The Canadian Press, By Alexander Panetta, February 24
Washington – U.S. President Barack Obama made good Tuesday on a threat to veto a bill to approve the Keystone XL pipeline, bringing the two sides in the long-running controversy to a rare point of agreement: their battle is far from over.
”The president’s veto of the Keystone jobs bill is a national embarrassment,” said the top Republican in the House of Representatives, John Boehner.
”We are not going to give up in our efforts to get this pipeline built — not even close.”
Even the White House concurred that the issue is far from settled. It pointed out that Tuesday’s announcement was a step in a long, winding process — not a final destination.
The president cast the veto as a matter of procedural principle. In his letter to Congress, Obama said the bill he was scrapping had improperly tried to usurp presidential authority.
Reports suggest JP Morgan will initiate charges on certain deposits
Bidness, Etc., By Larry Darrell, February 24
The largest bank in the US in terms of assets, JP Morgan Chase & Co., is likely to start charging large customers on deposits and is making holding money costly for clients, reports the Wall Street Journal.
The move is an attempt to reduce the effect on deposits that are affected by billions of dollars and is said to bring the number down in 2015. It is the recent in a series of discussions by big banks to discourage certain deposits by corporate clients that are attracted by the low interest rates and new regulations.
Sources privy to the matter said that the memo in place cites new rules that will not affect retail clients. However, some financial firms and corporate clients might be charged higher fees. It is reported that JP Morgan will unveil the bank’s strategy with investors on Tuesday.
“We are adapting to a changing regulatory environment across our company,” Wall Street Journal quotes the JP Morgan memo sent on Monday.
Wall Street Journal [paywalled]: J.P. Morgan to Start Charging Big Clients Fees on Some Deposits
US union leaders have launched a large-scale strike at nine refineries after failing to agree on a new national contract with major oil companies.
BBC, February 1
It marks the first nationwide walkout since 1980 and impacts plants that together account for more than 10% of US refining capacity.
The United Steelworkers Union (USW) began the strike on Sunday, after their current contract expired and no deal was reached despite five proposals.
The USW said it “had no choice”.
“This industry is the richest in the world and can afford to make the changes we offered in bargaining,” USW International Vice President of Administration Tom Conway said in a statement.
Reuters: Workers strike for second day at nine U.S. oil, chemical plants
Al Jazeera investigates ties between Louisiana and the Chinese government in a proposed $1.85 billion methanol plant.
Al Jazeera, By Massoud Hayoun, January 26
This article is part one of a three-part series on China’s role in redeveloping southern Louisiana called China’s Louisiana Purchase.
St. James Parish, LA — A prominent Chinese tycoon and politician — whose natural gas company has a dubious environmental and labor rights record that recently started coming under fire in the Chinese press — is parking assets in a multibillion dollar methanol plant in a Louisiana town. And he appears to be doing it with help from the administration of likely GOP 2016 presidential ticket contender Louisiana Gov. Bobby Jindal.
Not many locals in a predominantly black neighborhood of St. James Parish — halfway between New Orleans and Baton Rouge — know that Wang Jinshu, the Communist Party Secretary for the northeastern Chinese village of Yuhuang and a former delegate to the National People’s Congress, is the man at the helm of a $1.85 billion methanol plant to be built in their town over the next two years with a $9.5 million incentive package from the state. The details of the project are unclear, residents say, largely because they were not told about the project until local officials, amid discussions with state officials and Chinese diplomats, decided to move forward with the project in July 2014.
“We never had a town hall meeting pretending to get our opinion prior to them doing it,” said Lawrence “Palo” Ambrose, a 74-year-old black Vietnam War veteran who works at a nearby church. “They didn’t make us part of the discussion.”
Al Jazeera, by Tom Kutsch, January 14
“Banks are under assault.”
That was the resounding message from Jamie Dimon, CEO and President of JPMorgan Chase, in a conference call with reporters on Wednesday, announcing a fourth quarter decline in profits for the nation’s largest bank.
“We have five or six regulators coming at us on every issue,” he said, adding that this spoke of a general wrong directed at his industry: “You all should ask the question, ‘How American that is? How fair that is?”
Zero Hedge: Bank Of America Misses Revenue By $2 Billion As Trading Revenue Collapses; Fires Thousands
Zero Hedge: “It’s Carnage” – Swiss Franc Soars Most Ever After SNB Abandons EURCHF Floor; Macro Hedge Funds Crushed
Zero Hedge: UBS’ Take On The Swiss Shocker: “The SNB’s Standing Is Undermined… There Could Be A Significant Deflationary Shock”
Zero Hedge: Market Wrap: “It’s Turmoil” – Overnight Gains Wiped Out, Futures Trade Below 2000 On SNB “Shock And Awe”
Bloomberg, By Liam Vaughan, December 29
Halfway down a muddy, secluded road on marshland in suburban Essex sits Wharf Pool, a lake stocked with some of the biggest freshwater fish you will ever see.
A white sign with red lettering reads: “Private Syndicate: Strictly Members Only.” A metal gate, a barbed-wire fence and two CCTV cameras bar the way. Anglers hoping to spend time on the lake’s carefully tended banks must join a waiting list. Those who make it to the top pay a membership fee that buys them the chance to catch a carp that weighs more than a Jack Russell. There are hundreds of them swimming beneath the surface. It’s close to shooting fish in a barrel.
An hour away by train, in London’s financial district, the lake’s owners ply their trade. Wharf Pool was purchased for about 250,000 pounds ($388,000) in 2012 by Richard Usher, the former JPMorgan Chase & Co. (JPM) trader at the center of a global investigation into corruption in the foreign-exchange market, and Andrew White, a currency trader at oil company BP Plc. (BP/)
With revenue of almost $400 billion last year and operations in about 80 countries, BP trades large quantities of currency each day. Traders at the company regularly received valuable information from counterparts at some of the world’s biggest banks — including tips about forthcoming trades, details of confidential client business and discussions of stop-losses, the trigger points for a flurry of buying or selling — according to four traders with direct knowledge of the practice.
Zero Hedge picks up the story: The Rigging Triangle Exposed: The JPMorgan-British Petroleum-Bank Of England Cartel Full Frontal
The ugly ramifications of the Trade in Services Act (TiSA)
Wolf Street, By Don Quijones, December 25
Much has been written, at least in the alternative media, about the Trans Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP), two multilateral trade treaties being negotiated between the representatives of dozens of national governments and armies of corporate lawyers and lobbyists (on which you can read more here, here and here). However, much less is known about the decidedly more secretive Trade in Services Act (TiSA), which involves more countries than either of the other two.
At least until now, that is. Thanks to a leaked document jointly published by the Associated Whistleblowing Press and Filtrala, the potential ramifications of the treaty being hashed out behind hermetically sealed doors in Geneva are finally seeping out into the public arena.
Washington Post, By David Nakamura, December 26
President Obama is preparing a major push on a vast free trade zone that seeks to enlist Republicans as partners and test his premise that Washington can still find common ground on major initiatives.
It also will test his willingness to buck his own party in pursuit of a legacy-burnishing achievement. Already, fellow Democrats are accusing him of abandoning past promises on trade and potentially undermining his domestic priority of reducing income inequality.
The dynamic, as the White House plots strategy for the new year when the GOP has full control of Congress, has scrambled traditional political alliances. In recent weeks, Obama has rallied the business community behind his trade agenda, while leading Capitol Hill progressives, including Sen. Elizabeth Warren (D-Mass.), have raised objections and labor and environmental groups have mounted a public relations campaign against it.
The administration is moving aggressively in hopes of wrapping up negotiations by the middle of next year on a 12-nation free-trade pact in the Asia Pacific before the politics become even more daunting ahead of the 2016 presidential campaign.
“This is an all-hands-on-deck moment for the administration,” said Rep. Ron Kind (D-Wis.), a pro-trade Democrat viewed by the administration as a key ally. “They need to get out and educate members and address the concerns they might have. I’ve been advising colleagues who are skeptical and not supportive of trade to at least engage in conversations and feedback.”
Business Insider, By Mike Bird, December 11
French inflation just sank to another five-year low, down at 0.4% in November, compared to the same month last year, leaving France even further away from the European Central Bank’s 2% inflation target.. Analysts were expecting a 0.5% figure.
But it’s even worse than that. France’s core inflation is now at -0.2%. It’s negative for the first time the country started recording it. It’s much harder to blame falling oil prices for that: core inflation deliberately strips out volatile items like fresh food and energy, to try to give an idea of the underlying trend.
BBC, December 7
Japan’s economy shrank more than initially estimated in the third quarter of 2014, according to revised gross domestic product (GDP) figures.
The economy contracted by 1.9% in annual terms from July to September, well above a preliminary reading of 1.6%.
It also shrank 0.5% on a quarterly basis, compared with an initial estimate of 0.4%, data showed.
A big fall in business spending plunged the economy into a deeper recession.
The revised figures, which come just days before Japan’s national elections, showed that business spending dipped by 0.4% from the previous quarter, instead of the 0.2% estimated in the preliminary reading.
It’s always been:
“What do you call 100 lawyers at the bottom of the sea?”
“A good start.”
What do you call 39 dead bankers?
North Dakota took on the oversight of a multibillion-dollar oil industry with a regulatory system built on trust, warnings and second chances. The cooperative approach doesn’t seem to generate results.
NYT -In early August 2013, Arlene Skurupey of Blacksburg, Va., got an animated call from the normally taciturn farmer who rents her family land in Billings County, N.D. There had been an accident at the Skurupey 1-9H oil well. “Oh, my gosh, the gold is blowing,” she said he told her. “Bakken gold.”
It was the 11th blowout since 2006 at a North Dakota well operated by Continental Resources, the most prolific producer in the booming Bakken oil patch. Spewing some 173,250 gallons of potential pollutants, the eruption, undisclosed at the time, was serious enough to bring the Oklahoma-based company’s chairman and chief executive, Harold G. Hamm, to the remote scene.
More of this lengthy, detailed article at the link. (image: Brent McDonald/NYT)
Value Walk, By Mark Melin, November 21
After press reports reveal more than a cozy relationship, but sharing of confidential documents, investigation called for on eve of Senate testimony on the issue
After a withering expose in The New York Times that showed bank regulators at the New York Federal Reserve sharing confidential information with Goldman Sachs and earlier disclosure from secret tapes inside the New York Fed showed regulators providing the large Wall Street bank kid glove treatment, comes a two-pronged investigation and a call for structural changes.
In a letter to the Inspector General for the Federal Reserve System and the Consumer Financial Protection Bureau Thursday, Scott Alvarez, general counsel at the Federal Reserve Board of Governors, and Michael Gibson, director of banking supervision, both with primary offices in Washington DC, are requesting an investigation into the operations at the New York Federal Reserve and other locations.
“After consultation with the Chair and other Board members, we respectfully request that the Office of the Inspector General conduct a review of… the manner in which the Federal Reserve System conducts examinations of large banking organizations (with over $50 billion in total assets),” the letter requested. The vast majority of such banks are located in New York City.
The Washington DC-based inspector-general is being asked to examine if there are “adequate methods for decision makers to obtain all the necessary information to make supervisory assessments” and if there are channels, both within and outside the immediate chain of command, for decision-makers to be aware of divergent views about material issues regarding large banking organizations addressed by the members of the dedicated examination team?
New York Times: New Scrutiny of Goldman’s Ties to the New York Fed After a Leak
ProPublica: Federal Reserve Announces Sweeping Review of Its Big Bank Oversight
Report Notes Deals Between Goldman, Deutsche and Others Drove Up Aluminum Prices
The Wall Street Journal, by Christian Berthelsen & Ryan Tracy, November 19
Washington — A U.S. Senate report on commodity-market activities at big Wall Street banks accuses the firms of being so powerful they were able to influence prices, gain trading advantages and put the broader financial system at risk by entering volatile businesses such as uranium trading and coal production.
The two-year, bipartisan probe by the U.S. Senate Permanent Subcommittee on Investigations is the most extensive look at how banks like Goldman Sachs Group Inc., J.P. Morgan Chase & Co. and Morgan Stanley built up voluminous inventories of aluminum, copper and other commodities. The report said the banks often exceeded regulatory limits on the size of commodity holdings. It portrays banks straying far beyond their traditional business lines to dabble in lucrative but risky activities that posed legal and financial threats to the firms.
The findings are likely to put additional pressure on the Federal Reserve as it considers whether to restrict or reduce Wall Street banks’ role in physical commodity markets. A two-day hearing on the report begins Thursday, with Fed Gov. Daniel Tarullo expected to testify on Friday. The Fed, which is reviewing its oversight of banks’ commodity-market activities, declined to comment.
The banks identified in the report said they adequately manage risks of the activities and don’t use their commodities business to gain an unfair advantage. All three firms have moved to reduce their commodities holdings amid congressional and regulatory scrutiny.
New York Times: Senate Report Finds Goldman and JPMorgan Can Influence Commodities
New York Times: Senate Report on Wall Street’s Role in Commodities
Reuters: In Senate hot seat, Goldman denies commodity manipulation Add to …
This, via Monksworks, from Thomas Merton:
Let me say this before rain becomes a utility that they can plan and distribute for money. By “they” I mean the people who cannot understand that rain is a festival, who do not appreciate its gratuity, who think that what has no price has no value, that what cannot be sold is not real, so that the only way to make something actual is to place it on the market. The time will come when they will sell you even your rain. At the moment it is still free, and I am in it. I celebrate its gratuity and its meaninglessness.
The rain I am in is not like the rain of cities. It fills the wood with an immense and confused sound. It covers the flat roof of the cabin and its porch with insistent and controlled rhythms. And I listen, because it reminds me again and again that the whole world runs by rhythms I have not yet learned to recognize, rhythms that are not those of the engineer.