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Malaysian Government Admits Altering MH370 Pilot Transcript, Hiding Evidence and Misleading the Public in Massive Cover-up

“As the facts about MH370 slowly emerge, it is increasingly apparent that the Malaysian government has been — and continues to be — involved in an elaborate cover-up that falsified and hid evidence the public deserves to know about the fate of Flight 370 passengers.

The government openly admitted this, in fact. “A Malaysian team have told relatives of Chinese passengers on board the missing Malaysia Airlines (MAS) flight MH370 that there was sealed evidence that cannot be made public, as they came under fire from the angry relatives at a briefing on Wednesday,” reported the Straights Times.(1)

The Times also reports:

“We demand you retract announcement that MH370 ended in south Indian Ocean and continue search-and-rescue operations,” one relative said at the briefing.

Why would a government seal evidence concerning the fate of MH370? It would only do so if it didn’t want the public to see that evidence, of course. This is typically done under circumstances of national security or military secrets. We all have to wonder: what evidence is there concerning MH370 that the Malaysian government would not want to be made public? And why?

Pilot transcript altered, mischaracterized for weeks

We also know that the Malaysian government altered the pilot transcript, misleading the public for weeks about the sign-off words uttered by either the pilot or the copilot. The government’s claim that the pilot said, “all right goodnight” turned out to be false. This strange-sounding sign-off was apparently floated by the Malaysia government to support its contention that the pilot was suicidal and departing from customary communications protocols.

But now, we’ve learned the pilots actually said, “Good night, Malaysian three seven zero.”(3)

It is, of course, impossible to misconstrue “Good night, Malaysian three seven zero” as “all right goodnight.” This means the Malaysian government deliberately altered the pilot transcript and fed disinfo to the public. This charade continued for weeks until public pressure finally forced the government to release the real transcript, as follows:

Families of MH370 victims not fooled by deceptive Malaysian government

The families of MH370 passengers are, of course, outraged at the increasingly apparent deceptions being pushed by the Malaysian government. As the Straights Times reports:

Some family representatives targeted Malaysian envoy Iskandar Sarudin, asking him: “You expect us to accept a report you cannot defend?”

“No comment,” said Mr Iskandar.

He again declined to comment when asked “how do you expect us to feel friendly towardsMalaysia?”

Upset by the response from the Malaysia team, a relative said: “You have once again left us speechless!”

The Malaysian government is now engaged in a stonewalling exercise to deliberately prevent the public from learning the truth.

Governments routinely deceive the People and withhold crucial evidence…”

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It Takes an Act of God to Set Criminals Free in Chile, Not So In America

Chilean earthquake sets criminals free

“Obama Administration Releases 68,000 Illegal Immigrant Criminals

Immigration and Customs Enforcement (ICE) officials released 67,879 illegal immigrants with criminal convictions in 2013 and made no move to deport them. ICE is part of the Department of Homeland Security (DHS).

This information was made available on March 31 by the Center for Immigration Studies (CIS), a Washington, D.C.-based think tank that collected the information from ICE’s “Weekly Departures and Detention Report” for the end of fiscal year 2013. The CIS obtained a copy of the report through a lawsuit.

CIS released it findings in a document written by former State Department foreign service officer Jessica Vaughan titled, “Catch and Release: Interior Immigration enforcement in 2013.”

The ICE document showed that its agents encountered 193,357 illegal immigrants with criminal convictions last year, but issued charging documents for only 125,478. As noted above, 67,879 charged and/or convicted criminals were released.

“ICE released 68,000 criminal aliens in 2013, or 35 percent of the criminal aliens encountered by officers. The vast majority of these releases occurred because of the Obama administration’s prosecutorial discretion policies,” Vaughan wrote in a memo that drew from the ICE document. She noted that ICE classifies illegal immigrants as criminal if they have been convicted of a crime, excluding traffic offenses.

Vaughan noted further: “The Obama administration’s deliberate obstruction of immigration enforcement, in which tens of thousands of criminal aliens are released instead of removed, is threatening the well-being of American communities.”

Fox News reported that Immigration and Customs Enforcement accused CIS of distorting the numbers, claiming that some of the convictions might represent minor offenses. The agency also took credit for deporting a total of 216,000 “convicted criminals” in 2013.

“ICE is focused on the removal of criminal aliens,” Fox quoted an ICE spokeswoman. “The percentage of criminals removed continues to rise. Nearly 60 percent of ICE’s total removals had been previously convicted of a criminal offense, and that number rises to 82 percent for individuals removed from the interior of the U.S. The removal of criminal individuals is and will remain ICE’s highest priority.”

Fox also reported that earlier this month, a DHS spokesman said the internal review of immigration enforcement is a process that is “ongoing” and will be done “expeditiously.”

“Since taking office, [Jeh Johnson] the secretary [of Homeland Security] has made clear that he shares the president’s commitment of enforcing our immigration laws effectively and sensibly, in line with our values,” the spokesman said. “As part of that effort he has been taking a hard look at these tough issues, meeting with a range of stakeholders and employees and already has been assessing if there are areas where we can further align our enforcement policies with our goal of sound law enforcement practice that prioritizes public safety.”

The CIS report said factors such as “family relationships, political considerations, or attention from advocacy groups” are likely helping to “trump criminal convictions as a factor leading to deportation.”

So much for President Obama’s claim last June that “today, deportation of criminals is at its highest level ever” because “we focused our enforcement efforts on criminals who are here illegally and who are endangering our communities.”

CIS has charged that the Obama administration has manipulated statistics by changing how it counts the number of deportations in order to hide the decline. Jessica Vaughan said that Homeland Security plays a statistical shell game of “removals” vs. “returns” and that if you actually “count the number of people sent out of the country, it’s not even close to a record. It’s the lowest since the 1970s.”

The number of returns in 2012 was 229,968, down from 1.6 million returns in 2000, the last full year of the Clinton administration.

Homeland Security defines a “return” — which is how deportations were previously measured — as “the confirmed movement of an inadmissible or deportable alien out of the United States not based on an order of removal.”

Senator Jeff Session (R-Ala.) issued a statement on March 31 in response to the release of the statistics that read, in part:

The preponderance of the evidence demonstrates that immigration enforcement in America has collapsed. Even those with criminal convictions are being released. DHS is a department in crisis. Secretary Johnson must reject the President’s demands to weaken enforcement further and tell him that his duty, and his officers’ duty, is to enforce the law—not break it….

American citizens have a legal and moral right to the protections our immigration laws afford—at the border, the interior and the workplace. The Administration has stripped these protections and adopted a government policy that encourages new arrivals to enter illegally or overstay visas by advertising immunity from future enforcement….

While Senator Sessions hit the nail on the head regarding the Obama administration’s lax immigration enforcement, there was a certain partisanship in his comments: “Unfortunately, Congressional Democrats continue to empower this lawlessness. Republicans must work to end it.”

Democrats have unquestionably led the charge on weakening enforcement of our immigration laws….”

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The Bearded Clam Backtracks on Keynesian Economics

“At an emotional press conference this morning, former Chairman of the Federal Reserve, Ben Bernanke, strongly rejected the Keynesian economic policies he endorsed and implemented during his tenure at the Federal Reserve. He stated that he deeply regrets his part in prolonging the economic crisis and pledged to be a vocal supporter of reform and sound money policies. Bernanke also tearfully read from an apology letter he wrote to the American people.


A tearful Ben Bernanke reads an apology letter to the American people.

“I would like to apologize to the citizens of the United States whose wealth I stole through the Federal Reserve’s careless easy money policies that unfortunately I endorsed and supported at the time,” said Bernanke. “I wrongly believed that printing money and giving it to big banks and the government would help the average American. I was wrong. I have seen the errors of my ways and pledge to spend the rest of my life fighting for reform at the world’s most powerful institution.”

In a surprising turn of events, Bernanke also endorsed Congressman Ron Paul’s Audit the Fed legislation….”

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FBI Investigating High-Speed Trading

“The Federal Bureau of Investigation is probing whether high-speed trading firms are engaging in insider trading by taking advantage of fast-moving market information unavailable to other investors.

The investigation, launched about a year ago, involves a range of trading activities and is still in its early stages, according to a senior FBI official and an agency spokesman. Among the activities being probed is whether high-speed firms are trading ahead of other investors based on information that other market participants can’t see.

Among the types of trading under scrutiny is the practice of placing a group of trades and then canceling them to create the false appearance of market activity. Such activity could be considered potential market manipulation by encouraging others to trade based on false orders.

Another form of activity under scrutiny involves using high-speed trading to place orders to conceal that the transactions are based on an illegal tip.

“There are many people in government who are very focused on this and who are concerned about it and who think it breaks the law,” an FBI spokesman said. “There is a big concern that high-frequency traders are getting material nonpublic information ahead of others and trading on it.”

Ultimately, federal prosecutors would have to decide whether the facts of a specific case warrant bringing charges, the FBI official said.

The probe, which has picked up steam in recent months, comes amid heightened scrutiny of computerized trading. New York Attorney General Eric Schneiderman is investigating whether high-speed trading firms have gained advantages that aren’t available to regular investors, such as access to superfast data feeds.

The Commodity Futures Trading Commission and the Securities and Exchange Commission are looking into ties between high-speed traders and major exchanges, examining whether the firms are getting preferential treatment that puts other investors at a disadvantage, said people familiar with the probes.

Since the beginning of the investigation, the FBI, working with the SEC, has developed fact patterns of potentially illegal trading and run them by prosecutors to determine if they could be used in a criminal case.

For the FBI, the investigation marks a new and unusual phase of its focus on insider trading. ….”

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Russia’s Prime Minister Declares Plans to Turn Crimea Into a Special Economic Zone

“(Reuters) – Prime Minister Dmitry Medvedev flaunted Russia’s grip on Crimea on Monday by flying to the region and announcing plans to turn it into a special economic zone, defying Western demands to hand the region back to Ukraine.

The visit, hours after Russia held talks on Ukraine with the United States, is likely to anger Kiev and the West, which accuse president Vladimir Putin of illegally seizing the Black Sea peninsula after a March 16 referendum they say was a sham.

Shortly after landing in Crimea’s main city of Simferopol with many members of his cabinet, Medvedev chaired a Russian government meeting attended by Crimean leaders and outlined moves to revive the region’s struggling economy.

“Our aim is to make the peninsula as attractive as possible to investors, so that it can generate sufficient income for its own development. There are opportunities for this – we have taken everything into consideration,” he told the televised meeting, sitting at a large desk with Russian flags behind him.

“And so we have decided to create a special economic zone here. This will allow for the use of special tax and customs regimes in Crimea, and also minimize administrative procedures.”

In comments that made clear Russia had no plans to give back Crimea, he set out moves to increase wages for some 140,000 state workers in Crimea, boost pensions, turn the region into a tourism hub, protect energy links with the peninsula and improve its roads, railways and airports….”

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The De Facto Repeal of the Second Amendment.

“At the conclusion of the U.S.-EU Summit held this week in Brussels, President Obama and his European colleagues released a joint statement reaffirming their common commitment to civilian disarmament as mandated in the United Nation’s Arms Trade Treaty (ATT).

While globalist and establishment media reports focus on the summit’s attention to the events in Crimea, there is a provision at the end of the statement that is of much greater concern to Americans aware of the crescendo of calls for restrictions on the right to keep and bear arms.

Paragraph 33 of the declaration released on March 26 states: “We reaffirm our joint commitments on non-proliferation, disarmament and arms control.”

Among other agreements, President Obama, in the name of the United States, joined with the gathered heads of state in promising: “We will also work together to promote the entry into force of the Arms Trade Treaty in 2014.”

Despite significant congressional opposition to the United Nation’s attempt to confiscate privately owned weapons and ammunition, President Obama quietly signed his name to a document that if carried out, would amount to nothing less than the de facto repeal of the Second Amendment.

In order to appreciate the seriousness of the the Arms Trade Treaty’s threat to the God-given right to keep and bear arms and to the constitutional protection of that right, details of the plan should be understood.

This author attended the negotiations at UN headquarters in Manhattan where the ATT was hammered out, and I found that the ATT is so offensive to the preservation of the right to keep and bear arms, it is an understatement to call it unconstitutional. As The New American has reported, several provisions of this treaty significantly diminish the scope of this basic right.

First, the Arms Trade Treaty grants a monopoly over all weaponry in the hands of the very entity (government) responsible for over 300 million murders in the 20th century.

Furthermore, the treaty leaves private citizens powerless to oppose future slaughters.

One uncomfortable fact of armed violence ignored by the UN in its pro-disarmament propaganda is that all the murders committed by all the serial killers in history don’t amount to a fraction of the brutal killings committed by “authorized state parties” using the very weapons over which they will exercise absolute control under the terms of the Arms Trade Treaty.

Article 2 of the treaty defines the scope of the treaty’s prohibitions. The right to own, buy, sell, trade, or transfer all means of armed resistance, including handguns, is denied to civilians by this section of the Arms Trade Treaty.

Article 3 places the “ammunition/munitions fired, launched or delivered by the conventional arms covered under Article 2” within the scope of the treaty’s prohibitions, as well.

Article 4 rounds out the regulations, also placing all “parts and components” of weapons within the scheme.

Perhaps the most immediate threat to the rights of gun owners in the Arms Trade Treaty is found in Article 5. Under the title of “General Implementation,” Article 5 mandates that all countries participating in the treaty “shall establish and maintain a national control system, including a national control list.”

This list should “apply the provisions of this Treaty to the broadest range of conventional arms.”

Article 12 adds to the record-keeping requirement, mandating that the list include “the quantity, value, model/type, authorized international transfers of conventional arms,” as well as the identity of the “end users” of these items.

In very clear terms, ratification of the Arms Trade Treaty by the United States would require that the U.S. government force gun owners to add their names to the national registry. Citizens would be required to report the amount and type of all firearms and ammunition they possess.

Section 4 of Article 12 of the treaty requires that the list be kept for at least 10 years…..”

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Go Back to Sleep, Fukushima Was Some Obscure Event in the Past

“A Canadian high school student named Bronwyn Delacruz never imagined that her school science project would make headlines all over the world. But that is precisely what has happened. Using a $600 Geiger counter purchased by her father, Delacruz measured seafood bought at local grocery stores for radioactive contamination. What she discovered was absolutely stunning.

Much of the seafood, particularly the products that were made in China, tested very high for radiation. So is this being caused by nuclear radiation from Fukushima? Is the seafood that we are eating going to give us cancer and other diseases?

The American people deserve the truth, but as you will see below, the U.S. and Canadian governments are not even testing imported seafood for radiation. To say that this is deeply troubling would be a massive understatement.

In fact, what prompted Bronwyn Delacruz to conduct her science project was the fact that the Canadian government stopped testing imported seafood for radiation in 2012

Alberta high-school student Bronwyn Delacruz loves sushi, but became concerned last summer after learning how little food inspection actually takes place on some of its key ingredients.

The Grade 10 student from Grande Prairie said she was shocked to discover that, in the wake of the 2011 Fukushima nuclear disaster in Japan, the Canadian Food Inspection Agency (CFIA) stopped testing imported foods for radiation in 2012…..”

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[youtube://http://www.youtube.com/watch?v=lpAqiGSp29c 450 300]

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The IRS Declares Bitcoin as Property and Not Currency for Tax Purposes

“Wading into a murky tax question for the digital age, the U.S. Internal Revenue Service said on Tuesday that bitcoins and other virtual currencies are to be treated, for tax purposes, as property and not as currency.

“General tax principles that apply to property transactions apply to transactions using virtual currency,” the IRS said in a statement, meaning that bitcoins would be taxed as ordinary income or as assets subject to capital gains taxes, depending on the circumstance.

Bitcoin, the best-known virtual currency, started circulating in 2009. Its present market value is around $8 billion, with up to 80,000 transactions occurring daily, according to accounting firm PricewaterhouseCoopers LLP.

Recent incidents have brought the currency under new regulatory scrutiny, such as the failure of Mt. Gox, a Tokyo-based exchange that filed for bankruptcy after losing an estimated $650 million worth of customer bitcoins.

Unlike conventional money, bitcoin is generated by computers and is independent of control or backing by any government or central bank, which its proponents like, but which also has led to calls for more guidance on U.S. tax treatment.

The IRS supplied that in its statement, which dealt a blow to bitcoin “miners,” who unlock new bitcoins online. The IRS said miners must include the fair market value of the virtual currency as gross income on the date of receipt.

This change “is a disincentive to start looking for bitcoins,” said John Barrie, a partner with law firm Bryan Cave LLP, who advises charities that receive bitcoins as donations.


The IRS also said that virtual currency is not to be treated as legal-tender currency to determine if a transaction causes a foreign currency gain or loss under U.S. tax law…..”

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The ECB Considers Stimulus to Combat Deflation

European Central Bank officials sent strong signals Tuesday that they are willing to consider dramatic steps to guard against dangerously low inflation, including negative interest rates and asset purchases.

The comments by top policy makers from different parts of the euro zone suggest the ECB, faced with a weak economy and strong currency, is prepared to shed some of its cautious approach and take more-aggressive action, as central banks in the U.S., the U.K. and Japan have done for years.

Hermès: ‘We want to be bigger, but not fatter’

New Hermès CEO Axel Dumas on maintaining the luxury firm’s exclusive image while selling more goods.

“We haven’t exhausted our maneuvering room” on interest rates, Bank of Finland Gov. Erkki Liikanen said in an interview in Helsinki. The ECB’s main lending rate to banks is 0.25%, a record low. A separate deposit rate set by the ECB for overnight funds parked at the central bank has been at zero for nearly two years.

Asked what tools the ECB has remaining, Mr. Liikanen, who has headed Finland’s central bank since 2004 and is on the ECB’s 24-member governing council, cited a negative deposit rate as well as additional loans to banks and asset purchases.


Other officials, including the heads of the German and Slovakian central banks, offered a similar message on Tuesday…..”

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The SEC Investigates Opportunity for Fraud in the Bond and Loan Markets

“The Securities and Exchange Commission is investigating whether a Wall Street boom in complicated bond deals is creating new avenues for fraud, according to people close to the probes.

SEC investigators are looking at whether banks and companies are using the bond deals to hide certain risks illegally, said the people close to the probes. A number of likely cases in that area are in the pipeline, one of the people said.

Separately, the government has expanded an inquiry into how Wall Street banks sell the deals, the people added. The securities being examined aren’t traded on any exchanges or open platforms, and their prices are negotiated privately between buyers and sellers.

The probes could pose a new legal headache for banks, which have faced years of government investigations and large financial settlements involving their conduct leading up to the financial crisis.

In previous investigations, the SEC primarily explored how the banks put the deals together. The new probes look at how these complex securities are being used and traded.

A spokesman for the SEC declined to comment.


The securities, which are packages of corporate loans and debts assembled and sold by Wall Street banks to investors, boomed in popularity before the financial crisis—and then crashed after it. They have seen a resurgence in popularity as investors pump more money into riskier, higher-yielding investment products.

Before the crisis….”

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Renewed Signs of a Slowdown in China Send Global Markets Lower, U.S. Futures Buck the Trend

“(Reuters) – European shares edged lower on Monday after further signs of a slowdown in China, although robust data from France and Germany limited their decline.

The euro briefly strengthened against the dollar and German Bund futures extended losses after data compiler Markit said its March flash composite purchasing managers’ index for France jumped to 51.6 from 47.9 last month.

However, the single currency largely gave up its gains after figures showed private sector growth slowed in Germany. Data from the euro zone as a whole, while suggesting the recovery was becoming more broad-based, dipped compared with February.

Having lagged the recent recovery in much of the euro zone, the French index surged through the 50-point threshold dividing contraction from expansion to hit its highest since August 2011.

However, the data was not enough to lift European shares. The FTSEurofirst 300 index .FTEU3 fell 0.2 percent as investors focused on a fall in Chinese business activity.

The flash Markit/HSBC China Purchasing Manager index fell to an eight-month low of 48.1 in March from February’s 48.5. The index has been below 50 since January.

“As the data shows this morning, China’s slowdown is sharper than what most people had expected, which fuels worries about the impact on global growth,” Philippe de Vandiere, analyst at Altedia Investment Consulting in Paris, said.

“But Chinese authorities have plenty of tools to avoid a hard landing, and we know that the country’s transition to an economic model more focused on consumer spending will lower its growth rate a bit, so no big concern here.”

A string of weak numbers has reinforced concerns over a slowdown in the world’s second largest economy, though the impact on Asian shares was limited as the data raised expectations the Chinese government could stimulate the economy….”

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The White House States Russia May Be Getting Ready to Invade the Ukraine

“Russian forces gathering on the border with eastern Ukraine may be poised to invade, the White House warned on Sunday, as the government in Kiev said that the prospect of war with Moscow was continuing to grow after the annexation of Crimea.

Speaking after Nato’s top commander in Europe voiced alarm about the size and preparedness of the Russian troop buildup, President Barack Obama’s deputy national security adviser, Tony Blinken, said President Vladimir Putin may indeed be readying further action.

“It’s deeply concerning to see the Russian troop buildup on the border,” Blinken told CNN. “It creates the potential for incidents, for instability. It’s likely that what they’re trying to do is intimidate the Ukrainians. It’s possible that they’re preparing to move in.”

Thousands of Russian troops held a military exercise near the border even before Putin last week formally annexed Ukraine’s southern Crimea region following a referendum – condemned as illegal by western governments – that endorsed unification with Russia.

General Philip Breedlove, Nato’s supreme allied commander in Europe, said earlier on Sunday that the Russian military force gathered near the Ukrainian border was “very, very sizeable and very, very ready” and could even pose a threat to Moldova, on the other side of the country.

Andriy Deshchytsia, Ukraine’s acting foreign minister, said the chances of all-out war between his government and Moscow “are growing”, adding: “The situation is becoming even more explosive than it was a week ago.”

Deshchytsia told ABC News: “We are ready to respond. The Ukraine government is trying to use all the peaceful diplomatic means … to stop Russians, but the people are also ready to defend their homeland.

“At this moment, when Russian troops would be invading the eastern region,” Deshchytsia went on, “it would be difficult for us to ask people who live there not to respond on this military invasion”.

Russian forces in the Crimean city of Belbek on Saturday aggressively seized a military base that was one of the last strongholds of the Ukrainian military in the region. Moscow, meanwhile, allowed civilian observers from the Organisation for Security and Cooperation in Europe (OSCE) to begin monitoring elsewhere in Ukraine….”

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29 0f 30 Banks Pass the Fed’s Stress Test

“WASHINGTON—The Federal Reserve’s annual test of big banks’ financial health showed the largest U.S. firms are strong enough to withstand a severe economic downturn, a sign that many will get the green light soon to reward investors by raising dividends and buying back shares.

The Fed said 29 of the 30 largest institutions have enough capital to continue lending even when faced with a hypothetical jolt to the U.S. economy lasting into 2015, including a severe drop in housing prices and a spike in unemployment. The Fed’s annual “stress tests” are designed to ensure large banks can withstand severe losses during times of market turmoil.

Only Zions BancorpZION +3.19% a regional lender based in Salt Lake City, posted capital levels during the two-year-downturn scenario that didn’t meet the Fed’s minimum standards. The Fed said Zions had a Tier 1 common capital ratio of 3.5%, below the 5% level the Fed views as a minimum allowance. The ratio measures high-quality capital as a percentage of risk-weighted assets such as mortgages, commercial loans and securities.

The results could buttress the desire of banks—which have seen their profits soar amid an improving economy and severe cost cutting—to return more of that income to shareholders. The six biggest banks earned $76 billion in 2013, just $6 billion shy of their collective all-time high. All U.S. banks earned a record $154.6 billion, according to data compiled by SNL Financial. Some of the biggest financial institutions, including Bank of America Corp.BAC +2.75% and Morgan Stanley,MS +3.08% haven’t boosted dividend payouts since the financial crisis.

The stress-test results will be a factor in the Fed’s decision next week to approve or deny individual banks’ plans for returning billions of dollars to shareholders through dividends or share buybacks. But a good performance on Thursday’s test is no guarantee, since the Fed also will consider more subjective factors such as the strength of a bank’s internal risk management.

On Thursday afternoon, the Fed was expected to privately give banks a preliminary answer on their requests, setting up a week of jockeying for banks that were told “no.” Firms will have until early next week to revise their plans or challenge the Fed’s math before a final decision is issued Wednesday.

Paul Miller, an analyst at FBR Capital Markets, said the results bode well for banks’ approval of capital plans. “There’s nothing in here that I think is a big shocker,” he said. Analysts this year are expecting distributions from banks to be the highest since at least 2007, according to estimates compiled by Thomson Reuters for The Wall Street Journal.

The first stress test took place in the immediate aftermath of the 2008 crisis and helped shore up confidence at a critical juncture for the American financial system. Regulators forced banks to cut their dividends in exchange for billions of dollars in government aid and lenders were prohibited from raising shareholder payouts without U.S. approval.

The Fed said the latest tests show banks are “collectively better positioned” to withstand losses than they were during the financial crisis, after which regulators pushed banks to hold more loss-absorbing capital.

Under the Fed’s “severely adverse” scenario—a deep recession with a rising unemployment rate, steep drop in housing prices and a nearly 50% decline in stock prices over nine quarters—30 banks would have suffered total loan losses of $366 billion, trading losses of $98 billion and a net loss before taxes of $217 billion.

The Fed also raised the bar in this year’s test by….”

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Markets Do Not Trust Yellen as Rates Rise

Janet Yellen said the Federal Reservewasn’t altering policy when it overhauled the way it signals changes in borrowing costs. Investors didn’t buy it.

In her first press conference as Fed chair, Yellen emphasized that dropping a 6.5 percent unemployment threshold for considering an interest-rate increase “does not indicate any change in the committee’s policy intentions.”

Rather than paying heed to Yellen’s assertion, investors seized on an increase in Fed officials’ own interest-rate forecasts and Yellen’s comment that that borrowing costs could start rising “around six months” after it stops buying bonds. Yields on two-year Treasury notes climbed as much as 10 basis points, the most since June 2011.

The market reaction highlights the perils faced by central bankers when they retreat to language investors consider vague after setting precise numerical markers for changes in policy. Lacking specific guidance in the Fed’s policy statement, investors swung toward the next best thing: Fed officials’ own forecasts for the benchmark federal funds rate.

“With the shift to qualitative guidance, the only quantitative metric we have is the fed funds projections from the Fed,” said Dean Maki, chief U.S. economist for Barclays Plc in New York and formerly an economist at the central bank. “So while the statement and Chair Yellen in the press conference said little had changed, the Fed’s projections suggested that there was a notable change in the Fed’s outlook.”

Broad Range

The Federal Open Market Committee said it will no longer link borrowing costs to a specific unemployment rate, saying it would instead consider a broad range of indicators on the labor market, inflation and financial markets.

“We know we’re not close to full employment, not close to an employment level consistent with our mandate, and unless inflation were a significant concern, we wouldn’t dream of raising the federal funds rate-target,” Yellen said at the press conference in Washington…..”

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Putin Announces Procedures to Annex Crimea

“(Reuters) – Russian President Vladimir Putin, defying Ukrainian protests and Western sanctions, told parliament on Tuesday that Russia will move forward with procedures to annex Ukraine’s Crimean region.

Putin signed an order “to approve the draft treaty between the Russian Federation and the Republic of Crimea on adopting the Republic of Crimea into the Russian Federation”. The order indicated the president would sign the treaty with Crimea’s Russian-installed leader, who is in Moscow to request incorporation into Russia, but it gave no date.

The move followed a disputed referendum in Crimea on Sunday, staged under Russian military occupation, in which a Soviet-style 97 percent of voters were declared to have voted to return to Russian rule, after 60 years as part of Ukraine.

By pressing ahead with steps to dismember Ukraine against its will, Putin raised the stakes in the most serious East-West crisis since the end of the Cold War.

But Ukraine’s interim prime minister, Arseniy Yatseniuk, sought to reassure Moscow on two key areas of concern, saying in a televised address delivered in Russian that Kiev was not seeking to join NATO, the U.S.-led military alliance, and would act to disarm Ukrainian nationalist militias.

On Monday, the United States and the European Union imposed personal sanctions on a handful of officials from Russia and Ukraine accused of involvement in Moscow’s military seizure of the Black Sea peninsula, most of whose 2 million residents are ethnic Russians.

Russian politicians dismissed the sanctions as insignificant and a badge of honor. The State Duma, or lower house, adopted a statement urging Washington and Brussels to extend the visa ban and asset freeze to all its members.

Leonid Slutsky, one of the lawmakers on the sanctions list, hailed Crimea’s decision as historic. “Today we see justice and truth reborn,” he said.

Japan joined the mild Western sanctions on Tuesday, announcing the suspension of talks with Russia on investment promotion and visa liberalization.

Putin was to address a special joint session of the Russian parliament on the Crimea issue on Tuesday…..”

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China Expects Growth of 7.5%, But They Are Extremely Worried Over Achieiving Estimates

“BEIJING—China’s leaders kept the growth target for their giant economy unchanged but signaled that they are more concerned than ever about reaching it, giving themselves the option of letting credit flow freely to keep from falling short.

The suggestion of more lending to buoy growth—despite repeated recent efforts to rein in debt—is the latest sign of government unease that a slipping economy could trigger higher unemployment and corporate failures, aggravating already high social tensions.

For years, China kept a growth target of about 7.5% but actually grew far faster; in the last two years the economy has barely cleared that figure, and many economists have said it would have a tougher time meeting the goal this year as its economy matures and global demand for its exports comes under pressure. That is a troubling trend for the rest of the world, which has increasingly depended on China to fuel the global economy.

At home, as well, the Chinese regime has felt pressures that can be exacerbated by a slowing growth rate. Last week the government set up a committee to improve cybersecurity and police the Internet, upsetting some middle-class Chinese who have taken to social media. Over the weekend, assailants rampaged through a provincial railway station, killing 29 in what the government says was the work of separatists from the northwestern Xinjiang region.

Chinese Premier Li Keqiang delivers the government work report during the opening meeting of the second session of the 12th National People’s Congress. ZUMAPRESS.com

In opening the annual session of the national legislature Wednesday in the Great Hall of the People, the leaders and the more than 2,900 delegates stood for a moment of silence to honor the victims of Saturday’s knife attack.

In his work report to the National People’s Congress, Premier Li Keqiang said government spending is being increased by more than 9%, with a push to build more public housing, and the overall fiscal deficit is projected to rise more than 12%.

Mr. Li called for a “balanced” monetary policy, in a change from the “prudent” monetary policy used last year. The slight wording change allows the government to loosen credit, a move that economists have said would likely give a short-term boost but worsen the growing credit problems plaguing local governments and the shadow-banking market.

Economists are bracing for trust and bond defaults this year and greater market volatility given the number of debt-plagued companies close to the edge. A third of the outstanding 4.6 trillion yuan ($750 billion) trust loans are due to mature this year, which many struggling firms rely on for capital…..”

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The G 20 States Inflation Fell Again In January Across the Globe

“The rise in consumer prices slowed across the world’s largest economies for a second straight month in January, driven by falling inflation rates in several large developing economies.

The low level of inflation will worry central bankers in those developed economies that are witnessing a prolonged period of sluggish price rises. In the euro zone, the annual rate of inflation stands at 0.8%, well below the European Central Bank’s target of just below 2.0%.

The ECB’s governing council meets Thursday and faces some pressure to provide further stimulus to boost growth and ensure inflation returns to its target over coming years.

The Organization for Economic Cooperation and Development said Tuesday the annual rate of inflation in its 34 developed-country members rose to 1.7% from 1.6% in December, while in the Group of 20 leading industrial and developing nations it fell to 2.6% from 2.9%.

Weaker global price rises were the result of declines in the annual rate of inflation in India, Indonesia, Russia and Brazil. The annual rate of inflation was steady in China and increased in South Africa.

When inflation is low, companies, households and even governments have a harder time cutting their debt loads, a particular problem for a number of highly indebted nations in the euro zone. Businesses can see their profit margins squeezed, lessening their willingness to invest and hire workers.

When prices start to fall, consumers can postpone purchases in the expectation that they will get better value for their money in the future. That can, in turn, weaken economic activity and create further deflationary pressures. Following the difficulties Japan has experienced in getting out of its long period of deflation, central banks in other countries are anxious to avoid a similar struggle.

Separate figures released by European Union’s statistics agency on Tuesday showed prices of goods leaving the euro zone’s factory gates fell at the fastest annual rate since the end of 2009 in January, adding to concerns that the currency area faces a period of low inflation that may hinder its recovery.

The steepening decline in producer prices suggests the inflation rate is unlikely to pick up significantly in the coming months. Speaking in Bilbao, Spain on Monday, the head of the International Monetary Fund warned that a prolonged period of low inflation in the euro zone may derail the currency area’s fragile economic recovery, and said that the threat must be countered with additional monetary stimulus…..”

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