Around here, we went from a miserably cold Sunday to a bitterly Cold Monday: 10F at 6 AM, and not a chance of reaching freezing before Thursday, when it will warm up to snow. Or not. Weather forecasts have been prodigiously inaccurate this winter. The computer models aren't able to cope.

Come Friday, we barbecue George Soros, who has been asking for it for some time now. Get your Czárdás on!

http://www.npr.org/blogs/money/2015/01/22/377470959/how-much-more-or-less-would-you-make-if-we-rolled-back-inequality



What would incomes look like for U.S. families today if the income distribution were the same as it was in 1979?

Larry Summers recently made this really intriguing calculation in the FT.

His conclusions:

Families in the bottom 80 percent of the income distribution would be making $11,000 more per year, on average, than they're earning today.
Families in the top 1 percent would be making about $750,000 less than they're earning today.

That got us thinking: What would those numbers look like in greater detail? How would the incomes of the poor, the middle class and the rich look different if you had 1979 levels of inequality in today's economy?

Here's what we found:

YOU HAVE TO GO TO THE LINK TO SEE THE GRAPH--AND IT'S A SHOCKER, WELL WORTH THE CLICK!

The middle class would have the biggest gain if we returned to the 1979 income distribution. That's another way of saying the middle class has seen the biggest fall in share of total income over the past several decades.

Similarly, the huge losses to the top 1 percent of earners if we returned to 1979 levels of inequality are a reminder of the huge gains the top 1 percent has seen since then.

Of course, this is a purely theoretical exercise. It combines two different worlds: an economy as big as today's, but with 1979 levels of inequality. Some economists would argue that this could never exist, because economic growth has been been driven by forces, such as globalization and technological change, that have also driven up inequality.

One final note: As you may have noticed, our number for the change for the top 1 percent is a bit different from what Summers found. We calculated this number based on figures from the World Top Incomes Database and the Census Bureau.

INSURGE INTELLIGENCE, a new crowd-funded investigative journalism project, breaks the exclusive story of how the United States intelligence community funded, nurtured and incubated Google as part of a drive to dominate the world through control of information. Seed-funded by the NSA and CIA, Google was merely the first among a plethora of private sector start-ups co-opted by US intelligence to retain ‘information superiority.’

The origins of this ingenious strategy trace back to a secret Pentagon-sponsored group, that for the last two decades has functioned as a bridge between the US government and elites across the business, industry, finance, corporate, and media sectors. The group has allowed some of the most powerful special interests in corporate America to systematically circumvent democratic accountability and the rule of law to influence government policies, as well as public opinion in the US and around the world. The results have been catastrophic: NSA mass surveillance, a permanent state of global war, and a new initiative to transform the US military into Skynet.

THIS IS PART ONE. READ PART TWO HERE.

http://www.ibtimes.com/trans-pacific-partnership-deal-isnt-secret-says-us-official-access-text-highly-1793274


DAVOS, Switzerland -- The trade rules of the proposed Trans-Pacific Partnership (TPP) between the U.S. and 11 Asian nations would cover nearly 40 percent of the world economy -- but don't ask what they are. Access to the text of the proposed deal is highly restricted. Nevertheless, U.S. Trade Representative Michael Froman defended the Obama administration Friday at the World Economic Forum from intensifying criticism of its refusal to release the full text of the proposed TPP.

“We can always do better on transparency,” he said, but added that “there is no area of policy where there is closer collaboration between the executive and Congress than trade policy.”

Froman, who said his office has held more than 1,600 briefings with lawmakers over the TPP, said his office also has released summaries of proposed provisions. Yet the actual text of the agreement remains under lock and key. That represents a significant break from the Bush administration, which in 2001 published the text of a proposed multinational trade agreement with Latin American nations.

“It is incomprehensible to me that leaders of major corporate interests who stand to gain enormous financial benefits from this agreement are actively involved in the writing of the TPP, while at the same time, the elected officials of this country, representing the American people, have little or no knowledge of what’s in it,” wrote U.S. Sen. Bernie Sanders, I-Vt., in a letter to Froman earlier this month.

Sanders’ office confirmed to International Business Times that congressional lawmakers are permitted to view the text of the agreement only in the Trade Representative’s office, without their own staff members or experts present. They are not allowed to take copies of the agreement back to Capitol Hill for deeper, independent evaluation. Despite those restrictions, specific details of the agreement’s text have surfaced from unauthorized leaks -- some of which appear to contradict the Obama administration’s promises. Froman, for instance, said in Davos that “none of the trade participants want to lower our health, safety or environmental standards,” yet one of the leaks showed the U.S. proposing to empower corporations to attempt to overturn domestic regulations, while critics say another leaked provision would help the pharmaceutical industry inflate the price of medicines in poor countries.

Froman and Roberto Carvalho de Azevêdo, the director-general of the World Trade Organization, were asked at the World Economic Forum why the TPP is being kept secret by the U.S. at the same time the European Union has just published the full text of a separate proposed trade agreement with the United States. If, as the Obama administration has argued about TPP, some confidentiality is necessary for frank negotiations, was the EU wrong to publish its full proposal? Froman suggested that nations have varying definitions of transparency.

“It is very important that as we pursue these trade negotiations we do so in a way that takes into account input from the public, from our wide range of stakeholders, our political processes -- in our case, Congress -- we each have different ways we engage in that process,” he said.

Azevêdo said: “Honestly, this is something that the participants have to solve -- the degree of openness and the degree of transparency.” Negotiations require a degree of balance between transparency and secrecy, he said, “otherwise they don’t move."

http://www.reuters.com/article/2015/01/22/us-usa-security-metadata-idUSKBN0KV2NC20150122

President Barack Obama's administration has quietly abandoned a proposal it had been considering to put raw U.S. telephone call data collected by the National Security Agency under non-governmental control, several U.S. security officials said. Obama promised changes in the government's handling of such data in a speech a year ago after revelations by former NSA contractor Edward Snowden about the extent of the agency's electronic surveillance of Americans' communications. Under the proposal floated by a Presidential review panel, telephone call "metadata" generated inside the United States, which NSA began collecting in bulk after the Sept. 11, 2001 attacks, could instead be collected and retained by an unspecified private third party.

The Obama administration has decided, however, that the option of having a private third party collect and retain the telephone metadata is unworkable for both legal and practical reasons. "I think that's accurate for right now," a senior U.S. security official said. Telephone "metadata" includes records of which telephone number calls which other number, when the calls were made and how long they lasted. Metadata does not include the content of the calls.

An alternative proposal, which U.S. officials said the administration is still considering, would have telecommunications firms collect and retain such data.

The senior U.S. security official said that among the concerns officials had when examining that option was putting security protocols at risk. The official also cited concerns about the extra costs of moving data from telecom companies to a third party, and in a format which the government agencies found easy to use. The official said there would be no significant cost to the government to require telecom providers to hold the data. The official said that no final decision had been made on the issue, but said the President's goal remained that the government would no longer hold the data.

The law which NSA has cited to authorize its bulk collection of U.S. telephone metadata expires in June. Officials said Congress had made various proposals to change or substantially reform legal authorities for collection and retention of the metadata but had not approved any specific legislation. Shawn Turner, a White House spokesman, said the Office of Director of National Intelligence was expected to issue a report in early February that will chart progress on reforms Obama ordered a year ago in U.S. surveillance programs.

And died from dysentery and shit come out the butt.

Went to see Book of Mormon over the week-end.

If you get a chance, you'll piss your pants laughing.

http://www.businessinsider.com/10-most-important-things-in-the-world-right-now-jan-25-2015-1

1. Radical leftist party Syriza won the Greek election Sunday night by a landslide.

2. After Syriza's victory, the party will be looking for coalition partners this morning to form a new government.

3. US President Barack Obama attended India's annual Republic Day parade in Delhi, the first American president to do so, as part of a three-day visit to the country.

4. The official Malaysia Airlines website was hacked Monday by a group calling itself the "Official Cyber Caliphate."

5. The journalist who first reported the death of Argentine state prosecutor Alberto Nisman has fled Argentina fearing for his life.



Read more: http://www.businessinsider.com/10-most-important-things-in-the-world-right-now-jan-25-2015-1#ixzz3Pvacd69o

http://www.businessinsider.com/r-imfs-lagarde-rules-out-special-treatment-for-greece-2015-1

PARIS (Reuters) - Greece must respect the euro zone's rules and cannot demand special treatment for its debt in the wake of the victory of anti-austerity party Syriza, International Monetary Fund chief Christine Lagarde said in a newspaper interview on Monday.

"There are internal euro zone rules to be respected," Lagarde told Le Monde daily. "We cannot make special categories for such or such country."

Lagarde added that Greece still needed to carry out key reforms, such as tax collection and reducing judicial backlogs.

"It's not a question of austerity measures, these are in-depth reforms that remain to be done," she said.



Read more: http://www.businessinsider.com/r-imfs-lagarde-rules-out-special-treatment-for-greece-2015-1#ixzz3PvbI4dSl

to the IMF, ECB and whatever that 3rd member of the criminal Troika is...

http://www.businessinsider.com/oil-prices-falling-after-greek-election-2015-1

Oil prices are slumping early Monday, with Brent falling close to a six-year low after Greece's election results.

At 11.38 a.m. GMT (6.38 a.m. EST) Brent was trading at $48.16 per barrel, down 1.25%.

West Texas Intermediate crude was trading at $45.05, down 1.18%, and just above the $45 threshold, after it had traded below that mark for most of the morning.

Here is a chart for WTI:



Read more: http://www.businessinsider.com/oil-prices-falling-after-greek-election-2015-1#ixzz3Pvbu2ACM

http://www.businessinsider.com/afp-japan-trade-deficit-expands-to-a-record-109-bn-in-2014-2015-1

Tokyo (AFP) - Japan's trade deficit swelled to a record $109 billion in 2014, official data showed Monday, weighed down by post-Fukushima energy bills.

The shortfall of 12,781 billion yen ($109 billion) was up 11.4 percent from the 2013 deficit and the worst since records began in 1979, according to the finance ministry.

In December alone, however, the deficit almost halved from the year before's level to 660.7 billion yen, thanks to lower oil prices.



Read more: http://www.businessinsider.com/afp-japan-trade-deficit-expands-to-a-record-109-bn-in-2014-2015-1#ixzz3PvcXmcYQ

http://www.zerohedge.com/news/2015-01-25/despite-what-you-dont-hear-media-its-all-out-currency-war-pt-1



The premise of this book is that Western countries are ultimately controlled by a group of private banks, which, according to the book, runs their central banks. This book uses the claim that the Federal Reserve is a private body to support its role. The book's author correctly predicted a banking crisis in the US in 2008. More than one million copies of this book have been sold...



The world is at war, yet it's citizens don't even know it!

First, a backgrounder, as excerpted from Wikipedia:



Of course, it seems to be lost on many that competitive devaluations (currency war) only really works for strong net export nations such as China, Japan, Germany and the US. If you are highly reliant on imports vs. exports and try to become a currency warrior then the Marshall–Lerner condition will likely occur. Best case scenario you get a significant lag in true economic benefits; MOST likely scenario... You just piss off your neighbors and lose economic benefit as the higher price of your imports simply outweigh the internal generation of economic activity and exports. After all, if you buy more than you sell, why raise the price of your purchases?

The Three Methods of Currency Manipulation

Countries and their central banks can:

1. Buy and sell currencies in the open market. This takes horsepower. Just ask the Swiss National Bank whose balance sheet swelled 3x in 2 years - and that's before the ECB QE announcement (which would have easily doubled the pressure, if not more). If you want to move upscale, ask the Bank of England after their conversation with Soros, et. al.
   
   
   ... Black Wednesday refers to 16 September 1992 when the British Conservative government was forced to withdraw the pound sterling from the European Exchange Rate Mechanism (ERM) after it was unable to keep the pound above its agreed lower limit in the ERM. George Soros, the most high profile of the currency market investors, made over 1 billion GBP[1] profit by short selling sterling.
   
   In 1997 the UK Treasury estimated the cost of Black Wednesday at £3.4 billion, with other sources giving estimates as high as £27 billion. In 2005 documents released under the Freedom of Information Act revealed that the actual cost may have been £3.3 billion.[2]
   
   The trading losses in August and September were estimated at £800 million, but the main loss to taxpayers arose because the devaluation could have made them a profit. The papers show that if the government had maintained $24 billion foreign currency reserves and the pound had fallen by the same amount, the UK would have made a £2.4 billion profit on sterling's devaluation.[3] Newspapers also revealed that the Treasury spent £27 billion of reserves in propping up the pound.
   
   
   If you haven't picked up on the theme yet, this central bank buying currencies in an attempt to over power the markets (dirty float) stuff really just doesn't work. Over time, mother market takes charge and extracts one hell of a price in return.
   
   
2. Central banks can also just attempt to talk rates down or up. I'll not waste anymore words on this as CBs around the world have lost credibility. Talk is cheap!
   
   
3. Lastly, and this is the kicker, banks can engage in quantitative easing (QE). QE is essentially the injection of money into the economy by openly purchasing public and private assets, oftentimes dead assets that no private entity would touch with a ten foot pole. The PC way of putting it is this is creating money, but more aptly put this bailing out failed institutions by creating a market for things that the actual market has priced at, or close to, economically nothing. This practice was invented by the Japanese, and it didn't work! Do you guys remember the 26 year lost decade? It's not that hard to remember since, although it started in 1990, it's still ongoing. That's Japanese central banker math for you.

As per Wikipedia:



Now, there are some who said Japan did start recovering earlier, but they used the very malleable (in terms of definition) GDP numbers to prove their point. Asset values didn't back the story...



QE was taken to the next level by the only central bank that I know of that is actually owned by, and controlled by, a coterie of private, for profit, publicly traded banks. It is also the most powerful central bank in the world, bar none. Here's a hint...

https://www.youtube.com/watch?x-yt-cl=84503534&v=9nogVlFRBhY&x-yt-ts=1421914688

Between QE1/2/3, the Fed has injected well over $3 trillion dollars and has exploded its balance sheet both in terms of size and composition...



Despite many proclamations that things are getting better, the Fed has increased its purchases of both MBS (the housing market's financial underpinnings are still in trouble of the Fed wouldn't be doing this) and US Treasury securities (the treasury issues the securities to fund the US and the Fed creates money and buys them - as we all know, we are financing our credit cards with newly acquired credit cards). It is the Fed that IS this country (US), almost literally with a balance sheet that is over 25% of the US GDP. Remember who owns the Fed? Well, if you do you realize why the ECB is doing this QE thing to the level that it is. Their banks are still in trouble, material trouble. Reference "Overbanked, Underfunded, and Overly Optimistic: The New Face of Sovereign Europe" from 5 years ago and tell me if you think its gotten better... Well, it's all relative. The banks are smaller, leverage is down - and that's after 6 years of global QE, ZIRP and now NIRP, yet each and every bank is big enough to collapse the country that it's domicled in...



And since the big global banks are so interconnected as they daisy-chain their hedges and act as counter-parties with each other (6 banks hold over 85% of the multi-trillion dollars global derivatives exposure), once one goes down hard, it brings the rest with them. And as you can see from the size of each individual bank relative to their domiciled country, such an event will still drag the countries down with them.

MORE AT LINK

Stay tuned for part two of four of this series

http://r.smartbrief.com/resp/gtdABYvBbTCNaCvzCicOlvCicNnpvx?format=standard

The Obama administration's efforts to win congressional approval of a Pacific trade agreement are faltering amid complaints that some trade partners are manipulating currencies to boost exports. The White House and multinationals oppose rules deterring trading partners from intervening in currency markets, while many Democratic and Republican lawmakers and labor unions favor such rules

http://hosted.ap.org/dynamic/stories/F/FINANCIAL_MARKETS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2015-01-26-05-24-09

KEEPING SCORE: European stocks were mostly higher after some fluctuations. Germany's DAX rose 0.4 percent to 10,690.87 and France's CAC 40 added 0.2 percent to 4,650.18. Britain's FTSE 100 lost 0.2 percent to 6,822.47. U.S. futures were down but had narrowed their losses. Both S&P 500 futures and Dow Jones futures were off 0.2 percent. The euro bounced back, rising 0.4 percent to $1.1246 after trading at its lowest since 2003.

GREEK ELECTION: Syriza party, the left-wing party vowing to end Greece's painful austerity policies, won a historic victory in Sunday's parliamentary elections. Alexis Tsipras, the party leader, promised to end "humiliation and pain" that Greece has endured since a 2010 international bailout imposed harsh spending cuts, setting up a showdown with the country's international creditors that could shake the eurozone.

ANALYST'S TAKE: "Doubts over whether the EU bailout program will be extended should keep Greek bonds and the euro under pressure," said Chang Wei Liang at Mizuho Bank in a commentary. Within Europe, "Syriza's victory could signal a broadening shift of support away from mainstream political parties toward economic populism, and might lead to more active political pressure to pare back austerity measures within Spain and Italy as well."

ASIA SCORECARD: Most Asian markets narrowed their early losses with Chinese stocks turning higher. Japan's Nikkei 225 finished 0.3 percent lower at 17,468.52 and South Korea's Kospi was flat at 1,935.68. Hong Kong's Hang Seng closed 0.2 percent higher at 24,909.90 and China's Shanghai Composite jumped 0.9 percent to close at 3,383.18.

ENERGY: Benchmark U.S. crude was down 76 cents to $44.83 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 72 cents to settle at $45.59 on Friday. The price of oil has fluctuated since the death of Saudi Arabia's King Abdullah late last week. Analysts said the king's death is unlikely to change Saudi's oil production levels, a key factor in the global prices, but it has created a small amount of additional uncertainty that has unsettled markets. Brent crude was down 75 cents to $48.03 a barrel on the ICE exchange in London.

http://www.bbc.com/news/business-30977714

The euro recovered from an 11-year low against the dollar as investors digested what Syriza's election victory in Greece meant for the eurozone. Europe's main share markets also rose - after initial falls - on hopes that a compromise over Greece's bailout terms might be found. Syriza wants to renegotiate the €240bn bailout and slow the austerity cuts. Syriza leader Alexis Tsipras said he wanted negotiation, not confrontation, with Greece's international lenders.

"The new Greek government will be ready to co-operate and negotiate for the first time with our peers a just, mutually beneficial and viable solution," Mr Tsipras said.

Euro v US Dollar Last Updated at 26 Jan 2015, 07:26 ET *Chart shows local time EUR:USD intraday chart

The troika of lenders that bailed out Greece - the European Union, European Central Bank, and International Monetary Fund - imposed big budgetary cuts and restructuring in return for the money. But Mr Tsipras said: "The troika for Greece is the thing of the past."

The euro briefly fell as low as $1.1088, the lowest level against the dollar in more than 11 years, but in mid-morning trading was 0.4% higher at $1.125. The euro had already been under pressure following last week's announcement of a new stimulus programme by the European Central Bank. MORE

http://hosted.ap.org/dynamic/stories/U/US_AMERICAN_AIRLINES_UNION_LAWSUIT?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2015-01-23-19-12-55

DALLAS (AP) -- A union group is suing American Airlines, claiming supervisors are pressuring mechanics to release planes before they are safe to fly.

Local 591 of the Transport Workers Union says that union officials who raised objections were threatened with termination or even arrest.

American Airlines denies the allegations, saying that it complies with federal safety rules. A spokesman said Friday that regulators have not contacted the airline about any critical issues.

A spokesman for the Federal Aviation Administration declined to comment because the matter is under investigation.

http://www.bloomberg.com/news/2015-01-26/gold-climbs-toward-highest-level-since-august-after-greek-vote.html

Gold fell the most this year amid speculation an anti-austerity party’s victory in Greek elections won’t result in the country leaving the currency bloc.

Greek Prime Minister-elect Alexis Tsipras prepared to form a government after Syriza came within two seats of an absolute majority with most votes counted. He has pledged to keep the nation within the single currency area as he negotiates a writedown of Greek debt and eases budget constraints.

Gold touched a five-month high last week after the European Central Bank announced plans to increase stimulus to revive inflation. Investors have boosted holdings in gold-backed funds.

“The market has been trading on uncertainty surrounding central bank action and the Greek elections for some time, so to see some profit-taking is not at all surprising,” Eugen Weinberg, an analyst at Commerzbank AG (CBK) in Frankfurt, said by phone.

http://www.zerohedge.com/news/2015-01-25/ecb-blinked-and-gold-once-again-proves-be-wealth-saver

As was widely expected, the European Central Bank has started a program of Quantitative Easing, something which the ECB vowed it would never even consider when the supranational institution was created. Situations can change and less than 10 years after its incorporation the central bank already had to deal with the worst financial crisis on the markets in decades.

Back in 2008 it already looked like the ECB was very hesitant to get involved on the market and the Eurozone was very fortunate to see a lot of spill-over effects of the quantitative easing program of the Federal Reserve, its American counterparty. Fast forward to 2012 when the Euro-crisis started to erupt and the collapse of Greece and the sky-high interest rates in other countries forced the ECB’s hand and a hefty market reaction was absolutely necessary.

When you look back at the past 5-8 years, these two events have actually paved the way for the ECB to take drastic measures like the announcement of a 1.1 trillion quantitative easing program over the next 18 months. The central bank will now start to pump 60B EUR per month ($70B) in the financial system which is more than expected. This means the total value of the Quantitative Easing program will be roughly $1.26B or approximately 10% of the total GDP of the Eurozone in just 1.5 years. This could prove to be very effective, but the main question will be whether or not the full amount (or even half of that amount) will effectively trickle down to the ‘real’ economy. There are approximately 340 million inhabitants in the Eurozone, so the total size of the ECB’s Quantitative Easing project means that the ECB will print in excess of 3000 EUR per inhabitant. As this will be completed in just 18 months time, this is huge. Unfortunately there will be a lot of ‘middle man’ with sticky fingers and it’s increasingly likely the banks will simply deploy a large chunk of the QE money on the capital markets for their own benefit, instead of acting as an ECB agent to use the funds for what they were intended to be.

EURUSD exchange rate



The Euro started to tumble versus the US Dollar when reports of Quantitative Easing emerged as the currency dropped by 11.5% in value in just 3 months time and seems to be on its way to reach parity.

30 Day Gold EUR



What’s more important to discuss, is that once again gold has proven to be a safe haven for someone who wants to protect his wealth from a sudden currency depreciation. If we look at the 30 day price of gold in EUR, we see it moved up from 960 EUR on December 25th to a stunning 1149 EUR per ounce as of the market close on Friday which is a 19.7% jump in just one month time. A part of this was caused by an increased gold price expressed in USD, but this accounts for only 9.2% of the increase, so less than half. Another (partial) explanation is the ‘crash’ of the Euro against the Dollar, but this also had an impact of just 8.1%, so if you add both numbers, only 17.3% of the jump in the gold price can be explained by the two biggest forces in determining the gold price. This means that even if the gold price expressed in USD wouldn’t have changed, the purchasing power of a gold owner in the European Union would have increased even though the Euro lost almost 10% of its value.

30 Day Gold USD



This story is now focused on the Eurozone, but the United States might soon be in the same position. Right now, the USD is considered to be a safe haven currency, mainly because people are ignorant and believe the economic growth-story of the US government. But this charade might soon be over as the reality will set in. The Debt/GDP ratio of the USA is now a triple digit percentage and the budget deficit will only increase.

Gold has always proven its value. In Japan, more recently in Russia and last month in the Eurozone, the purchasing power of the citizens was safeguarded by their gold holdings. Whenever a country is in distress, gold keeps its value.

http://www.theguardian.com/business/2015/jan/24/mark-carney-davos-warns-risk-quantitative-easing

Mark Carney gave strong backing to the European Central Bank’s radical stimulus but warned it could disrupt the financial markets. The governor of the Bank of England told the last day of the Davos meeting of the World Economic Forum that he could receive daily risk positions of the banks to monitor any stresses in the system as he admitted persistently low interest rate environments could cause investors to take risks.

The move by the European Central Bank to buy €60bn of government bonds and corporate debt announced on Thursday dominated much of the discussing during the four-day meeting in the alpine ski resort and comes after central banks in the US and the UK have also taken similar steps to stimulate economies.

“In an environment of low interest rates and quantative easing there can be excessive risk-taking,” he said. Investors could make the false assumption that the Bank of England was already to step in causing them to buy riskier assets than they might otherwise have done.

Carney admitted that savers could lose out from low interest rates but said that stimulus was necessary to avoid long-term unemployment. “Monetary policy always has distribution effects,” he said. “One of the biggest distributional issues is the risk that people who are unemployed for a long time become detached from the labour market and lose their skills, in the UK we have created 600,000 jobs in the last year and wages are starting to pick up. We are winning that race against unemployment.”

http://www.reuters.com/article/2015/01/23/ecb-policy-carney-davos-idUSB4N0RB00G20150123

The bond-buying plan unveiled by the European Central Bank (ECB) on Thursday has laid the foundations for more prosperity in Europe, Bank of England chief Mark Carney said.

"I welcome the steps that the ECB took yesterday," Carney told a panel at the World Economic Forum in Davos, Switzerland.

&quot They are) absolutely necessary to preserve the prospects of medium-term prosperity in Europe. This doesn't deliver medium-term prosperity, it just creates the conditions for it.


IN OTHER NEWS, THE FAMED BROOKLYN BRIDGE IS AGAIN ON THE MARKET...

http://www.bloomberg.com/news/2015-01-25/euro-may-decline-as-greek-exit-polls-show-syriza-set-for-victory.html

The euro rebounded from an 11-year low on speculation fallout from the election of the anti-austerity Syriza party in Greece will be contained. European stocks erased earlier losses, while oil and copper led commodities (BCOM) lower and Russia’s ruble weakened.

Europe’s shared currency strengthened 0.2 percent to $1.1229 by 7:05 a.m. in New York. The Stoxx Europe 600 Index advanced less than 0.1 percent after closing at a seven-year high on Friday, while Standard & Poor’s 500 Index futures slipped 0.3 percent. Greek stocks fell with bonds. The ruble tumbled 2.4 percent as fighting in Ukraine spread. Oil dropped from the lowest closing price in almost six years, copper slid 1 percent in London and gold declined.

Greek Prime Minister-elect Alexis Tsipras formed an alliance with Independent Greeks within hours of his election victory. German business confidence rose for a third month as falling energy costs and anticipation of more European Central Bank stimulus helped lift optimism about an economic recovery. Microsoft Corp. and Texas Instruments Inc. are among companies reporting earnings.

“Syriza’s win won’t be as bad for markets now as it could have been a few months ago,” said Alessandro Bee, a strategist at Bank J Safra Sarasin AG in Zurich. “Tsipras is less aggressive and willing to negotiate. The result will affect sentiment on Greece, but in a broader European context it’s just a blip. Markets are still in a risk-on mode and any news is dwarfed by the ECB stimulus program.”

http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_1_26/01/2015_546524

SYRIZA was on the verge of a historic election victory on Sunday night but one that might not hand the leftist party an outright parliamentary majority, raising doubts about whether a government can be formed in the next few days.

With 70 percent of the votes counted at around midnight, SYRIZA held 36 percent and New Democracy 28.2. This would give SYRIZA 149 seats in Parliament, two short of a majority. The two parties were followed by Golden Dawn on 6.4 percent, Potami on 5.9 and the Communist Party (KKE) on 5.4. PASOK and Independent Greeks also looked certain to enter Parliament, both with close to a 4.7 percent share of the vote.

George Papandreou’s Movement of Democratic Socialists (Kinima) appeared set to miss out on a place in Parliament as it was under the 3 percent threshold for gaining seats, with 2.4 percent.

This means that SYRIZA leader Alexis Tsipras is likely to receive a three-day exploratory mandate from President Karolos Papoulias on Monday. If Tsipras cannot form a government, the mandate will pass to New Democracy for three days and then the third party for another three. However, as SYRIZA receives a 50-seat bonus for coming first, the other parties will not have enough seats to create a majority coalition and second elections would be needed, as in 2012....

In a triumphant speech before a large and boisterous crowd outside Athens University, Tsipras said the leftists’ victory was “a victory for all peoples of Europe fighting austerity.” “Greece is turning a page, advancing with firm steps in a Europe which is changing.”

“The mandate of the Greek people today cancels, in an indisputable way, the memorandums,” Tsipras said, referring to Greece’s loan agreements with its international creditors. “It makes the troika a thing of the past.”

He said his government would seek a mutual solution that would allow the country to emerge from its mountainous debt and pledged to to make good on his party’s promise to curb the corruption that contributed to Greece’s debt crisis in the first place. “Today the Greece of the oligarchs, of the elite, of the cover-ups was defeated. Victory was for the Greece that strives, that hopes,” he said.

http://www.reuters.com/article/2015/01/25/us-greece-election-idUSKBN0KY00520150125?feedType=RSS&feedName=topNews

Greek leftist leader Alexis Tsipras promised on Sunday that five years of austerity, "humiliation and suffering" imposed by international creditors were over after his Syriza party swept to victory in a snap election on Sunday.

With about 60 percent of votes counted, Syriza was set to win 149 seats in the 300 seat parliament, with 36.1 percent of the vote, around eight points ahead of the conservative New Democracy party of Prime Minister Antonis Samaras. While a final result may not come for hours, the 40-year-old Tsipras is on course to become prime minister of the first euro zone government openly opposed to the kind of crippling austerity policies which the European Union and International Monetary Fund imposed on Greece as a condition of its bailout.

"Greece leaves behinds catastrophic austerity, it leaves behind fear and authoritarianism, it leaves behind five years of humiliation and anguish," Tsipras told thousands of cheering supporters gathered in Athens.

European leaders have said Greece must respect the terms of its 240 billion euro bailout deal, but Tsipras campaigned on a promise to renegotiate the country's huge debt, raising the possibility of a major conflict with euro zone partners. Tsipras said on Sunday he would cooperate with fellow euro zone leaders for "a fair and mutually beneficial solution" but said the Greek people came first. "Our priority from the very first day will be to deal with the big wounds left by the crisis," he said. "Our foremost priority is that our country and our people regain their lost dignity." Tsipras's campaign slogan "Hope is coming!" resonated with voters worn down by huge budget cuts and heavy tax rises during six years of crisis that has sent unemployment over 25 percent and pushed millions into poverty. With Greece's economy unlikely to recover for years, he faces enormous problems and his victory raises the prospect of tough negotiations with European partners including German Chancellor Angela Merkel.

As thousands of flag-waving supporters hit the streets of Athens, some shedding tears of joy, Germany's Bundesbank warned Greece it needed reform to tackle its economic problems and the euro fell nearly half a U.S. cent.

MORE

http://www.bloomberg.com/news/2015-01-26/low-oil-price-to-offset-a-decline-in-fed-s-loan-survey-ecopulse.html


Investors who are bullish about U.S. consumption are watching for a rebound in the share of banks willing to lend -- a trend that traditionally buoys retail-sales growth.

The net percentage of financial institutions reporting increased willingness to make installment loans to consumers, including through credit cards, was 8.7 percent in the most-recent survey of senior loan officers released Nov. 3 by the Federal Reserve. That’s down from 15.7 percent in the previous survey and the lowest since October 2009.

The latest results, scheduled to come out in early February, will provide an important gauge for future spending trends, according to Dan Binder, an analyst at Jefferies & Co. in New York. The data -- the percentage of banks more willing to lend minus the share less willing -- is a leading indicator of retail-sales growth by about nine months, he said.

Even though banks’ willingness has been “on the weaker side” recently, it remains positive, Binder said. With credit growth “getting broader and showing improvement,” he’s “encouraged” about the pace of consumer spending in 2015.

THE BHOPAL MASS-POISONING INCIDENT AND THE FUKUSHIMA NUCLEAR MELTDOWN WERE EVIDENTLY INSUFFICIENT LESSONS TO EITHER THE US OR INDIA...EXCEPT AS A LESSON TO PASS THE BUCK ON TO SOME FOOLISH INSURANCE SCHEME...

http://www.reuters.com/article/2015/01/26/us-india-obama-nuclear-idUSKBN0KY0UE20150126

Prime Minister Narendra Modi and U.S. President Barack Obama unveiled a plan centered on insurance on Sunday that they hope will convince U.S. companies to build nuclear power stations in India, but stopped short of demands to soften a liability law. With the 1984 Bhopal gas tragedy still fresh in India's mind, parliament five years ago passed a law that makes equipment suppliers ultimately responsible for an accident, a deviation from international norms that the companies found hard to swallow. I'LL BET THEY DO!

India's top diplomat, Foreign Secretary Sujatha Singh, said the new plan was "squarely within our law".

"We have reached an understanding, the deal is done," she said at a media briefing.

Details of the new plan were sketchy, but Indian and U.S. diplomats said the idea was to transfer the financial risk to insurers in case of an accident.

"The India nuclear insurance pool is a risk transfer mechanism which is being formed by GIC Re and four other public sector undertakings in the general insurance business in India," foreign ministry joint secretary Amandeep Singh said.

After India and Washington first reached a nuclear deal in 2006, nuclear commerce worth billions of dollars was meant to be the centerpiece of a new strategic relationship, allowing New Delhi access to nuclear technology and fuel without giving up its weapons program. But the liability issue blocked progress.

Both GE and Westinghouse have already been given land in Gujarat and Andhra Pradesh to begin construction of reactors...GE-Hitachi Nuclear Energy (GE.N) (6501.T) said it would review the governmental agreement in due course...

"We believe a sustainable solution is one that brings India into compliance with the International Convention on Supplementary Compensation," the company, a joint venture of General Electric and Hitachi Ltd, said in a statement.

India's foreign secretary Singh said there was a bilateral understanding that India's law was compatible with the Convention on Supplementary Compensation. India has yet to ratify the convention. It is also likely that India will need a similar deal with Japan since many of the reactor components used by the joint U.S.-Japanese companies come from there...EDIT...

On Sunday, Richard Verma, the U.S. ambassador in New Delhi, said the new plan was based on a memorandum of law and would not require new legislation at this stage. Until recently, U.S. officials have said that the best solution would be to change the (INDIAN) liability law. That is deemed politically impossible by the Indian government, in a country that suffered thousands of deaths when U.S. company Union Carbide Corp's pesticide factory leaked gas in 1984. Activists are still seeking financial compensation and a clean-up of the site by parent Dow Chemical Co (DOW.N).

Modi is committed to increasing India's low carbon energy sources to cut a reliance on coal, and nuclear is intended to be a major part of the energy mix. But progress on projects has been slow. Under the workaround, the Indian state-run insurance company GIC Re and three others would contribute 7.5 billion Indian rupees ($122.09 million) to the pool and the balance would be contributed by the government on a tapering basis, joint secretary Singh said. SO INDIA IS PUTTING ITSELF ON THE HOOK WHEN THE REACTORS BLOW UP OR MELTDOWN

"It is similar to 26 such international pools around the world. The details of the premiums are being worked out and the U.S. has committed to work with India to share information and best practices on the formation of this insurance pool."

"This is a complete risk management solution for operators and suppliers without causing undue financial burden," he said.

UNLESS YOU ARE A CITIZEN OF INDIA, OF COURSE. MORE AT LINK

http://www.reuters.com/article/2015/01/26/us-axis-capital-partnerre-merger-idUSKBN0KZ01U20150126

Axis Capital Holdings Ltd (AXS.N) and PartnerRe Ltd (PRE.N) have agreed to an $11 billion merger to create one of the world's largest reinsurers, PartnerRe said on Sunday.

The move is the latest indication that fierce competition and falling premiums in the reinsurance sector has led market players to consolidate. Reinsurers help insurers pay large damage claims in exchange for part of the profit.

The combined company will have gross premiums topping $10 billion, total capitalization of more than $14 billion, and total cash and invested assets of more than $33 billion, according to the PartnerRe statement.

PartnerRe shareholders will own 51.6 percent of the new company, and Axis holders, 48.4 percent, according to the statement.

Net income at the top 31 reinsurers rose to $14 billion in the first six months of 2014, up 12 percent from the same period the prior year.

http://finance.yahoo.com/news/warning-mortgage-market-government-slaps-051248430.html

Wells Fargo and JPMorgan Chase have agreed to pay a combined $35.7 million settlement for their participation in an alleged mortgage kickback scheme with a now-defunct Maryland-based title company. According to the Consumer Financial Protection Bureau, the banks referred thousands of consumers to Genuine Title for real estate loan closing services in exchange for cash, marketing materials and other consumer information meant to help the banks attract more customers.

CFPB director Richard Cordray said in a statement:



Genuine Title closed its doors in April 2014.

The CFPB said several other loan officers at a third financial institution also participated in the mortgage kickback scheme, but unlike the two big banks, that institution dealt with the issue, and the CFPB was able to resolve its investigation without taking any enforcement action.

“While Wells Fargo and JP Morgan Chase did not identify or address the illegal conduct, that third institution self-identified the problematic practices and terminated the loan officers involved,” the CFPB said.

Wells Fargo spokesman Tom Goyda said the bank has cooperated with the CFPB and fired the employees involved, The Associated Press reports. A spokesman for Chase Mortgage Banking said the loan officers involved in the scheme are no longer with the bank. THIRD INSTITUTION GOES UNIDENTIFIED

MORE AT LINK

http://www.reuters.com/article/2015/01/24/us-venezuela-currency-results-analysis-idUSKBN0KX0FC20150124?feedType=RSS&feedName=businessNews

Venezuela's deepening economic troubles, and in particular the weakness of the bolivar and restrictive currency controls, have hurt U.S. corporate profits for the fourth quarter of 2014 and are set to inflict further pain this year. In a likely sign of things to come from a number of companies this results reporting season, Ford Motor Co on Friday said it was taking a pre-tax charge of $800 million for its Venezuela business. It blamed Venezuelan exchange control regulations that have restricted the ability of its operations in the country to pay dividends and obligations in U.S. dollars. Ford also said that it was unable to maintain normal production in Venezuela with the availability of vehicle parts constrained.

Also on Friday, diaper and tissue maker Kimberly-Clark Corp said it took a fourth-quarter charge of $462 million for its Venezuelan business. That was after it concluded that the appropriate rate at which it should be measuring its bolivar-denominated monetary assets should be a Venezuelan government floating exchange rate - currently at around 50 bolivars to the dollar - rather than a fixed official rate of 6.3 to the dollar that it had previously been using. Kimberly-Clark blamed increased uncertainty and lack of liquidity in Venezuela for the move.

Venezuela President Nicolas Maduro said on Wednesday he was shaking up the complex currency controls in the socialist-run country, where dollars are sold on the black market for about 184 bolivars to the U.S. dollar instead of the country's three-tiered exchange rate system that has ranged from the 6.3 official rate to two other rates, currently at about 12 and the one at around 50. Those latter two tiers of the system would be merged, he said, though it is not immediately known at what rate that would happen. Maduro also announced that another new rate would be introduced into the system to offer dollars via private brokers to vie with the black market rate. The latest moves may catch some companies flat-footed - particularly regarding the size of the hit they may have to take to their earnings as they revalue assets at a much weaker bolivar exchange rate.

"They may be surprised by the magnitude of the move but not by the direction," said Marc Chandler, global head of market strategy at Brown Brothers Harriman & Co. "But many shied away from hedging in the past because it is very expensive.”

ISOLATING VENEZUELAN BUSINESS

Companies often need approval from Caracas to raise prices amid soaring inflation. Sometimes that approval is delayed or the price hikes don't keep pace with a 12-month inflation rate currently at nearly 64 percent, threatening losses because of a mismatch between costs and revenue. Before the move by Maduro, some well known U.S. companies, including Procter & Gamble, General Motors, Baker Hughes Inc and Brink's had already reported financial hits related to the bolivar over the past year.

“A wide swath of multinational companies with large operations in Venezuela will suffer from having to hold currency that is stuck in the country and depreciating in value," said Erik Gordon, professor of law and business at the University of Michigan.

For Ford, conditions are so tough in the South American country that it also announced on Friday that it will make an accounting change that will allow it to isolate the rest of the company from its Venezuela operations. "In future periods, our financial results will not include the operating results of our Venezuelan operations," it said in a corporate filing. Bob Willens, a veteran accounting expert on Wall Street, said other companies might follow Ford's lead. "Who wouldn’t want to deconsolidate a Venezuelan subsidiary?” he asked.

Cleaning and household products maker Clorox last year decided to exit Venezuela altogether. CEO Don Knauss told analysts in October that Venezuela's government was slow to approve price increases and when it did they were not as high as promised.

"We saw no hope that we could create a sustaining business in that country," Knauss said during an October conference call.

Overall, foreign companies have an estimated $16 billion in outstanding dividends listed on their balance sheets that they have not been able to return to headquarters, according to Caracas-based research firm Ecoanalitica. The actual value of those assets could, though, be considerably less, depending on the exchange rates. At the end of the third quarter, for example, American Airlines Group Inc, had $721 million held in the Venezuelan currency, at a weighted average exchange rate of 6.41 bolivars to the dollar. Theoretically, if the airline tried to repatriate all of that money into dollars at the current black market rate of 184 bolivars per U.S. dollar as quoted by the website dolartoday.com, it would only receive about $25 million.

"For a business like American Airlines, they have a bank account full of worthless monopoly money, and the only way it is worth something is if they can get an exchange," said Russ Dallen, head of Caracas Capital Markets in Miami. "But the government doesn’t have any dollars to exchange, in size. They can’t pull out because not only will they not get the dollar at the original rate promised but the Venezuelan government said they would take the travel routes and never let them back into the country if they did.”

A spokeswoman for American Airlines said the company will have guidance on its Venezuela operations with its fourth-quarter results, which are expected next week.

Instead, they could pay it to the workers.

It will have to wait. I have a life to live (or better put, survive). Stay warm (and cool)!