It appears that as the United States’ citizenry continues to learn in increasing numbers about the shenanigans of the privately-owned and unconstitutional Federal Reserve, about the Nazi roots of the Pharmaceutical companies, about the communist roots of major tax-exempt foundations and their collectivist ‘educational’ purposes, about the scientific study out of the University of Copenhagen unequivocally proving the presence of nano-thermite high-tech explosives within the dust of the rubble of the World Trade Center, about the continued confirmations coming out of ‘The Iraq Inquiry‘ hearings ongoing in London that the entire U.S. incursion into Iraq was based on lies, about the opium industry so protected by U.S. interests in Afghanistan that it is booming under U.S. watch care, about the bill in Congress to further restrict gun ownership, about the socialist agenda still attempted to be inculcated within Healthcare reform, and about the undaunted coasting of international leaders to the “Climate Conference” to be hosted by the U.N. in Copenhagen beginning December 7th in spite of the worldwide fraud of “man-made” Climate Change that was exposed last month, to sign a spurious document that sets up the structural framework for global economic governance based on that fraud and which is the precursor to the subjugation of our Constitutional Republic to a tyrannical World Government, our nation’s citizenry and consequently all the world will soon experience the repercussion of an orchestrated acceleration of economic implosion geared to extort our cooperation with and participation in the NEW WORLD ORDER. (And there are still more blockbuster revelations waiting in the wings.)

Read the stunning news from the International Forecaster:

Potential for Fed to Hyperinflate

Reposted from The International Forecaster November 28th, 2009

Always the question about what the Fed will do, more pressure on small and medium banks, municipal bond meltdown, bailouts cant go on indefinitely, looking at the banks, and recalling the French Revolution, the truth of fractional banking.

The following information may be the most important we have ever published. One of our Intel sources, highly placed in banking circles, tells us that on 1/1/10 all banks that have received TARP funds have been informed by the Federal Reserve that they must further restrict any commercial lending. Loans have to be 75% collateralized, 50% of which has to be in cash, which is a compensating balance.

The Fed has to do one of two things: They either have to pull $1.5 trillion out of the system by June, which would collapse the economy, or face hyperinflation. This is why the Fed has instructed banks to inform them when and how much of the TARP funds they can return. At best they can expect $300 to $400 billion plus the $200 billion the Fed already has in hand.

We believe the Fed will opt for letting the system run into hyperinflation. All signs tell us they cannot risk allowing the undertow of deflation to take over the economy. The system cannot stand such a withdrawal of funds. They also must depend on assistance from Congress in supplying a second stimulus plan. That would probably be $400 to $800 billion. A lack of such funding would send the economy and the stock market into a tailspin. Even with such funding the economy cannot expect any growth to speak of and at best a sideways movement for perhaps a year.

We have been told that the FDIC not only is $8.2 billion in the hole, but they have secretly borrowed an additional $80 billion from the Treasury. We have also been told that the FDIC is lying about the banks in trouble. The number in eminent danger are not 552, but a massive 2,035. The cost of bailing these banks out would be $800 billion to $1 trillion. That means 2,500 could be closed in 2010. Now get this, the FDIC is going to be collapsed before the end of 2010, which means no more deposit insurance. This follows the 9/18/09 end of government guarantees on money market funds. Both will force deposits into US government bonds and agency bonds in an attempt to save the system.

This will strip small and medium-sized banks and force them into shutting down or being absorbed. This means you have to get your money out of banks, especially CDs. We repeat get your cash values out of life insurance policies and annuities. They are invested 80% in stocks and 20% in bonds. Keep only enough money in banks for three months of operating expenses, six months for businesses.

Major and semi-major banks are being told to obtain secure storage for new currency-dollars. They expect official devaluation by the end of the year.

We do not know what the exchange rate will be, but as we have stated previously we expect three old dollars to be traded for one new dollar. The alternative is gold and silver coins and shares. For those with substantial sums that do not want to be in gold and silver related assets completely you can use Canadian and Swiss Treasuries. If you need brokers for these investments we can supply them.

The Fed also expects a meltdown in the bond market, especially in municipals. Public services will be cut drastically leading to increased crime and social problems, not to mention the psychological trauma that our country will experience. Already 50% of homes in hard hit urban areas are under water, nationwide more than 25%. That means you have to be out of bonds as well, especially municipals.

As you can see, the Illuminist program is going to come quicker than we anticipated. That in part is because they have had to expedite their program, due to exposure in the IF, other publications and especially via talk ratio and the Internet. There is no doubt we have the elitists on the run.

We are reaching the masses. On TalkStreamLive.com we were on the Rumor Mill this past week and out of 50 talk radio programs we were 5th behind, Rush, Hannity, Dr. Laura and we were tied with Beck. On the Sovereign Economist on Wednesday night we were 5th behind Beck and Savage and ahead of Hannity. Both these programs are not well known and the Sovereign Economist is only about a month old. It shows you what you can do if you work hard enough at it.

The latest favorable events we are told are the seeds of recovery. The green-shoots of spring are to be harvested before winter sets in. We are skeptical of the strength and duration of such a recovery.

The underlying problems are still not being addressed. The US government and the Fed cannot bail out banking, Wall Street, insurance and government indefinitely via monetization. Impaired corporations, no matter what their size, have to be allowed to fail. Stimulus cannot be used indefinitely. Both have to be reigned in, because the longer this charade continues the worse the final outcome is going to be. As we predicted six year’s ago, Fannie Mae, Freddie Mac, Ginnie Mae and FHA are the wards of American taxpayers, as is AIG. All their financial conditions worsen every day. They have again been insuring subprime mortgages by the thousands and when they begin to reset next year, we will be back to 60% failure rates. Even government admits already they’ll see 20% failure rates. This, so that housing inventory can be cut from 11-1/2-months inventory to 7-months, again in order to bail out the lenders at the expense of taxpayers. Government and the Fed have no exit plans for these sinking ships, particularly Fannie, Freddie, Ginnie and FHA, never mind their meddling in the economy guaranteeing everything is sight. Benito Mussolini would be very proud of what they have done.

Then we have those on Wall Street, banking and corporate America who believe they are doing God’s work by looting the American public making outrageous profits by in part using taxpayer funds, and allotting themselves disgraceful bonuses as unemployment hovers at 22.2%. Haven’t these people heard of the French Revolution? Their arrogance has no bounds. The credit crisis hasn’t ended; the Fed has extended it by throwing money at problems. We have a mortgage market that is worse than it was a year ago, only kept from sinking by a tax credit 3% down. As a result now we have more than $1 trillion of new mortgage failures on the way.

Our monetary base has more than doubled. Interest rates will probably stay where they are for 18 months or more and we even have a dollar carry trade. The 2009 fiscal budget deficit was $1.5 trillion and 2010 will be worse. Government is not cutting expenses. They are increasing expenses.

In addition making matters worse corruption is flourishing via the incestuous revolving door between Wall Street, the Treasury, in a multiplicity of other appointments and with the Fed. Is it any wonder 75% of Americans want the Fed audited and investigated. That said, the present set of circumstances cannot be allowed to go on indefinitely. We cannot keep insurance, Wall Street and banking on life support forever. Not when we finance two occupations and an ongoing war, never mind our unfunded liabilities of Medicare, Social Security, etc. most all of these problems are being financed by debt to be paid by our great, great grandchildren. We just created $12.7 trillion for bailouts and the Inspector General tells us we are presently on the hook for $23.7 trillion. What happens if all the recipients need another $20 trillion?

The situation is still dire and the solution is temporary and unworkable and Washington and New York are well aware of this. The game will play out over the next few years. In the meantime the dollar will move lower and inflation, gold and silver higher.

Economics is not complex; it is very simple. Professors and economists would like to have you believe it is complicated when in fact they make it opaque, so you cannot understand it. The same is true with banking. In normal times through the century’s bankers using the fractional banking system usually lent 8 times their assets, or deposits. It was only until recently that the privately owned Federal Reserve told banks within the system to lend 40 times assets or more in order to accommodate the system.

All this is to cover to confuse and hide the truth of fractional banking. Bankers’ indebt borrowers with money they made up out of thin air. Debt is enslavement by the bankers upon the people by buying almost everyone off. In the final analysis banking is a fraud unless money is interest free. The Fed, and all the other banks are a fraud.

The game as we know it today began in 1694 when the Rothschild’s formed the privately owned Bank of England and the production of bank notes began and circulated along with sterling silver coins. The end result has been that the bankers own the world. The system today is based on confidence and trust, something that has been worn thin. A reflection of the loss of trust and confidence is that 75% to 80% of Americans want HR1207 and S604 passed by Congress, so that the Fed can be audited and investigated. The public no longer trusts the Fed and the banks. As a result the con game may well be coming to an end. Fifty years ago we and a handful of other conservative warriors set out to inform the public of the giant scam that the Fed really was. It has been a long hard road. Gary Allen and Alan Stang are gone and of the originals all that are left are G. Edward Griffin, Stan Monteith, Anthony Hilder and us. During our lifetimes we now probably will see the end of the Fed. Because the people have finally been awakened. It was a long hard battle that may soon come to fruition.

The final step will be the termination of the Federal Reserve and its monopoly on financial theft. Unfortunately it will mean the demise of the only financial system we have known for 315 years. We do not know as yet what the new system will be like, but the con game is over and most of the world’s inhabitants are broke. The debt that is owed simply cannot be repaid. Japan, the US, the UK and Europe will be the first to go followed by most of the rest of the world.

You ask who will be the big winners? Gold and silver of course. Just as we have been telling you they would for 9-1/2 years, since gold was $252.00 and silver $3.80. Look at the gains for those who listened. And, we still have a long, long way to go to preserve our wealth. Over all those years the gold suppression cartel fought to hold down gold prices by selling gold, using derivatives and futures and in collaboration with good producers such as Barrick Gold and others. Hopefully HR3996 (HR-1207) will now pass unchanged and we can take a look at what the Fed and the Treasury were doing and who aided them.

What we are witnessing in the US and world economy is the result of the greed of central banks to make as much money as possible before they have to collapse the system to bring about World Government.

Manufacturing activity in the Federal Reserve Bank of Kansas City’s district improved in November.

House prices rose for the seventh month in November but the pace of the recovery is beginning to ease, the Nationwide said.

The cost of a home increased by 0.5pc during the month, pushing average property prices up to £162,764 – a level last seen in August 2008. Martin Gahbauer, Nationwide’s chief economist, said: “The monthly rate of house price inflation was unchanged in November at a seasonally adjusted 0.5pc, leaving the average price of a typical property 2.7pc higher than a year earlier.”

But there are signs that house prices are rising at a more moderate pace than in the spring and summer, with the 0.5pc rise recorded for both October and November, the smallest since prices stopped falling in April. The three month on three month growth rate, which is generally considered to be a smoother indicator of the underlying trend, also moderated during November to 2.8pc, down from 3.5pc in October and 3.8pc in September.

 Today’s figures come the day after the Bank of England reported that the number of loans approved for house purchase had increased for the 11th consecutive month in October, rising to 57,345, their highest level since March 2008. The housing market has recovered quicker than expected during 2009 as a shortage of properties on the market has pushed up prices.

However, many economists are predicting a return to price falls during 2010 as more homes are put up for sale. Nationwide said the housing market remained “crucially dependent” on labour market conditions. It added that while unemployment had increased noticeably, the rise had not been as rapid or as pronounced as previously feared. Mr Gahbauer said: “Despite continued uncertainties about the future, the better than expected performance of the labour market has probably contributed to the surprise rebound in house prices this year. “Together with the fact that mortgage rates have fallen sharply as a result of base rate cuts, this has meant that far fewer borrowers have fallen into arrears than would normally be the case in such a deep recession. “As such, the downward pressure on house prices from distressed sales has so far been significantly lower than expected.”

Online estate agency turtlehomes.co.uk

(CFD.net.au – Contract for Difference, Share, Forex, ETFs, Commodities Traders) –

Bank of England Governor Mervyn King said Tuesday that the British economy will likely return to growth in the second half of this year, but warned that gains would be modest and that the path to a sustained recovery is far from clear.

King said that sharp falls in output in the global economy have largely come to an end, and that business and consumer confidence have “improved somewhat.”

Improvements in financial markets should in time ease lending conditions to households and businesses, he added, in comments that will be closely scrutinized by economists for clues about the central bank’s intentions for its asset purchasing program to boost the money supply.

“These developments are encouraging,” King told business leaders at a dinner in Edinburgh, Scotland. “But they need to be seen in context, and we should be under no illusion that the path to a sustained recovery will be smooth and painless.”

“Output is still well below and unemployment well above their levels of a year ago, and are likely to remain so for some time,” he added.

King’s comments come ahead of Friday’s eagerly awaited figures on gross domestic product, which economists believe may show modest expansion.

The British economy officially entered recession at the turn of the year following two quarters of negative economic growth – the widely accepted definition of a technical recession – in the second half of 2008.

economists had pegged gross domestic product to return to growth in the July to September quarter after a 0.6 percent contraction between April and June, but recent surveys on industrial production and business confidence have raised doubts.

Conflicting economic data in recent weeks has also left economists unsure of the Bank of England’s plans for its 175 billion pound so-called quantitative easing program.

The British pound fell against the U.S. dollar on Monday after Bank of England policy maker Adam Posen was quoted as saying that he was “not worried about overshooting inflation right now.”

The central bank is tasked with keeping inflation at a 2 percent target.

Economists said the comments, reported in the Financial Times newspaper over the weekend, suggested that the asset purchase program could be extended when the central bank’s nine-member monetary policy committee meets next month.

On Friday, the currency rose to an almost seven-month high against the euro on comments by Posen’s colleague Paul Fisher that were interpreted as likely signalling at least a temporary halt to the quantitative easing program.

King said Tuesday that inflation will likely remain volatile over the coming year, but added that falls in spending will continue to pull down on inflation until spending recovers.

He added that the monetary policy committee would continue to make its decision month by month. The committee’s next decision is due on Nov. 5.

AP

Source: Bank of England warns recovery path not smooth

Sehr schön zusammengefasst, was aktuell vor sich geht und wie sich die Lage immer weiter zuspitzt – halt primär mit Focus auf England, aber vieles kann man auch auf andere Länder der EU übertragen…

Gefunden bei dailymail.co.uk:

Is Britain on the brink of financial armageddon?

By James Palumbo

Last updated at 11:07 PM on 27th November 2009

He’s one of our top entrepreneurs who recently put all his investments into cash. The reason: He believes Britain faces bankruptcy. You may disagree with his bleak analysis but you can’t afford NOT to read it

A year ago, the world reacted with astonishment as Iceland technically went bust. It seemed inconceivable that a modern democratic nation could have such parlous finances that only an emergency $6billion bail-out from the International Monetary Fund enabled its economy to keep functioning.

This week, we witnessed a similar crisis in the Middle East but on a far, far more dangerous scale, as Dubai effectively defaulted on £48billion of loans.

Unless its more prudent and oil-rich neighbour, Abu Dhabi, launches a rescue plan then Dubai – once a gilded monument to financial success – will effectively be insolvent.

Which leads us to a haunting question: as the country in the world hardest hit by the credit crunch, with gross domestic product (GDP) projected to decline by almost five per cent in 2009, could Britain be next?

Let’s think the unthinkable for a moment. These are the facts.

Even before the financial crisis, the British Government spent roughly £30billion more per year than it earned in tax revenues. This money, of course, had to be borrowed from international investors.

Today, the Government needs up to £200billion a year for at least the next three years in order to meet its spending commitments. But the Government’s estimates invariably understate its true need, and they have to be continually revised upwards.

Before the crunch, total government debt stood at roughly 40 per cent of GDP. It is now around 60 per cent of GDP, but is projected to soar close to 100 per cent in the next few years. But again, that is not the full story.

Treasury estimates of the size of the national debt ignore so-called ‘off balance sheet commitments’, such as Private Finance Initiatives (effectively, hospitals and schools built with money loaned by the private sector) as well as the massive unfunded government pension liability.

There may be other, hidden, liabilities. After this week’s shocking revelation of secret loans of £62billion made by the Bank of England to the Royal Bank of Scotland and HBOS at the height of the credit crunch, who knows how many other skeletons remain in the Treasury’s closet?

It is wise to assume that the true size of Britain’s debts could be much bigger than we all think.

Yet politicians of both parties can’t acknowledge this. Why? Because any dispassionate analysis would spell only one thing – we need massive spending cuts and tax rises to avoid heading the way of Iceland and Dubai.

The news is potentially so bad that politicians simply don’t want the general public to know what’s going on.

Given the scale of the crisis, what then do they propose? New Labour is non-committal, suggesting that cuts will be prudent, thoughtful and spare people’s worst pain. The Conservatives have targeted around £7billion of spending cuts, but these won’t happen immediately and are nothing like enough to rebalance the nation’s books.

Besides, one minute the Tories are preaching ‘austerity’, warning that savage cuts are needed, the next David Cameron is telling the City that ‘our strategy has to be for growth, both now and in the long term’.

Such posturing, flip-flopping and vague promises are truly worrying. For, make no mistake, we could be teetering on the brink of a truly epic national crisis – one that makes the financial hardship of the past 18 months seem like a mere inconvenience.

For the past few years, Hollywood disaster movies have shown the world under attack by aliens or being destroyed by global warming. We have all thrilled to images of the White House being taken out by a giant laser beam or Big Ben frozen in an Ice Age snow drift.

Politicians don’t want the public to know what’s going on

A disaster movie involving countries going bust doesn’t quite have the same dramatic appeal, but it would be every bit as deadly as a tsunami hitting London – and we have precious little left to defend us.

We’ve already had one big shock to Britain’s financial system as many of our best-known banks teetered on the brink. The Treasury spent hundreds of billions of taxpayers’ pounds trying to steady the ship. The financial cupboard is now bare. So what could cause the second wave of the disaster?

In three words – a sterling crisis. So far, containment of the crisis has focused on rescuing the banks and pumping more money into the system through the crazy Zimbabwe-esque expedient of ‘quantitative easing’ – effectively flooding the banking system with more cash.

This has cost hundreds of billions of pounds, all of which needs to be repaid if we are to avoid rampant inflation. That means borrowing more money from the international money markets.

But there is a problem. Until recently it was unthinkable that a sovereign nation couldn’t service its debts. And yet this is exactly what’s just happened with Dubai.

If international lenders begin to doubt the creditworthiness of UK plc, they will downgrade our credit rating and dramatically increase the rates of interest they charge. UK banks will have to follow suit to match these rates, putting unsustainable pressure on our struggling economy.

Thousands of businesses already hit by the recession will go bust. Trapped by soaring unemployment and welfare benefits, the Government will have to borrow more. And so the vicious debt cycle will continue to spiral down towards national insolvency – and, potentially, social anarchy.

Why won’t our politicians get a grip?

The seeds of a possible future disaster were sown during the Blair years. Blair inherited a strong, stable economy which had been responsibly managed by his Conservative predecessors with acceptable levels of government debt.

He played his first term in office with textbook good sense; it was a continuation of Conservative policy to all extents and purposes, with debt kept at record lows. After that, perhaps because the Opposition was so weak, Blair and his Chancellor let rip.

The massive spending by New Labour on public services during its last two terms was a good idea in principle but a disaster in practice. This was because Blair was not a ‘details’ type of person.

As with the invasion of Iraq, he took wide-ranging decisions on economic planning based on little more than a broad vision, no doubt wishing to feel the hand of history upon his shoulder. Instead of the money being carefully managed, with every penny accounted for as with a household budget, it was sprayed about indiscriminately like a fire hose out of control.

As a result, the Conservatives accuse the Government of ‘not fixing the roof while the sun was shining’. But the problem is they didn’t suggest it at the time. Politics had became so centrist that for the Tories to suggest restraint at a time of economic prosperity would have been electoral suicide.

We are now reaping the harvest of that short-sighted conformism.

Yet even now, no one in power dares speak the truth.

Christmas is only four weeks away; people don’t want to hear bad news. Our politicians also don’t want to be the ones to deliver it (bad news equals lost votes). But unfortunately, as Dubai’s predicament now shows, we’ve got to stop thinking that it couldn’t happen to us and start having an urgent national debate if we are to have any hope of staving off disaster.

The Conservatives are odds-on to win the forthcoming General Election, to be held probably in May or June. There is a view they will not announce the full range of spending cuts they intend to make until it is safely won.

Once in office they can claim the situation is far worse than they envisaged and start swinging the axe. But do we want a party that surfs into office on a wave of optimism, only then to reveal its true character later? This is hardly the stuff of greatness.

The unfortunate reality is what we see with the Conservatives is probably what we will get; decent enough chaps but no Margaret Thatcher or Winston Churchill to save us in our time of need. An even worse result would be a hung Parliament and the ensuing political paralysis which would almost certainly cause a sterling collapse.

It is understandable that no one wants to talk the language of crisis. Spending cuts and tax rises are not popular concepts. Perhaps it is just a fact of human nature that it is only possible to begin the debate when the scale of the crisis is beyond question. But history teaches us that such obfuscation only worsens the pain in the long run.

Present times are alarmingly like 1939, when the nations didn’t want to accept the prospect of a war, or – if they did – liked to feel it would be over quickly.

Even our then Prime Minister, Neville Chamberlain, delayed, entering futile peace negotiations and refusing to accept reality. It took a great man, possibly the greatest Englishman of all time, to save the nation.

What if the great danger in our lifetime is not a military but an economic war? Who then has the moral courage to take the tough but necessary action?

James Palumbo is a former City banker and founder of Ministry of Sound, the largest independent record label in the world, which had a turnover of £80million last year.

(CFD.net.au – Contract for Difference, Share, Forex, ETFs, Commodities Traders) –

By Elizabeth Stanton

Yahoo, the owner of the No. 2 U.S. search engine, rose 4.5 percent after

earnings

were helped by increased spending from some advertisers. Morgan Stanley rallied after reporting its first profit in a year.

SanDisk Corp.

, the biggest maker of flash-memory cards used in digital cameras and mobile phones, jumped 10 percent after its sales forecast topped estimates.

“Companies prepared investors for very mediocre results,” said

Robert Lutts

, president of Cabot Money Management in Boston, which manages $450 million. “They lowered the bar very low and now are jumping over those bars.”

The

Standard & Poor’s 500 Index

added 0.6 percent to 1,097.28 at 11:17 a.m. in New York and earlier climbed above its highest close of the year. The

Dow Jones Industrial Average

increased 39.98 points, or 0.4 percent, to 10,081.46. About three Stocks advanced for each that fell on the New York Stock Exchange.

The

S&P 500

has rallied 62 percent from a 12-year low in March as the government lent, spent or guaranteed $11.6 trillion to combat the worst U.S. recession since the 1930s. The rebound left the benchmark index trading at about 20.6 times the reported Earnings of its companies, the highest since 2004.

Earnings Season

Profit has topped estimates at 76 percent of the S&P 500 companies that have posted third-quarter results, including Google Inc.,

JPMorgan Chase & Co.

and DuPont Co. More than 130 S&P 500 companies are reporting this week.

Yahoo rose 4.5 percent to $17.95. Third-quarter

profit

excluding some expenses was 15 cents a share, beating the average prediction of 13 cents by analysts in a Bloomberg survey. Sales, excluding fees passed on to partner sites, were $1.13 billion, exceeding projections.

SanDisk Corp.

soared 10 percent to $23.63. The biggest maker of flash-memory cards used in digital cameras and mobile phones forecast fourth-quarter sales that beat analysts’ estimates as chip prices rebounded.

Apple Inc., maker of the iPhone mobile phone, iPod music players and MacIntosh computers, rose 3.1 percent to a record $204.91 and contributed most to the S&P 500’s advance.

Morgan Stanley Jumps

Morgan Stanley rallied 6.5 percent to $34.63. The sixth- largest U.S. bank by assets reported its first profit in a year, surpassing analysts’ estimates on higher investment-banking fees. Third-quarter Earnings were $757 million, or 38 cents a share. The average estimate of 21 analysts was for profit of 30 cents a share.

U.S. Bancorp climbed 6.7 percent to $25.38. The Minneapolis-based lender that has expanded during the financial crisis said third-quarter profit rose 4.7 percent on higher net interest margins and fees from mortgage banking and transactions at automated teller machines.

SLM Corp. soared 19 percent to $10.61 for the biggest advance in the S&P 500. The largest U.S. student loan company reported its first profit in more than a year.

Treasury Secretary

Timothy Geithner

said the bank capital- purchase program in the $700 billion bailout will be allowed to expire later this year because parts of the economy and markets are stabilizing, Reuters reported, citing an interview.

“We are now at the point where we can begin to wind down the programs that really defined TARP in its initial stages,” Reuters quoted Geithner as saying in the interview today, referring to the Troubled Asset Relief Program.

Boeing Slumps

Boeing Co., the second-largest maker of commercial aircraft, fell 1.1 percent to $51.34 after Booking $3.5 billion in charges for the delayed 787 Dreamliner and 747-8 jumbo jet programs. Its largest-ever net loss of $1.56 billion, or $2.23 a share, exceeded the $2.10-a-share average estimate of 18 analysts in a survey.

Per-share Earnings for the 97 companies in the S&P 500 that released third-quarter results since Oct. 7 were down 11 percent from the year-earlier period. Per-share profit fell in each of the past eight quarters, a record streak of declines that analysts expect to end in the current quarter.

The Dollar Index, which gauges the U.S. currency against a basket of six trading partners, Slumped 0.5 percent to a 14- month low. The pound and the New Zealand dollar rose after central bankers signaled interest rates may increase. The U.K. currency climbed 1.4 percent against the dollar and the New Zealand dollar strengthened 0.6 percent.

Bank of England Governor

Mervyn King

started preparing Britons for higher interest rates, writing in the Herald newspaper of Scotland that “it would be wise to take account” of the prospect of rising borrowing costs. Reserve Bank of New Zealand Governor Alan Bollard said a strengthening currency isn’t an obstacle to raising rates. Australia last week became the first Group of 20 nation to lift its benchmark rate since the start of the global financial crisis.

The Fed will issue its Beige Book report on regional economies, which policy makers will use to gauge the state of the housing market and the overall economy when they meet in the first week of November, at 2 p.m. in Washington today.

To contact the reporters on this story:

Elizabeth Stanton

in New York at

estanton@bloomberg.net

.

Last Updated: October 21, 2009 11:19 EDT

Source: U.S. Stocks Rise on Yahoo, Morgan Stanley Results; Dollar Falls

(CFD.net.au – Contract for Difference, Share, Forex, ETFs, Commodities Traders) –

By Elizabeth Stanton

Yahoo, the owner of the No. 2 U.S. search engine, rose 4.5 percent after

earnings

were helped by increased spending from some advertisers. Morgan Stanley rallied after reporting its first profit in a year.

SanDisk Corp.

, the biggest maker of flash-memory cards used in digital cameras and mobile phones, jumped 10 percent after its sales forecast topped estimates.

“Companies prepared investors for very mediocre results,” said

Robert Lutts

, president of Cabot Money Management in Boston, which manages $450 million. “They lowered the bar very low and now are jumping over those bars.”

The

Standard & Poor’s 500 Index

added 0.6 percent to 1,097.28 at 11:17 a.m. in New York and earlier climbed above its highest close of the year. The

Dow Jones Industrial Average

increased 39.98 points, or 0.4 percent, to 10,081.46. About three Stocks advanced for each that fell on the New York Stock Exchange.

The

S&P 500

has rallied 62 percent from a 12-year low in March as the government lent, spent or guaranteed $11.6 trillion to combat the worst U.S. recession since the 1930s. The rebound left the benchmark index trading at about 20.6 times the reported Earnings of its companies, the highest since 2004.

Earnings Season

Profit has topped estimates at 76 percent of the S&P 500 companies that have posted third-quarter results, including Google Inc.,

JPMorgan Chase & Co.

and DuPont Co. More than 130 S&P 500 companies are reporting this week.

Yahoo rose 4.5 percent to $17.95. Third-quarter

profit

excluding some expenses was 15 cents a share, beating the average prediction of 13 cents by analysts in a Bloomberg survey. Sales, excluding fees passed on to partner sites, were $1.13 billion, exceeding projections.

SanDisk Corp.

soared 10 percent to $23.63. The biggest maker of flash-memory cards used in digital cameras and mobile phones forecast fourth-quarter sales that beat analysts’ estimates as chip prices rebounded.

Apple Inc., maker of the iPhone mobile phone, iPod music players and MacIntosh computers, rose 3.1 percent to a record $204.91 and contributed most to the S&P 500’s advance.

Morgan Stanley Jumps

Morgan Stanley rallied 6.5 percent to $34.63. The sixth- largest U.S. bank by assets reported its first profit in a year, surpassing analysts’ estimates on higher investment-banking fees. Third-quarter Earnings were $757 million, or 38 cents a share. The average estimate of 21 analysts was for profit of 30 cents a share.

U.S. Bancorp climbed 6.7 percent to $25.38. The Minneapolis-based lender that has expanded during the financial crisis said third-quarter profit rose 4.7 percent on higher net interest margins and fees from mortgage banking and transactions at automated teller machines.

SLM Corp. soared 19 percent to $10.61 for the biggest advance in the S&P 500. The largest U.S. student loan company reported its first profit in more than a year.

Treasury Secretary

Timothy Geithner

said the bank capital- purchase program in the $700 billion bailout will be allowed to expire later this year because parts of the economy and markets are stabilizing, Reuters reported, citing an interview.

“We are now at the point where we can begin to wind down the programs that really defined TARP in its initial stages,” Reuters quoted Geithner as saying in the interview today, referring to the Troubled Asset Relief Program.

Boeing Slumps

Boeing Co., the second-largest maker of commercial aircraft, fell 1.1 percent to $51.34 after Booking $3.5 billion in charges for the delayed 787 Dreamliner and 747-8 jumbo jet programs. Its largest-ever net loss of $1.56 billion, or $2.23 a share, exceeded the $2.10-a-share average estimate of 18 analysts in a survey.

Per-share Earnings for the 97 companies in the S&P 500 that released third-quarter results since Oct. 7 were down 11 percent from the year-earlier period. Per-share profit fell in each of the past eight quarters, a record streak of declines that analysts expect to end in the current quarter.

The Dollar Index, which gauges the U.S. currency against a basket of six trading partners, Slumped 0.5 percent to a 14- month low. The pound and the New Zealand dollar rose after central bankers signaled interest rates may increase. The U.K. currency climbed 1.4 percent against the dollar and the New Zealand dollar strengthened 0.6 percent.

Bank of England Governor

Mervyn King

started preparing Britons for higher interest rates, writing in the Herald newspaper of Scotland that “it would be wise to take account” of the prospect of rising borrowing costs. Reserve Bank of New Zealand Governor Alan Bollard said a strengthening currency isn’t an obstacle to raising rates. Australia last week became the first Group of 20 nation to lift its benchmark rate since the start of the global financial crisis.

The Fed will issue its Beige Book report on regional economies, which policy makers will use to gauge the state of the housing market and the overall economy when they meet in the first week of November, at 2 p.m. in Washington today.

To contact the reporters on this story:

Elizabeth Stanton

in New York at

estanton@bloomberg.net

.

Last Updated: October 21, 2009 11:19 EDT

Source: U.S. Stocks Rise on Yahoo, Morgan Stanley Results; Dollar Falls

Die britische Regierung rechtfertigt der Öffentlichkeit verschwiegene Kredite an Banken mit der Gefahr eines Zusammenbruchs des gesamten Finanzsystems!

Diese Woche wurde durch die Bank of England bekannt, dass die britische Regierung der Royal Bank of Scotland und der Halifax Bank of Scotland im letzten Jahr 61,6 Milliarden Pfund mehr zuschob hat als vorher angenommen.

Labour-Schatzkanzler Alistair Darling versuchte dies gegenüber der BBC damit zu rechtfertigen, dass eine Information der Öffentlichkeit angeblich die Stabilität des gesamten Finanzsystems gefährdet habe. Zudem habe es sich lediglich um Kredite gehandelt, die mittlerweile wieder zurückgezahlt worden seien. Laut Finanzminister Lord Myners vergaben die amerikanische FED und die Europäische Zentralbank EZB ähnliche Geheimsubventionen.

George Osborne, der unter anderem durch Spesenabrechnungen bekannt gewordene hochadelige Schatten-Schatzkanzler der Tories, zeigte sich der Auffassung, dass die Maßnahmen gerechtfertigt gewesen seien. John Vincent Cable, finanzpolitischer Sprecher der ebenfalls oppositionellen Liberaldemokraten, befürwortete zwar die Kreditvergabe, fragte sich aber, warum so lange gewartet wurde, bis der britische Steuerzahler die Wahrheit erfahren durfte.

Quelle:

TP

by Sara Schaefer Muñoz, for The Wall Street Journal, November 26, 2009.

London—An independent commission on corporate governance at U.K. banks on Thursday issued a final report recommending tough new rules seeking greater disclosure of high-end compensation and calling on boards to more closely monitor risk.

The report, commissioned by the U.K. government and drawn up by David Walker, a former executive director of the Bank of England and now a senior adviser to Morgan Stanley, also calls for board members to be more deeply involved in the operation of banks in areas such as remuneration and risk.

“It is not about presiding over a lunch and then taking all the board off to the golf club,” Sir David said in an interview Wednesday.

The report, released Thursday, follows preliminary findings that were released in July. The proposals are advice to the U.K. government, which commissioned the report earlier this year.

The final report hews closely to the earlier proposals, but tightens the screws in some areas. For example, it says that banks should be required to disclose—but not name—high-end earners making more than £1 million, or $1.65 million, a year in total compensation, and disclose details of employee salary, cash bonus, deferred shares and long-term awards. The preliminary report had suggested the disclosure be voluntary…(continue reading)

Macro

The Real War on Terror

Message from the Fed to the W-Shaped Evil-doers and Devilish Deflation-mongerers (courtesy of Winston Churchill):

We shall go on to the end, we shall fight in France,
we shall fight on the seas and oceans,
we shall fight with growing confidence and growing strength in the air, we shall defend our Island, whatever the cost may be,
we shall fight on the beaches,
we shall fight on the landing grounds,
we shall fight in the fields and in the streets,
we shall fight in the hills;
we shall never surrender… 

Now, that’s fighting talk! It might as well have been the Bank of England’s Mantra on Deflation.

That’s all very well but is it just me or is there a worryingly ominous deflationary creep encroaching into our investment psyche?

• The “Depressionists” are back in vogue.
• Auto Sales fell off a cliff after the cash for clunkers program expired.
• The Japanese economy once again failed to reach the, now seemingly mythical, escape velocity and once more slips back into deflation.
• US GDP growth was revised down at +2.8% this week, much lower than the +3.5% originally reported. David Rosenberg thinks that this number would actually have been negative were it not for the carpet-bombing of cash and spending administered by the Government and Fed. “Is that all I get for my money?” he scoffs, quoting a Billy Idol Lyric.
• Meredith Whitney says that she has “never been this bearish in over a year” and (more significantly) that she “has never seen this level of credit contraction”.
• Mervin King unveiled the startling revelation that the BoE actually secretly bailed out two of Britain’s largest banks.
• US initial jobless claims have only just managed to breach less than half a million joblosses a week and chatter over Wage Deflation has resurfaced.
• Mauldin muses the over-crowded “sell treasuries” trade – a yield curve which this week yielded negative at the short end, and even entertains the notion of “value” in a market where 5 year US government bonds which yield less than 2.5%. I can’t help feeling reminded of the old Japanese government bond traders’ motto at the height of their deflationary despondence: “Never go home short government bonds”.
• Bankruptcy Filings are up 34% YoY.
• BNP US Economist talks about slack in the economy drowning out any notion of an inflationary tailwind:  deflation is their immediate forecast. While Asia did not decouple coming into the crisis, the French bank’s Chief Economist admits it is almost inevitable that Asia (in particular China) will decouple coming out of the crisis, leaving the rest of the World to languish in depression and muted growth.

Despite the heaviest artillery since Adolf Hilter rolled out the Bismarck, there is doubt as to whether the Fed’s Naval Fleet has the arsenal to blast the terrifying and disturbingly immovable object of looming deflation. The Rumsfeld-esque “Shock and Awe” guerilla raids on the Monetary Base and mezmerizing propaganda from the body politic go only so far before the awe is no longer awesome and the shock ceases to be shocking. That over-zealous use of the printing-press throttle may be flooding the engine and drowning in liquidity.

Inflation-ites beware; the Mission is NOT yet accomplished. We fight an elusive enemy which lurks in caves and the dark shadows of your consciousness, the Jury is still out as to whether “The War on Deflation” is actually over.

Macro Data to Watch

• Happy Thanksgiving!
• German CPI

Markets

Oh dear me. The Dollar got spanked overnight, the Euro traded above 1.50 again and the DXY dollar index hit a new low capitulating through 75 (see chart of the day below).

Source: Bloomberg

The Dollar-Yen waltzed through 88 then susequently plummeted to its lowest level against the Japanese Currency since 1995.

The Swiss Franc broke parity (1.00) on the Dollar – a Dollar bill now will not even get you a single, solitary Swiss Franc… if the Greenback breaks 0.98 it will be the lowest level against the Swiss currency since… … wait a minute, since the beginning of time!

Global Stocks to Watch

• Chinese B-shares bounced last night – but the volatility remains.
• Asahi Glass comes out with $1billion convertible bond issue – CB investors are getting skittish into year end, this deal will have to be priced cheap!

Alistair Darling has today been defending the Bank of England’s “lender of last resort” loan to HBOS last October and November.

He has, rightly, said that this type of loan is a key duty of the Bank of England. He also pointed out that HBOS provided collateral for the loan, and that the loan has since been repaid in full. He also defended the decision to keep the loan secret, saying, “The Bank’s assessment at that time was that it was vital that their emergency liquidity assistance operations remained confidential.”

When similar “lender of last resort” support to Northern Rock had been leaked, it had caused a run on the bank, and its collapse. So Mr Darling’s arguments that the loan had to be made, and that it had to be kept secret, are persuasive.

The government are on less solid ground, however, on the issue of the Lloyds takeover of HBOS. Lloyds shareholders, remember, were voting on the takeover at a time when those loans had been taken out by HBOS. However, they were not told about the loans. The existence of them was very clearly material to the takeover.

We have been told that the circular to Lloyds shareholders referred to the bank’s reliance on Bank of England liquidity facilities. This is misleading. The document opaquely referred to the bank’s ongoing reliance on the “availability of Bank of England liquidity facilities”, but did not mention that HBOS had already made use of those facilities. In fact, the circular specifically stated:

“Save for the £4 billion net cash proceeds raised by HBOS in its rights issue in July 2008 and as disclosed in the sections headed ‘Group Overview’, ‘Divisional Review’ and ‘Outlook’ in Part XIII (‘‘HBOS Interim Management Statement 3 November 2008’’) of this document, which sets out the current trading, trends and prospects of the HBOS Group, there has been no significant change in the financial or trading position of the HBOS Group since 30 June 2008.”

The government have claimed that the Lloyds directors knew about the loans. If that is true, it implies serious allegations about the conduct of those directors. For they continued to back the takeover, and kept the loans secret from their shareholders.

If the government are not telling the truth, and the Lloyds directors did not know of the loans, then the spotlight would move to the HBOS directors. They clearly did know about the loans, and in that case did not disclose those material facts when opening their books to Lloyds.

I am not a lawyer. However, it is clear that either the HBOS directors or the Lloyds directors, or both, were in clear infringement of takeover rules at the very least. The government itself, I presume, was not in breach of those rules since it had no duty of disclosure to the Lloyds shareholders.

I believe the Bank of England were right to provide those loans. I believe the Bank and the government were right to keep them secret. But they, and more especially the directors of HBOS and/or Lloyds, were dead wrong to allow the takeover to proceed.

The takeover could have been very simply stopped by the government. There was no need for them to disclose the loans; they could simply have said that the situation at both HBOS and RBS was so serious that an immediate capital injection by the government was required. Then Lloyds could have simply walked away.

Of course the most serious concern of the authorities was to prevent a meltdown of the financial system. But they could have done that without stuffing the Lloyds shareholders.

The authorities have been very keen to prosecute mortgage and insurance brokers for “miss-selling” endowment policies and pensions.

And all the while they were themselves guilty of miss-selling an entire bank.

Ein weiteres Beispiel dafür, wie sehr die Hütte geraucht hat – oder noch immer raucht? Und natürlich auch im Oktober / November letzten Jahres, wo es ja auch bei uns in Deutschland kurz vor knapp war…

Gefunden bei sueddeutsche.de:

Geheimdarlehen

“Sehr nah am Zusammenbruch”

25.11.2009, 15:20

Großbritanniens Finanzminister verteidigt verbissen Geheimdarlehen in enormer Höhe an zwei britische Banken – es habe der Kollaps gedroht.

Die Bank of England (BoE) hat zwei wegen der Finanzkrise strauchelnden Geldinstituten mit höheren Summen unter die Arme gegriffen als öffentlich bekanntgegeben.

Die Royal Bank of Scotland (RBS) und die Halifax Bank of Scotland (HBOS) wurden im vergangenen Jahr mit Krediten in Höhe von 61,6 Milliarden Pfund (67,7 Milliarden Euro) vor dem Zusammenbruch bewahrt. Finanzminister Paul Myners verteidigte am Mittwoch die absolute Geheimhaltung, mit der die Entscheidung über die Bühne ging.

Das Bankensystem sei damals “sehr nah am vollständigen Zusammenbruch” gewesen, sagte Myners der BBC, und die Geheimhaltung sei notwendig gewesen. Die Bank of England hatte in den vergangenen Tagen bekanntgegeben, dass die RBS und die HBOS im Oktober und November 2008 massiver unterstützt wurden als angekündigt.

Weil sich die Banken inzwischen wieder stabilisiert hätten, könnten Einzelheiten der Notkredite nun öffentlich gemacht werden, sagte der Finanzminister. Das Geld sei im Januar von beiden Geldinstituten komplett zurückgezahlt worden.

“Im Rahmen ihrer Funktion als Zentralbank agiert die Bank bei außergewöhnlichen Umständen als Kreditgeber letzter Instanz für Finanzinstitute, die sich in Schwierigkeiten befinden, um einen Vertrauensverlust im gesamten Finanzsystem zu verhindern”, hatte es in einer Mitteilung der BoE geheißen.

RBS ist nach der Finanzunterstützung inzwischen zu 84 Prozent in Staatsbesitz. HBOS wurde von Lloyds übernommen, die Gruppe gehört zu 43 Prozent dem Staat.

(sueddeutsche.de/AP/hgn/pak)

Federal Reserve Assuring Great Depression
Another Weimar, Argentina or Zimbabwe hyperinflation collapse is coming. . . unless we End the Fed!

Federal Reserve Copies Weimar Hyperinflation

The study of money, above all other fields in economics, is one in which complexity is used to disguise truth or to evade truth, not to reveal it. The process by which banks create money is so simple the mind is repelled. –John Kenneth Galbraith, former professor of economics at Harvard, writing in Money: Whence it came, where it went (1975).

J.K. GALBRAITH’S STATEMENT THAT COMPLEXITY is used by modern economics to confuse the truth about money is a fact. Simply put, bankers replaced money with credit and debt in order to profit by the indebting of others. It’s why bankers are now so rich. It is also why others are now so poor.

Understanding money is not rocket science. Modern currencies are a fraud, a fraud that has escaped detection much as did Bernard Madoff’s ponzi-scheme. Bernard Madoff’s scheme was based on the fraud that investor’s money was, in fact, invested. The fraud of modern economics, however, is that money isn’t actually money—and they don’t want you to know it.

MERRY OLD ENGLAND: THE MOTHER OF MODERN MONETARY FRAUD
From the time of Charlemagne until the 12th century, the silver currency of England was made from the highest purity silver available. Unfortunately there were drawbacks to minting currency of fine silver, notably the level of wear it suffered, and the ease with which coins could be “clipped”, or trimmed, by those dealing in the currency.

In the 12th century a new standard for English coinage was established by Henry II — the Sterling Silver standard of 92.5% silver and 7.5% copper. This was a harder-wearing alloy, yet it was still a rather high grade of silver. It went some way towards discouraging the practice of “clipping”, though this practice was further discouraged and largely eliminated with the introduction of the milled edge we see on coins today. By 1696 the currency had been seriously weakened by an increase in clipping during the Nine Years’ War to the extent that it was decided to recall and replace all hammered silver coinage in circulation.

CLIPPING CURRENCY BIG TIME:
THE INTRODUCTION OF PAPER BANKNOTES
The real clipping of money began in 1694 when the Bank of England was allowed to issue its paper banknotes to circulate alongside silver coins. Over the next three hundred years, the bankers’ debt-based notes would replace gold and silver; and, as a consequence, the entire world would eventually become in debt to the bankers.

The triumph of private bankers in replacing money with banknotes was to be universal as all nations would eventually succumb to the banker’s easy credit and inevitable debt. Today, the central ingredient of money is not gold or silver but confidence, confidence in banknotes no longer backed or convertible to anything of value. Modern economics is a highly successful confidence game run by bankers. The following is from the Bank of England’s own website emphasizing its considerable efforts to maintain the necessary confidence in its on-going con game:

The Bank of England has been issuing banknotes for over 300 years …Gaining and maintaining public confidence in the currency is a key role of the Bank of England and one which is essential to the proper functioning of the economy. [bold mine]

THE BANKER’S CON GAME
The long-running and lucrative confidence game, however, is about to end. Its breakdown is now underway as constantly compounding consumer, business and government debt can no longer be carried and/or paid for by existing or future productivity, especially as economies are contracting, not expanding, and collective debt levels are skyrocketing to levels which can never be repaid.

We borrowed against tomorrow and tomorrow is here. The collapse of economies such as the US, the UK, and Japan etc, will eventually render the bankers’ IOUs and government currencies worthless; and when this happens, the three hundred year stranglehold of bankers over human endeavor will be over.

GOLD MAKES A RUN
Two powerful forces, paper money and gold, are now locked in mortal combat. The combatants, however, are proxies for far more fundamental forces. Paper money is a proxy for private banking and government power—and gold is a proxy for freedom. –Moving Through The Maelstrom, Monthly Commentary, November 2009

The complete breakdown of the global economy was necessary for people to understand what is happening. Economic elites had banished all inquiry into monetary issues that did not conform to their special interests. Keynes and Friedman were popularized not because they were right, but because their theories suited those in power. Truth was ignored. Today, its revenge is here. Popular theories supporting paper money will soon give way to economic realities exposing their failings.

Against the formidable opposition of central banks and Western governments, the price of gold has more than quadrupled in ten years. The forward selling of unmined gold by large gold mining companies in collusion with central bank gold leasing did much to constrain gold’s advance but the power of its intractable rise should be seen in the light of that opposition.

Currently, the fall of the US dollar is currently pushing gold to new highs. Tomorrow it will be the fall of the pound, the euro or the yen that will do so. The fraud of paper money is being exposed and it is only a matter of time until the global edifice of credit and debt it supports will collapse.

In The Great Wave (Oxford University Press 1996), Professor David Hackett Fisher, an economic historian, tells of the great waves that periodically destroy existing epochs to make way for the new and better eras that follow.

Such waves, Professor Fisher found, always culminate in total economic collapse. We are nearing the end of what Fisher believes is perhaps history’s greatest wave; and yet, the economy is still standing (though currently quite wobbly). Since great waves last from 80 to 120 years and this wave began in 1896, it means an economic collapse is imminent.

It does seem to be a possibility, doesn’t it?

THANKSGIVING AND THANKFULNESS
For those invested in gold and silver, their recent rise is cause for thanksgiving. But our thanksgiving for gold and silver’s rise must be tempered with what the rise of gold and silver signifies. Gold and silver are barometers of monetary turmoil and economic distress; and the higher they rise, the more severe and closer the collapse will be. For the few who saw the collapse coming, it will be a vindication that the truth can and will triumph, that monetary fraud no matter how ubiquitous or long-standing cannot last forever, that gold and silver are money and that paper currencies are not.

Professor Antal Fekete said the day gold and silver explode upwards will be a sad day for humanity. He is right. The explosive ascent of gold and silver will be caused by the global collapse of paper assets and paper money. Suffering and loss will be the experience of most.

Although that day will be one of tragedy, it will also make way for the new and better world that is to come. Give thanks for that. Life is a miracle and we are a part of it. It is not done with us yet. That much is obvious. Buy gold, buy silver, have faith.

It has emerged that in October and November 2008 the Bank of England, as lender of last resort, made loans of £61.6 billion available to Royal Bank of Scotland and HBOS, to prevent their collapse. Of that, £25.4 billion went to HBOS.

The media are concentrating on the implications for how close the system was to collapse at that time. Clearly, to act as lender of last resort is absolutely legitimate and one of the Bank of England’s key roles. Given the state these banks were in, it was entirely appropriate for the Bank of England to provide those loans. It was also probably entirely appropriate to keep the loans secret, to prevent a run on the banks that might have been catastrophic.

What came after was entirely less appropriate, however.

At that time, Lloyds TSB was in advanced talks to buy HBOS. There have been suggestions that the Treasury, the Financial Services Authority, and even the Prime Minister himself encouraged Lloyds TSB to take on HBOS.

The Lloyds TSB shareholders voted on the takeover by HBOS on 19th November, and they approved the takeover.

It was clear even then that HBOS was in serious trouble, and this was a rescue bid by Lloyds TSB. However, those “lender of last resort” loans by the Bank of England were at that time secret. Crucially, they were not disclosed to the Lloyds shareholders as they approved the deal.

It is therefore clear that material facts were withheld from the Lloyds shareholders. Indeed, the circular issued to shareholders of Lloyds TSB, produced on 3rd November, says:

“Save for the £4 billion net cash proceeds raised by HBOS in its rights issue in July 2008 and as disclosed in the sections headed ‘Group Overview’, ‘Divisional Review’ and ‘Outlook’ in Part XIII (‘‘HBOS Interim Management Statement 3 November 2008’’) of this document, which sets out the current trading, trends and prospects of the HBOS Group, there has been no significant change in the financial or trading position of the HBOS Group since 30 June 2008, the date to which HBOS’s last published interim financial information (which is set out in Part IX (‘‘Historical financial information relating to HBOS plc’’) of this document) was prepared.”

We do not know, of course, whether the Lloyds directors knew of these loans. If they did, then they misled their shareholders.

If the Lloyds directors were not told about the loans, then a signficant part of the HBOS accounts was being hidden from the potential purchasers – in which case, it was the government that was misleading the Lloyds shareholders.

If the Lloyds shareholders had known about these loans, it might have made a difference to their decision to back the deal.

The media are saying that those shareholders might feel aggrieved at being misled in this way. The BBC, for example, say that “shareholders might be unhappy at not being told earlier”.

Let’s be clear. It is much more significant than that. It is now evident that Lloyds has been hobbled by the takeover of HBOS. Therefore, shareholders have lost money as a result of the deal. If those Lloyds shareholders were misled about such a major part of the deal, then they have clear grounds to sue. This could get interesting.

The Bank of England has revealed for the first time that it lent Royal Bank of Scotland (RBS) and HBOS £61.6bn in emergency funding last autumn.

Bank governor Mervyn King told a parliamentary hearing it “was to prevent a loss of confidence spreading through the financial system as whole”.

The money was repaid in full by January this year, he added.

A spokesman for the prime minister said it was “a powerful reminder” of how the banking system had nearly collapsed.

It was also revealed that Chancellor Alistair Darling had agreed to underwrite any losses which the Bank may have made on the loans.

The Liberal Democrats have called on Mr Darling to explain to the House of Commons why the Treasury guarantees were kept secret.

Vince Cable, the party’s Treasury spokesman, called it a “shocking cover-up”.

Secrecy

It is the first time that the central bank has detailed this support for the two institutions.

Mervyn King said the Bank was acting in its capacity as the lender of last resort.

The loans, which were given in October and November of 2008, were in addition to other financial support measures extended to the banks by the government.

The chairman of the Treasury Committee, John McFall, said that when he saw the amount there had been “a little bit of an intake of breath thinking how many universities, how many colleges, how many jobs you could support with this”.

The Bank of England said it had carefully considered the public interest case for disclosure but decided that the assistance should only be revealed “once the Bank considers that the need for secrecy has ceased”.

RBS has since signed up for the government’s Asset Protection Scheme while Lloyds Banking Group – which took over HBOS – has announced plans to raise capital from its shareholders.

The BBC’s chief economics correspondent Hugh Pym said that the £62bn of emergency loans were agreed just as shareholders were being asked to approve the takeover of HBOS. He suggested that shareholders might be unhappy at not being told earlier.

Profound challenges

In his parliamentary testimony Mr King also discussed the wider UK economy, reiterating his view that the recovery was still in the early stages.

He told the Treasury Committee that the economy still faced “profound challenges”.

Regarding the Bank’s policy of quantitative easing – pumping money into the economy to try to boost lending by the commercial banks – Adam Posen, one of Mr King’s colleagues on the Bank’s Monetary Policy Committee (MPC), said he hoped the initiative was “coming to an end”.

Last month, the MPC voted to increase its quantitative easing programme by a further £25bn to £200bn.

However, minutes released subsequently showed a three-way split on the decision, with seven of the nine MPC members voting for it, one wanting a larger increase in the scheme, and one calling for no additional spending.

Mr King also told MPs that he did not think there was any “immediate risk” of the UK having a credit downgrade

George Osborne has repeatedly tried to link himself to Barack Obama since the financial crisis has unfolded.

Initially he claimed that Obama wasn’t backing a fiscal stimulus ala Gordon Brown but actually pursuing a monetary policy ala George Osborne, something Andrew Sparrow from the Guardian politely called ‘valiant’.

Now he claims that his plans to abolish the FSA and hand powers back to the Bank of England are matched by Obama in the USA calling on the Federal Reserve. Similarly Osborne plans to create a new quango, the ‘Consumer Protection Agency’, which will allegedly be similar to a new body Obama is setting up.

As ever with Osborne, his claims are two parts horse…erm…radish, and about a billion parts sheer bloody cheek.

Firstly we all know Obama has backed an absolutely huge fiscal stimulus, so much so that even some Democrats are nervous about it. We also know that the US believes it would still be in a recession were it not for the stimulus, something Osborne has tried to deny.

Secondly, Obama’s ‘Consumer Financial Protection Agency Act’ actually mirrors the FSA in many ways, as William Kay points out. Osborne is really just shuffling around responsibilities from one body to another, while Obama is imitating the UK government in creating an FSA-esque body to deal with consumer rights and protections.

Osborne’s commitment to scrap the FSA is born not out of a belief that it needs to be scrapped but out of a desire to scrap a keystone Labour policy. If he is handing some of it’s regulatory powers to the Bank of England that doesn’t mean he needs to create a new body for the remaining powers, there is no reason he couldn’t keep the FSA if he liked. Meanwhile we still don’t know what he plans to do with the oversight of regulated markets and companies, see Peston’s ‘Four Observations” section here.

But, as with most of Osborne’s approach to economics, it is borne out of political expediency and positioning rather than any deep and serious thinking, something recognised by business groups in the country, who are still not convinced about this policy (see 12:40pm here).

As Alastair Campbell has pointed out, Osborne’s relentless political positioning over sound economic policy means he’s still not trusted by business figures and the public at large, who can sense that Osborne is a weakness for Cameron rather than a strength as Shadow Chancellor.

For the first time in history, the Federal Reserve Bank may be facing an audit. On Thursday, the House Finance Committee passed a bill (HR 1207) that authorizes the Government Accountability Office (GAO) to conduct a wide-ranging audit of the Fed’s secretive deals with foreign central banks and major U.S. financial institutions.

HR 1207, sponsored by Rep. Ron Paul (R-TX), currently has 313 co-sponsors in the House from both sides of the aisle, which is a veto-proof majority. A companion bill in the Senate (S 604) has 30 co-sponsors.Whenever the government needs to have money printed, or spend our tax dollars, it issues treasury bonds to the Federal Reserve, which in turn prints the Federal Reserve notes to back those up. The catch, however, is that money is issued with interest charged to the federal government (a.k.a. the taxpayers). According to CNN, the interest alone on U.S. debt is projected to grow to $4.8 trillion in the next decade. According to Ron Paul, since the Federal Reserve was given control over U.S. currency in 1913, the purchasing power of the dollar has fallen by over 95%.

The FED is Evil the Rothchilds,,, the Rockefellers, Soros. WE know Now … The Giant has Awoken… see OUR power

Gordon Brown was quite adamant that inflation had nothing to do with the credit crunch and the subsequent recession, and so he is quite happy to pump billions of pounds into the economy, confident that inflation will not return.

The current Bank of England base rate stands at 0.5%, which it was hoped would stimulate the economy and so alleviate recessionary pressures, but at the beginning of this year it was clear that recession was not going away anytime soon. As a result, he, Alistair Darling, the Chancellor of the Exchequer, and the Bank decided to create a new euphemistic facility called Quantitative Easing. I know, sounds quite benign doesn’t it.

This facility has so far pumped a little over £175 billion into the economy, and it was hoped that, since interest rates could not be reduced to zero or below, this approach would stimulate business and so shorten the recession.

What is unfortunate for those who disagreed with such a policy, is that nothing can really be proven. How do we know if a recession is shorter or longer than it might otherwise be? Quite, but this works very well for the government. No-one can categorically demonstrate the foolishness of this policy.

However, while recession is never good for an economy, or employment, inflation is not great either. And that is where we seem to be heading. The CPI has, this month, risen to 1.5%, which is above all the other G7 countries, and we should be worried. Hopefully, it will remain at around the ‘target’ rate of 2%, but we cannot be sure, only time will tell.

The real reason, however, for Gordon to manoeuvre this policy – which is, in fact, the printing of money and debasement of the currency – is to pay for his budget deficit. Is it a coincidence that QE (the overwhelming majority of which has gone on Gilts) has created £175 billion, which just so happens to be the exact figure for this year’s projected budget deficit? I think not.

So, when Gordon Brown tells us that his policies are there to provide money for cash strapped businesses, he is only telling half the truth. The main purpose is to provide money for his spending addiction, and like most serious addicts, he finds a way to get other people to pay for it.

(CFD.net.au – Contract for Difference, Share, Forex, ETFs, Commodities Traders) –

October 9, 2009

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Source: Europe, UK leave interest rates unchanged

(CFD.net.au – Contract for Difference, Share, Forex, ETFs, Commodities Traders) –

October 9, 2009

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Video settings

What type of connection do you have?

Video settings form

Automatically detect my connection speed (recommended)

56K modem

Home broadband (100+ Kb/s)

Medium-speed broadband (300+ Kb …

Source: Europe, UK leave interest rates unchanged