Category Archives: Drama

China Feathers Ruffled as We Limit IT Imports

“BEIJING (Reuters) – China expressed “resolute opposition” and “strong dissatisfaction” with a newU.S. cyber-espionage rule limiting imports of Chinese-made information technology products, state media reported on Saturday.

The remarks underscore growing tension between the world’s top two economies after the United States accused China of backing a string of hacking attacks on U.S. companies and government agencies.

China says the accusation lacks proof and that it is also a victim of hacking attacks, more than half of which originate from the United States.

The new provision, tucked into a funding bill signed into law on Thursday, requires NASA, as well as the Justice and Commerce Departments, to seek approval from federal law enforcement officials before buying information technology systems from China.

The United States imports about $129 billion worth of “advanced technology products” from China, according to a May 2012 report by the U.S. Congressional Research Service.

State media including Xinhua, the China Daily and the People’s Daily, quoted a spokesman for the Ministry of Commerce as saying the U.S. bill “sends a very wrong signal”.

“This will directly impact partnerships of Chinese enterprises and American business as they conduct regular trade,” said Shen Danyang, the commerce ministry spokesman….”

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Slovenia Becomes the Next Sovereign Debt Target as Yields Push Over 7%

“Cyprus may be a “special case” in the eyes of European officials, but their handling of its bailout is taking a toll on another small euro zone member with an over-burdened banking sector – Slovenia.

Yields on its two-year bonds surged to nearly 7 percent on Thursday, overtaking those on longer-dated paper and inverting the yield curve – a sign investors are pricing in a high risk of default.

Slovenia issued its first bond in 19 months in October and former Prime Minister Janez Jansa has said the country must sell another bond by June 6, when 907 million euros of 18-month treasury bills mature, to meet its financial obligations.

Contagion from Cyprus, which clinched a bailout deal on Monday at the expense of large bank depositors, has made that task more challenging and the prospect of a rescue more likely.

“One way or another things are coming to a head. June is a long way away for these guys now, so they need to do something,” said Tim Ash, head of emerging markets research ex-Africa at Standard Bank.

“It’s becoming increasingly likely they are going to have to begin to talk to the IMF and the Troika (about a bailout),” Ash said, referring to lenders including the International Monetary Fund, the European Union and European Central Bank.

The new government has so far declined to say anything about its borrowing plans, but it is expected to tap markets in coming months to repay some 2 billion euros of debt falling due in the middle of this year….”

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SAC’s Steinberg Arrested as Probe Gets Closer to Cohen

SAC Capital Advisors LP fund manager Michael Steinberg was arrested by FBI agents as the U.S. government’s wide-ranging probe of insider trading at the $15 billion firm got one step closer to founder Steven A. Cohen.

Steinberg, 40, worked at SAC’s Sigma Capital Management unit and is the most senior SAC official to be charged. He was one of 15 portfolio managers handling technology, media and telecommunications stocks before being placed on leave in September, said a person with knowledge of the matter. His lawyer, Barry Berke, said his client did nothing wrong and will appear in New York federal court later today….”

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Whale Depositors May Have Been Given a Heads Up on Cyprus Capital Controls & Depositor Tax

“The decision to crush Cypriot depositors (first all of them, then just the uninsured ones) came in March, without any prior hints of the carnage that was about to be unleashed upon Cypriot bank unsecured liabilities. Or so the media narrative goes, because the last thing needed is to give skeptics any indication the “ad hoc” Troika plan was not so ad hoc after all, and some individuals – notably the whale depositors – were warned in advance, sparing them the indignity of pulling a few billion at €300 per day. Alas, as just released central bank data shows, there may be cracks in the narrative because in February, at a time when the Eurozone was supposedly getting better every day and the Dow Jones was on the verge of its all time high, Cypriot depositors pulled the largest amount of cash in over three years….”

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$JPM Braces to Get Grilled

“As the nation’s strongest bank, JPMorgan Chase used to be known for carrying special sway with regulators. Now it increasingly finds itself in the cross hairs of federal authorities.

At least two board members are worried about the mounting problems, and some top executives fear that the bank’s relationships in Washington have frayed as JPMorgan becomes a focus of federal investigations.

In a previously undisclosed case, prosecutors are examining whether JPMorgan failed to fully alert authorities to suspicions about Bernard L. Madoff, according to several people with direct knowledge of the matter. And nearly a year after reporting a multibillion-dollar trading loss, JPMorgan is facing a criminal inquiry over whether it lied to investors and regulators about the risky wagers, a case that could accelerate when the Federal Bureau of Investigation and other authorities interview top JPMorgan executives in coming weeks.

All told, at least eight federal agencies are investigating the bank, including the Federal Deposit Insurance Corporation, the Commodity Futures Trading Commission and the Securities and Exchange Commission. Federal prosecutors and the F.B.I. in New York are also examining potential wrongdoing at JPMorgan.

A recent misstep points to the growing friction between JPMorgan and regulators as well as to the concerns within the bank. JPMorgan misstated how the bank may have harmed more than 5,000 homeowners in foreclosure, according to several people briefed on the matter. The bank’s primary regulator, the Office of the Comptroller of the Currency, is expected to collect a cash payment from the bank to remedy the flawed review of loans, these people say…..”

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Massive Cyber Attack Slows Down the Interwebs Worldwide

“Internet speeds around the world have noticeably slowed down due to a massive “distributed denial of service” attack, reports the BBC.

These DDoS attacks bombard targeted web servers with so much dummy traffic that people trying to access a site for legitimate purposes are unable to do so. It’s most analogous to a traffic jam on a highway with no one able to move.

The BBC says that security experts are describing it as “the biggest cyber-attack in history.”

The attacks were focused on a company called Spamhaus, which maintains a “domain name system” to connect a typed-in URL to the correct server hosting the appropriate content. With this company’s services compromised, large portions of the web became less stable….”

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$WFC Gets Hacked, Company Says No Customer Impact

Wells Fargo on Tuesday said its online banking website was experiencing an unusually high volume of traffic that it believes stems from a denial-of-service cyber attack.

“The vast majority of customers are not impacted and customer information remains safe,” said Bridget Braxton, a spokeswoman for the fourth-largest U.S. bank by assets. Customers who have trouble should try logging in again because the disruption is usually intermittent, she said….”

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In the Shade: U.S. Regulators Crack Down on Bank Instructed ‘Forced’ Insurance

Is there no end to the shadiness of banks and making money?

“WASHINGTON—A U.S. housing regulator is cracking down on a little-known practice that has hit millions of struggling borrowers with high-price homeowners’ insurance policies arranged by banks that benefit from the costly coverage.

The Federal Housing Finance Agency, which regulates mortgage giants Fannie MaeFNMA +4.67% and Freddie MacFMCC +3.96% plans to file a notice Tuesday to ban lucrative fees and commissions paid by insurers to banks on so-called force-placed insurance.

Such “forced” policies are imposed on homeowners whose standard property coverage lapses, typically because the borrower stops making payments. Critics say the fee system has given banks a financial incentive to arrange more expensive homeowners’ policies than necessary.

Banning the fees and commissions could help lower the price of the insurance policies. The housing agency’s move would apply nationwide to all mortgages guaranteed or owned by Fannie and Freddie—about half of the housing market”

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The Saddest Story You Ever Heard

“AUSTIN (CN) – An ill, elderly Texas woman claims in court that she’s being thrown out the home she’s lived in for 47 years because of $49 in property taxes — which she paid early.
Aron Ezilla Ridge, 75, sued James B. Nutter & Co. in Travis County Court.
She claims Nutter is foreclosing on her home for allegedly unpaid taxes – taxes she says it paid on her behalf already.
Ridge is partly blind, has diabetes, congestive heart failure and had surgery for colon cancer several years ago.
“She needs a wheelchair to leave her home and is largely housebound at this point in her life,” the complaint states. “She can read but her reading level is approximately at the 6th grade level and her ability to read is, of course, further limited by her failing eyesight.”
Ridge says she paid off the mortgage for her 900-square-foot home about 20 years ago. But in 2007 it needed major roof, kitchen and bathroom repairs. In February that year, she says, she signed up for a reverse mortgage with Nutter, which provided her with $39,000 for the repairs.
Ridge says she was told by the Travis County Tax Assessor’s office in 2000 that she did not need to pay property taxes because the value of her home was below homestead and senior exemption caps.
But she received a property tax bill in 2011 for $20.31. She says she was able to drive to the assessor’s office and pay the taxes in full and on time.
In April 2012, the assessor’s office informed her that her home was valued at $60,743 and that her taxes were estimated at $46.87, according to the complaint.
Ridge says she did not receive a tax bill, but later received a receipt stating that $49 in taxes were paid in late 2012.
“She assumed that the receipt meant she was again exempt from property taxes,” the complaint states. “She did not call the tax office to see why she had received a receipt without having received a bill.”
In January this year, Nutter’s attorneys told Ridge her reverse mortgage had been accelerated, and that she had to pay off the entire loan “or the lender would exercise its right to enforce the lien on her home. Ms. Ridge does not remember receiving this letter,” the complaint states. (Citation to exhibit omitted.)
Ridge says her home was foreclosed on on Jan. 30, and she received notice on Feb. 6….”

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Nicolas Sarkozy Faces Charges Over Corruption

“Preliminary charges have been filed against Nicolas Sarkozy over allegations he took financial advantage of an elderly L’Oreal heiress.

The move means the former French president is under formal investigation, accused of accepting envelopes stuffed with cash from Liliane Bettencourt to illegally finance his 2007 election campaign.

The 90-year-old was declared in a state of dementia in 2006 and was placed under the guardianship of her family in 2011.

The preliminary charges were issued after Mr Sarkozy was questioned for several hours in a Bordeaux courthouse, according to the prosecutor’s office.

A statement said he had been placed under investigation “for taking advantage of a vulnerable person in February 2007 and during 2007 to the detriment of Liliane Bettencourt”.

Under French law, preliminary charges mean the investigating magistrate has reason to believe wrongdoing was committed, but allows more time to investigate. The charges may later be dropped or could lead to a trial.

Mr Sarkozy’s lawyer Thierry Herzog criticised the decision as “legally incoherent and unfair”.

Earlier, the former president was unexpectedly summoned for a face-to-face encounter with Ms Bettencourt’s ex-butler Pascal Bonnefoy over the claims….”

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Fun Times In The Marine’s DoC

“In what promises to be a major public relations headache for Maine’s Department of Corrections, local media have released raw footage of a restrained inmate being subdued with pepper spray and then left unattended for over twenty minutes.

The story and video first appeared in this week’s Maine Sunday Telegram, and were further reported on by the Portland Press Herald, with a shorter clip accompanied by some two hours of additional video. The raw footage depicts Windham Correctional Center inmate Paul Schlosser being bound to a restraint chair, flanked by five prison officials – three of them in riot gear – protesting that guards “watch his arm,” and subsequently being pepper sprayed in the face at close range by Captain Shawn Welch….”

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EU Finance Ministers Consider Shutting Two of Cyprus’s Largest Banks and Freezing Assets of Uninsured Depositors

“Euro-area finance chiefs, pressuring Cyprus to shrink its banking system as the condition for a bailout, are reviving demands they jettisoned last week as too extreme, four European officials said.

Finance ministers for the 17 euro countries are considering a plan to shutter the two biggest banks in Cyprus and freeze the assets of uninsured depositors, said the four officials, who asked not to be named because the talks are ongoing.

Cyprus Popular Bank Plc  and the Bank of Cyprus Plcwould be split to create a so-called bad bank, one of the officials said. Insured deposits — below the European Union ceiling of 100,000 euros ($129,000) — would go into a so-called good bank and not sustain any losses, while uninsured deposits would go into the bad bank and be frozen until assets could be sold, said the four officials.

Losses to unsecured creditors, including uninsured depositors, could reach 40 percent under the plan, which has support from the International Monetary Fund and the European Central Bank. The proposal, a version of which was rejected last week, is considered a better option than taxing insured deposits or allowing Cypriot banks to collapse in a disorderly fashion if they lose access to ECB aid, the officials said.

‘Serious’ Situation…”

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Business as Usual

Preferential treatment for a tycoon by the head of the IMF is being investigated. Today investigators raided the Paris apartment of Christine Lagarde…

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Mini Flash Crashes On the Rise

“There may not have been any major market malfunctions recently, but mini flash crashes still happen nearly every day.

Stock exchanges don’t publicly release data about these mini crashes — when a stock rapidly plunges then rebounds — but most active traders say there are at least a dozen a day.

Dennis Dick, a proprietary trader at Bright Trading in Detroit, said he stopped tracking them because they happen so frequently.

While none have been as disruptive as the “flash crash”of 2010, or the ones that marred the IPOs of the BATS exchange and Facebook in 2012, they highlight the fragility of markets increasingly dominated by high frequency traders who count on fancy algorithms to make a quick profit.

So far this year, these mini crashes have taken place in shares of Apple (AAPLFortune 500), Berkshire Hathaway (BRKAFortune 500), insurance broker Aon Plc (AON,Fortune 500) and apparel maker Hanesbrands (HBI).

On Jan. 25, Apple’s stock plummeted nearly 2% in the last minute of trading, with roughly 1 million shares changing hands. That’s nearly 10 times the volume during any other time that day, and the move briefly wiped out as much as $7 billion of Apple’s market value. Apple managed to recover more than half of that in the final few seconds of trading.

Other publicly traded companies have experienced even more extreme swings. On Feb. 5, Hanesbrands’ stock dropped 3% in less than half a second before quickly rebounding…..”

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Freddie Mac Sues a Dozen Banks Over Libor Scandal

“U.S. mortgage finance company Freddie Mac is suing more than a dozen banks for losses from the alleged manipulation of the benchmark interest rate known as Libor.

Bank of America Corp, JPMorgan Chase,UBS and CreditSuisse are among the banks named as defendants in the lawsuit.

Freddie Mac, which invested in mortgage bonds and swaps tied to U.S. dollar Libor, claims the banks colluded to rig the benchmark from 2007 to 2010, according to the complaint, which was filed March 14 in U.S. District Court for the Eastern District of Virginia.

The banks worked together to artificially lower the U.S.dollar Libor “both to hide their institutions financial problems and to boost their profits,” the complaint said. The lawsuit seeks undetermined damages.

Freddie Mac and Fannie Mae, the two government-controlled mortgage companies, may have suffered more than $3 billion in losses as a result of Libor manipulation, according to a memo obtained by Reuters in December.

The memo was sent to the Fannie and Freddie’s regulator,the Federal Housing Finance Agency, by its inspector general.The watchdog urged the regulator to consider legal action.

Bank of America, JPMorgan Chase, UBS, Credit Suisse and other banks did not immediately respond to calls for comment or declined to comment.

More than a dozen banks have been under scrutiny by authorities in the United States, Japan and Europe over claims they altered the Libor…..”

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Regarding The New Pope

“As Pope Francis takes his place as the leader of the world’s 1.2 billion Catholics, his participation in Argentina’s US-backed ‘Dirty War’ is sure to come under increased scrutiny.

From 1976 until 1983, Argentina was governed by a series of US-backed military dictators who ruled with iron fists and crushed the regime’s opponents, many of them students, trade unionists, journalists and leftists. Kidnapping, torture, murder by death squads and disappearances characterized this brutal ‘Dirty War,’ and many of the leading perpetrators, including two junta leaders and the military dictator Gen. Leopoldo Galtieri, were trained by the United States in kidnapping, torture, assassination and democracy suppression at the School of the Americas in Panama. As many as 30,000 people were killed or disappeared during this horrific period, and many children and babies were stolen from parents imprisoned in concentration camps or murdered by the regime.

During this harrowing period, the Argentine Catholic church was shamefully silent in the face of horrific atrocities. Argentine priests offered communion and support to the perpetrators of these crimes, even after the execution of two bishops, including Enrique Angelelli, and numerous priests. Worse, leading church figures were complicit in the regime’s abuses. One priest, Father Christian von Wernich, was a former police chaplain later sentenced to life in prison for involvement in seven murders, 42 kidnappings and 31 cases of torture during the ‘Dirty War.’ At his trial, witnesses testified how the priest used his position to gain their trust before passing information to police, who tortured victims– sometimes in von Wernich’s presence– and sometimes killed them.

Senior military commanders who justified the regime’s appalling practice of dumping drugged and tortured ‘Dirty War’ prisoners into the sea from airplanes, known as ‘death flights,’ told participants that the Church sanctioned the missions as “a Christian form of death.”

“We have much to be sorry for,” Father Ruben Captianio told the New York Times in 2007. “The attitude of the Church was scandalously close to the dictatorship to such an extent that I would say it was of a sinful degree.”

So exactly what role did Jorge Bergoglio play in his country’s brutal seven-year military dictatorship?

1995 lawsuit filed by a human rights lawyer alleges that Bergoglio, who was leading the local Jesuit community by the time the military junta seized power in 1976, was involved in the kidnapping of two of his fellow Jesuit priests, Orlando Yorio and Francisco Jalics, who were tortured by navy personnel before being dumped in a field, drugged and semi-naked, five months later.

At the time, Bergoglio was the superior in the Society of Jesus of Argentina. According to El Silencio (Silence), a book by Horacio Verbitsky, one of Argentina’s most respected investigative journalists, Bergoglio urged the two priests, who were strong believers in liberation theology, to stop visiting Buenos Aires slums where they worked to improve the lives of some of the country’s poorest people. After the priests refused, Bergoglio allegedly stopped protecting them, leading to their arrest and torture. According to the Associated Press, Yorio accused Bergoglio of “effectively handing [the priests] over to death squads.”

Despite his alleged role in the Jesuits’ imprisonment, Bergoglio did eventually take action to secure their release. His intervention and appeal to the vicious junta leader Jorge Videla quite likely saved their lives.

But that wasn’t the only time Bergoglio allegedly cooperated with the regime. According to Verbitsky, he also hid political prisoners from a delegation of visiting international monitors from the Inter-American Human Rights Commission.

Bergoglio was also silent in the wake of Father Angelelli’s assassination, even as other leading Argentine clergy condemned the murder. He was quick, however, to hail the slain priest as a “martyr” years later in more democratic times….”

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Microsoft Probed By Justice Department Over Potential Bribery

“(Reuters) – Microsoft Corp said on Tuesday it takes seriously any allegations of misconduct, after a report that the U.S. Department of Justice is investigating potential bribery by its employees in China, Romania and Italy.

“We take all allegations brought to our attention seriously and we cooperate fully in any government inquiries,” a Microsoft spokesman said, without confirming that it was aware of any investigation….”

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$EA Hits the Bid on CEO John Riccitiello

“John Riccitiello was ousted as chief executive officer of video-game maker Electronic Arts Inc. (EA), a casualty of shrinking sales as the industry gears up for new consoles no one is sure shoppers want.

Chairman Larry Probst, 63, who ran Electronic Arts until 2007, becomes executive chairman and will lead management as the board seeks a new CEO, according to a statement yesterday. The Redwood City, California-based company, the second-largest U.S. game publisher, rose as much as 7.9 percent after saying Riccitiello, 53, will leave at the end of this month.

“He lasted a pretty long time given that the company hasn’t really performed that well,” said Edward Woo, an analyst at Ascendiant Capital Markets in IrvineCalifornia. “The fact that their stock is up on the news goes to show investors weren’t that big a fan.”

Sales have fallen in three of the past four quarters Bloomberg data show, and the company said yesterday that fourth- quarter results will miss its previous forecast, which had already beenlowered in January….”

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Apparently 2800 Pigs Was Not Enough, Now 6000 Pigs Have Been Dumped in Huangpu River

Shanghai said it’s increasing the frequency of water quality checks after the number of dead pigs found upriver from China’s largest commercial city more than doubled from the previous tally to almost 6,000.

The government pulled 5,916 hogs from the Huangpu River as of 3 p.m. yesterday and said the discovery of new carcasses has slowed, according to a statement on its website. It’s accelerating construction of barriers along parts of the river to prevent more pigs from floating downstream, after preliminary investigations showed the hogs originated from neighboring Zhejiang province.

The discovery of the hogs is the latest safety scare in China, where leaders have come under criticism for the handling of public health and environmental issues. The government announced a plan March 10 for a regulator with broader authority to ensure food and drug safety and said the agriculture ministry will oversee the quality of farm products, underpinning its pledge to crack down on violations and better protect consumers.

“The impact on sentiment is big when you see floating pigs along this river,” Jean-Yves Chow, an analyst at Rabobank International, said in an interview in Hong Kong. “It’s come to a situation where the government has to do what they need to make some improvements and create transparency among farmers.”

Shanghai Bund

The Shanghai government said March 10 it’s investigating why so many dead pigs were found in the river. People in the Zhejiang city of Jiaxing have been dumping pigs in the river since March 4, the official Xinhua News Agency said, citing the Shanghai information office. Xinhua said authorities in Jiaxing acknowledged dead pigs had been dumped into the water…..”

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Consumer Protection Agency Wants $HLF To Go Under FTC Microscope

“The National Consumers League wants the Federal Trade Commission to open an investigation on Herbalife.

“Herbalife’s business practices have recently come under intense investor scrutiny, and NCL is now calling on federal regulators to examine both the claims lodged against Herbalife and Herbalife’s responses,” wrote the NCL in a press release.

The recent scrutiny was triggered by Bill Ackman and his hedge fund Pershing Square Capital.

Ackman has accused Herbalife of being an illegal pyramid scheme, and he’s convinced the stock will go to $0.

Pershing Square was quick to file its response, which Business Insider has obtained.

Pershing Square Capital Management, L.P. Issues Statement Regarding National Consumers League’s Call for FTC Investigation into Herbalife….”

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