing $1.6 billion of client funds from MF Global? The money is safe and sound at JPM and other counterparties. As with Goldman Sachs et al and American International Group, the banks have been bailed out at the cost of somebody else. And the various agencies of the federal government are complicit in the fraud."

Chris Whalen, The Institutional Risk Analyst

"But where says some is the king of America? I’ll tell you Friend, he reigns above, and doth not make havoc of mankind like the Royal Brute of Britain. Yet that we may not appear to be defective even in earthly honors, let a day be solemnly set apart for proclaiming the charter...that in America the law is king. For as in absolute governments the king is law, so in free countries the law ought to be king; and there ought to be no other."

Thomas Paine, Common Sense


"And remember, where you have a concentration of power in a few hands, all too frequently men with the mentality of gangsters get control. History has proven that."

Lord Acton

Drei Groschen Oper - Die Moritat von Mackie Messer  English translation.

Silver Option Expiry Next Week

Source: CME Group 2012

Feb. 23 Comex March silver options expiry
Feb. 23 Comex March copper options expiry
Feb. 24 Nymex February platinum futures last trading day
Feb. 24 Nymex February palladium futures last trading day
Feb. 27 Comex February gold futures last trading day
Feb. 27 Comex February copper futures last trading day
Feb. 27 Comex February E-micro gold futures last trading day
Feb. 27 Comex March E-mini copper futures last trading day
Feb. 27 Comex March miNY silver futures last trading day
Feb. 29 Nymex March palladium futures first notice day
Feb. 29 Comex March silver futures first notice day
Feb. 29 Comex March copper futures first notice day
March 16 Nymex April platinum options expiry
March 20 Nymex April platinum futures first notice day
March 27 Comex April gold options expiry
March 27 Comex April copper options expiry
March 28 Comex April miNY gold futures last trading
March 28 Comex March silver futures last trading day
March 28 Comex March copper futures last trading day
March 28 Comex April E-mini copper futures last trading day
March 28 Nymex March palladium futures last trading day
March 29 Comex April E-mini gold futures last trading day
March 30 Comex April gold futures first notice day
March 30 Comex April copper futures first notice day
April 25 Comex May copper options expiry
April 25 Comex May silver options expiry
April 26 Comex April gold futures last trading day
April 26 Comex April copper futures last trading day
April 26 Comex April E-micro gold futures last trading day
April 26 Comex May E-mini copper futures last trading day
April 26 Comex May miNY silver futures last trading day
April 26 Nymex April platinum futures last trading day
April 27 Comex April silver futures last trading day
April 30 Comex May silver futures first notice day
April 30 Comex May copper futures first notice day
May 24 Comex June gold options expiry
May 24 Comex June copper options expiry
May 26 Comex June miNY gold futures last trading day
May 29 Comex May silver futures last trading day
May 29 Comex May copper futures last trading day
May 29 Comex June E-mini copper futures last trading day
May 29 Comex June miNY gold futures last trading day
May 31 Comex June gold futures first notice day
May 31 Comex June copper futures first notice day
May 31 Nymex June palladium futures first notice day
June 26 Comex July silver options expiry
June 26 Comex July copper options expiry
June 26 Comex July silver futures last trading day
June 27 Comex June gold futures last trading day
June 27 Comex June copper futures last trading day
June 27 Comex June E-micro gold futures last trading day
June 27 Comex July E-mini copper futures last trading day
June 27 Comex July miNY silver futures last trading day
June 27 Nymex June palladium futures last trading day
June 29 Comex July silver futures first notice day
June 29 Comex July copper futures first notice day
June 29 Nymex July platinum futures first notice day

Gold Daily and Silver Weekly Charts - Les Cahiers de la Nuit Surveillée

"People who lie to themselves, and believe their own lies, becomes unable to recognize the truth, either in themselves or in anyone else. 

And they end up losing respect for themselves and for others. When they have no respect, they can no longer love.

So they yield themselves up to their impulses, indulging in the lowest forms of pleasure, and behave in the end like a thing obsessed in satisfying their vices.

And it all comes from lying — to others and to yourself."

Fyodor Dostoevsky, The Brothers Karamazov

Gold was capped a bit with equity markets and oil rising as speculators were feeling frisky about the Eurozone and an economic recovery in the US.

The pigmen and pampered princesses were just shameless on Bloomberg television today.

"Beauty may be skin deep, but the ugliness of vanity, selfishness, and deceit goes to the bone."

SP 500 and NDX Futures Daily Charts - Plus C'est La Même Chose

“I know that life is a doorway to eternity, and yet my heart so often gets lost in petty anxieties. It forgets the great way home that lies before it.”

Sophie Scholl

Riskiness was the trade today as the Greek Parliament voted to place its economy under European austerity measures and the financials rallied.

1350 is the big resistance in the SP futures. Apple is the Titan of the tech sector reaching $500 today.

SP 500 Deflated By Gold

Much of the recent rally, that nominally looks like a straight shot higher is really due to the monetization going on in the US and Europe.

Such distribution of money through asset bubbles can provide the appearance of vitality, but it is not self-sustaining.

But as we saw in the tech and the housing bubbles, they can go quite far, and inflict serious damage on real economy, before they collapse.

MF Global: Francine McKenna of re: The Auditors Gives a Plausible Explanation

Francine McKenna is an ex-auditor from Price, Waterhouse Coopers.

McKenna has a blog called re: The Auditors, and also writes for Forbes.

MF Global is a slowly boiling scandal. It is always the cover up that brings the most damage, rather than the initial criminal acts that are committed by a few.

She provides a very plausible description of what really happened at MF Global, and I find it to be entirely consistent with my own thoughts and extensive reading on the subject.

She does not address the actual cause of the MF Global bankuptcy but that is another matter.

It is a dirty business. And Francine is a highly credible source.

This will start viewing at 13:00 to hear McKenna's thoughts.

Registered Ounces of Silver in the Comex Warehouse

Gold Daily and Silver Weekly Charts - Bear Raid, Risk Off Trade on Greece

It was 'Risk Off' into the weekend as traders and funds raised cash levels as the markets took a 'wait and see' attitude towards the Greek debt deal.

SP 500 and NDX Futures Daily Charts - VIX Higher On Greek Deal Jitters

All eyes on Europe.

See you Sunday evening.

US Dollar Very Long Term Chart

As I have said previously, the US Dollar DX index may be less useful now because of its almost quaint concentration in the Euro, Yen and Pound, and lack of representation in the currencies of the high growth countries of the emerging markets, particularly India, Brazil, Russia and China.

The Anglo-American banking cartel would like to keep it that way as well. Encouraging the western central banks to inflate their currencies will maintain the appearance of stability while monetization and even devaluations can occur.

Still it is nice to have some historical context.

The Wall Street Conspiracy: Ascent of the Psychopaths and the Culture of Death

"The privileged have regularly invited their own destruction with their greed."

John Kenneth Galbraith, The Age of Uncertainty


"Psychopaths have a grandiose self-structure which demands a scornful and detached devaluation of others, in order to ward off their envy toward the good perceived in other people."

“He will choose you, disarm you with his words, and control you with his presence. He will delight you with his wit and his plans. He will show you a good time but you will always get the bill. He will smile and deceive you, and he will scare you with his eyes.

And when he is through with you, and he will be through with you, he will desert you and take with him your innocence and your pride. You will be left much sadder but not a lot wiser, and for a long time you will wonder what happened and what you did wrong.

And if another of his kind comes knocking on your door, will you open it?"

Robert D. Hare, Without Conscience

The Wall Street Conspiracy




You can also watch the full documentary 'Fishead' here.

I thought the section focusing specifically on Prozac was a bit overdone, as if it was somehow a cause rather than a symptom. At the height of its use, the largest per capita use of Valium was in Japan, probably due to the high tension caused by their close living conditions and a strict cultural system of obligations tied to personal worth.

The point of the film to me is that psychopaths require no such drugs, and if they come to power they order the system to suit their needs. Psychopathic cultures foster extraordinary actions amongst ordinary and feeling people to cope and compete.

High tension cultures live on abusing drugs, whether they be alcohol, cocaine, marijuana, amphetamines, prescription drugs, nicotine, or even sex, sports, or obsessive collecting. People can 'lose themselves' in many ways, including apathy, hatred and ignorance. There was a story just today that says the latest craze on Wall Street is testosterone therapy.

Let's just say that anything can be abused, used for inappropriate purposes, but that does not mean that it is 'bad.' What is more questionable is the set of values and the culture that drives people to such extremes, and their inability to otherwise regulate and restrain themselves that makes a mockery of such idylls as the efficient markets hypothesis.

What has changed in the States over the last thirty years, as best as I can determine based on conversations I have had with a number of people older than myself and extensive reading, is the notion of the 'social norm.' What is considered acceptable, and even desirable, has changed dramatically. "Greed is good" was more than just a line in a movie. And the decline in what was once considered abhorrent, but is now acceptable or even necessary, has been gradually progressing, year by year, slowly and almost imperceptibly. Until over time a people can become hard, almost heartless, even cruel.

"Dort wo man Bücher verbrennt, verbrennt man auch am Ende Menschen."
Where they have burned books, they will end in burning people.

Heinrich Heine

Always there is a progression of evil. As you may have gathered, MF Global represents an important event, a watershed, a mark along the progression of society which I have been watching. If the US continues along this path, at some point the next milestone will be reached, and the die may be cast. You cannot believe it now, but it can happen. And your grandchildren will curse you for their shame.

This film may be especially fitting and useful perhaps, given that it is an election year and the choice is between two well-groomed corporate brands, with messages cynically tailored to appeal to different aspects of their audiences, but with little actual difference between them.

"Lying, deceiving, and manipulation are natural talents for psychopaths...When caught in a lie or challenged with the truth, they are seldom perplexed or embarrassed -- they simply change their stories or attempt to rework the facts so that they appear to be consistent with the lie. The results are a series of contradictory statements and a thoroughly confused listener."

Robert Hare, Without Conscience

MF Global: Trail Growing Cold - 'No One to Blame"'

I did predict something like this would happen in about the second week of the scandal, didn't I?

Did you ever imagine that in America a major brokerage firm would brazenly steal over a billion dollars in customer funds and assets, and that no one would even be prosecuted?

And that the financiers would use the courts to just keep the money, and basically tell the broker's customers to eat shit? 

The money?  Oh no, that's just vaporized.  Just a freak accident, practically  an act of God.   Very mysterious, but could not happen again.  Protection?  Sorry don't know anything about that.

No one knows anything.  Except that the financial system can't be trusted, and that nothing in it is safe.  But they are afraid to admit it.

Reuters Africa
ANALYSIS-Criminal probe trail going cold at MF Global
Thu Feb 9, 2012 10:54pm GMT

Feb 9 (Reuters) - When commodities brokerage MF Global imploded, the FBI and federal prosecutors were quick to launch an investigation to pursue what seemed obvious to outspoken regulators and lawmakers: laws were broken and crimes were committed.

More than three months later, it is far from clear that anyone will face criminal charges over the disappearance of more than $600 million in customer money as MF Global spiraled towards bankruptcy in the brokerage's final, frantic days in the last week of October.

So far, the MF Global investigation is not tracking the early progress of other high-profile financial scandals such as RefCo, where former Chairman Phil Bennett was arrested within days of the disclosure that the futures firm had been hiding losses for years.

Lawyers and people familiar with the MF Global investigation of the firm that was run by former Goldman Sachs head Jon Corzine say that even though the hunt is still on to find out whether or not officials at MF Global intended to pilfer customer money in a desperate bid to keep the brokerage from failing, the trail at this point is growing cold.

To date, scant evidence of criminal intent has emerged in company emails, no former or current employees have sought to cut a deal to provide testimony about potential wrongdoing and seasoned defense lawyers say they are not seeing the tell-tale signs of a hot criminal investigation.

A source familiar with the work of Louis Freeh, trustee for the MF Global holding company that filed for Chapter 11 bankruptcy protection, says investigators have yet to find evidence of fraud in the multi-faceted and complex investigation.  (Perhaps stealing and then passing on stolen goods as your own does not qualify as fraud? And what is the MF Global trustee, Lous Freeh, who invokes attorney client privilege with MFG, doing running the investigation? - Jesse)

The source, who declined to be identified because Freeh's office is still conducting its inquiry, says there was plenty of "chaos" at MF Global in its waning days, but "no evidence of fraud." Freeh is a former Director of the Federal Bureau of Investigation...

Read the rest here.

Drei Groschen Oper - Die Moritat von Mackie Messer  English translation.

Yes We Can!

Gold Daily and Silver Weekly Charts - More of the Same - Monetary Trends

Some economists were saying patently silly things about gold today.

It might be useful to review why gold proves such an irritant to financial engineers and modern monetary theorists.

Typically when this happens we are a few weeks away from a major money episode of some sort, most generally of the printing kind. 

The Fed has a penchant for allowing asset bubbles to form, although that typically ends rather badly.  The mispricing of risk is the antithesis of fostering a healthy market economy. It is ironic that it is so often done in the name of restoring 'confidence' which afterwards appears to be little more than cleverness and hubris, if not downright folly. Confidence obtained by deception or false premises never lasts, and is always corrosive. But it can appear to be expedient.

"I don't know where the stock market is going, but I will say this, that if it continues higher, this will do more to stimulate the economy than anything we've been talking about today or anything anybody else was talking about."

Alan Greenspan

A stock bubble does not stimulate real economic growth, even though it may temporarily confer the appearance of vitality. Rather it encourages malinvestment and the dissipation of resources. In the end it affects the transfer of wealth from savers and labor to speculators and financial insiders. And the corruption drives out productive investment.

"Whoever commits a fraud is guilty not only of the particular injury to him who he deceives, but of the diminution of that confidence which constitutes not only the ease but the existence of society."

Samuel Johnson

The volatility on the stock indices is very subdued, if not complacent. Be careful.

SP 500 and NDX Futures Daily Charts - Winding Up for a Move - VIX

"Once stock prices reach the point at which it is hard to value them by logical methodology, stocks will be bought as they were in the late 1920s not for investment but to be unloaded at a still higher price. The ensuing break could be disastrous because panic psychology cannot be summarily altered or reversed by easing money policies."

Alan Greenspan, 1959

The Fed and its acolytes in the banking system sometimes foster an environment where equity prices rise in a steady manner, with little solid underpinning. The higher they go, the further they slide away from rational valuations, the less is required for them to take a tumble.

At the extreme, it can be a bit of a mystery and rather difficult to determine what exactly caused the market collapse. This is how it was with the Great Crash of 1929. Most often it can be something mundane and seen before, but at that stage of the bubble's ascent can cause a fatal break in confidence. And then comes the deluge. And confidence is not so easily restored.

Gold Daily and Silver Weekly Charts

Bear raid. Boring really.

SP 500 and NDX Futures Daily Charts

Groupon missed earnings but Cisco beat after the bell.

Light volumes.

JPMorgan Chase Caps Martin Luther King PR Campaign By Foreclosing on Civil Rights Activist

It's not really about the money, its the hypocrisy.

$9,000 is not a lot of money to many people in America these days. And certainly such an amount could be raised fairly quickly with an online drive for funds. Over 40,000 people have signed the online petition protesting this.

What has people upset is the blatant hypocrisy of JPMorgan, in this and so many other things. It is what drives the Occupy people. It is the entirety of the bank bailout with public money, despite the propaganda campaign and deceit of the Fed to the contrary, and the subsequent massive manipulation of the political and legal process especially in regard to the foreclosure frauds, not to mention the theft of customer funds.

The Banks even cheated returning war veterans. So why should an elderly black woman be treated any better?

Back in the 1950's and 1960's people could have raised bus fare to take Helen Bailey to a less hostile envinronment in which to live. But she chose to stand her ground and fight. It was a matter of principle to her. And such principled stands mystify those without any moral principles, such as the TBTF banks and the pampered princes of Wall Street, whose only principles are self-delusional superiority, self-centered excess, deceit, fraud, and greed.

Helen Bailey does not stand alone, then and now. That is the message that the Banks just don't get. But they will.

MFI-Miami
Chase Refuses To Give 78 Year Old Hero A $9000 Principal Write Down
By Steve Dibert
February 7, 2012

JPMorgan Chase, like their competitors, has been attempting to improve their public image with an American public who blames them for the recession. In order to show their commitment to some of the hardest hit segments of economy, JPMorgan Chase has reached out to African-American communities across the U.S. by starting a public relations campaign to help “fulfill” the “vision” of Martin Luther King Jr. to coincides with Black History Month.

Now that campaign is turning into a public relations nightmare for the banking behemoth. Chase is now threatening to foreclose on 78-year old, Helen Bailey, a former Nashville area Civil Rights activist who stood up to police attack dogs, tear gas and fire hoses for her God given rights.

Ms. Bailey couldn’t keep up with her mortgage payments and attempted to refinance with another mortgage company and would work with her to let her stay in her home until she died. The only thing she asked from Chase was a $9000 principal write down.

Chase refused and now are threatening to foreclose and evict this hero of one of the darkest times of American history.

Pictures in a Pyramid Scheme

Wax on, wax off.

Gold Daily and Silver Weekly Charts

The precious metal markets had a good day compliments of Herr Bernanke, who is obviously going to provide enough liquidity to prevent another Lehman event if he can.

SP 500 and NDX Futures Daily Charts - Benny Gooses the Beta with a Liquid Touch

This market is looking tired and the volume is drying up. But while the volume remains low it will likely keep drifting with an upward bias.

The SP Futures closed today at the July high which is remarkable.

First serious event will take it down hard. Strong support is at 1270 or so.

Don't feed the sharks. Wait for it.

Disney exceed earnings but missed the topline revenue. It is amazing what modern US accounting rules can allow. They took a hit in the theme park business. Looks like Mom and Pop are tightening their budgets.

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

Panic On Wall Street As Anti-Insider Trading Bill Spreads Wider Net Over Information Peddling

Senator Chuck Grassley put a clause back into the Senate's anti-insider trader law that requires financial analysts who meet with Congressmen and their staffs to register their meetings.

The purpose of this clause is to bring transparency to the information peddling that represents a lucrative business for hedge funds and banks that trade on insider information from the Congressmen themselves.

There is also the selling of information obtained in private meetings with the Congress to hedge funds. And rumour has it that quite a bit of that information spreads its way through the halls of the august Wall Street banks as well who help to gather it as well.

Wall Street apparently went into full court lobbying mode when they found out that Grassley had resubmitted this clause after they had successfully had it removed.

The clause only requires analysts to register their contacts and to disclose how they might be using the information provided by the Congress.

Information is power, and private access to public power is one of the great strengths of the Wall Street monied interests.

This bill might curtail the ability of JP Morgan and Goldman Sachs to obtain private information from the Finance Committees.  And they are upset about the loss of that privilege.

I am sure Mr. Obama, the great reformer who promised transparency, is solidly behind this move by the Republican Senator Grassley, right? Hard to tell right now.

Panic on Wall Street.

Bloomberg
Wall Street Sees Analysts Snagged by Political Intelligence Bill
By Phil Mattingly and Robert Schmidt
Feb 7, 2012 12:01 AM ET

A U.S. Senate measure that would place restrictions on people who gather and sell government information to hedge funds may entangle bank research analysts and others on Wall Street, according to lawyers and lobbyists. (The others are the conduits to the trading desks of the TBTF banks - Jesse)

The Securities Industry and Financial Markets Association, which represents firms including Goldman Sachs Group Inc. and JPMorgan Chase & Co., held a rare weekend call for members on Feb. 4 to discuss the measure, according to two people with direct knowledge of the call.

The provision, part of a broader bill that passed the Senate last week and is scheduled to face a House vote this week, may require analysts and others to register with Congress and disclose contacts with government officials, according to a legal analysis prepared for the group’s members.

“There are going to be a lot of entities and organizations who will not want their people anymore to contact government officials to get information which might be used for a number perfectly appropriate purposes,” Robert L. Walker, an attorney for Wiley Rein LLP who is listed as one of the authors of the legal memo, said of the impact of the provision. ('Jump you fuckers' as the Tea Party said before they turned corporate. lol - Jesse)

The broader bill would ban lawmakers, their staffs, and much of the executive branch from trading stocks, commodities or futures based on confidential information they learn on the job. Senator Charles Grassley, an Iowa Republican, succeeded last week in adding the provision that targets trading in so-called “political intelligence.” (There is nothing 'so-called' about it. That is what it is, and it is a form of corruption, albeit lucrative. - Jesse)

Such information may include conversations with lawmakers, congressional staff or other government officials about the future of legislation or regulations that have not been made public. That information has been targeted by lawmakers, who are pushing to identify firms and individuals in the business and force them to disclose their clients....

US Seizes Iranian Assets Citing 'Deceptive Financial Practices'

These fellows in New York, Washington, and London hate to see any amateurs engaging in deceptive financial practices without an official license or the right markings.

When the Iranians get good enough to move past merely practicing deception into the big leagues of world class professional fraud, and start playing ball with the big boys maybe the Iranian central bank can sign up for the primary dealer slot recently vacated by MF Global.

It is hard to imagine that Iran even has any assets remaining in the US or in any of their foreign branches.

The repatriation of assets and gold overseas is starting to gain some momentum, based on a fresh wave of vaporization concerns. Unless you're talkin about German gold which is on semi-permanent loan to Wall Street.

Bloomberg
Obama Freezes Iranian Government, Central Bank Assets
By Indira A.R. Lakshmanan
February 06, 2012, 11:47 PM EST

Feb. 6 (Bloomberg) -- President Barack Obama ordered a freeze on all Iranian government and central bank assets held in the U.S. or any foreign branch of a U.S. entity, the White House said today.

The president cited “deceptive practices” of the Iranian central bank and an “unacceptable risk” to the international financial system from Iranian activities.

Previously, only assets belonging to sanctioned Iranian entities or individuals were frozen. The order, signed by the president yesterday, blocks all property and interests in property belonging to the Iranian government, its central bank, and all Iranian financial institutions, even those that haven’t been specifically designated for sanctions by the U.S. Treasury.

Longstanding U.S. regulations already prohibited American citizens or entities from virtually all direct and indirect transactions involving Iran or its government, aside from those exempted under general licenses for transactions involving food, medicine, remittances and humanitarian relief.

The measure was mandated as part of Iran sanctions legislation that was passed by Congress and signed by the president Dec. 31.

“I have determined that additional sanctions are warranted, particularly in light of the deceptive practices of the Central Bank of Iran and other Iranian banks to conceal transactions of sanctioned parties, the deficiencies in Iran’s anti-money laundering regime and the weaknesses in its implementation, and the continuing and unacceptable risk posed to the international financial system by Iran’s activities,” Obama said in his congressional notification...

MF Global Collapsed in the Face of a $310 Million Margin Call Made by 'Undisclosed Party'

The margin call was predicted here about day two as I recall. The question in my mind is the extent that JP Morgan and any of their other bankers and credit line holders played in this.

It will be interesting to see how this case progresses from the Giddens-Freeh bankruptcy team and into the hands of the regulators and Justice Department.

So far (for the past three years) the Obama Administration has been adverse to looking too far into these sorts of cases before throwing a waiver or settlement without admission of any guilt on the table.

Bloomberg
MF Global’s $310 Million Margin Call Exceeded Its Market Value
By Matthew Leising
February 06, 2012, 8:33 PM EST

Feb. 7 (Bloomberg) -- MF Global Holdings Ltd., the futures broker that filed the eighth-largest bankruptcy in October, faced a $310 million margin call on its final day that exceeded its market value.

Calls for payments tied to bets MF Global made on European sovereign debt increased Oct. 24 and continued through Oct. 31, the day the futures broker formerly run by Jon Corzine filed for bankruptcy protection, according to a report yesterday from James Giddens, a trustee overseeing the brokerage’s liquidation. MF Global had a market value of $198 million on Oct. 28 as it held $6.3 billion in European sovereign-debt trades.

After tracing 840 transactions of $327 billion in the company’s final days, Giddens is still analyzing where some of the $1.2 billion in missing customer money “ended up,” he said in the report. Corzine’s firm failed after credit-rating downgrades, a record quarterly loss and revelations about its $6.3 billion European debt trade unnerved investors. The missing money has sparked Congressional hearings and former customers have said it undermined confidence in the futures industry.

“For three months, our investigative team has worked to understand what happened during the final days of MF Global when cash and related securities movements were not always accurately and promptly recorded due to the chaotic situation and the complexity of the transactions,” Giddens said in a statement.

The trustee didn’t disclose the identity of the counterparties making the margin calls. The trades were cleared through LCH.Clearnet Ltd., according to an MF Global contingency plan drafted before its failure. In the plan, which was designed to address the effects of a credit-rating downgrade on the company’s solvency and liquidity, MF Global questioned whether it should move the debt trades out of LCH.Clearnet.

“How will LCH respond, how much in excess margin will be required, time period, can/will they force us out?” the brokerage questioned in a section of the plan titled “immediate decision making required.” The undated plan indicated the company could move some of the cleared positions to the over- the-counter market, where it could get more favorable terms.

Congress, the Commodity Futures Trading Commission, Securities and Exchange Commission and the Justice Department are investigating events surrounding the collapse of MF Global, including the disappearance of the customer funds...

Gold Daily and Silver Weekly Charts - The Usual 3 AM NY Time Bear Raid

Gold was hit hard by a selling flurry around 3 AM Eastern Time, with most of the selling timed to events in London.

Check out the plunge in gold lease rates on 2 February in the last chart.

Silver proved to be more resilient.

If and when the metals brokers and their pyramid of leverage breaks, be careful about any holdings you may have that are mingled with theirs, otherwise your victory may be marred by a loss of funds related to the collateral damage of a default and a financial reorganization.

I hope for the best, but if there is another financial dislocation in the markets it is going to be quite ugly. They are running a little low on scapegoats and patsies, and the pain to be distributed will be great.

SP 500 and NDX Futures Daily Chart - Watch For a Divergence in VIX

Another light volume day saved the market from rolling over, which it seemed ready to do early on.

I think it is time now to take a maximally defensive position, which for me at least means hedged gold bullion positions and cash. The bullion hedge is to guard against a liquidation event as opposed to an equity correction.

If volumes stay light the wiseguys can keep lifting this up, burning the shorts. So do not get ahead of this, but keep your powder dry if you trade, and if not, start packing up in advance of a move to higher ground.

MF Global: 'Select Parties' Received the Customer Funds in the Last Week of Business

Hail to the Real Chief

It sure is taking them a long time to spit this one out, isn't it?   We stole your money, we own the system, and there is nothing you can do about it, you pipsqueaks, so just STFU and take what we choose to give you. 

Given the timing and the likely parties involved, these transfers, even when they do not involve the theft of customer funds, with the withholding of third party cash transfers by the intermediaries, done among insiders in the last week of a bankruptcy, have the appearance of a fraudulent conveyance.

Given that quite a bit of this money was undoubtedly held by MF Global's bankers, who were almost certainly aware of and may have helped to precipitate the bankruptcy, we might even have a criminal conspiracy to defraud the customers and other creditors in addition to the civil actions appropriate in a fair and unbiased bankruptcy proceeding.

There is also some evidence that certain customers were privately warned by the bankers, or perhaps even parties in the company itself, a few weeks in advance, and were able to withdraw their funds from the company before it failed. Some right wing money men come to mind, among others.

This suggestion by the trustee that the MF Global personnel took the customer money unknowingly, ie. by mistake, would be hilarious if it was not being used to describe so malicious and unspeakable lapse in stewardship by the privileged, wealthy people in stealing the livelihoods from farmers and cattle ranchers among others.

What surprises me almost more than anything is that these jokers are willing to risk bringing down the financial system for a measly billion dollars, which is a fraction of what they take in personal bonuses in a good year. Is this some sort of perverse adherence to the Ferengi rules of acquistion? "Once you have their money, never give it back."

If this stands, then nothing, no assets, held by the Anglo-American financial system are safe. When the next crisis comes, they will take what they want, starting with foreign holdings, working their way up the power and influence pyramid from there. And you can talk to the back of their hand if you don't like it.

Reuters
MF Global shortfall worsened as bankruptcy neared
Mon Feb 6, 2012 2:18pm EST

Feb 6 (Reuters) - The trustee liquidating MF Global Holdings Ltd's broker-dealer unit said the shortfall in commodity customer accounts began five days before the company's bankruptcy and grew in the days leading up to the Chapter 11 filing.

James Giddens, the trustee for MF Global Inc, said in a statement that his investigation has revealed that MF Global personnel might not have known of the shortfall at the time.  (Anyone in the business must be rolling on the floor laughing at this one. Oops, sorry, we inadvertently took the customer money by mistake, a simple $1.2 billion error, and its too late to give it back to the right persons. But we're dreadfully sorry for our innocent mistake. - Jesse)

He said he has traced a majority of cash transactions, totaling more than $105 billion, made in the last week prior to MF Global's bankruptcy on Oct. 31, 2011. Giddens said he is working with third parties to seek more complete information about transfers to "select" parties prior to that bankruptcy.

Giddens also said it is unknown when he will be able to make more distributions to former customers.

Net Asset Value Premiums of Certain Precious Metal Funds - Sprott Places Gold Offering at Premium

Sprott Physical Gold Trust Announces Completion of Its Follow-on Offering of Trust Units
Feb 3, 2012

TORONTO, Feb. 3, 2012 /CNW/ - Sprott Physical Gold Trust (the "Trust") (NYSE: PHYS / TSX: PHY.U), a trust created to invest and hold substantially all of its assets in physical gold bullion and managed by Sprott Asset Management LP, today announced that it has completed its follow-on offering of 20,000,000 transferable, redeemable units of the Trust (the "Units") at US$15.19 per Unit for gross proceeds of US$303,800,000 (the "Offering").

The Trust will use the net proceeds of the Offering to acquire physical gold bullion in accordance with the Trust's objective and subject to the Trust's investment and operating restrictions described in the prospectus related to the Offering. The net proceeds of the Offering per Unit are greater than 100% of the most recently calculated net asset value per Unit of the Trust prior to, or upon determination of, pricing of the Offering, as required under the trust agreement governing the Trust.

At today's prices this offering will pull about 176,000 ounces of gold off the public market.

In the reverse of what we saw with silver, the big follow on offering for the Sprott Physical Gold Trust priced out at a premium to its NAV and its market price. I think that is not possible with silver because of the huge premium that the Silver trust often carries. The Gold Trust premium is normally in the 3-4% range.

Sprott placed the entire gold offering fairly quickly, having announced it last week.

John Williams: US Unemployment Hits 22.5% in Alternate Estimate

Perhaps this chart will help explain the divergence that Charles Biderman of Trimtabs sees between the official unemployment numbers and the income tax data he has been tracking.

The difference amongst the three measures revolves around the treatment of workers who desire a real full time job, but have to either settle for a part time position and other forms of under-employment that may technically qualify as a 'job' but not as a 'living,' or who have simply been removed from the government's official attention span.

"The seasonally-adjusted SGS Alternate Unemployment Rate reflects current unemployment reporting methodology adjusted for SGS-estimated long-term discouraged workers, who were defined out of official existence in 1994. That estimate is added to the BLS estimate of U-6 unemployment, which includes short-term discouraged workers.

The U-3 unemployment rate is the monthly headline number. The U-6 unemployment rate is the Bureau of Labor Statistics’ (BLS) broadest unemployment measure, including short-term discouraged and other marginally-attached workers as well as those forced to work part-time because they cannot find full-time employment."

Read the rest of John Williams' Shadowstats here.

My own estimation is that the recovery is flat-lining here and is vulnerable to a double dip which, if it does occur, will be blamed on some exterior factor such as slack European demand, problems in the emerging markets, or China. But it is still too soon to tell from the numbers.

In terms of historical perspective, the great reformer Obama is much more like Herbert Hoover or Nelson Rockefeller than a Franklin Roosevelt. He resembles a moderate Republican despite all the hysterical rhetoric from the far right.

The economy has not been reformed, and most of the problems that caused the collapse in the first place are still operating. As the corporate lobbyists were able to weaken financial reform in Dodd-Frank, so they continue to monopolize the conversation and policy discussions with their money.

I do not see genuine change happening until and unless the human misery increases enough to trigger a reaction, mass protests, or some other serious challenge to the status quo and the apathy of the fortunate. And I have quite a bit of confidence that the one percent will continue to obsessively power forward as the economy dries up until they achieve a pyrrhic victory. Winning.

This applies not only to the US but several other western countries, particularly the UK. It is also true for China which despite the gloss of their miracle economy in the western corporate media remains largely a narrow oligarchy sitting on top of a virtual slave labor camp, with a few showcase exceptions. And the western oligarchs love it. As Bill Gates said, 'This is my kind of capitalism.'

SEC Allows Some of America's Biggest Wall St. Banks To Continually Flout the Law

The NY Times has discovered that the Banks that were rescued by the public have turned into serial fraud offenders. JP Morgan is near the top of their ranks, with Goldman Sachs and Bank of America not far behind.   Only Citigroup seems to have fallen out of favor.

This is not news to any of the regular patrons of the Cafe, but it is good to see the mainstream media taking notice. Perhaps they might have a look at the Silver manipulation investigation that the CFTC has been sitting on for over three years. Not to mention the outrageous theft of customer money by MF Global and the Banks.

Obama talks a good game, and presents a moral face through the media, but an examination of his actions and his record shows that his administration serves the monied interests to the detriment of the public interest. In many cases they are merely following the same practices begun in the Clinton Administration and carried on by Bush.  It is a bad situation indeed when the 'reformer' elected by the people has failed to reform. 

He may not be as brazen and open as his Republican opponents in promoting the interests of the Wall Street, perhaps, and certainly is not as favorable to Big Oil, but the corruption of justice for all in American politics seems to have become pervasive over the last fifteen years. 

NY Times
S.E.C. Is Avoiding Tough Sanctions for Large Banks
By Edward Wyatt
February 3, 2012

WASHINGTON — Even as the Securities and Exchange Commission has stepped up its investigations of Wall Street in the last decade, the agency has repeatedly allowed the biggest firms to avoid punishments specifically meant to apply to fraud cases.

By granting exemptions to laws and regulations that act as a deterrent to securities fraud, the S.E.C. has let financial giants like JPMorganChase, Goldman Sachs and Bank of America continue to have advantages reserved for the most dependable companies, making it easier for them to raise money from investors, for example, and to avoid liability from lawsuits if their financial forecasts turn out to be wrong.

An analysis by The New York Times of S.E.C. investigations over the last decade found nearly 350 instances where the agency has given big Wall Street institutions and other financial companies a pass on those or other sanctions. Those instances also include waivers permitting firms to underwrite certain stock and bond sales and manage mutual fund portfolios.

JPMorganChase, for example, has settled six fraud cases in the last 13 years, including one with a $228 million settlement last summer, but it has obtained at least 22 waivers, in part by arguing that it has “a strong record of compliance with securities laws.” Bank of America and Merrill Lynch, which merged in 2009, have settled 15 fraud cases and received at least 39 waivers.

Only about a dozen companies — Dell, General Electric and United Rentals among them — have felt the full force of the law after issuing misleading information about their businesses. Citigroup was the only major Wall Street bank among them. In 11 years, it settled six fraud cases and received 25 waivers before it lost most of its privileges in 2010...

Read the rest here.

Charles Biderman on the US Non-Farm Payrolls Report

I spend a great deal of time looking at the various government reports, and especially the Payrolls report as you know. I keep my own spreadsheets with their data, and measure various changes in the way in which they calculate the seasonal adjustment factors, imaginary jobs, and prior revisions.

If I wish to leave you with one takeway, it is that the current use of the monthly headline number is more of a Sales and PR program for Wall Street and the government, and hardly the product of serious and thoughtful analysis of statistical data.

The US economy is on a flatline from all that I can tell. I suspect that if a double dip occurs it will be blamed on Europe or some other factor. but in fact there has been no real recovery as of yet.

There is a yawning discrepancy between the bond and equity markets in the manner in which they are interpreting the data. And one of them is wrong. Based on my experience, it is the bond guys who are most always the adults in the room.

Still, the markets are what they are, and it does not pay to fight the tape ahead of its season. Wall Street and its Banks have shown a marvelous ability to create paper rallies out of nothing and sustain them for quite some time before their inevitable collapse.

The US economy can recover. The system can be repaired. But I do not see the effort required to perform that task coming out of New York or Washington yet. They may be talking a good game, but it looks like just more of the same.

On the 70th Anniversary of the Munich Students Movement - The War is Lost - The Future of Europe

It is interesting to read this now, when Europe once again considers what its shape and its future will be. And the rest of the world as well.

This leaflet was written and distributed in January, 1943. Intelligent and open minded Germans could see the decline and fall coming, even while the Reich was intensifying its efforts to feed the hatred and delusion with its lies.

I was always struck by the fact that even while the Russians were shelling Berlin, there were gangs of Nazi thugs roaming the streets, hanging old men and even boys who were not in uniform, labeling them as slackers. The will to power calls out the madness. Always. If men who would be gods cannot create and sustain life as God does, then they must ravage and destroy life, and the creative impulse and diversity of art, and finally themselves in their delusion.

As Charles Upton said, "This is why true evil always exhibits a tell-tale mixture of diabolical cunning and immense stupidity." It only imitates and steals its forms from true being, but remains a souless and non-productive aberration of genuine life.

The White Rose
Fifth Leaflet
Munich, 1943

We will not be silent.

The war is approaching its destined end. As in the year 1918, the German government is trying to focus attention exclusively on the growing might of our submarine warfare, while in the East the armies are constantly in retreat and invasion in imminent in the West. Mobilisation in the United States has not yet reached its climax, but already it exceeds anything that the world has ever seen. It has become a mathematical certainty that Hitler is leading the German people into the abyss. Hitler cannot win the war; he can only prolong it. The guilt of Hitler and his minions goes beyond all measure. Retribution comes closer and closer.

But what are the German people doing? They will not see and will not listen. Blindly they follow their seducers into ruin. Victory at any price! is inscribed on their banner. "I will fight to the last man," says Hitler-but in the meantime the war has already been lost...

What can we learn from the outcome of this war-this war that never really was our own national war?

The imperialist ideology of force, from whatever side it comes, must be shattered for all time. A one sided Prussian militarism must never again be allowed to assume power. Only in large-scale cooperation among the nations of Europe can the ground be prepared for reconstruction.

Centralized hegemony, such as the Prussian state has tried to exercise in Germany and in Europe, must be cut down at its inception. The Germany of the future must be a federal state.

At this juncture only a sound federal system can imbue a weakened Europe with a new life. The workers must be liberated from their condition of down trodden slavery under National Socialism. The illusory structure of autonomous national industry must disappear. Every nation and each man have the right to the goods of the whole world!

Freedom of speech, freedom of religion, the protection of individual citizens from the arbitrary will of criminal regimes of violence-these will be the bases of the New Europe.

Please make as many copies of this leaflet as you can and distribute them.

Gold Daily and Silver Weekly Charts

Bear raid on the metals intraday, with the message that piling into 'risk assets' like stocks and junk bonds was the thing to do because of the wonderful economic recovery.

Nothing has changed. The band just played a lively polka, and Josef and Magda led a cheer on the financial networks.

Keep an eye on Europe. That is where the rubber meets the road, or the truncheon meets the jaw, as they say.

Can the triple A's bring Greece and the other prodigals under control? Will they submit as meekly as the Irish? Stay tuned.