More active trading of USD/Asians and selling of Major/Asians? And more trades done in Singapore now? BBG: Singapore surpassed Tokyo as the busiest market for currency trading in Asia, spurred by growth in the region's emerging markets that has led FX traders to shift more of their top staff to the city state. Singapore FX Market Committee rose to $314.2 billion in April, according to a survey published today. Average volumes in Japan's capital the same month were $277.9 billion, a survey by the Tokyo FX Market Committee showed. Banks in Singapore accounted for 5% of the global $4 trillion-a-day FX market in April 2010. On FX, GBP/USD back down below 1.6300, vs 5-wk highs above 1.6340, with EUR back near day lows, weighed by ongoing concerns in eurozone despite the deal. GBP/SGD at 1.9700-10, focus still on all time lows of 1.9400, as USD/SGD hit new lows of 1.4079 despite talks of aggressive MAS interest. Key 1.20.WL
Monday, July 25, 2011
Sunday, July 24, 2011
Fed planning for potential default
http://uk.reuters.com/article/2011/07/20/us-usa-debt-fed-idUKTRE76J6IT20110720
(Reuters) - The Federal Reserve is actively preparing for the possibility that the United States could default as a deadline for raising the government's $14.3 trillion borrowing limit looms, a top Fed policymaker said on Wednesday.
Charles Plosser, president of the Philadelphia Federal Reserve Bank, said the U.S. central bank has for the past few months been working closely with Treasury, ironing out what to do if the world's biggest economy runs out of cash on August 2.
"We are in contingency planning mode," Plosser told Reuters in an interview at the regional central bank's headquarters in Philadelphia. "We are all engaged. ... It's a very active process."
Plosser said his "gut feeling" was that President Barack Obama and Congress will come to an agreement to increase the Treasury's borrowing authority in time to avert a default on government obligations.
Wall St. Prostitution Ring involves NY's wealthiest
After 17 people were busted yesterday for running a prostitution ring that catered mostly to Wall Street clients, word is that the Brooklyn DA is considering charging the "Johns," the clients who ordered the ladies, too.
Read more: http://www.businessinsider.com/brooklyn-da-might-charge-clients-in-wall-street-prostitution-ring-2011-7#ixzz1T2zCz8i3
So far, only 30 people total have been charged.
But everyone expects more people to be arrested, because basically, besides how the prostitution ring worked, all the Brooklyn DA (Charles Hynes) spoke about at a press conference covered by NBC is how this case involves some of "New York's "wealthiest," most "sophisticated" and "high class" people on Wall Street.
It seems like he's dying to tell us some of these names. In a press conference yesterday, he said:
"For people like that, money is irrelevant."
"Everything was about people who have unlimited money. Instead of paying $20 for cocaine, they were paying $170 for cocaine."
Those who used credit cards - many charging $10,000 per night - are at risk. So was it worth it?
Read more: http://www.businessinsider.com/brooklyn-da-might-charge-clients-in-wall-street-prostitution-ring-2011-7#ixzz1T2zCz8i3
Who owns US Government Debt?
Percentage of total U.S. debt, according to Business Insider:
- Hong Kong: $121.9 billion (0.9 percent)
- Caribbean banking centers: $148.3 (1 percent)
- Taiwan: $153.4 billion (1.1 percent)
- Brazil: $211.4 billion (1.5 percent)
- Oil exporting countries: $229.8 billion (1.6 percent)
- Mutual funds: $300.5 billion (2 percent)
- Commercial banks: $301.8 billion (2.1 percent)
- State, local and federal retirement funds: $320.9 billion (2.2 percent)
- Money market mutual funds: $337.7 billion (2.4 percent)
- United Kingdom: $346.5 billion (2.4 percent)
- Private pension funds: $504.7 billion (3.5 percent)
- State and local governments: $506.1 billion (3.5 percent)
- Japan: $912.4 billion (6.4 percent)
- U.S. households: $959.4 billion (6.6 percent)
- China: $1.16 trillion (8 percent)
- The U.S. Treasury: $1.63 trillion (11.3 percent)
- Social Security trust fund: $2.67 trillion (19 percent)
The U.S. Federal Reserve gave out $16.1 trillion in emergency loans
The U.S. Federal Reserve gave out $16.1 trillion in emergency loans to U.S. and foreign financial institutions between Dec. 1, 2007 and July 21, 2010, according to figures produced by the government's first-ever audit of the central bank.
Last year, the gross domestic product of the entire U.S. economy was $14.5 trillion.
Of the $16.1 trillion loaned out, $3.08 trillion went to financial institutions in the U.K., Germany, Switzerland, France and Belgium, the Government Accountability Office's (GAO) analysis shows.
Additionally, asset swap arrangements were opened with banks in the U.K., Canada, Brazil, Japan, South Korea, Norway, Mexico, Singapore and Switzerland. Twelve of those arrangements are still ongoing, having been extended through August 2012.
http://www.rawstory.com/rs/2011/07/21/audit-fed-gave-16-trillion-in-emergency-loans/
Full GAO report:
http://www.scribd.com/doc/60553686/GAO-Fed-Investigation
Court rules securities fraud only valid when transaction takes place in US
A federal district judge dismissed a securities fraud charge against Goldman Sachs yesterday on grounds that the plaintiffs hadn’t show the transaction occurred in the United States.
There were no doubt sighs of relief at Goldman. Once again, Goldman has avoided having to deal with fraud charges head-on.
The case tracked closely the one brought by the Securities and Exchange Commission last year. Basically, Goldman was accused of selling a foreign investor a stake in a collateralized debt obligation while failing to disclose it had a short position on the underlying mortgage securities.
The judge threw out the case based on a recent U.S. Supreme Court ruling that held that securities fraud laws only apply to deals that take place in the U.S. Of course, in the age of electronic communications, global financial firms and international investments it can be quite tricky to find out where a deal actually “takes place.”
President Obama absent from debt talks
First came the Biden talks. When those blew up, the Obama-Boehner talks took center stage. And when that failed, the McConnell-Reid talks looked promising. And after they faltered, the Obama-Boehner talks tried to find a new life.
Now it’s all come down to the Boehner-Reid-Pelosi-McConnell talks to solve the debt crisis. Notably absent? The president.
Read more: http://www.politico.com/news/stories/0711/59737.html#ixzz1T2eiHIbq
Wednesday, July 20, 2011
Couple forecloses Bank of America branch
In a modern-day evocation of David’s slingshot triumph over Goliath, a couple of foreclosed homeowners in Naples, Fla., reportedly foreclosed on a Bank of America branch last week, their attorney actually having moving trucks pull up in front of a Naples branch to execute a foreclosure judgment against the bank.
What must have seemed to observers like a scene out of a parallel universe — you can see some video here — was actually the fair and logical conclusion to a situation which, the court had ruled, had an unfair and illogical start. In 2009, retired police officer Warren Nyerges and his wife, Maureen Collier, paid $165,000 cash for their 2,700 square foot home in the Golden Gate Estates subdivision, and never took a mortgage out on it. So imagine their surprise when, in February of 2010, Bank of America initiated foreclosure proceedings against them. The Nyerges hired an attorney, Todd Allen, to defend them against the wrongful foreclosure, and the bank eventually abandoned the matter.
But not before the Nyerges incurred $2,534 in attorney’s fees, which they requested informally from Bank of America multiple times before resorting to the courts, which ordered the bank to make the couple whole. When B of A still had not paid the judgment after five months of phone calls and letter writing by Allen and the Nyerges to the bank insisting that the court order be obeyed, Allen took the next step in the legal collection process, obtaining an order of foreclosure against the bank.
Read more: http://moneyland.time.com/2011/06/06/homeowner-forecloses-on-bank-of-america-yes-you-heard-that-right/#ixzz1SeVN9x70
Texas Adverse Possession - Man buys 330k house for $16
Thanks to a little-known Texas law, a man found an abandoned $300,000 home, moved his stuff in and filled out some paperwork. It cost him $16. Now, apparently he’s a homeowner.
On June 17, Kenneth Robinson moved into a $330,000 home in an upscale neighborhood in Flower Mound, Texas. Except, instead of going through a bank, wading through the mortgage process and making a down payment, Robinson went to the Denton County Courthouse and filled out a form. The house he was after was abandoned, and the mortgage company went out of business. So after months of research, Robinson took advantage of a Texas law called “adverse possession.” All he had to do was print out an online form and for a $16 fee was granted rights to the house.
Read more: http://moneyland.time.com/2011/07/18/man-gets-330000-home-for-16/#ixzz1SeUHhtWi
Tuesday, July 19, 2011
Soros’s Quantum Holding 75% Cash Leads Hedge Funds Baffled by Instability
Keith Anderson, who runs the $25.5 billion Quantum Endowment Fund for Soros Fund Management LLC, has seen enough of choppy global markets.
In mid-June, Anderson told his portfolio managers to pull back on trades as the hedge fund’s losses hit 6 percent for the year, according to two people familiar with the New York-based firm. As a result, the fund is about 75 percent in cash as it waits for better opportunities, said the people, who asked not to be identified because the firm is private.
Soros and Moore Capital Management LLC are among hedge funds that have reduced the amount of money they’re investing in stock, bond and currency markets as they look for clarity on global events ranging from the debt crisis in Europe to China’s efforts to control inflation to the debate over the U.S. debt ceiling. About 18 percent of asset allocators, including hedge funds, are overweight cash, the highest level in a year and up from 6 percent in May, a Bank of America Corp. survey showed last month.
EU approaches resolution as Aug 2 Deadline looms for US
The euro rallied against the dollar and rose from almost a record low versus the Swiss franc on bets European officials are approaching an agreement over measures designed to contain the region’s sovereign-debt crisis.
The 17-nation currency pared gains as Germany’s Chancellor Angela Merkel told reporters in Hanover that the debt crisis can’t be resolved “in one step.” Sweden’s krona and Australia’s dollar climbed amid renewed investor appetite for higher-yielding assets as Greek Finance Minister Evangelos Venizelos said a resolution of debt turmoil is attainable. The Canadian dollar rose after the central bank’s policy statement.
Friday, July 8, 2011
Insight on Friday's EUR/USD move
More on the EUR/USD move higher, and despite all the wide ranging reasons behind why the currency pair has gone completely against its positive correlation with the equity indices, the over-riding factor is that a large Asian name was a big buyer of from the low 1.4200's. Having taken out stops through the Thursday lows, the familiar trading account emerged and bought up the pair in some pretty hefty amounts. Whatever the views on how and where the employment stats would impact, there is no disputing that the above is the key factor in this afternoon's (eventual) move. The Asian account holds a large 1.40/1.47 DNT structure, which is set to roll off inside the next 2 weeks, and is choosing to 'smooth' FX moves when we get anywhere near the outer limits of the range. For now, we see expiries at 1.4330, 1.4335 and 1.4340 keeping trade up at these levels. SM
Thursday, July 7, 2011
Chained CPI to save $300 Billion over 10 years
What is “chained CPI,” and why should you care?
One proposal in the budget talks that is getting a serious look from all sides would switch the government’s way of measuring inflation and delivering a big impact on tax, spending, and entitlement programs.
How big? It could save roughly $300 billion over 10 years. That big.
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