Tag Archives: Too Big To Succeed

Millions of US government workers hit by data breach

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“Chinese hackers are suspected of carrying out a ‘massive breach’ affecting the data of millions of US government workers, officials said.  The Office of Personnel Management (OPM) confirmed on Thursday that almost four million current and past employees have been affected.  The breach could potentially affect every federal agency, officials said.  Susan Collins, a member of the Senate Intelligence Committee, said the attack was thought to originate in China.  OPM serves as the human resource department for the federal government.  The agency issues security clearances and compiles records of all federal government employees.”

http://www.bbc.com/news/world-us-canada-33017310

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They’re Coming for Your Accounts

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“Just a week or two ago, the International Monetary Fund (IMF) published a horrifying paper, called The Fund’s Lending Framework and Sovereign Debt. That paper, in turn, was based on one from December 2013, called Financial and Sovereign Debt Crises: Some Lessons Learned and Those Forgotten.  Major media ignored all of this, of course.  The December 2013 document, right at the start, says that ‘financial repression’ is necessary.   That’s not my interpretation; those are their words.  It’s not just the IMF, of course. The US Treasury has had a group working on these ideas since the Bush administration.”

http://www.caseyresearch.com/freeman/they-are-coming-for-your-accounts

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African Bank rescue rekindles bailout fears

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“South Africa’s decision to rescue a small lender seen as neither ‘too big’ nor ‘too interconnected’ to fail shows that taxpayers worldwide may have to accept that bank bailouts are here to stay.  When South Africa’s central bank recently announced a $700 million (520 million euro) rescue of faltering African Bank Investments Limited, it scarcely made a splash outside the country.  The bank’s managers made far too many bad loans to too many South Africans who could not afford to pay them back.  Because it had not asked borrowers to put up their car or any other asset as collateral, it was left with a massive hole in its balance sheet when they failed to pay.”

http://www.moneyweb.co.za/moneyweb-financial/african-bank-rescue-rekindles-bailout-fears

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Congress slams Fed’s permanent crisis lending proposal

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“A bipartisan group of lawmakers on Monday urged the Federal Reserve to restrict its crisis lending programs for big banks.  Congress approved billions of dollars in 2008 to stabilize banks. In addition, the Fed launched its own programs, such as an overnight loan facility for primary dealers.  In all, the Fed provided more than $13 trillion to banks that relied on emergency lending programs for an average of 22 months, the letter said. ‘These loans were another bailout in all but name,’ the lawmakers said.  The group criticized rules the Fed proposed in December 2013 to implement the Dodd-Frank requirement that emergency programs provide liquidity to the entire financial system, not failing banks.”

http://www.baltimoresun.com/business/sns-rt-us-financial-regulations-fed-20140818,0,2845782.story

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The Single Most Important Strategy Most Investors Ignore

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“‘If I scare you this morning, and as a result you take action, then I will have accomplished my goal.’ That’s what I told the audience at the Sprott Natural Resource Symposium.  But the reality is that I didn’t need to try to scare anyone. The evidence is overwhelming and has already alarmed most investors; our greatest risk is not a bad investment but our political exposure.  And yet most of these same investors do not see any need to stash bullion outside their home countries. They view international diversification as an extreme move. Many don’t even care if capital controls are instituted.  I’m convinced that this is the most common—and important—strategic investment error made today.”

http://www.caseyresearch.com/cdd/the-single-most-important-strategy-most-investors-ignore

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$90 million spent on now-abandoned Maryland Obamacare exchange

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“Maryland’s Obamacare exchange received millions in federal taxpayer dollars to build its Affordable Care Act website and was even awarded early innovator grants that earned it even more taxpayer funding. But the website crashed on the first day of open enrollment and officials have been unable to fix it.  The late decision won’t help anyone who hoped to sign up for health insurance on the exchange for 2014. The open enrollment period in Maryland closes Friday, with a special exception for more than 18,000 people who have already requested extra time to sign up due to the website’s problems.”

http://dailycaller.com/2014/04/18/maryland-obamacare-exchange-spent-90-million-on-technology-before-abandoning-website/

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Bill Bonner: The Fed’s Childishly Naïve Theory of Credit

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Bill-Bonner2

“The $33 trillion spent by Americans over the last four decades or so did not come from savings. Instead, it came out of thin air – from the banking system, which contrary to the common belief that it requires some pre-existing money (in the form of cash deposits or reserves) to make loans, simply creates them out of nothing.  In other words, this credit creation did not represent resources that had been set aside – like seed corn – to prime future growth.  No one ever deprived himself of a single meal, or as much as a single beer, to save the money. No one troubled himself to work even a single hour to earn it. No one toiled or spun.”

http://www.bonnerandpartners.com/the-feds-childishly-naive-theory-of-credit/

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Global Debt Exceeds $100 Trillion as Governments Binge

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“The amount of debt globally has soared more than 40 percent to $100 trillion since the first signs of the financial crisis as governments borrowed to pull their economies out of recession and companies took advantage of record low interest rates.  The $30 trillion increase from $70 trillion between mid-2007 and mid-2013 compares with a $3.86 trillion decline in the value of equities to $53.8 trillion, according to the Bank for International Settlements and data compiled by Bloomberg.  Borrowing has soared as central banks suppress benchmark interest rates to spur growth Yields on all types of bonds, from governments to corporates and mortgages, average about 2 percent.”

http://www.bloomberg.com/news/2014-03-10/debt-exceeds-100-trillion-as-governments-binge.html

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Western banking regulations could be ‘mutually destructive’: IMF

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“Western governments have put in place banking regulations that could be ‘mutually destructive’ and undermine efforts to prevent bust banks from costing taxpayers billions of pounds, according to a report by the International Monetary Fund.  Policymakers representing the world’s biggest financial centres have failed to make the banking sector stand on its own feet by ending implicit subsidies and co-ordinating rescue plans when multinational banks go bust, the Washington-based lender of last resort said.  Subsidies to the banking sector in some countries are as high as they were before the crash, amounting to $590bn (£355bn), with the eurozone the worst affected.”

http://www.theguardian.com/business/2014/mar/31/western-banking-regulations-costly-mutually-destructive-imf-report

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Cyprus abolishes maximum daily cash withdrawal limits

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“In a decree issued by the finance ministry, the 300 euro limit per person per day was scrapped, along with restrictions on breaking fixed-interest time deposits prior to maturity.  The decree also allowed, under conditions, individuals to open bank accounts in other credit institutions.  Restrictions remain on moving money abroad. Cypriot officials have previously said they anticipate that all controls could be fully lifted by the end of 2014.  Cyprus was forced to wind down a major bank and convert large deposits in a second to recapitalise it in order to qualify for aid from the International Monetary Fund and the European Commission.”

http://www.reuters.com/article/2014/03/28/cyprus-capital-controls-idUSL5N0MP3GP20140328

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