Bank Name | City | State | CERT # | Closing Date | Updated Date |
|---|---|---|---|---|---|
| La Jolla Bank, FSB | La Jolla | CA | 32423 | February 19, 2010 | February 19, 2010 |
| George Washington Savings Bank | Orland Park | IL | 29952 | February 19, 2010 | February 19, 2010 |
| Marco Community Bank | Marco Island | FL | 57586 | February 19, 2010 | February 19, 2010 |
| The La Coste National Bank | La Coste | TX | 3287 | February 19, 2010 | February 19.2010 |
Gold falls 1 pct after Fed hikes discount rate
more than 1 percent on Friday as the dollar gained after the Federal Reserve said it was raising the interest rate charged to banks for emergency loans
http://in.news.yahoo.com/137/20100219/748/tbs-gold
-falls-1-pct-after-fed-hikes-dis.html
-END-
Peter Grandich chips in with:
Fed Raises Interest Rates
Posted by Peter Grandich at 5:01 PM on Thursday, February 18th, 2010Lets see, the IMF announces gold sales at 4:30PM yesterday. The Fed announces a discount rate hike todayaround the same time and gold quickly drops $15. It's a good thing I'm not one of those conspiracy nuts like these guys:http://grandich.agoracom.com/2010/02/fed-raises-interest-rates/-END-
On Thursday, I pointed out that the 10 year bond fell badly to a yield of 3.80% The long bond fell to a price of 116.18 dangerously close to blowing up all of those interest rate swaps.
Here is a commentary by Bill Murphy showing what happened to gold and the bond yields before and after the announcement:
During yesterday's normal trading hours, three points stuck out to me…
*Despite LOUSY U.S. economic news, the DOW dinked its way to an 80 point higher close … in the same turtle-like up fashion we have seen for so long.
*The price of the 10 yr T note broke down … an enormous threat to the money starved US Treasury and to the recovery of our economy.
*Gold's stunning price recovery, and breakout above key resistance at $1120, despite the IMF news.
Then came the Fed discount rate hike news….
*The DOW fell exactly what it rose for the day, but has since recovered and even gone HIGHER. It then made sense why the DOW rose so much yesterday. Thus it was allowed to drop the exact amount it made for the day, so no harm, no foul there.
*The yield of the T note didn't budge an iota.
*And, of course, the gold price was bombed.
end.
Thus gold started Friday at around 1100 and spent the entire day climbing to par and then climbing to 1125. The cartel members were extremely nervous seeing gold's huge demand.
It was only in the last half hour that they lowered gold's value in the paper market when all the physical boys were satisfied with the metal that they had obtained.
Pay no attention to the whack of gold after 1:30 in the access market as they bankers are trading amongst themselves as everyone else had gone home.
Here are some numbers for yesterday:
The yield on the 10 yr T note dropped slightly to 3.78%.
The dollar fell .33 to 80.61. The euro went up .0121 to 1.3581. The pound gained .0023 to 1.5450. The yen rose .35 to 91.62.
While gold and silver are still under The Gold Cartel's gun, other commodities like crude oil (up 75 cents per barrel to $79.81) and copper (up 7 cents to $3.36 per pound) are really on the move.
The CRB gained 1.65 yo 277.80.
The turtle DOW did it again, up 9 to 10,402. The DOG gained 1 yo 2243.
end.
On the physical front, we had 5 stories to note:
1. Russia last month increased their official physical inventory of gold by 100,000 oz or 3.3 tonnes of gold.
2. The COT report released after the market closed at 4 pm showed short covering by the long speculators of some 5571 contracts in gold.
The commercials were all over the board ---they lowered their long positions (the intermediate bankers) by 9757 contracts but also the massive
bank shorts (JPMorgan and HSBC) lowered their shorts by 7400 contracts.
It was the small specs that received the paper from the bankers to th tune of 3478 contracts. Believe it or not but a rather large 5845 contracts went on the short side
from these small specs.
In silver: it seems that the silver COT was quite calm as very few longs exited and very few commercials released their short positions.
Also remember that the COT report is basis Tuesday.
3. The open interest on gold comex and silver comex basis Thursday:
The open interest climbed a huge 5000 contracts rising to 469400 from 464000. The volume on the comex gold was estimated to be 181000 contracts.
In silver, something spooked our banker friends: the OI dropped from 120600 to 119100 which is a large move down with a rather large up movement in silver.
Also mysteriously :
There was a transfer of 187,274 ozs of silver from the dealers to the customers by way of an "adjustment".
The dealer inventory is at an all time low of 47.1 million oz.
4. another oh-oh moment: Dennis Gartman decided to change fate: He bought a gold contract unit. However it was denominated in yen:
Today The Gartman Letter added a gold/yen "unit" to its position. This means that 4 out of 9 positions in this influential publication's model portfolio are FX hedged gold.
5. On Thursday, I reported a significant event has occurred in that we had reached record levels in gold price with respect to Euro gold. Yesterday, Euro gold climbed another 1/2 Euro.
The press over there are all over this fact. Also remember that the Europeans are the ones that are basically in the physical market. The paper gold market is over here:
Euro-priced gold hits record 825.96 euros/oz
LONDON, Feb 19 (Reuters) - Euro-priced gold rose to a record high at 825.96 euros an ounce on Friday, as investors spooked by fears over the fiscal health of some euro zone economies and weakness in the single currency sought a portfolio diversifier.
Euro-priced gold
While gold prices generally decline when the euro weakens against the dollar, sovereign worries sparked by Greek fiscal problems have pushed investors towards gold as an alternative to the euro.
However, lo and behold we have another European currency with respect to gold reaching record levels and this is Gold denominated in pounds: (from the Scarborough Bullion Desk)
Gold hit its record close of 723.00 British pounds per oz of gold:
With my screens flashing the news of a new all time Eurogold price over 825, I'm turning to my Sterling chart,
Am leaving the office shortly, but if we see Sterling Gold close tonight at current levels, it'll be a definitive all time weekly high in UK terms,
Bear in mind that it was only last week that Gold recorded a new all time weekly high against the Euro closing above the 800 level, Some 2-3 trading days later and it was notching up record interday high's as well!
Wishing all at Midas and the 'Cafe' a most enjoyable wknd,
Best,
Rich (Live from 'The Scarborough Bullion Desk')
end.
Ok lets go to other economic stories that hit the markets:
I find this one strange: Bernanke announces a discount rate hike trying to give the impression that he is going to rein in the excess liquidity given to bankers.
Then why this?
Isn't it kind of funny – the Fed raises the Discount Rate [the rate at which banks can borrow at the discount window] yesterday and the talking heads all claim that "excess liquidity" is now being drained from the market.
Meanwhile, TODAY – the Fed conducts Permanent Open Market Operations [POMO] to the tune of close to 1 billion in AGENCY BONDS [Fannie / Freddie]:
http://www.newyorkfed.org/markets/pomo/display/index.cfm?opertype=agny
Operation 1 - RESULTS
Operation Date: 02/19/2010
Operation Type: Outright Agency Coupon Purchase
Release Time: 10:30 AM
Close Time: 11:00 AM
Settlement Date: 02/22/2010
Total Par Amt Accepted (mlns) : $946
Total Par Amt Submitted (mlns) : $3,154
Where do you suppose the Fed got the money to buy those Agency Bonds????
The Discount Rate Hike spin as retraction of liquidity was a canard.
end.
Consumer prices rose less than expected but they always doctor the figures:
Consumer prices rise less than expected in January
WASHINGTON (Reuters) - Consumer prices rose less than expected in January, while prices excluding food and energy fell for the first time since 1982, according to a government report on Friday that soothed worries inflation pressures were starting to build up.
The Labor Department said its seasonally adjusted Consumer Price Index rose 0.2 percent last month, lifted by a spike in energy costs, after rising 0.2 percent in December.
Analysts polled by Reuters had forecast consumer prices rising 0.3 percent in January. Compared to January last year, prices rose 2.6 percent, also below market expectations for a 2.8 percent increase.
Energy costs soared 2.8 percent last month after rising 0.8 percent in December. Food prices climbed 0.2 percent following a 0.1 percent gain in December.
A surprise surge in prices paid at the farm and factory gate last month, owing to higher gasoline costs, had fanned fears that inflation pressures could soon weigh on the economy, which is recovering from the most brutal recession in 70 years.
Stripping out volatile energy and food prices, the closely watched core measure of consumer inflation fell 0.1 percent in January, the first decline since December 1982. Core prices rose 0.1 percent the prior month.
Analysts had expected core prices to rise 0.1 percent. Core prices were pulled down by declining costs for new vehicles, shelter and airline fares. High vacancy rates are keeping rentals depressed.
Compared to January last year, the core inflation rate rose 1.6 percent after increasing 1.8 percent in December.
-END-
From John Willliams of shadowstats.com on the release of the consumer prices: ( he is showing a 9.8% rise)
Are you interested in the real statistics and the real story?
Here they are. There are nowhere else. I am totally serious.
Commentary No. 280: January CPI, PPI, Housing Starts, Production
- Annual Inflation 2.6% (CPI-U), 3.3% (CPI-W), 9.8% (SGS)
- Quarterly Inflation Shifted from Fourth- to Second-Quarter 2009
- Economy Keeps Bottom-Bouncing as Intensified Contraction Nears
"No. 280: January CPI, PPI, Housing Starts, Production "
http://www.shadowstats.com/
USA mortgages showed their biggest delinquency rate yet running at at 15% delinquency over the 4th quarter:
US mortgages foreclosing,delinquent at 15 pct Q4-MBA
NEW YORK, Feb 19 (Reuters) - A record proportion of U.S. mortgages were in foreclosure or at least one payment past due in the fourth quarter, according to industry data showing the fragile state of the recovery in the housing market.
The Mortgage Bankers Association said on Friday the combination of loans in foreclosure and at least one payment past due was 15.02 percent on a non-seasonally adjusted basis,
the highest ever seen in the survey.
However, the delinquency rate for mortgage loans on one-to-four-unit residential properties fell to a seasonally adjusted rate of 9.47 percent of all loans outstanding as of the end of the fourth quarter of 2009, down from 9.64 percent in the third quarter, but up from 7.88 percent in the same quarter a year earlier, the MBA said in its National Delinquency Survey.
The percentage of loans on which foreclosure actions were started fell to 1.20 percent in the fourth quarter, down from 1.42 percent in the third quarter, but up from 1.08 percent in the same quarter a year earlier, the MBA said.
The U.S. foreclosure inventory rate for all loans was 4.58 percent in the fourth quarter, up from 4.47 percent in the third quarter and from 3.30 percent in the fourth quarter of 2008.
The records are based on MBA data dating back to 1972.
end.
This was certainly not welcomed news for our bankers as they are seeing their balance sheet crumble as their collateral dissipates away.
end
As many of you know, I like the Trimtabs data on the economy as they use tax receipts as opposed to survey to get their data on the unemployed.
Today we got a glimpse of the tax receipts so far this year. Witholding taxes are running 13.1% behind last year (year over year).
Total individual tax recepits are faring worse: down by almost 17%.: Here is the story:
more on tax receipts
For Jan 10
Withholdings y/y: -13.1%
Total Individual Tax Receipts y/y: -16.8%
Still no improvement with comps getting easier. Tout tv keeps telling us everything is getting better, but it is pretty clear that the economy is continuing to decline at a 15% annualized rate.
Jeff
Source:
http://www.fms.treas.gov/mts/index.html
We are now hearing that many cities wish to enter Chapter 9 as they cannot fund their operations:
Muni Threat: Cities Weigh Chapter 9
By IANTHE JEANNE DUGAN And KRIS MAHERJust days after becoming controller of financially strapped Harrisburg, Pa., in January, Daniel Miller began uttering an obscure term that baffled most people who had never heard it and chilled those who had: Chapter 9.
The seldom-used part of U.S. bankruptcy law gives municipalities protection from creditors while developing a plan to pay off debts. Created in the wake of the Great Depression, Chapter 9 is widely considered a last resort and filings under it are more taboo than other parts of bankruptcy code because of the resulting uncertainty for everyone from municipal employees to bondholders.
The economic slump, however, is forcing debt-laden cities, towns and smaller taxing districts throughout the U.S. to consider using Chapter 9. As their revenue declines faster than expenses, some public entities are scrambling to keep making payments on municipal bonds. And that is causing experts to worry about the safety of securities traditionally considered low risk.
People believe that municipal debt is safe based on assumptions that are no longer true," says Kenneth Buckfire, managing director and chief executive of Miller Buckfire & Co., an investment bank that has worked with corporations on restructurings and now is advising municipalities. For example, it isn't safe to assume that governments can raise taxes to cover shortfalls, he says...
V&V Corporate Investments Inc.
Pete Yore President
end
I pointed this out to you on Thursday, It is a big story and will certainly hit Californians big time:
Anthem Insurance-Rate Hikes Point to Broken Health System
By KATE PICKERT Kate Pickert – Thu Feb 18, 7:15 pm ET
Californians with individual health-insurance policies from Anthem Blue Cross must have breathed a collective sigh of relief on Feb. 13. Under heavy pressure from the state insurance commissioner and the Obama Administration, the company announced that it would delay a set of dramatic rate hikes. In the meantime, at the request of the commissioner, independent actuaries will review the company's books and investigate whether one-year premium increases of up to 39% are legal and justifiable. Surely they can't be, right
Well, actually, rate hikes from Anthem Blue Cross, a for-profit company, will probably still happen, according to actuaries and other experts with extensive knowledge of the individual health insurance market, in which the company operates. The best that Anthem Blue Cross customers in California can probably hope for, say these experts, is that the rate hikes will be less dramatic than what the company first proposed.
http://news.yahoo.com/s/time/20100219/us_time/08599196498800
As many of you know, I filed a complaint to the CFTC on the silver manipulation. On Wednesday, I asked why they totally left off the number of banks who are short the silver metal off the banking participation report.
For many years, on the first Tuesday of the month, the CFTC prepares its banking participation report in all commodities whereby it lists the inherent risks to the banks who have gone short.
It was here that we first discovered that only two banks went massively short in silver (20% of wordly production) namely JPMorgan and HSBC and 12% of worldly gold production.
For the first time ever in their history, the CFTC redacted the massive silver banking short.
I wrote to the CFTC last week on this matter and copied Bill Murphy. They responded to me and I would like to share this with you.
I also responded to the letter to Mr Gensler, the chairman of the CFTC in one email and the lawyer of the enforcement who wrote the email to me Laura Gardy.
Just in and it is a bombshell beauty from the CFTC….
Inquiry regarding Bank Participation Report
Dear Messrs. Organ and Murphy,
Commissioner Chilton asked that I look into your issue regarding the CFTC Bank Participation Report (the "BPR"). Specifically, you noticed that beginning with the December 2009 BPR, the CFTC has not included a breakdown of the participating banks in the silver futures, although the breakdown is provided for gold. You had inquired as to why the information has changed.
Beginning with the December 2009 BPR, the CFTC began suppressing the trader count in some markets. The change became effective with the Dec 2009 BPR because it was the next available report to be published following the Commission's November 2009 decision to implement the change. The decision to suppress the trader counts was made as part of an ongoing review of the methodology of the BPR. As part of that review, the Commission determined that where the number of banks in each reporting category is particularly small, fewer than four banks, there exists the potential to extrapolate both the identity of individual banks and the bank's positions. Under section 8(a) of the Commodity Exchange Act, the Commission, among other things, is generally prohibited from publishing data and information that would separately disclose the business transactions or market positions of any person/entity. Accordingly, in order to protect the confidentiality of market participants' positions, the Commission determined to suppress the individual category breakdown when that number is less than four. An explanation of this determination appears in the Explanatory Notes section of the BPR as it appears on the CFTC website, www.cftc.gov. I have cut and pasted the language below for your convenience. The Explanatory notes appear at: http://www.cftc.gov/marketreports/bankpa
rticipation/bankparticipation_about.html. Notably, these Explanatory Notes were posted on November 30, 2009, prior to the release of the amended BPR.
I took a look at the January 2010 BPR, and noted that the change has affected the reporting on several commodities including soybeans, wheat, corn, heating oil, natural gas, etc., such that silver has not been treated in a manner inconsistent with the report structure.
I hope this explanation is helpful. Please do not hesitate to contact me if you have any further questions.
Regards,
Laura Gardy
Legal Assistant to Commissioner Bart Chilton
202-418-5354
Here is an explanation as to the particulars of the Banking Participation Report:
Bank Participation Report
Explanatory NotesSince the 1980s, the CFTC has provided, on a monthly basis, the U.S. banking authorities and the Bank for International Settlements (BIS, located in Basel, Switzerland) aggregate large-trader positions of banks participating in various financial and non-financial commodity futures. Since the BIS used some of this aggregate data in its own publications, beginning in the late '90s the CFTC has posted the "Bank Participation Report" (BPR) for public access on its website (cftc.gov).
Separate reports are generated for futures and for gross options (not delta adjusted). The as-of date of the monthly BPR is typically the first Tuesday of each month, and publication on the Commission's website occurs on the following Thursday or Friday. The BPR includes data for every market where five or more banks hold reportable positions. The BPR breaks the banks' positions into two categories—U.S. Banks and Non-U.S. Banks—and shows for each type their aggregate gross long and short market positions. For purposes of protecting the confidentiality of participants' market positions (as required under §8(a) of the Commodity Exchange Act), when the number of banks in either category (U.S. Banks or Non-U.S. Banks) is less than four, the number of banks in each of the two categories is omitted and only the total number of banks is shown for that market.The BPR is based on the same large-trader reporting system database that CFTC economists use to monitor large-trader activity in the regulated futures and options markets, and which also is used to generate the weekly Commitment of Traders (COT) report. The BPR's "U.S. Bank" and "Non-U.S. Bank" trader classifications are based on the self-description of a trading entity on its CFTC Form 40. Each trader files that Form upon first becoming reportable and every two years the trader remains reportable, or more frequently upon CFTC request.If any reportable trader is "commercially engaged in business activities hedged by use of the futures or option markets," it enumerates its business activities on Schedule 1 of the Form 40. If on that Schedule the reportable trader describes itself as a U.S. Commercial Bank or as a Non-U.S. Commercial Bank in any one commodity, that designation is applied to its positions in all commodities published in the BPR. A given business enterprise may have one or more trading entity among which are a U.S Commercial Bank or a Non-U.S. Commercial Bank, or a non-bank. Each trading entity could be a separate reportable trader, which would file a separateForm 40. Only traders that are classified as either a U.S. Commercial Bank or a Non-U.S. Commercial Bank are reported in the BPR.The CFTC does not maintain a history of BPR data except for the rolling most recent 25 months posted on the Commission's website.
end/
This is the data that the BIS uses to calculate bank risks from overexposure to shorts and it is the very data that Reg Howe uses to discuss the risks to the banks in his papers.
I will now show you my response to Mr Gensler and to Ms Gardy:
Dear Mr Gensler:In my letter to you on Wednesday, I surmised correctly that the reason for the removal of the number of banks engaged in the massive short of silver was that we could deduce who were the guilty parties in their suppresion . I wrote to you stating that it was my belief and many others that JPMorgan and/or HSBC were probably giving you a mouthful and demanding that you omit this very important banking number.You will note that in the treasury OTC report, these two banks are named in full view and they control 95% of the total derivatives in the precious metals and their holdings dwarf the entire notional open interest in gold and silver on the comex exchange in NY. Thus, as you state correctly to me, it would be easy to extropolate that these two characters, JPMorgan and HSBC, are the same ones doing the manipulating and are the identical duo in the banking participation report that you needed to redact.I stand by what I emailed you earlier in the week: you are protecting the interests of these two banks who are engaging in criminal manipulation ahead of your sworn duties to protect the interests of investors.I are truly alarmed by your statement to me and let your response to me stand for your apparent lack of interest in safeguarding the interests of ordinary investors.I enclose a commentary by Adrian Douglas whose views on the matter parallel mine.SincerelyHarvey Organ BScPhm. MBAPlease file this complaint in the same manner as my earlier emails to you.
and to Ms Gardy:
Dear Laura:I responded to your email as I addressed my concerns to Mr Gensler.There is no question that the legal and regulatory staff are getting the heat from the powerful banks, JPMorgan and HSBC. I guess the heat is also getting to our two banker friendsJPMorgan and HSBC, from the public, as they do not like to see their names in the floodlights with manipulation of markets.May I remind your legal staff, that your duty is to the public and not the bankers.If criminal manipulation has occurred, you should be asking the pointed questions to ascertain how on earth they could attain a massive 20% of the world's silver production and how this is not manipulative?You are engaging in a similar exercise with the energy complex as it is your desire to place position limits to prevent such manipulation.Your desire is to prevent such concentration from manipulating prices in the energy complex.Yet you refuse to ask or pry into the affairs of JPMorgan and their massive short position in silver and gold. J{PMorgan claims that their short position is nothing but a hedge. Yet you never ask them to show you their "hedge" which simply does not exist according to the BIS data. This is nothing but an outright lie and you know it.The investigation on the silver manipulation by the enforcement arm of the CFTC has now exceeded 18 months and we have yet to see a response from them.Smells pretty fishy to me!!I am available to discuss these matters.This email should be filed and be open for public scrutiny.SincerelyHarvey Organend.
This is Adrian Douglas's commentary on the email to Murphy and myself:
GATA's Adrian Douglas responds...
Bill,
Game, set and match!Yesterday I sent an email to you that explained that HSBC and JPM are NAMED in the Treasury Department OCC Report on the holdings of derivatives by American banks. These reports show that these two banks hold more than 95% of the derivatives in precious metals but that these holdings dwarf the entire open interest notional value of gold and silver on the COMEX. I noted that as ONLY two banks hold a massive short position on the COMEX, it a very logical inference that these two banks are necessarily the same. That is to say that HSBC and JPM ARE the massive short sellers on the COMEX. Voila, just 24 hours later the CFTC confirms it for us because they say that it would be possible to extrapolate who the banks are that hold the positions. How could it be extrapolated? It would have to be from some other positional data that is made public. The only data of that nature that I know of is the OCC derivatives data.
Note the word used by the CFTC "suppress". Yes, that is the word GATA uses in talking about the gold market. It is suppressed and the CFTC is now complicit is suppressing the identity of the banks who are suppressing the price. Why are entities that have a manipulative, one-sided position (the banks hold almost no long position) be entitled to anonymity?
This is worse than the ex-Soviet Union. How can a Bank Participation Report SUPRESS the participation of banks???? Does nobody at the CFTC realize how comical that is?
I now expect that someone will contact the Treasury and get the names of the largest derivative holders to be "suppressed" in the OCC US Bank Derivatives report.
Cheers
Adrianend.
In international news, we are hearing more stories that the risk to Britain defaulting is greater than of Greece:
Britain at risk of worse deficit crisis than Greece
Britain is at risk of a Government deficit crisis worse than that of Greece, sparking serious fears over the economic stability of the country.
Edmund Conway and James Kirkup
Published: 10:43PM GMT 18 Feb 2010In surprise news which sent the pound sliding on Thursday, official figures showed that the Government borrowed £4.3 billion last month.
It was the first time since 1993 that the public finances had gone into the red in January – a month in which tax revenues usually push the Exchequer into the black.
Economists said that the scale of the shortfall in the budget could this year mount to above £180 billion – higher than even the Chancellor's forecast of a record £178 billion.
Such a deficit would, at 12.8 per cent of British gross domestic product, be even greater than the deficit faced in Greece, which is facing a full-scale fiscal crisis and may need to be bailed out by fellow euro nations or the International Monetary Fund.
The public borrowing figures coincided with further bad news from the housing market, as the Council of Mortgage Lenders reported that mortgage lending dropped last month by 32 per cent, hitting the lowest monthly total in a decade.
The Bank of England also reported a decline in lending to businesses, indicating that the economic slowdown is far from over.
I wish everyone a grand weekend.On a personal note, I wish a very happy birthday to my bride of 39 years, my wife Daliah.
see you on Monday.
Harvey.
