Even the Wall St Journal is against the Fed's latest attempt to paper over bank losses.

Denninger posted a lengthy commentary today, with some of the most important issues in the middle of it.
One key issue is that WSJ is against the Fed's latest attempt to paper over bank losses.
http://market-ticker.org/akcs-www?post=200337

Breaking down the Market Ticker report:

1. The Fed is has sent an unsolicited white paper to Congress, in an attempt to get Congress to cover the bank's butts on losses,
and the paper admits that if implemented, there will be losses which " must ultimately be allocated among homeowners, lenders, guarantors, investors, and taxpayers."
( anyone but the banks, that is).
Denninger helpfully links to the pdf of the paper
http://federalreserve.gov/publications/other-reports/files/housing-white-paper-20120104.pdf

2. Further in the Ticker column are details of the fact that banks are sitting on HUGE piles of losses from 2nd mortgages, and a discussion of why these are monstrous ticking time bombs for all of us, esp. pension funds:

" * The losses are real but being hidden by further Fed actions! Just one example is the hundreds of billions of dollars of second lines (Home Equity and "Silent Second" mortgages) that are behind underwater, non-performing first line mortgages. These have an actual net present value in a foreclosure of zero, as they're not entitled to one penny of recovery until every dollar of the first is satisfied, and the first is underwater and thus will not be fully recovered. All of our large banks have monstrous exposures in this regard -- almost none of these loans were securitized and thus they are all sitting on bank balance sheets, most at nearly 100 cents on the dollar. These accounting values are fictions.

The reason that The Fed and our Government are desperate to hide these losses, praying for a miracle to somehow keep them from being recognized, is quite simple -- these long-duration investments are typically held by insurance companies and pension funds. Recognition of these losses will cause the allegedly "healthy" firms and funds that hold this paper to be shown to be severely impaired or worse."

I urge a read of the column. VERY illuminating. The White paper is also worth tucking away for posterity.
Hopefully one day it will be an exhibit in a trial of those who wrote and signed it.

Anyone here enjoy being " a loner"????

Love solitude?
Find you need huge amounts of time to be inside your head with your own thoughts, reading, etc?

Know and appreciate the difference between "being alone" and being "lonely"?
Prefer the company of pets/animals to people?
Can count the number of "good" friends on one hand?

And if you answered yes to most of the above, are you decidedly comfortable about it?

Transocean’s CFO steps down

The chief financial officer of offshore drilling contractor Transocean is stepping down from that role effective Monday, the company said Thursday.

Ricardo Rosa will retire from the company April 30. A search firm is helping find his successor.

Gregory Cauthen is returning to the Swiss-based Transocean as interim CFO.

He was a consultant to the company from September 2009-August 2010. Before retiring from Transocean in August 2009, he was the company’s CFO.
http://fuelfix.com/blog/2012/01/05/transoceans-cfo-steps-down/

I keep an eye on Gulf of Mexico oil/BP news around here.
In the past, CFO's have "stepped down" sometimes ahead of lawsuits ( think Enron, etc)

Doctors going broke ( and how imminent Medicare cuts are making it worse)

I just read 2 articles that deserve attention for all of us who rely on small practice doctors.

First article:
"Half of all doctors in the nation operate a private practice. So if a cash crunch forces the death of an independent practice, it robs a community of a vital health care resource.

"A lot of independent practices are starting to see serious financial issues," said Marc Lion, CEO of Lion & Company CPAs, LLC, which advises independent doctor practices about their finances.

Doctors list shrinking insurance reimbursements, changing regulations, rising business and drug costs among the factors preventing them from keeping their practices afloat. But some experts counter that doctors' lack of business acumen is also to blame."
http://money.cnn.com/2012/01/05/smallbusiness/doctors_broke/index.htm

and what is adding to that cash crunch? Decreasing Medicare payments, set to go into effect this month.

"The payroll tax impasse in Congress has put Medicare doctors on edge over the likelihood that their pay could be slashed 27.4% in two weeks time.

Under current law, health care providers to the nation's 45 million Medicare beneficiaries -- including physicians, nurse practitioners, physical therapists and podiatrists -- face reduced government reimbursement payments on Jan. 1."

and this part:
"Federal law requires that Medicare reimbursement rates be adjusted annually based on a formula tied to the health of the economy. That law says rates should be cut every year to keep Medicare financially sound.

Although Congress has blocked those cuts from happening 13 times over the past decade, most recently on Dec. 23 with a two-month temporary "patch," this dilemma continues to haunt doctors every year."
http://money.cnn.com/2011/12/21/smallbusiness/medicare_cuts/index.htm?iid=EL

Now, look at the growing number of over 65 people who have reduced income, depend on Medicare, and depend on small dr. practices for their health services., especially those of us who live in rural/small town areas.

Not a rosy picture. Already one of the 3 dr. offices in town here is reducing staff.

USA ( the LA) Arson Suspect Also Faces German Fire Probe

The man who allegedly ignited more than 50 fires that terrorized Los Angeles last week is also under investigation in Germany for a house fire near Frankfurt.

U.S. investigators also disclosed Wednesday that a search of Harry Burkhart's Hollywood apartment turned up news articles about the Los Angeles fires and a series of car blazes in Germany last year.

The disclosures came on a day when Burkhart made an awkward first court appearance in Los Angeles, where he appeared dazed with his long hair matted on the front of his face, and alternated between sitting and standing.

The ponytailed Burkhart was arrested Monday near the Sunset Strip in a van with Canadian license plates loaded with fire-starting materials, and he has stonewalled investigators while being placed on a suicide watch. His mother, Dorothee Burkhart, appeared disoriented in federal court Tuesday after being arrested on a fraud warrant from Germany, where she referred to Nazis and questioned if her son had died.

http://abcnews.go.com/US/wireStory/la-arson-suspect-faces-german-fire-probe-15294507

Pigs..good enough for Sarah, good enough for Newt. Hell, yeah!

[IMG][/IMG]

A Parallel Quagmire: The Trans-Afghanistan Gas Pipeline

Very interesting story, esp. to those who have been following the Adventures in Afghanistan over the last 20 years,

"The perpetually postponed U.S. withdrawal from Afghanistan tracks a little too closely with timelines for another fubar project, the Turkmenistan-Afghanistan-Pakistan-India gas pipeline.

TAPI, as the pipeline is known, ought to be called TBD. It’s been a Big Oil dream since the mid-1990s, and a decade’s-long American military presence in the region has brought it no closer to reality. The Afghan news outfit Killid Media reported yesterday that “Little has happened on the TAPI natural gas project involving four countries a year after [an] agreement was signed by the governments.”

Planners are promising the project could be in operation by 2016. … Work which was delayed by security concerns will start from early 2012 and finish in two years…

Are the pipeline planners scheduling based on the projected 2014 timeline for U.S. withdrawal from Afghanistan, or vice-versa? Does it matter? Either way, there are signs that the U.S. government is doubling down on the project as Pakistani leaders have indicated they might prefer a competing pipeline proposed to connect Pakistan and a U.S. adversary, Iran."

http://www.warisbusiness.com/7808/news/a-parallel-quagmire-the-trans-afghanistan-gas-pipeline/#more-7808

First broker failure of the year: due to fraud?

Added info: Note the REST of the story below this one, which explains WHY the company may have closed its doors ( fraud)


WJB Capital Halts Brokerage Operations

WJB Capital Group Inc., a Wall Street firm with more than 100 employees, shut its brokerage operations amid “financial issues,” according to the company’s attorney.

“A decision was made -- and I might say it was a very painful decision -- that it would terminate its broker-dealer operations, and it has done so,” Mark Skolnick, general counsel for the company at law firm Platzer, Swergold, Karlin, Levine, Goldberg & Jaslow LLP, said today. The closely held firm has some non-brokerage operations and is exploring “other possibilities,” he said in a phone interview today.
WJB Capital was “unable to raise capital in a manner that would have allowed the firm to continue its operations given the current climate and the constraints that would have been placed on everyone,” Chief Executive Officer Craig A. Rothfeld said in an interview. The New York-based firm shut voluntarily, he said.
http://www.bloomberg.com/news/2012-01-03/wjb-capital-halts-brokerage-operations.html

Note: Unlike MF global the company holds no client funds nor is it going to file for bankruptcy...but it IS closing, after expanding twice since 2005.
denninger has a take on it in his Market Ticker today also...
http://market-ticker.org/akcs-www?post=200006

Added info:

WJB Capital Group Sued for Alleged Fraud

WJB Capital Group Inc. the Wall Street firm that said it shut down its brokerage operations, was sued in New York over an alleged fraud.
WJB Capital and its chief executive officer, Craig Rothfeld, were accused of fraud and breach of contract by an individual who said he made a $250,000 investment in the company, according to a complaint filed Dec. 31 in New York State Supreme Court in Manhattan.

The plaintiff, James McNally, said in his complaint that he was promised “compensation for the duration of the investment.” WJB Capital failed to pay and used the money “for fraudulent purposes,” according to the complaint.

Rothfeld said in a phone interview that McNally provided an eight-year, $250,000 loan to the firm, not an equity investment, and received monthly interest.

http://www.bloomberg.com/news/2012-01-03/wjb-capital-group-sued-for-alleged-fraud.html

Bank of America severing some small-business credit lines

By E. SCOTT RECKARD - Los Angeles Times
Published Mon, Jan 02, 2012 08:20 PM


LOS ANGELES -- Bank of America Corp., under pressure to raise capital and cut risks, is severing lines of credit to some small-business owners who have used them to stay afloat.

The Charlotte, N.C., bank is demanding that these customers pay off their credit line balances all at once instead of making monthly payments. If they can't pay in full, they are being offered new repayment plans for as long as five years, but with far higher interest rates than their original credit lines had.

Business owners complain that BofA's credit squeeze is abrupt and could strain their small companies and even put them out of business.
The credit cutoff is coming at a time when the California economy can't seem to catch a break, and bucks what the financial industry says is a new trend of easing standards on business loans.
http://www.newsobserver.com/2012/01/02/1749212/bank-of-america-severing-some.html

Found a very cool site for those who have repair all sorts of household items: