Free Republic

Monday was a libertarian’s worst nightmare. I sat and watched a president who has already nationalised banks, car companies, the student loan system, and mortgages announce that he’s moving on to attempt to push through “the most ambitious overhaul of the financial system since the Great Depression”. President Obama went to Wall Street to give a speech about “financial reform” and he was not in a kind mood. He started with soothing, conciliatory language (his usual speech-making pattern) then launched into a scathing attack on, well, essentially free enterprise. What he called “the near-collapse of our financial system one year...

New York, NY (AHN) - Federal Reserve Chairman Ben Bernanke's remark that recession is likely over a jump in August retail sales sent Wall Street to its highest close this year on Tuesday. The Dow Jones Industrial Average, beefed up by 56.61 points or 0.5 percent and gains by Alcoa, Caterpillar and General Electric, closed at 9,683 points. It was the eighth consecutive rise and highest close of the Dow since Oct. 2, 2008, according to reports. The Nasdaq Composite Index went up 10.86 points or 0.5 percent to end at 2,102.64 while the Standard & Poor's 500 Index climbed...

James S. McDonald, head of investment-management firm Rockefeller & Co. and a board member of NYSE Euronext, died on Sunday in Massachusetts, according to people familiar with the matter. He was 56 years old. In a statement Monday night, Barclay McFadden III, who identified himself as a friend of Mr. McDonald's family, said he "took his own life." The family has "no further comments beyond this," the statement added. " Jim McDonald was an exceptional individual who provided strong leadership of Rockefeller & Co. for over eight years," Colin Campbell, Rockefeller & Co. chairman, said in a statement on Monday....

A BBC production of the last days of Lehman Brothers is a must see. You have to read between the lines a bit, but the production shows how Treasury Secretary Paulson treated Lehman different from the way he handled others that had just as many problems as Lehman. In a nice touch, the BBC hints that Paulson tipped off former Goldman man, and then Merrill CEO, John Thain, of the trouble ahead----which was behind Merrill's sale to Bank of America. The dramatization does a nice job of showing Thain's style in landing an incredible $29 per share for Merrill from...

WASHINGTON/NEW YORK (Reuters) - Some of the largest U.S. banks will remain caught in the government's financial bailout program for months, as officials do not expect to grant the next wave of exit approvals until near the end of the year, according to a source familiar with the matter. Banks such as Citigroup (NYSE:C - News) and Bank of America Corp (NYSE:BAC - News) have been chafing under the government's reins and want to exit the Troubled Asset Relief Program (TARP), which delivered capital infusions to banks along with limits on pay, share repurchases and dividends. *** "It is very...

One of those hopefully seminal moments, when someone, somewhere decided to take a stand against the perpetual engine of corruption, greed, and cronyism. From Judge Rakoff's Order For example, the Consent Judgment would effectively close the case without the S.E.C. adequately accounting for why, in contravention of its own policy, see Order, 8/25/08 (quoting the policy), it did not pursue charges against either Bank management or the lawyers who allegedly were responsible for the false and misleading proxy statements...

Part of the charm of Wall Street, and what scares most reasonable people away, is that it is as close to a meritocracy as exists on this earth. It's dog eat dog. It's sink or swim. You do a trade and it makes money, then you're a hero (for a moment anyway) and deserve a bonus. You bring in a deal, you get paid. You lasso more clients' assets under your firm's roof, you're a hitter. I once discovered some good news on the stocks I followed before the rest of the Street, and mentioned it to the sales force...

The stock market's recent rally is likely to run out of steam soon and equity prices may collapse again, Jeffrey Gundlach, chief investment officer at Los Angeles-based mutual-fund giant TCW Group Inc., said Wednesday. The benchmark Standard & Poor's 500 index is "extremely unlikely" to climb above 1,100, before collapsing again, he said during a conference call. "You've made 90% of the money you're gonna make in this rally," Gundlach said, advising investors to sell on strength when the S&P 500 is above 1,000.

WASHINGTON -- President Barack Obama warned Wall Street that it wouldn't be wise to ignore lessons from last year's economic turmoil, pressing the financial sector to join his effort to remake financial regulation by the end of the year. In a major address in New York, Mr. Obama said the storms of the financial crisis "are beginning to break" with less need for the government to get involved in the financial system. But he pressed Wall Street not to grow complacent as the economy returns to normal, saying banks shouldn't expect taxpayers to come to the rescue again. (See the...

Stocks aren't the only things falling--America's confidence in Wall Street and banks is plummeting too. Last year this time, the markets nosedived after the Lehman bankruptcy on Sept.14, 2008. One year later, how has public opinion fared? How do Americans feel about the institutions that have dominated the headlines in our cascading financial crisis? Fortunately for students of public opinion, several survey organizations have been asking identical questions about our confidence in the financial world for decades. In 1977, Harris asked about people "in charge of running Wall Street," and 19% of those polled expressed a great deal of confidence....

For all the talk of another big drop coming, the pieces are in place for 3 years of 15% annual increases for the giants of the blue-chip index. It's been exactly a year since the government kicked a smoldering financial crisis into a roaring blaze by letting Lehman Brothers (LEHMQ, news, msgs) collapse. Observers this week are memorializing the mistake, but investors need to look forward -- and what they should see is that the government's later reaction to its error may have actually laid the groundwork for the greatest bull market of the decade. For while it seems unlikely...

NEW YORK (AFP) – President Barack Obama bluntly warned Monday that some Wall Street bosses were ignoring lessons of the financial crisis, as he demanded a new age of prudence after bloated years of unchecked excess. "The old ways that led to this crisis cannot stand," the US leader said, in an outspoken address delivered in the shadow of US finance firms he blamed for unleashing global contagion. "History cannot be allowed to repeat itself." A year after Lehman Brothers failed, triggering the meltdown, Obama also called on Congress to act this year on regulatory reforms he hailed as the...

A year after the financial system nearly collapsed, the nation's biggest banks are bigger and regaining their appetite for risk.

NEW YORK (AFP) – US President Barack Obama on Monday warned Wall Street it must not return to the "reckless behavior" and "unchecked excess" which he blamed for unleashing the global financial crisis. The president, in a major economic speech at the heart of the mighty US financial system just blocks from the New York Stock Exchange, laid out a wide ranging prescription for rebuilding the US finance system. He said the crisis was a "collective failure" of Washington, Wall Street and across America, vowed to press G20 powers for action on regulatory reform, and cautioned top executives not to...

I read an article that states that Wall Street is considering bundling life insurance policies taken out on citizens and selling them as securities. Where investors pay the premium and hope that the person will die soon enough for them to cash out with a profit. This really got me thinking on why Obama is pushing this healthcare bill so hard. The Obamacare bill has provision that will obligate doctors to keep electronics records and convert any paper record to electronic form. All in the name of efficiency and well being of the patient. Now if Wall Street wants to...

When President Obama travels to Wall Street on Monday to speak from Federal Hall, where the founders once argued bitterly over how much the government should control the national economy, he is likely to cast himself as a “reluctant shareholder” in America’s biggest industries and financial institutions. But one year after the collapse of Lehman Brothers set off a series of federal interventions, the government is the nation’s biggest lender, insurer, automaker and guarantor against risk for investors large and small. Between financial rescue missions and the economic stimulus program, government spending accounts for a bigger share of the nation’s...

Sunday’s Washington Post reports that “J.P. Morgan Chase for the first time convened its board in Washington this summer, calling the directors to a meeting at the downtown Hay-Adams hotel, then dispatching them to Capitol Hill for meet-and-greets,” highlighting the bed-sharing between State and economy in an article titled, “In Shift, Wall Street Goes to Washington: District Rises as New Financial Center”.“Fascism should more properly be called corporatism because it is the merger of state and corporate power.” –Benito MussoliniDavid Cho, Steven Mufson and Tomoeh Murakami Tse report:As financial firms navigate a life more closely connected to government aid and...

Since its birth, the United States has grappled with the problem of an over-mighty financial sector. With the exception of Alexander Hamilton, the Founders' vision was of a republic of self-reliant farmers and small-town tradesmen. The last thing they wanted was for New York to become the London of the New World—a mammon-worshiping metropolis in which financial capital and political capital were rolled into one. That was why there was such resistance to creating a central bank, and why—despite two attempts—we have no Bank of the United States to match the Bank of England. That was why populists railed against...

Warren E. Buffett has two cardinal rules of investing. Rule No. 1: Never lose money. Rule No. 2: Never forget Rule No. 1. Well, a lot of old rules got trashed when the financial crisis struck — even for the Oracle of Omaha. At 79, Mr. Buffett is coming off the worst year of his long, storied career. On paper, he personally lost an estimated $25 billion in the financial panic of 2008, enough to cost him his title as the world’s richest man. (His friend and sometime bridge partner, Bill Gates, now holds that honor, according to Forbes.) And...

""America's Bailout Barons," a report released last week by the Institute for Policy Studies, a Washington-based non-profit that has long criticized Wall Street pay, said the top five executives at 10 banks bailed out by taxpayers were rewarded with stock options at the height of the crisis that have grown in value by $90 million."

Any time corporate executives and directors are heavily selling their company's stock there's reason for concern. And lately they've been doing just that. The last time insider selling was as high as it is now was in the period from late 2006 to late 2007. It was right after that insider-selling surge that the stock market began its long painful decline, says Charles Biderman, CEO of TrimTabs, an independent institutional research firm. Biderman believes that insider trades shoot higher when there's a disconnect between broad market opinions and what business executives feel in their gut. "When [insiders think] things are...

Since the near collapse of Wall Street from the sub-prime mortgage crisis, traders have been jonesing for a return to the adrenaline rush they once enjoyed from the slew of exotic financial instruments cooked up in the dark recesses of special hedge fund units. And according to a piece in the New York Times, they have found it with a ghoulish scheme gambling on death, by repackaging life insurance policies sold for a fraction of their worth by sick and desperate elderly people. Once people die, the investors make money. And it’s much more profitable if you die sooner rather...

Tony Greenwich, Connecticut isn’t immune to the fear and loathing that has been seen at townhall meetings across the country during the Congressional recess this summer. Wall Street traders and their wives showed up fully charged to debate health care reform last night... It was a bit of a mob scene. At one point Congressman Jim Himes, who represent Greenwich in Congress, went out to speak to the fifty or so people locked out of the meeting because of space restrictions. He was escorted by 8 armed police officers. The Congressman was “rattled” by questions ... At one point the...

Barack Obama said the Waxman-Markey carbon tax would help create "green energy" jobs in the U.S. He is now using taxpayer dollars to fund jobs in Spain.Barack Obama sold the Waxman-Markey "American Clean Energy and Security Act" to Congress and the American people by saying that investment in so-called "green energy" would create millions of high-wage American manufacturing jobs. We received an E-mail from the Society of Manufacturing Engineers (nonpartisan professional organization) that exposed Barack Obama as a blatant prevaricator who is shamelessly using our tax dollars to create jobs not in the United States but in foreign countries. We...

Asian stock markets pulled back Wednesday, sending Japan's benchmark down nearly 3 percent, after an overnight sell-off on Wall Street amid fears about the U.S. financial sector. Selling across the region was broad, with banks, commodity producers and exporters taking big hits. Oil prices rebounded slightly to trade just above $68 a barrel, while the dollar weakened against the yen. Investors were showing little appetite for risky assets after U.S. markets tumbled as rumors about escalating troubles in the banking sector revived concerns about the health of the financial industry and the economy as a whole. After a powerful six-month...

Professor Igor Panarin, whose book “The Crash of America” is just out, claims that by November the book will be yesterday’s news. Panarin believes President Obama will lead his country to a breakup. Panarin compares Obama to former Soviet president Mikhail Gorbachev. “Obama is “the president of hope”, but in a year there won’t be any hope. He’s practically another Gorbachev – he likes to talk but hasn’t really managed to do anything. Gorbachev at least had been a secretary of a regional communist party administration, whereas Obama was just a social worker. His mentality is totally different. He’s a...

The economic downturn has made an already competitive retail landscape especially brutal and unforgiving. Exhibit A is the rivalry between discount retailers Wal-Mart (WMT) and Target (TGT). The clear winner in the current downturn was Wal-Mart. Amid millions of job losses and plunging stock and housing markets, new customers flocked to Wal-Mart, at the expense of almost every other U.S. retailer except ultralow-price dollar stores. It appears that "cheap chic" -- Target's famous selling point -- is not the primary concern of recession-battered consumers. Last quarter, the average U.S. Wal-Mart store actually saw traffic increase 1.3% from the year before....

Some experts say the U.S. economy is in the early stages of recovery but it will be a while before growth starts to bring down unemployment. "My forecast envisions a return to positive but subdued gross domestic product growth over the medium term weighed down by significant adjustments to our economy," Federal Reserve Bank of Atlanta President Dennis Lockhart said in prepared remarks. "My forecast for a slow recovery implies a protracted period of high unemployment," Lockhart, a voting member of the Fed's policy-setting committee this year, told the Chattanooga Area Chamber of Commerce in a luncheon speech. Lockhart also...

Companies from US, UK and Australia have the most concentrated financial power. A recent analysis of the 2007 financial markets of 48 countries has revealed that the world's finances are in the hands of just a few mutual funds, banks, and corporations. This is the first clear picture of the global concentration of financial power, and point out the worldwide financial system's vulnerability as it stood on the brink of the current economic crisis. A pair of physicists at the Swiss Federal Institute of Technology in Zurich did a physics-based analysis of the world economy as it looked in early...

<p>Dell's release slipped out about three minutes before the market closed Thursday, giving the company's shares a boost of 98 cents, or 6.7%, to end at $15.65. The stock topped $16 ahead of Friday's opening bell.</p> <p>Really? You sure about that Marketwatch?</p>

Cs, broadband Internet connections, online brokerage accounts. These advances brought democracy to Wall Street, leveling the playing field between everyday investors and the insiders, right? Wrong. In fact, computers are ruining investing for the average investor. Sure, your PC lets you see when your stock is moving. But multiply its computing power by thousands, add a throng of software geniuses earning more than $1 million a year and an army of full-time analysts, and you start to understand how the biggest brokerages and hedge funds can stay a few steps ahead of any move you can make. Yes, you can...

The US banking system will lose some 1,000 institutions over the next two years, said John Kanas, whose private equity firm bought BankUnited of Florida in May. “We’ve already lost 81 this year,” he told CNBC. “The numbers are climbing every day. Many of these institutions nobody’s ever heard of. They're smaller companies.” Failed banks tend to be smaller and private, which exacerbates the problem for small business borrowers, said Kanas, who became CEO of BankUnited when his firm bought the bank and is the former chairman and CEO of North Fork bank. “Government money has propped up the very...

AMERICANS should boycott the stock market. No, I'm not kidding. And this isn't going to be one of those funny columns. In fact, I'm deadly serious that investors shouldn't risk any more of their money until there are promises of a thorough investigation of Goldman Sachs. Over the past few years I've looked into the much-too-cozy relationship between Goldman and Washington. I've suspected that this Wall Street firm has been acting, in essence, as an arm of the government. And I am also pretty sure that if Goldman and Washington have something secret going on, the investment firm isn't doing...

Flying home to New Jersey from Chicago after the first two days at his new job, Sergey Aleynikov was prepared for the usual inconveniences: a bumpy ride, a late arrival. He was not expecting Special Agent Michael G. McSwain of the F.B.I. At 9:20 p.m. on July 3, Mr. McSwain arrested Mr. Aleynikov, 39, at Newark Liberty Airport, accusing him of stealing software code from Goldman Sachs, his old employer. At a bail hearing three days later, a federal prosecutor asked that Mr. Aleynikov be held without bond because the code could be used to “unfairly manipulate” stock prices.

Securities regulators are examining weekly meetings at Goldman Sachs Group Inc. in which research analysts give tips to traders and then to big clients, as the Wall Street giant considers disclosing these so-called trading huddles to all its clients. The Wall Street Journal reported Monday that analysts at Goldman sometimes shared with traders and key clients short-term trading tips that sometimes differed from the firm's long-term research. Examiners at the Financial Industry Regulatory Authority, the industry self-regulatory body known as Finra, and the Securities and Exchange Commission intend to ask Goldman for more information on these weekly get-togethers, people familiar...

Remember when the US government had to bail out investment banks? Now a bank is bailing out the state of California. California had been covering its budget shortfalls by issuing IOUs to pay for services, making it the first state to issue its own fiat currency since the Civil War. The program ran into trouble when banks announced they wouldn't keep cashing the IOUs. Eventually California reached a budget deal and kicked the can down the road, but there's still the issue of the outstanding IOUs. Yesterday JP Morgan agreed to lend California $1.5 billion to

The bankruptcy of Colonial Bank (CNB) was the largest bank-bankruptcy in the U.S. since several large, U.S. financial institutions collapsed last year – with the most recent being Washington Mutual, last fall. However, there is one huge difference between the mega-bankruptcies of last year and the collapse of Colonial Bank a week ago. During the large bank-failures of 2008, the acquiring institutions wrote-down the “assets” on the books of these banks by an average of 18% - according to a Bloomberg article. However, when BB&T Corp purchased Colonial, it immediately wrote-down Colonial's assets by 37%, double the amount of discounting...

Few Americans have the time to educate themselves on the operations of those who control the most critical elements at the heart of the Nation’s well being. The Kings of Wall Street have long coveted the absolute supremacy they now enjoy over the largest economy in the world. Their road to ascendancy has been long and methodical, but with the collapse of the mortgage and equity bubbles, the past year’s actions by those pillars of persuasive absolutism on Wall Street confirm that their dominance is unprecedented in American history. A vast majority of Americans must have been astounded by Bernanke’s...

China is the future of Wall Street. But Wall Street may not be in China's future. Despite the Asian giant's phenomenal expansion and the plentiful opportunities that growth provides the U.S. financial services industry, Wall Street appears to be ill-prepared to capture the business bubbling up from the country and its neighbors. The U.S. banks and brokerages that traditionally dominated capital markets overseas are on the sidelines, dealing with the fallout from the credit crisis. They include some of the biggest names on the bailout shame list including Citigroup Inc. , Bank of America Corp. and American International Group Inc....

The market has a reputation for tanking in October, though there's no obvious reason why that month should stand out as being so bloody. A theme that we've seen discussed more than once is the scary resemblance this year's stock market bears to last years. Here's a look at the S&P 500 between January 1, 2008 and June 6, 2008.

Municipal bonds are usually thought to be a risk-free investment. Turns out that's not always the case. ___ Vallejo, California's bankruptcy last year represented the largest municipal default in 14 years. For 16 months, Jefferson County, Alabama has been unable to pay debts on billions of dollars in sewer bonds. Almost everywhere, tax revenues have plummeted, throwing the finances of local governments into disarray. So, are municipal defaults becoming more common? As it turns out, that question is part of the backdrop to a dispute between the Securities and Exchange Commission and local governments over regulation of the municipal bond...

Bottom line: he was in touch with Goldman a lot. While Mr. Paulson spoke to many Wall Street executives during that period, he was in very frequent contact with Lloyd C. Blankfein, Goldman’s chief executive, according to a copy of Mr. Paulson’s calendars acquired through a Freedom of Information Act request. During the week of the A.I.G. bailout alone, Mr. Paulson and Mr. Blankfein spoke two dozen times, the calendars show, far more frequently than Mr. Paulson did with other Wall Street executives. On Sept. 17, the day Mr. Paulson secured his waivers, he and Mr. Blankfein spoke five times....

Lloyd C. Blankfein has a story about the cataclysm that nearly brought down all of Wall Street. It goes something like this: One by one, lesser banks were swept away by the financial storm of 2008. And as the floodwaters rose, no one, not even Goldman Sachs, seemed safe. The question, in Mr. Blankfein’s eyes, was how high the water would rise. But Washington stepped in with all those bailouts before the surge reached Goldman. The story, which was recounted by several friends and colleagues, represents a sobering private admission from Mr. Blankfein, Goldman’s chief executive. Publicly, it is a...

Goldman positions itself in the middle of a speculative bubble, selling investments they know are crap. Then they hoover up vast sums from the middle and lower floors of society with the aid of a crippled and corrupt state that allows it to rewrite the rules in exchange for the relative pennies the bank throws at political patronage. Finally, when it all goes bust, leaving millions of ordinary citizens broke and starving, they begin the entire process over again, riding in to rescue us all by lending us back our own money at interest, selling themselves as men above greed,...

With all this blather about “green shoots” and economic “recovery” and new “bull market,” I thought I’d inject a little reality into the collective financial dialogue. The following are ALL true, all valid, and all horrifying… Enjoy. 1) High Frequency Trading Programs account for 70% of market volume High Frequency Trading Programs (HFTP) collect a ¼ of a penny rebate for every transaction they make. They’re not interested in making a gains from a trade, just collecting the rebate. Let’s say an institutional investor has put in an order to buy 15,000 shares of XYZ company between $10.00 and $10.07....

Yesterday we detailed the different between this current economic contraction, and your usual run of the mill plain vanilla recessions. We also went over the MASSIVE consumer credit contraction that needs to occur before American households have finished de-leveraging. Today, we’re detailing why stocks will Crash this coming fall. As you know the media is rife with folks calling the end of the recession and the beginning of a new bull market. It’s clear to me that this is a load of nonsense. Today I’ll show you why. Because a lot of the alleged “analysis” that is backing up the...

It's over — we're officially, royally $ucked. No empire can survive being rendered a permanent laughingstock, which is what happened as of a few weeks ago, when the buffoons who have been running things in this country finally went one step too far. It happened when Treasury Secretary Timothy Geithner was forced to admit that he was once again going to have to stuff billions of taxpayer dollars into a dying insurance giant called AIG, itself a profound symbol of our national decline — a corporation that got rich insuring the concrete and steel of American industry in the country's...

The Securities and Exchange Commission accused Bank of America on Monday of misleading investors about plans to pay billions of dollars in bonuses at Merrill Lynch, the troubled brokerage giant it bought last year. The development once again turns an uncomfortable spotlight on a defining moment of the financial crisis — the ill-starred merger of Bank of America and Merrill — and on Bank of America’s embattled chief executive, Kenneth D. Lewis. The $50 billion merger, completed at the behest of federal officials, has been the subject of heated hearings in Congress, as has the question of who knew what,...

Goldman Sachs Group Inc (NYSE:GS - News) Chief Executive Lloyd Blankfein told employees to avoid making high profile purchases, the New York Post said, citing sources. Blankfein, who first asked employees to avoid large purchases late last year, has stepped up his campaign in recent weeks, a source told the paper. "This is a sensitive time for us, and (Blankfein) wants to make sure that we're not being seen living high on the hog," the paper quoted an anonymous Goldman executive as saying. Goldman has faced a torrent of unwanted publicity recently including an unflattering story in Rolling Stone magazine,...

GOLDMAN PRINCES TOLD: SPEND LIKE PAUPERS Goldman Sachs CEO Lloyd Blankfein has warned his employess to avoid making big-ticket, high-profile purchases as the gold-plated Wall Street firm hunkers down amid a firestorm of public and political anger over outsize bonus payments. According to sources at the bank, Blankfein has Goldman in particular, should be toned down in light of the billions in bailout money that banks, including Goldman, have gotten from Uncle Sam. A source within the bank said Blankfein first began calling for an end to the conspicuous consumption late last year, but has stepped up his campaign in...