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Oct 19, 2010

Gata ; The Gata Dispatches.-CFTC may delay commodity position limits,J.S. Kim: Banks are rigging all commodity markets along with gold. Oct. 18th., 2010

Lacking trading data, CFTC may delay commodity position limits

By Roberta Rampton and Christopher Doering
Tuesday, October 19, 2010
WASHINGTON -- Clearinghouses, their members, and swap dealers will have to report large swaps positions in 46 commodities to the U.S. futures regulator daily starting in six to 10 months in a plan unveiled on Tuesday.
The Commodity Futures Trading Commission said about 180 trading firms and swap dealers and five clearinghouses likely will need to report positions, an effort to help the agency police position limits for speculative trades as part of the sweeping new Wall Street reform law. The CFTC has intensified its focus on trading activity of banks and funds in commodity markets since 2008, when prices spiked to record levels in oil, wheat, and many other markets, prompting demands from consumers and lawmakers to crack down.
The proposed plan, which builds on CFTC's monthly "special call" report by expanding the number of firms that must report as well as increasing the frequency to daily, is a key piece of the CFTC approach to position limits, a separate proposal that will be unveiled in the next month. This proposal sets the bar for mandatory daily reporting high enough to exclude most end-users, an official said, and applies only to "economically equivalent" swaps that are either based on a futures price or mirror a futures contract.
The new Dodd-Frank financial reforms require the CFTC to set position limits for commodity futures and swaps. Energy and metals limits face a mid-January deadline and agricultural market limits must be finalized in April. That timetable puts the CFTC in the awkward position of having to establish the curbs before having complete data for bilateral and over-the-counter swaps.
"The primary source could be, in the future, swap data repositories, but those are not operational yet," an agency official said in a background briefing. While the new report will help the CFTC enforce and reset limits, it won't be ready in time for the agency to set its initial limits, the official said.
Commissioner Scott O'Malia said he is concerned that the new report will not provide a good enough base for the upcoming position limit rule, and suggested that the CFTC should delay its implementation. "I would prefer the commission take a ready, aim, fire approach to position limits, rather than to shoot first and ask questions later," O'Malia said.
The CFTC's five commissioners, including Chairman Gary Gensler, will vote on Tuesday whether to advance the proposed regulation to the next stage -- a public comment period lasting at least 30 days but possibly as long as two months. After staff consider changes, the commissioners will vote again to finalize the plan.
The Dodd-Frank law gives the CFTC oversight of the $615 trillion over-the-counter derivatives market. The bilateral contracts will now have to be reported, and most will have to trade and clear to increase transparency and diffuse risk. The CFTC has said it plans to unveil the first draft of all its proposed regulations to implement the law by the end of the year so that it can meet deadlines to finalize them by July.
On Tuesday, the CFTC also proposed a formal definition for "agricultural commodity," and two regulations dealing with protecting consumer financial information. Next Tuesday, CFTC commissioners will meet to vote on six other rules, including regulations to prevent manipulation and disruptive trading practices, and the process for reviewing
swaps for clearing, Gensler said.
Since June 2008, the CFTC has collected detailed information on swaps positions held by the largest financial traders each month through a "special call." Under the new rule, clearinghouses and dealers will have to report positions of 50 or more "economically equivalent" swaps (on a futures-equivalent basis) in any one month. A swap is deemed "economically equivalent" if the floating price refers to a futures contract settlement price or if it is a "lookalike" contract to a commodity futures.
The new report will mirror the CFTC's large trader reporting system for futures markets, and the threshold will be high enough to exclude most commercial end-users who use swaps to hedge their risk buying and selling physical commodities, an official said.
"A position of 50 futures-equivalent contracts seemed like a reasonable way to get visibility on the market. Then, as time goes by, the commission might consider whether a higher level or a lower level is appropriate," the official said.

J.S. Kim: Banks are rigging all commodity markets along with gold

5:19p ET Tuesday, October 19, 2010
Dear Friend of GATA and Gold:
J.S. Kim, managing director of SmartKnowledgeU, a financial research and consulting firm, and editor of The Underground Investor Internet site has written a wonderful essay concluding that all world commodity markets are manipulated by investment banks and governments and none of those markets is free. Kim writes of gold particularly:
"When I started discussing enormous fraud in the pricing behavior of gold markets six years ago, people regularly ridiculed me for my beliefs, especially whenever I publicly blogged about my beliefs. Back then my beliefs were grounded in my own research as well as the very substantial mountain of evidence provided by GATA that had not yet made its way into the general consciousness of the mainstream public. Today public beliefs about gold price suppression schemes have evolved 180 degrees. Now deniers of gold price suppression schemes, not I, are the ones viewed as naive. I believe the same realizations will eventually happen with all commodities, not just gold."
Kim is not alone in his conclusion. In his 2001 essay, "The Debasement of World Currency: It Is inflation, But Not as We Know It," the British economist Peter Warburton described the commodity market price suppression achieved by the explosion of derivative products:
Kim's essay is titled "Inside the Illusory Empire of the Banking Commodity Con Game" and you can find it at The Underground Investor here:
Or try this abbreviated link:

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MarketWatch : Personal Finance Daily.-The money ties that bind. Oct. 19th., 2010

Personal Finance Daily
OCTOBER 19, 2010

Tuesday's Personal Finance stories

Don't miss these top stories:

By MarketWatch

The Great Recession has not hit everyone equally, and the economic divisions that cross cities and towns can divide families too. People who are struggling financially may consider asking wealthier relatives for money, or maybe those relatives are offering up cash gifts without being asked. Should you accept the money? Perhaps.

Just keep in mind, that money may come with strings that long outlast the current crisis. Read Ruth Mantell's Diary of a Recession Baby column today for more on what families should consider before giving cash gifts to, or accepting them from, relatives.

Even in more normal economic times, an older parent is likely to be better off financially than his or her adult children, so even if you're gainfully employed and not necessarily facing hard times, should you let your parents give you some cash so, say, you can all go on vacation together, and the parents don't have stay at a low-budget motel? I guess that depends on the family.

Andrea Coombes , Personal Finance editor

Accept money from parents? Maybe not

My mother gave me $500 a few days ago, and I've been torn. The cash was to help offset part of the cost of a week-long vacation that we took together to Italy. While the money is helpful, it came along with an unpleasant emotion: guilt, tinged with embarrassment, for being an adult child who takes money from a parent.
Read more on accept money from parents? Maybe not.


Canada's public health care at crossroads

Just across the Ottawa River from the Parliament building, the seat of Canada's government, Linda Irving is defying her nation's 45-year-old health-care system.
Read more on Canada's public health care at crossroads.

The long wait in Canada for health care

If you're a Canadian seeking non-urgent medical treatment, the waits can be legendary. But most residents north of the border say they wouldn't trade their health-care system for anything. MarketWatch's Russ Britt reports.
Watch video on the long wait in Canada for health care.

Canada's limited health-care opportunities

Normally, it would be enough to make any U.S. chief executive drool. Corporate tax rates in the high-single-digit to mid-20% range, and little or no health-care insurance costs to worry about? In some ways, it's good to be a Canadian company.
Read more on Canada's limited health-care opportunities.


Contrarian analysis of gold market

Gold market timers' behavior is getting "curiouser and curiouser," to quote Alice in Wonderland's classic phrase.
Read more on contrarian analysis of gold market.

Commentary: Happy 23rd anniversary of the 1987 crash

Today is a somber anniversary for anyone who is at least 45 years old.
Read more on happy 23rd anniversary of the 1987 crash.

Investment pros embrace China, emerging markets

Risk is in vogue again. A survey released on Tuesday shows fund managers are increasingly embracing emerging-markets assets, spurred by expectations for greater liquidity in the global financial system.
Read more on investment pros embrace China, emerging markets.

SEC head: Agency shifting resources to make rules

The head of the Securities and Exchange Commission said Tuesday that the agency will have to shift resources from other "equally deserving areas" to approve rules from sweeping bank reform legislation.
Read more on SEC head: Agency shifting resources to make rules.

Hedge funds raise most assets since late 2007

Investors plowed $19 billion into hedge funds during the third quarter, the greatest amount since late in 2007, Hedge Fund Research Inc. said Tuesday.
Read more on hedge funds raise most assets since late 2007.

SEC slams hedge fund in ‘side pocket' suit

The Securities and Exchange Commission said Tuesday that it sued a hedge fund firm, alleging it improperly valued assets in a so-called side pocket.
Read more on SEC slams hedge fund in ‘side pocket' suit.


Housing starts rise for 3rd straight month, up 0.3%

New construction on U.S. housing units inched higher in September, the third straight monthly increase and a sign the housing sector may be stabilizing following the removal of government stimulus, Commerce Department data showed Tuesday.
Read more on housing starts rise for 3rd straight month, up 0.3%.

Another Tylenol recall from J&J

Johnson & Johnson has voluntarily recalled yet another batch of Tylenol following worries that its flagship pain-reliever's may be contaminated by the same chemical that led to eight recalls earlier this year.
Read more on another Tylenol recall from J&J.


Commentary: Inflation's just another word for cheap dollars

In recent meetings and statements, Federal Reserve officials have opined that the measure of inflation that they follow is rising too slowly, if at all.
Read more on inflation's just another word for cheap dollars.

Commentary: All crime and no punishment on Wall Street

If you want to take the pulse of how many Americans feel about justice meted out to Wall Street, take a look at the more than 200 comments posted to MarketWatch's story on the settlement between prosecutors and Angelo Mozilo, the former chief executive of Countrywide Financial.
Read more on all crime and no punishment on Wall Street.

PBoC hike could be part of quiet U.S.-China deal

Before delving into whether the U.S. and China have reached some secret pact on trade, let's first consider what one would look like.
Read more on PBoC hike could be part of quiet U.S.-China deal.

FDIC starts plan to replenish bank insurance fund

The Federal Deposit Insurance Corp. on Tuesday voted to launch an effort to boost its deposit insurance fund, even as the agency lowered its estimate of bank failure costs and cancelled a planned bank fee hike in 2011.
Read more on FDIC starts plan to replenish bank insurance fund.

NY Fed, investors push B. of A. to buy back loans

Bank of America Corp. has been hounded for months by demands to repurchase billions of dollars in home loans backing mortgage securities. On Tuesday, the Federal Reserve Bank of New York emerged as one of the sources of this pressure.
Read more on NY Fed, investors push B. of A. to buy back loans.

Commentary: Restoring sanity: Is Mitt Romney the real deal?

It's been a wild and woolly midterm season. One candidate's private security team handcuffs a journalist, another candidate slaps the hand of his opponent, and a third candidate refuses to shake his rival's hand because he's offended by a negative ad. A hyper-emotional TV personality leads a rally to restore America's honor, while a funny man organizes one to restore its sanity.
Read more on restoring sanity: Is Mitt Romney the real deal?

Commentary: Death of a democracy

Will anyone even bother voting in future elections? Will they get involved in political causes? Will they spend one dime of their savings supporting a political candidate or a campaign?
Read more on death of a democracy.

F& F I N : E-Commerce Leaders Launch Online Mall / Japanese Stock Futures, Australia index



E-Commerce Leaders Launch Online Mall

E-Commerce Leaders Launch Online Mall
The venture between Japan's 
Rakuten and China's Baidu 
poses a new challenge for 
Alibaba's Taobao site.
Japanese stock futures and Australia shares fell.
after China, the world's faster growing economy 
unexpectedly raised its lendin and deposits rates
to curb inflation

NYT: Breaking News Alert: C.I.A. Was Alerted About Bomber of Afghan Base, Inquiry Finds.

Breaking News Alert
The New York Times
Tue, October 19, 2010

C.I.A. Was Alerted About Bomber of Afghan Base, Inquiry Finds

Three weeks before a Jordanian double agent set off a bomb at
a remote Central Intelligence Agency base in eastern
Afghanistan last December, a C.I.A. officer in Jordan
received warnings that the man might be working for Al Qaeda,
according to an investigation into the deadly attack.

But the C.I.A. officer did not tell his bosses of the
suspicions -- brought to the Americans by a Jordanian
intelligence officer -- that the man might try to lure
Americans into a trap, according to the recently completed
investigation by the agency.

Read More:

CNBC Evening Brief : NY Fed, 8 Firms Threaten BofA Over Mortgage Securities. Oct.19th., 2010


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RTTNews: Evening Market Wrap.- Dow Falls Below 11,000 After China Hikes Key Interest Rate - U.S. Commentary. Oct. 19th., 2010

Evening Market Wrap Tue Oct 19 17:01 2010


Oct 19, 2010 Dow Falls Below 11,000 After China Hikes Key Interest Rate - U.S. Commentary Stocks sank by substantial margins on Tuesday as the U.S. dollar strengthened in reaction to China's unexpected rate hike, its first in nearly three years. The move also came despite some of the better-than-expected quarterly results from major firms such as Coca-Cola (KO), as traders focused on shortcomings by Apple (AAPL) in its iPad sales and a miss on the revenue line by Johnson & Johnson (JNJ). Full Article

Economic News

Oct 19, 2010 Housing Starts Up, But Drop In Permits Clouds Outlook For Recovery Construction of new homes increased more than expected to a five-month high in September, but permits for future home builds surprisingly fell, suggesting that the sluggish housing market may be in for a choppy recovery. The expiration of a popular tax credit in April ushered in a dry patch for the housing market attempting to snap back from the credit crash of 2008. Full Article

Corporate News

Oct 19, 2010 Intel To Invest Up To $8 Bln In Its American Facilities - Update Chipmaker Intel Corp. (INTC) Tuesday said the company would invest between $6 billion and $8 billion on future generations of manufacturing technology in its American facilities, including a new development fabrication plant, which could lead to the creation of up to a thousand high-tech jobs. Full Article
Oct 19, 2010 Goldman Sachs Q3 Profit Drops, Yet Beats EstimatesFinancial services firm Goldman Sachs Group Inc. (GS) reported Tuesday a 43% year-over-year drop in profit for the third quarter, reflecting sharply lower revenues from trading and principal investments as well as lower net interest income. Offsetting factors for the decline included revenue growth at investment banking unit and lower costs, which helped earnings beat analysts' estimates by a wide margin. Full Article
Oct 19, 2010 Coca-Cola Q3 Profit Rises, Beats View On Strong VolumesBeverage giant Coca-Cola Co. (KO) on Tuesday reported an 8% increase in profit for the third quarter, bolstered by strong growth in international volumes and the second straight quarter of volume growth in the North American region. Adjusted earnings per share grew 12% and topped analysts' consensus estimate. Full Article
Oct 19, 2010 New York Times Posts Narrower Loss In Q3Diversified media giant New York Times Co. (NYT) Tuesday reported a narrower loss in the third quarter, reflecting lower one-time charges. On an adjusted basis, earnings declined from last year on lower revenues from print advertising and circulation, yet managed to come in above analysts' forecast. The company also expects modest improvement in print advertising revenue trends in the fourth quarter while circulation revenues are projected to be down, similar to the third quarter. Full Article
Oct 19, 2010 Johnson & Johnson Q3 Profit Tops Estimates, But Revenue DisappointsHealth care giant Johnson & Johnson (JNJ) reported Tuesday a higher profit for its third quarter, which came above market projections, reflecting strong Pharmaceutical sales. Meanwhile, total sales edged down from the prior year and also missed market estimates, reflecting lower U.S. sales. However, the company lifted its fiscal 2010 adjusted earnings forecast to a range which could meet or beat analysts' view. Full Article
Oct 19, 2010 Harley-Davidson Q3 Profit Surges, Tops EstimatesHeavyweight motorcycles maker Harley-Davidson Inc. (HOG) reported Tuesday a surge in third-quarter profit, despite lower sales, helped by a turn around at its financial services unit, compared to a loss last year. The company, which has been in a transformation, posted a narrower loss from discontinued operations on its divesture of MV Agusta subsidiary. Further, the company narrowed its full year 2010 guidance for shipments of motorcycles by about 5% to 7% from last year. Full Article
Oct 19, 2010 Bank Of America Posts $7.3 Bln Loss In Q3Financial services major Bank of America Corp. (BAC) reported Tuesday a wider net loss in its third quarter, hurt by a hefty impairment charge. On an adjusted basis, the company turned around to a profit on lower credit costs and higher net interest income, and significantly surpassed market projections. Meanwhile, revenues missed their view, despite a growth. Full Article

Forex Basic

Oct 19, 2010 Dollar Storms Back As Global Economic Woes Mount The dollar rallied across the board on Tuesday, supported by speculation that its recent fall to a yearly low was overdone in light of the severe headwinds still facing the global economy. The dollar, generally thought of as a safe haven currency, has been beaten up over the past months, in large part due to the Federal Reserve's willingness to keep interest rates near zero while contemplating another round of quantitative easing. Full Article

Political News

Oct 19, 2010 US, Israel Call For Added Pressure On Iran Against Nuclear ThreatThe United States and Israel have called on the international community to continue efforts to put pressure in changing Iran's "strategic calculus" and preventing that country from acquiring nuclear weapon capability. Full Article
Oct 19, 2010 British PM Announces 8% Cut In Defense SpendingBritish Primer Minister David Cameron on Tuesday announced an 8% cut in the country's defense spending over a period of four years. The move is expected to reduce expenditure in wake of the economic downturn and marks Britain's first strategic defense review in 12 years. Full Article
Oct 19, 2010 UN Pledges Help To Philippines Over Typhoon HavocThe United Nations has pledged help to the Philippines to recover from the aftermath of the super-typhoon Megi that hit northern part of the country on Monday. Packing wind speeds of over 140 miles per hour (225 kilometer) near its center, super-typhoon Megi, known in the Philippines as 'Juan,' made landfall in Sierra Madre in north-eastern Luzon island. Full Article
Oct 19, 2010 Cuomo, Paladino Upstaged In Bizarre New York Governor's Debate The highly anticipated New York governor's debate featuring Democratic front-runner Andrew Cuomo and Republican Carl Paladino, his closest challenger, was dominated by five fringe party candidates Monday night. The usual debate fodder -- taxes, wasteful spending, entitlements, and social issues -- was overshadowed by a series of bizarre remarks from little-known hopefuls representing upstart organizations like the Rent Is Too Damn High Party. Full Article

F & F I N : Reuters Investor Update.-Wall Street slides as mortgage worries hit banks. Oct . 18th., 2010


Wall Street slides as mortgage worries hit banks
Yahoo disappoints on revenue forecast
Investors and White House press banks over mortgages
China surprises with first rate rise since 2007
BofA faulty mortgage woes overshadow earnings
Goldman traders slump but still power earnings
Smartphones to drive AT&T, Verizon, Sprint results
Housing starts at 5-month high, still depressed
Parker, ITW suggest healthier industrial economy
Officials hint Fed on the verge of more easing

NYT: Afternoon Busibness News.- A grey Market in Real State. Oct 19th., 2010

In China, a City With Lots of Buildings, but Few People

China's sizzling economy created a speculative real estate market - and ghost towns.

Stocks Sharply Lower on Wall Street

China's announcement that it would raise interest rates weighed on the market, and investors found disappointment in earnings reports from Apple and I.B.M.

States Continue Foreclosure Inquiries

Despite Bank of America's announcement that it will resume foreclosures after its review found no evidence of error, state law-enforcement officials and the White House say they will continue their inquiries.

Bank of America Reports $7.3 Billion Loss, Citing Charges

Without the one-time writedown, the bank said it earned $3.1 billion, or 27 cents a share, which topped forecasts.

Goldman Sachs Tops Estimates in a Weak Third Quarter

While the firm's headline numbers beat estimates, expectations have been fading for weeks over a quarter that saw bond and equity markets fall.

F & F I N : U. S : Stocks Markets At Close Snapshot. Oct 19th., 2010


Major Indexes
 Last  Change  % Chg
DJIA*10978.62 -165.07   -1.48
Nasdaq*2436.95-43.71 -1.76
S&P 500*1165.90-18.81 -1.59 

MarketWatch: Special Financial Services.-Brazil Real Falls Due To hike In Taxes / Investments Pros embrace China

Latin American Markets: Brazil’s real falls as government hikes tax
By Carla Mozee MarketWatch
10/19/2010 01:13:51 PM

The currency drops as Brazil ramps up efforts to curb the real’s gains. 

By Sue Chang MarketWatch

Risk is in vogue again. A survey released on Tuesday shows money managers are increasingly embracing emerging-markets assets, spurred by expectations for greater liquidity in the global financial system. 

MarketWatch: Special Financial Services:- S&P 500 hesitates at the 200-week average

The Technical Indicator: S&P 500 hesitates at the 200-week average
By Michael Ashbaugh MarketWatch

Following a nearly straight-line, six-week spike, the S&P 500 has reached a technically significant inflection point. 

F & F I N : NFA 's Business Conct Committee Decisions, Member Responsability Actions. Oct. 19th., 2010

 National Futures Association

F & F I N : FINRA warns investors about High Yield Investment Programs. Oct 19th., 2010

F & F I N : NFA Issues Alert Regarding New Forex Rules. Oct. 19th., 2010

National Futures Association

MarketWatch: Special Financial Services: Hedge Funds pull in most assets / Financial stocks down after bank earnings crushh

Hedge Funds: Hedge funds pull in most assets since late 2007
By Alistair Barr MarketWatch

With assets on the rise, an index of managers run by Hedge Fund Research shows losses from the financial crisis now erased. 

By John Spence MarketWatch

Bank stocks weaken as investors digest mixed results from Goldman Sachs and Bank of America. The financial sector is caught up in the stock sell-off as the dollar rallies after China’s surprise rate hike. 

F & F I N . U.S. Major Indexes Snapshot At at mid morning

All the indices decline at open due to a big sell off on  technology stocks.
At  10:09 a.m Snapshot from The WSJ 

Major Indexes
 LastChange% Chg
S&P 5001172.62-12.09-1.02