Juggling Dynamite

A new website and on line book chronicles the critical role that JP Morgan played in Bernie Madoff’s $64 billion fraud. Of course no individuals at the bank were charged.  And after successfully negotiating the DOJ down to a deferred prosecution agreement on a two-count felony Information for the bank’s role, CEO and Chairman Jamie Dimon received a 74% pay raise. Good work indeed!

See JP Madoff.com for more details and some suggested steps on how individuals can protest the immunity now repeatedly granted the world’s biggest banksters.

“This is a book about JPMorgan Chase. It is, therefore, a book about greed, corruption, arrogance and power. And it is also a book about Bernie Madoff. Few people realize the link between America’s biggest bank and America’s biggest crook. Our government, which knows about it and should be the most outraged, doesn’t care. Although it announced criminal charges against the bank for two felony violations of the Bank Secrecy Act, it simultaneously entered into a deferred prosecution agreement with the bank, suspending an indictment for two years provided that the bank complies with the law in the future.1 As if JPMorgan Chase, with its armies of high-priced lawyers, didn’t know how to comply with the 1970 Bank Secrecy Act in 44 years. It needs another two years to figure out how to comply with the law!

Our government did not require that a single JPMorgan Chase employee face criminal charges . . . or even lose his job. In deferring the indictment against the bank, the United States government may have feared that JPMorgan Chase is too big to fail. But surely JPMorgan Chase, with 240,000 employees, can survive without the handful of officers who sheltered Madoff from the law for 20 years and, as the bank has acknowledged, violated the law.2 Are these officers too rich to jail? How did we become a country where powerful employers can purchase immunity from criminal prosecution for their employees?

Since the government won’t protect you, the purpose of this book is to give you the information you need to protect yourselves: when bankers act like gangsters, you should treat them like gangsters, even if the government won’t. And the last thing you should do is trust them with your money.”

With the majority of baby boomers under-saved and struggling to earn stable income for retirement, a very common plan is to downsize expensive real estate in order to raise cash. Indeed, with the leading edge of boomers just about to turn 70, the swell of interested sellers is just getting started. The question is who can afford to buy or even rent at these prices?

The real estate market in Calgary has left some people without a lot of choice, with many forced to pull their property off the sellers’ market and try to recoup their costs by renting.

It’s an option that has seen exponential growth, particularly in higher-end homes. Here is a direct video link.

While sell-side automatons explain why this morning’s big miss in payrolls is no big deal and the economic expansion (already one of the longest–although weakest–in history) is about to accelerate every day now, we offer a couple of big picture charts for sober consideration.  US factory orders here since 1990, comparing the downturn year to date (far right) with readings over the last 3 business cycles.

And this one of US and German 10 year government bond yields over the past 6 years.

Tightly correlated for many years, the yields of both countries rejected inflationary expectations since 2011 and fell throughout economic ‘recovery’.  After a short rebound when the US Fed rolled out QE3 experiments in 2012 (blue dot), yields resumed their downward trend in 2013.

Yawning at the inflation forecasts of bankers everywhere, the bond market continues to price for further economic weakness and deflationary pressures ahead.  With the US 10-year breaking below 2% again this morning, US yields still have significant downside if they are to rejoin Germany’s in the months ahead. How low can they go?  Commodity prices are answering:  a lot lower for longer than most imagine possible.