STOCK MARKET WATCH -- Thursday, 16 July 2015

[Tansy_Gold]

[font size=3]STOCK MARKET WATCH, Thursday, 16 July 2015[font color=black][/font]

SMW for 15 July 2015

AT THE CLOSING BELL ON 15 July 2015
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Dow Jones 18,050.17 -3.41 (-0.02%)
S&P 500 2,107.40 -1.55 (-0.07%)
Nasdaq 5,098.94 -5.95 (-0.12%)


[font color=green]10 Year 2.35% -0.07 (-2.89%)
30 Year 3.14% -0.06 (-1.88%) [font color=black]


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Matt Taibi: Secret and Lies of the Bailout


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[font color=red]Partial List of Financial Sector Officials Convicted since 1/20/09 [/font][font color=red]
2/2/12 David Higgs and Salmaan Siddiqui, Credit Suisse, plead guilty to conspiracy involving valuation of MBS
3/6/12 Allen Stanford, former Caribbean billionaire and general schmuck, convicted on 13 of 14 counts in $2.2B Ponzi scheme, faces 20+ years in prison
6/4/12 Matthew Kluger, lawyer, sentenced to 12 years in prison, along with co-conspirator stock trader Garrett Bauer (9 years) and co-conspirator Kenneth Robinson (not yet sentenced) for 17 year insider trading scheme.
6/14/12 Allen Stanford sentenced to 110 years without parole.
6/15/12 Rajat Gupta, former Goldman Sachs director, found guilty of insider trading. Could face a decade in prison when sentenced later this year.
6/22/12 Timothy S. Durham, 49, former CEO of Fair Financial Company, convicted of one count conspiracy to commit wire and securities fraud, 10 counts of wire fraud, and one count of securities fraud.
6/22/12 James F. Cochran, 56, former chairman of the board of Fair, convicted of one count of conspiracy to commit wire and securities fraud, one count of securities fraud, and six counts of wire fraud.
6/22/12 Rick D. Snow, 48, former CFO of Fair, convicted of one count of conspiracy to commit wire and securities fraud, one count of securities fraud, and three counts of wire fraud.
7/13/12 Russell Wassendorf Sr., CEO of collapsed brokerage firm Peregrine Financial Group Inc. arrested and charged with lying to regulators after admitting to authorities he embezzled "millions of dollars" and forged bank statements for "nearly twenty years."
8/22/12 Doug Whitman, Whitman Capital LLC hedge fund founder, convicted of insider trading following a trial in which he spent more than two days on the stand telling jurors he was innocent
10/26/12 UPDATE: Former Goldman Sachs director Rajat Gupta sentenced to two years in federal prison. He will, of course, appeal. . .
11/20/12 Hedge fund manager Matthew Martoma charged with insider trading at SAC Capital Advisors, and prosecutors are looking at Martoma's boss, Steven Cohen, for possible involvement.
02/14/13 Gilbert Lopez, former chief accounting officer of Stanford Financial Group, and former controller Mark Kuhrt sentenced to 20 yrs in prison for their roles in Allen Sanford's $7.2 billion Ponzi scheme.
03/29/13 Michael Sternberg, portfolio mgr at SAC Capital, arrested in NYC, charged with conspiracy and securities fraud. Pled not guilty and freed on $3m bail.
04/04/13 Matthew Marshall Taylor,fmr Goldman Sachs trader arrested, charged by CFTC w/defrauding his employer on $8BN futures bet "by intentionally concealing the true huge size, as well as the risk and potential profits or losses associated."
04/04/13 Matthew Taylor admits guilt, makes plea bargain. Sentencing set for 26 June; faces up to 20 years in prison but will likely only see 3-4 years. Says, "I am truly sorry."
04/11/13 Ex-KPMG LLP partner Scott London charged by federal prosecutors w/passing inside tips to a friend in exchange for cash, jewelry, and concert tickets; expected to plead guilty in May.
08/01/13 Fabrice Tourré convicted on six counts of security fraud, including "aiding and abetting" his former employer, Goldman Sachs
08/14/13 Javier Martin-Artajo and Julien Grout charged with wire fraud, falsifying records, and conspiracy in connection with JP Morgan's "London Whale" trade.
08/19/13 Phillip A. Falcone, manager of hedge fund Harbinger Capital Partners, agrees to admit to "wrongdoing" in market manipulation. Will banned from securities industry for 5 years and pay $18MM in disgorgement and fines.
09/16/13 Javier Martin-Artajo and Julien Grout officially indicted on charges associated with "London Whale" trade.
02/06/14 Matthew Martoma convicted of insider trading while at hedge fund SAC (Stephen A. Cohen) Capital Advisors. Expected sentence 7-10 years.
03/24/14 Annette Bongiorno, Bernard Madoff's secretary; Daniel Bonventre, director of operations for investments; JoAnn Crupi, an account manager; and Jerome O'Hara and George Perez, both computer programmers convicted of conspiracy to defraud clients, securities fraud, and falsifying the books and records.
05/19/14 Credit Suisse, which has an investment bank branch in NYC, agrees to plead guilty and pay appx. $2.6 billion penalties for helping wealthy Americans hide wealth and avoid taxes.
09/08/14 Matthew Martoma, convicted SAC trader, sentenced to 9 years in prison plus forfeiture of $9.3 million, including home and bank accounts







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[font size=3][font color=red]This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.[/font][/font][/font color=red][font color=black]

[Demeter]

1. Tsipras should now try to create time and breathing space to lead Greece out of the European Union

http://www.telesurtv.net/english/opinion/Greece-and-the-Union-of-Bullies-20150714-0017.html

The FT reports how, having reached an impasse in their negotiation, around 6 a.m., Merkel and Tsipras went to leave the room and President of the European Council Donald Tusk physically prevented them, saying “there is no way you are leaving this room”...Alone, sleepless, with other leaders reportedly taking turns on him in a process which one EU official described as “extensive mental waterboarding”, looking like “a beaten dog”, Tsipras finally succumbed. In any ordinary circumstances, in most legal jurisdictions, such an agreement would be considered void; obtained by coercion and under duress. In Euroland, it seems, such considerations do not apply.

Within the hard black and white reality of fat-lettered newspaper headlines, of adoration and condemnation, of twitter’s one-hundred-and-forty characters, everything is binary. Alexis Tsipras must be either praised as hero or condemned as villain; idolized as the Messiah or reviled as Judas. As I have written previously he is neither. He is just a man under an enormous amount of pressure, trying to reconcile a Greek mandate – to do away with austerity, but remain within the eurozone – which turned out to be irreconcilable. Much more cogent is the charge that Syriza should have known that such a promise was undeliverable when they made it. I do not subscribe to the view that this was done deliberately. That they inflated the hopes of a people, already betrayed so many times, intending to betray them again. Nothing in their behavior these last six months evidences that. On the contrary, time after time, I saw a government totally shocked by the behaviour of people who were meant to be our family, our friends and allies.

I saw in their eyes the look of someone stunned by an abusive partner. The very commentators claiming that this behavior was completely predictable also claim they have never seen anything like it and that Europe has changed fundamentally. Nevertheless, this cruelty is now a matter of record. We had all hoped for a Greek Spring. Instead, we got a German Winter. Yet, everyone has turned on the victim of this violent assault for not locking their door, for wearing too short a skirt, for not fighting back harder, while the criticism of the perpetrator seems to have dissipated.

The idea of Tsipras as a "traitor" relies heavily on a cynical misinterpretation of the referendum last week. "OXI", the critics would have you believe, was "no" to any sort of deal; an authorization to disorderly Grexit. It was nothing of the sort. In speech after speech Tsipras said again and again that he needed a strong "OXI" to use as a negotiating weapon in order to achieve a better deal. Now, you may think he didn't achieve a better deal - that may be a fair criticism - but to suggest the referendum authorized Grexit is deeply disingenuous. And what about the 38% that voted "NAI"? Was Tsipras not there representing those people, too?

Fear not. The deal may prove unworkable anyway. It may not be passed by Greek Parliament. Syriza might tear itself apart from within. Expulsion from the Euro may be forced by those who have been trying to make it happen for years now, both within and outside Greece’s borders. Then we may get to assess what this other outcome, of violent Grexit and disorderly default, looks like. A constant strand of criticism which has surfaced clearly in the last couple of days is that which claims Tsipras should have had a Plan B, should have prepared for an alternative currency, for the Drachma. This is fanciful. First, it ignores the fact that Tsipras had no such mandate. Public opinion in Greece had been consistently, doggedly and emotionally attached to the Euro. Any attempt to make advanced contingency planning for such an event would have undoubtedly made things worse in multiple ways. A hostile media, both within Greece and internationally, would present this as evidence that the Greek government was not serious about negotiation, but had always planned to lead Greece to Grexit. They did so, to a large extent, anyway – the thrust of the “yes” vote in the referendum was to suggest that a “no” meant leaving the Euro.

The slightest move to organise and print an alternative currency, to stockpile supplies, to practically take the necessary steps, would be interpreted as an act of aggression. The narrative of Greece being blackmailed by Europe would have instantly flipped to one of Greece being the blackmailer. The government would have fallen within days. It is completely legitimate to say that the Tsipras government went into negotiations far too naively. Even that, however, was down to the right sorts of reasons. I cannot condemn Syriza for having believed that the European Union was what it claimed to be: a partnership of equals, within which democracy mattered, sovereignty was pooled consensually and steps to come closer were irrevocable. In one horrific night, Germany and its allies within the Eurozone demolished that illusion. They asserted their dominion, wrested sovereignty by coercion and under threat of revoking Greece’s status.

As Fintan O’Toole wrote in the Irish Times, there was another, unspoken condition: “that Germany would restrain itself, accepting, in return for the immense gift of a new beginning that its fellow European countries had given it, that it must refrain from ever trying to be top dog again.” Many believe that this, too, has been totally trashed. How will this play out, I wonder, in the context of the upcoming in-out UK referendum? Badly, I would venture.

We now know what this new European Union looks like. Spain’s Podemos can adjust its offering to the electorate, accordingly. Be upfront about the possibility of exiting the currency. Go into their negotiations with eyes open. In Greece too, from hundreds of conversations over the last few days, I have the impression that public opinion has shifted significantly. Tsipras now can try to create the time and breathing space, away from the glare of the negotiation, to argue, to convince, to plan, to print. And to lead Greece out of this Union of Bullies.

This content was originally published by teleSUR at the following address:
http://www.telesurtv.net/english/opinion/Greece-and-the-Union-of-Bullies-20150714-0017.html. If you intend to use it, please cite the source and provide a link to the original article. www.teleSURtv.net/english

[Demeter]

2. Understanding Organizational Stupidity By Dmitry Orlov FROM SEPTEMBER

http://www.informationclearinghouse.info/article39686.htm

Is it morning in America again, or is the bubble that is the American economy about to pop (again), this time perhaps tipping it into full-blown collapse in five stages with symphonic accompaniment and fireworks? A country blowing itself up is quite a sight to behold, and it makes us wonder about lots of things. For instance, it makes us wonder whether the people who are doing the blowing up happen to be criminals. (Sure, they may be in a manner of speaking—as a moral judgment passed on the powerful by the powerless—but since none of them are likely to see the inside of a jail cell or even a courtroom any time soon, the point is moot. Let's be sure to hunt them down once they try to run and hide, though.) But at a much more basic and fundamental level, a better question to ask is this one:

“Why are we being so fucking stupid?”

What do I mean when I use the term “fucking stupid”? I do not mean it as a term of abuse but as a precise, if unflattering, diagnosis. Here is as good a definition as any, excerpted from American Eulogy by Jim Quinn:

If you had told someone on September 10, 2001 that ten years later America would be running $1.5 trillion annual deficits, fighting two wars of choice in countries that despise our presence, and had not only not addressed the $100trillion of unfunded welfare liabilities but added billions more with Medicare D and Obamacare, they would have thought you were a crazy doomster predicting the end of the world. They would have put you away in a padded cell if you had further predicted that politicians would cut taxes three separate times, that the Wall Street banks that leveraged themselves 40 to 1 and destroyed the financial system would be handed $2 trillion of taxpayer funds so they could pay themselves multi-million dollar bonuses, and that the Federal Reserve would triple its balance sheet to $2.45 trillion by running its printing presses at hyper-speed and handing the money to those same Wall Street Mega-Banks.

Well, the evidence is in, and that crazy doomster in his padded cell has turned out to be amazingly prescient, so perhaps we should listen to him. And what would that crazy doomster have to say now? I would venture to guess that it would be something along these lines:

There is no reason to think that those who failed to take corrective action up until now, but remain in control, will ever do so. But it should be perfectly obvious that this situation cannot continue ad infinitum. And, as a matter of general principle, things that can't go on forever—don't.

Back to the question of stupidity: Why are we (as a country) being so fucking stupid? This question has puzzled me for some time. It appears that the problem of stupidity is quite pervasive: look at any large human organization, and you will find that it is ruled by stupidity. I was not the first to stumble across the conjecture that the intelligence of a hierarchically organized group of people is inversely proportional to its size, but so far the mechanism that makes it so has eluded me. Clearly, there is something amiss with hierarchically organized groups, something that causes all of them to eventually collapse, but what exactly is it? To try to get at this question, last year I spent quite a while researching anarchy, and wrote a series of articles on it. I discovered that vast hierarchies do not occur in nature, which is anarchic and self-organizing, with no chains of command and no entities in supreme command. I discovered that anarchic organizations can go on forever while hierarchical ones inevitably end in collapse. I examined some of the recent breakthroughs in complexity theory, which uncovered the laws governing the different scaling factors in natural (anarchically organized, efficient, stable) systems and unnatural (hierarchically organized, inefficient, collapse-prone) ones.

But nowhere did I find a principled, rigorous explanation for the fatal flaw embedded in the very nature of hierarchical systems. I did have a very strong hunch, though, backed by much anecdotal evidence, that it comes down to stupidity. In anarchic societies whose members cooperate freely, intelligence is additive; in hierarchical organizations structured around a chain of command, intelligence is subtractive. The lowest grunts or peons are expected to carry out orders unquestioningly. Their critical faculties are 100% impaired; if not, they are subjected to disciplinary action. The supreme chief executive officer may be of moderately impaired intelligence, since it is indicative of a significant character flaw to want such a job in the first place. (Kurt Vonnegut put it best: “Only nut cases want to be president.”) But beyond that, the supreme leader must act in such a way as to keep the grunts and peons in line, resulting in further intellectual impairment, which is compounded across all of the intervening ranks, with each link in the chain of command contributing a bit of its own stupidity to the organizational stupidity stack.

I never ascended the ranks of middle management, probably due to my tendency to speak out at meetings and throw around terms such as “nonsensical,” “idiotic,” “brainless,” “self-defeating” and “fucking stupid.” If shushed up by superiors, I would resort to cracking jokes, which were funny and even harder to ignore. Neither my critical faculties, nor my sense of humor, are easily repressed. I was thrown at a lot of special projects where the upside of being able to think independently was not negated by the downside of being unwilling to follow (stupid) orders. To me hierarchy = stupidity in an apparent, palpable way. But in explaining to others why this must be so, I had so far been unable to go beyond speaking in generalities and telling stories.

And so I was happy when I recently came across an article which goes beyond such “hand-waving analysis” and answers this question with some precision. Mats Alvesson and André Spicer, writing in Journal of Management Studies (49 November 2012) present “A Stupidity-Based Theory of Organizations” in which they define a key term: functional stupidity. It is functional in that it is required in order for hierarchically structured organizations to avoid disintegration or, at the very least, to function without a great deal of internal friction. It is stupid in that it is a form intellectual impairment: “Functional stupidity refers to an absence of reflexivity, a refusal to use intellectual capacities in other than myopic ways, and avoidance of justifications.” Alvesson and Spicer go on to define the various “...forms of stupidity management that repress or marginalize doubt and block communicative action” and to diagram the information flows which are instrumental to generating and maintaining sufficient levels stupidity within organizations. What follows is my summary of their theory. Before I start, I would like to mention that although the authors' analysis is limited in scope to corporate entities, I believe that it extends quite naturally to other hierarchically organized bureaucratic systems, such as governments.

Alvesson and Spicer use as their jumping-off point the major leitmotif of contemporary management theory, which is that “smartness,” variously defined as “knowledge, information, competence, wisdom, resources, capabilities, talent, and learning” has emerged as the main business asset and the key to competitiveness—a shift seen as inevitable as industrial economies go from being resource-based to being knowledge-based. By the way, this is a questionable assumption; do you know how many millions of tons of hydrocarbons went into making the smartphone? But this leitmotif is pervasive, and exemplified by management guru quips such as “creativity creates its own prerogative.” The authors point out that there is also a vast body of research on the irrationality of organizations and the limits to organizational intelligence stemming from “unconscious elements, group-think, and rigid adherence to wishful thinking.” There is also no shortage of research into organizational ignorance which explores the mechanisms behind “bounded-rationality, skilled incompetence, garbage-can decision making, foolishness, mindlessness, and (denied) ignorance.” But what they are getting at is qualitatively different from such run-of-the-mill stupidity. Functional stupidity is neither delusional nor irrational nor ignorant: organizations restrict smartness in rational and informed ways which serve explicit organizational interests. It is, if you will, a sort of “enlightened stupidity”:

Functional stupidity is organizationally-supported lack of reflexivity, substantive reasoning, and justification. It entails a refusal to use intellectual resources outside a narrow and “safe” terrain. It can provide a sense of certainty that allows organizations to function smoothly. This can save the organization and its members from the frictions provoked by doubt and reflection. Functional stupidity contributes to maintaining and strengthening organizational order. It can also motivate people, help them to cultivate their careers, and subordinate them to socially acceptable forms of management and leadership. Such positive outcomes can further reinforce functional stupidity.

The terms I italicized are important, so let's define each one:

Reflexivity refers to the ability and willingness to question rules, routines and norms rather than follow them unquestioningly. Is your corporation acting morally? Well it doesn't matter, because “what is right in the corporation is what the guy above you wants from you.” The effects of this attitude tend to get amplified as information travels (or, in this case, fails to travel) down the chain of command: your immediate superior might be a corrupt bastard, but your supreme leader cannot possibly be a war criminal.

Justification refers to the ability and willingness to offer reasons and explanations for one's own actions, and to assess the sincerity, legitimacy, and truthfulness of reasons and explanations offered by others. In an open society that has freedom of expression, we justify our actions in order to gain the cooperation of others, while in organizational settings we can simply issue orders, and the only justification ever needed is “because the boss-man said so.”

Substantive reasoning refers to the ability and willingness to go beyond the “small set of concerns that are defined by a specific organizational, professional, or work logic.” For example, economists tend to compress a wide range of phenomena into a few numbers, not bothering to think what these numbers actually represent. Organizational and professional settings discourage people from straying from the confines of their specializations and job descriptions, in essence reducing their cognitive abilities to those of idiot-savants.

Functional stupidity can arise spontaneously, because there are many subjective factors which motivate people within organizations to narrow their thinking to the point of achieving it. A certain amount of closed-mindedness can be helpful in furthering your career. It helps you present yourself as a reliable organizational person—one who would never even question the validity of the organizational or occupational paradigm, never mind stray from it. At the other extreme, your refusal to stray beyond a narrow focus may be prompted by feelings of anxiety, insecurity, and fear of jeopardizing your position. And while, just as you would expect, functional stupidity produces negative outcomes for the organization as a whole, it provides for smooth social functioning within the organization itself by suppressing dangerous or uncomfortable questions and by avoiding the awkwardness of calling into question the judgment of your superiors.

But such subjective factors are dwarfed by certain stupidity-generating features of organizations. At their highest level, organizations tend to focus on purely symbolic issues such as “strong corporate cultures and identities, corporate branding, and charismatic leadership.” Corporate (and other) leaders try to project an identical internal and external image of the organization, which may have little to do with reality. This is only possible through stupidity management—the process by which “various actors (including managers and senior executives as well as external figures such as consultants, business gurus, and marketers) exercise power to block communication. The result is that adherence to managerial edicts is encouraged, and criticism or reflection on them is discouraged.”

As the people within the organization internalize this message, they begin to engage in stupidity self-management: they cut short their internal conversations, refusing to ask themselves troubling questions, and focusing instead on a positive, coherent view of their environment and their role within it. But stupidity self-management can also fail when the mismatch between the message and reality becomes too difficult to ignore, ruining morale. The suppressed reality (“The king is naked!”) can spread as a whisper, resulting in passive-aggressive behavior and deliberate foot-dragging all the way to sabotage, defections and resignations.

The functions of stupidity management are to project an image, to encourage stupidity self-management in defense of that image, and to block communication whenever anyone lapses into reflexivity or substantive reasoning, or demands justification. Communication is blocked through the exercise of managerial power. The authors discuss four major ways in which managers routinely exercise their power in defense of functional stupidity: direct suppression, setting the agenda, ideological manipulation, and fetishizing leadership. Of these, direct suppression is by far the simplest: the manager signals to the subordinate that further discussion will not be appreciated, threatening or carrying out disciplinary action if the signaling doesn't work. Setting the agenda is a more subtle technique; for instance, a typical ploy is to require that all criticisms be accompanied by “constructive suggestions,” placing beyond the pale all problems that do not have immediate solutions (which are the vast majority). Ideological manipulation is more subtle yet; one common technique is to emphasize action, at the expense of deliberation, as expressed by the corporate cliché “stop thinking about it and start doing it!” Finally, fetishizing leadership involves splitting each group into leaders and followers, where the leaders seek to make their mark, whatever it takes, and to get promoted quickly. To do so successfully, they must suppress the critical faculties of those around them, compelling them to act as obedient followers.

Functional stupidity is self-reinforcing. Stupidity self-management, reinforced using the four managerial techniques listed above, produces a fragile, blinkered sort of certainty. By refusing to look in certain directions, people are able to pretend that what is there does not exist. But reality tends to intrude on their field of perception sooner or later, and then the reaction is to retreat into functional stupidity even further: those who can ignore reality the longest are rewarded and promoted, setting an example for others.

But the spell can also be broken when the artificial reality bubble protected by the imaginary film of functional stupidity is punctured by a particularly contradictory outcome. For an individual, the prospect of unemployment or the end to one's career can produce such a sudden realization: “How could I have been so stupid?” Similarly, entire organizations can be shaken out of their stupor by a painful fiasco that subjects them to a barrage of public criticism. Public hearings in which industry leaders are forced to appear before government committees and answer uncomfortable questions can sometimes serve as stupidity-busting events. A particularly daunting challenge is to pop the functional stupidity bubble of an entire nation, since there is no public forum at which objective outsiders can force national leaders to take part in a substantive discussion. Bearing witness to the fast-approaching end of the nation as a going concern may be of help here. How could we have been so fucking stupid? Well, now you know.


Dmitry Orlov is a Russian-American engineer and a writer on subjects related to "potential economic, ecological and political decline and collapse in the United States," something he has called “permanent crisis”. http://cluborlov.blogspot.com

THANK YOU DMITRY! YOU HAVE JUST EXPLAINED WHAT IS WRONG WITH MY CONDO BOARD, A BIGGER BUNCH OF UNTHINKING HIERARCHISTS I HAVE NEVER SEEN...

AND HOW TO FIX IT, AS WELL....

I JUST LOVE ENGINEERS!

[Hotler]

12. Thank you, thank you Demeter. A very good read.

After I read it a light went on and it makes perfect sense. As with your condo board I know what is wrong with the company where I work. I will never be able to look at the three bosses have in the same way again. Every time I looked at them or interacted with them in my mind I would say " you're and idiot." It feels good to be right.

[DemReadingDU]

3. Good toon

[Demeter]

4. THE GREEK PARLIAMENT FOLDED

Greek Parliament votes in favor of bailout plan

http://www.cnbc.com/2015/07/15/crunch-time-in-greece-as-tsipras-seeks-crucial-vote.html



Greece's Parliament voted in favor of an austerity bill that paves the way for a third bailout.

Ahead of the vote, which ultimately came early Thursday morning local time, a violent protest erupted on the streets of Athens.

The vote was expected to pass, but the atmosphere was tense, with multiple politicians from within Prime Minister Alexis Tsipras's own party opposing the deal. Indeed, one of Greece's deputy finance ministers, Nadia Valavani, resigned on Wednesday...

Tsipras wins Greek vote backing bailout

PERHAPS, BUT WHO WANTS THE BOOBY PRIZE?

http://www.ft.com/intl/cms/s/0/db4d2f04-2b05-11e5-8613-e7aedbb7bdb7.html?ftcamp=published_links%2Frss%2Fhome_us%2Ffeed%2F%2Fproduct

Greece’s parliament on Thursday backed a slew of fresh austerity measures demanded by the country’s creditors, clearing the way for talks to begin on a fresh €86bn bailout package to prevent the country crashing out of the eurozone. But a rebellion inside the ruling coalition that saw 38 government MPs not back the measures raises fears that prime minister Alexis Tsipras may struggle to retain control of the government and his ruling Syriza party...Mr Tsipras prevailed with the support of 229 of Greece’s 300 MPs in a vote that took place in the early hours of Thursday morning, but was forced to rely upon the support of opposition parties to offset the mutiny in his own ranks, which could erode his parliamentary majority...Addressing his unruly party inside the chamber, Mr Tsipras called on MPs to maintain unity given the gravity of the situation, and asked them what they would have done instead.

“I was blackmailed, there were no good options and I chose the least bad, the MPs should recognise this and accept the same choice,” Mr Tsipras told lawmakers before the vote. “The government does not believe in these measures. We will do our best to protect people from measures we do not believe in but are forced to implement.”

**********
Throughout the day, there had been peaceful protests against the deal with the crowd growing by evening. The mood had been calm, with children in attendance, but later police clashed with balaclava-wearing demonstrators hurling Molotoff cocktails...In a sign of the tensions before a key parliamentary vote, radical leftist demonstrators opposed to further cuts hurled petrol bombs outside parliament and riot police used tear gas to disperse protesters, whose numbers had swelled to more than 10,000...As parliament edged closer to the vote, Syntagma square was strewn with broken glass and dotted with small fires. The smell of tear gas hung in the air.

**********

Despite the battles at home, there was some good news for Mr Tsipras from Brussels, where a cash pile to get Athens through the next week is almost prepared. EU authorities are poised to immediately disburse €7bn to Athens following the votes so it would not default on a bond due to the European Central Bank on Monday. If Greece were to default on the ECB, Frankfurt would probably be forced to pull emergency loans to Greek banks, which are the only support keeping the financial sector alive.

Under a compromise being worked out in Brussels, a long-dormant EU-wide rescue fund, known as the European Financial Stability Mechanism, would loan Athens €7bn for three months, which officials believe will be enough time for the full €86bn bailout to be finalised. Use of the EFSM, which Britain’s David Cameron thought he had killed in a 2010 summit agreement, has caused outrage in London. But Downing Street, faced with being outvoted in Brussels, has agreed to let the fund be used as long as non-euro countries are provided a guarantee against their portion of the loan. The guarantee, likely to come from a €3.6bn pool of profits on Greek bonds held by the ECB, was the last thing being hammered out in the deal.

[Demeter]

6. Greece: The Struggle Continues

https://www.jacobinmag.com/2015/07/tsipras-varoufakis-kouvelakis-syriza-euro-debt/

A definitive account of what has transpired over the last few weeks in Greece, and what’s next for Syriza and the European left. The latest agreement between the Syriza government and the creditors shocked many on the Left who have been following events in Greece. It seems to signal the end of a whole political cycle.

In this interview with Jacobin contributing editor Sebastian Budgen, Stathis Kouvelakis, a leading member of the Left Platform in the party covers the latest sequence, to what extent expectations have been confirmed or disproved, and the next steps for the radical wing of the party.

Kouvelakis uses this opportunity to reflect more broadly on the balance sheet of the Left Platform’s strategy, whether things could have been done differently, and what the prospects are for a more general left recomposition.

... in the interview he gave a couple of days ago to the New Statesman, Varoufakis says that a small team of people around him worked during the week leading to the referendum on an alternative plan including state control of the banks, issuing of IOUs and disconnection of the Greek central bank from the Frankfurt ECB, so on a sort of gradual exit. But that clearly came too late and was rejected by nearly all the rest of the economic team of the cabinet, by which he essentially means Dragasakis. And Tsipras, of course, validated that decision...

... we have to stress the continuity of the line of Tsipras. This is also the reason I think the word “betrayal” is inappropriate if we are to understand what is happening. Of course, objectively we can say that there has been a betrayal of the popular mandate, that people very legitimately feel they have been betrayed. However, the notion of betrayal usually means that at some moment you make a conscious decision of reneging on your own commitments. What I think actually happened was that Tsipras honestly believed that he could get a positive outcome by putting forward an approach centered on negotiations and displaying good will, and this also why he constantly said he had no alternative plan.

He thought that by appearing as a loyal “European,” deprived of any “hidden agenda,” he would get some kind of reward. On the other side, he showed for some months a capacity to resist to the escalating pressure and made some unpredictable moves such as the referendum or travelling to Moscow. He thought this was the right mix to approach the issue, and what happens is that when you consistently follow this line you are led to a position in which you are left only with bad choices...

THIS IS NOT YOUR GREEK 1776. IT'S A BATTLE OF ECONOMISTS AND OTHER INTELLECTUALS, WITHOUT ANY UNIFYING PRINCIPLE

THEY REALLY NEED PEOPLE LIKE THOMAS PAINE AND JOHN ADAMS....AND THEY DON'T HAVE ANYONE EXCEPT YANIS.

[Demeter]

5. Bank of America profits jump to $4.99 billion as legal costs drop sharply

WHO WOULD HAVE THOUGHT THAT ACTING WITHIN THE LAW COULD BE "PROFITABLE"?
(AT LEAST, UNTIL ONE HAS REWRITTEN OR GUTTED THE LAW, OF COURSE)

http://finance.yahoo.com/news/bank-america-profits-jump-legal-112138845.html

Bank of America's profits more than doubled in the second quarter thanks to lower legal costs and progress in resolving problems stemming from the financial crisis.

The consumer banking giant earned $4.99 billion after payments to preferred shareholders, the bank said Wednesday, up from $2.04 billion a year earlier. The bank earned 45 cents per share, compared with 19 cents per share a year earlier.

BofA's consumer banking division, its largest business by revenue and profit, earned $1.7 billion, up modestly from $1.63 billion a year earlier. The bank said an increase in deposits, lower expenses and an improving balance sheet helped offset a decline in revenue.

Financial analysts surveyed by FactSet expected the bank to earn 36 cents per share, a figure which typically excludes one-time items. Revenue rose to $22.1 billion from $21.75 billion...

[Demeter]

7. European Union may ease bank capital rules to boost lending

THE EU IS A BAD PARENT...LETTING THEIR LITTLE DARLING BANKS OUT TO COMMIT MORE CRIME AFTER A BRIEF TIME-OUT...

http://www.reuters.com/article/2015/07/15/uk-eu-banks-regulations-idUKKCN0PP10D20150715

Tougher capital rules imposed on banks in the European Union since the financial crisis will be reviewed to see if they unnecessarily crimp lending, the bloc's financial services chief said on Wednesday, as Europe makes growth its top priority. Jonathan Hill said the bloc's capital requirements law may be changed to make it easier for banks to lend to companies.

Banks were found to be undercapitalised when the financial crisis began in 2007, forcing taxpayers to bail out many lenders, and a global set of tougher capital rules, known as Basel III, were subsequently approved and applied in Europe. Banks argue that the tougher rules have forced them to shore up safety buffers at the expense of lending, and several banks say the new rules have forced them to stop trading securities, making markets less liquid and more volatile.

THAT'S A FEATURE, NO A BUG. EUROPE HAS GLASS-STEAGAL, AND WE DON'T!

[Demeter]

8. JANET YELLEN IS GOING TO DO IT. SHE'S REALLY GOING TO DO IT!

Yellen Delivers Upbeat Message on the Economy

http://www.bloomberg.com/news/articles/2015-07-15/yellen-says-rate-rise-likely-in-2015-as-labor-market-improves

Federal Reserve Chair Janet Yellen delivered an upbeat message on the economic outlook to lawmakers and parried attacks from Republicans who say the central bank is too secretive and needs stronger oversight.

Yellen repeated that the Fed is likely to raise its main interest rate this year, assuming its forecasts for stronger growth and lower unemployment are realized.
OR EVEN IF THE FORECASTS ARE NOT REALIZED...THIS IS IT, FOLKS! BATTLE STATIONS!

The first rate increase in almost a decade “will signal how much progress the economy has made in healing from the trauma of the financial crisis,” Yellen, 68, told members of the House Financial Services Committee on Wednesday.

Seeking to reassure investors accustomed to more than six years of near-zero borrowing costs, she emphasized that the timing of liftoff is less important than the subsequent pace of increases, which she said would be gradual. Policy will probably remain “highly accommodative for quite some time,” she said...

DON'T YOU JUST LOVE BEING THE GUINEA PIG IN THE LABORATORY?

Yellen stands by Fed's transparency as lawmakers turn up heat

http://www.reuters.com/article/2015/07/15/us-usa-fed-yellen-idUSKCN0PP1GC20150715

Federal Reserve Chair Janet Yellen on Wednesday resisted calls for more congressional oversight, as members of a House of Representatives panel criticized the central bank's policies and pressed it to be more accountable... in the hearing before the House Financial Services Committee, monetary policy took a backseat to central bank transparency. While some lawmakers aggressively questioned Yellen, it was a gentler session than the grilling she received before the same panel in February.

The most heated exchange occurred when Representative Sean Duffy, a Wisconsin Republican, lambasted the Fed and Yellen for what he described as a failure to properly respond to the 2012 leak of sensitive information to a private financial newsletter.

Duffy pressed Yellen to explain why the Fed has failed to meet the House panel's demands to release documents related to the case.

"We've said that we plan to give (the documents) to you as soon as we're able to do so and not compromise an open criminal investigation," Yellen responded. "We want to see this investigation succeed."

THIS COULD SPELL THE END OF THE FED AS WE KNOW IT--ONE FATAL INTEREST RATE INCREASE AND A GROWING POLITICAL SCANDAL, AND IT'S

[Demeter]

9. Beyond Greece, the world is filled with debt crises

http://www.theguardian.com/business/2015/jul/11/beyond-greece-world-filled-debt-crises


Drama in Athens reflects a bigger truth: precarious countries across the globe owe trillions of dollars to lenders and investors who must be repaid

AND TOO MANY OF THOSE DEBTS ARE IN DOLLARS, MAKING US THE MOST VULNERABLE

With its shuttered banks, furious public protests and iconoclastic politicians, the plight of Greece, brought to its knees by a crippling debt burden, has been gripping and heartbreaking in equal measure: a full-blown sovereign debt crisis on the doorstep of some of the wealthiest countries in the world.

Yet new analysis by the Jubilee Debt Campaign reveals that Greece’s plight is far from unique: more than 20 other countries are also wrestling with their own debt crises. Many more, from Senegal to Laos, lie in a debt danger zone, where an economic downturn or a sudden jump in interest rates on world debt markets could lead to disaster.

One of the lessons from the 2008 crash was that hefty debt levels can leave countries vulnerable to sudden shifts in market mood. But Jubilee reports that the rock-bottom interest rates across major economies, which have been a key response to the crisis, have in many cases prompted governments, firms and consumers to go on a fresh borrowing binge, storing up potential problems for the future.

Judith Tyson of the Overseas Development Institute thinktank says the flipside of the latest round of borrowing has been investors and lenders in the west looking for bigger returns than they could get at home, a process known in the markets as a “search for yield”.

MORE

[Demeter]

10. Wholesale Prices in U.S. Increased in June as Fuel Climbed

http://www.bloomberg.com/news/articles/2015-07-15/wholesale-prices-in-u-s-increased-in-june-as-fuel-climbed

Wholesale prices in the U.S. climbed more than forecast in June as the cost of fuel picked up.

The 0.4 percent increase in the producer-price index followed a 0.5 percent gain in May, Labor Department figures showed Wednesday in Washington. The median forecast of 70 economists surveyed by Bloomberg called for a 0.2 percent advance. Costs fell 0.7 percent over the past 12 months.

A broad pickup in prices would help strengthen the case for Federal Reserve policy makers to start raising interest rates this year, as Chair Janet Yellen has indicated could be appropriate. The plunge in oil costs last year may wring itself out of the data in the coming months, helping to boost the inflation figures further.

“The profile of inflation heading into the second half of the year will actually look quite a bit more favorable,” Gennadiy Goldberg, a U.S. strategist at TD Securities USA LLC in New York, said before the report. That should work in the Fed’s favor, because “it’s much easier to communicate the need for a rate hike when inflation is starting to climb.”

MORE MAGICAL THINKING AT LINK

[mahatmakanejeeves]

11. ETA News Release: Unemployment Insurance Weekly Claims Report (07/16/2015)

Source: Department of Labor, Employment and Training Administration

Read More: http://www.dol.gov/opa/media/press/eta/eta20151375.pdf

News Release

TRANSMISSION OF MATERIALS IN THIS RELEASE IS EMBARGOED UNTIL
8:30 A.M. (Eastern) Thursday, July 16, 2015

UNEMPLOYMENT INSURANCE WEEKLY CLAIMS

SEASONALLY ADJUSTED DATA

In the week ending July 11, the advance figure for seasonally adjusted initial claims was 281,000, a decrease of 15,000 from the previous week's revised level. The previous week's level was revised down by 1,000 from 297,000 to 296,000. The 4-week moving average was 282,500, an increase of 3,250 from the previous week's revised average. The previous week's average was revised down by 250 from 279,500 to 279,250.

There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.6 percent for the week ending July 4, a decrease of 0.1 percentage point from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending July 4 was 2,215,000, a decrease of 112,000 from the previous week's revised level. The previous week's level was revised down by 7,000 from 2,334,000 to 2,327,000. The 4-week moving average was 2,264,000, a decrease of 2,500 from the previous week's revised average. The previous week's average was revised down by 1,750 from 2,268,250 to 2,266,500.

UNADJUSTED DATA

....
The total number of people claiming benefits in all programs for the week ending June 27 was 2,181,870, an increase of 33,570 from the previous week. There were 2,447,289 persons claiming benefits in all programs in the comparable week in 2014.

[MattSh]

13. Greek assets go on sale!

Greek Assets - €1 (Greece)



For sale are some recently acquired Greek Assets for sale:

Acropolis €4B OBO
Greek Parliament Building + Syntagma Square €8.5B OBO
Greek Island Aegina €10B OBO
Greek Island Mykonos €13B OBO
Athens International Airport €7B OBO

If interested, please contact:
Angela Merkel: : +49 (0)30 - 220 70-0
Wolfgang Schäuble: [phone]

Serious buyers only please.

See more at - http://berlin.craigslist.de/for/5125648403.html