October 19, 2010 posts

Business / Economic / Financial

[ This link to a somewhat more cumulative blog posts page will precede current days news since most all topics remain current in terms of impact and longer-term effect and can be searched by topical index term more easily. The same is provided since the blog site http://alpeiablog.blogspot.com has just been censored as to size by google which is typical for google as nsa / cia / gov’t shill as more are becoming aware of. The same is true for microsoft, another co. that’s seen their best days and relies on the government to maintain their monopoly. Up to now the better page http://www.scribd.com/alpeia is provided for ease of formatting and clarity thereby while the Washington Post page is the real deal but without formatting http://www.washingtonpost.com/wp-srv/community/mypost/index.html?plckPersonaPage=PersonaComments&plckUserId=alpeia&newspaperUserId=alpeia ]

Look Closer - It's a Giant House of Cards Simon Maierhofer, On Tuesday October 19, 2010, 7:14 pm Call me a hopeless 'free market' romantic, but I believe that the natural forces of supply and demand (and cause and effect) will eventually trump the Federal Reserve's underhanded, yet obvious, efforts to pump up the market. If you are curious to know how the Fed massages the stock (NYSEArca: VTI - News) and commodity markets (NYSEArca: DBC - News) in an effort to keep the economy from collapsing, keep reading. But before we get there, let's take a look at a problem that is as obvious as it is ignored.
Bad News is Good News and Good News is Good News If you've ever been asked: 'Honey, does this skirt look too tight,' you know there's only one response that won't have negative consequences. Right now, the market - at least according to Wall Street and the media - is in a win-win position. Any commentary to the contrary is met with disdain. Good news means the economy is improving. Bad news means more quantitative easing is on the way. Any news is good news. But what about the foreclosure debacle or mortgage bust 2.0? It seems like investors have not even begun to price in the eventual ramifications. Without going into too much detail, courtesy of faulty foreclosure procedures, many mortgage payers may have the legal right to walk away from their debt. Banks (NYSEArca: KBE - News) and other financial institutions (NYSEArca: XLF - News) on the other hand have no recourse of getting their money back. The plot for the financial sector continues to thicken ... and continues to be ignored.
Obvious and Ignored Simultaneously, Bloomberg featured the following two headlines on Monday: 'Citigroup profits exceeds estimates on decline in provision for bad loans' 'Mortgage buybacks may cost lenders $120 billion, JPMorgan says' In case the irony of the headlines isn't obvious, here it is again: Citigroup rallied over 5% because profit increased due to a reduction of bad loan provisions, while a fellow banking giant sees a $120 billion future liability caused by bad loans. Is this a problem that can be hidden via another round of accounting rule changes? As I look at the performance of stocks, I wonder how long it will take for investors to realize the magnitude of the problem. Stocks don't care, which means investors don't care - at least not yet. Overall, the market reminds me a lot of April 2010. For a period of weeks, the S&P (SNP: ^GSPC) and Dow (DJI: ^DJI) kept inching higher, making incremental new recovery highs and thereby pushing sentiment readings to an extreme. It seemed like the rally would never end, but it did. On April 16, the ETF Profit Strategy Newsletter took note of this unhealthy behavior and stated that: 'The message conveyed by the composite bullishness is unmistakable bearish.' Note the reason for investors' bullishness in April and compare it to today. The newsletter continued: 'Most bulls have no clue why they are bullish except for the fact that they feel the need to play the momentum game. It doesn't take an economist to see how fragile the economy really is.' Have things improved since April? Let's see; unemployment has gone up, GDP has been revised down, banks are struggling, real estate (NYSEArca: IYR - News) continues to slide, Europe has been patched although hit with more downgrades and the foreclosure landslide has hit the fan. Things have gotten worse, yet stocks have come back to revisit the April highs. How come? There's an explanation with an 89% accuracy ratio; more in a moment. Crushed by an Elephant You can't write an article right now without commenting on Apples earnings. In case you haven't heard, they were outstanding. Apple has a variety of great products. After countless crashes, I switched from a PC to Mac and haven't regretted the move. I'm the proud owner of the 'iTriple' (iPod, iPad and iPhone) and have no complaints. But investors are a fickle and insatiable bunch. No matter how good things are, they want better. How much better can it get for Apple? More iPhone sales through Verizon, is huge. Christmas season is big, but hasn't that already been priced in? The entire technology sector (NYSEArca: XLK - News) collapsed in 2000. Busts are always a surprise and they always occur at the top. AAPL (NasdaqGS: AAPL - News) accounts for 20.93% of the Nasdaq (Nasdaq: ^IXIC), as much as Google, Qualcomm, Microsoft, Oracle, Amazon and Cisco combined. As Apple goes, so goes the Nasdaq. In Monday's after hours trading, Apple is down over 5%.
More than a 'Rotten Apple' Apple is not the only liability to the market. Complacency is another. The VIX (Chicago Options: ^VIX) is trading at the lowest level since April and small option trades are about as hopeful as they were in April. Small option traders are one of the purest real-money sentiment gauges as they aren't clouded by institutional hedging cross currents.
Rising Prices, How and Why? Since the Fed has been unable to create consumer inflation (why else would we need QE2?) it has shifted its focus to another type of inflation - asset inflation. As the administrations attempts to propel the economy have failed, it realizes that the stock markets role as a nation's mood barometer is crucial to the economy's survival. A declining stock market would surely deliver a depression.
Monetizing Debt Monetizing debt was the buzzword in early 2009, when the Federal Reserve agreed to buy $1.2 trillion of government and government agency debt (such as Fannie Mae and Freddie Mac). By so doing, the Federal Reserve exchanged crisp new dollar bills against toxic debt. This also meant that the U.S. dollar was not only backed by U.S. Treasuries, it was also backed by toxic mortgages. Quite a departure from the gold (NYSEArca: GLD - News) standard. The chart below shows the soaring balance sheet of the Federal Reserve. [chart]

In POMO They Trust Who are 'they?' POMO is the Federal Reserve's Permanent Market Operations. Via POMO, the Fed buys back T-Bonds from banks and financial institutions. 'They' are banks. Banks sell the T-Bonds at a profit and invest the additional funds in stocks and commodities. A rising stock market - even if devoid of any fundament reason - is what the government wants. It doesn't matter that the same banks that started the financial wreckage now make money with the clean up. The chart below illustrates this process. Entire books have been written to explain the unethical role of the Federal Reserve. The November issue of the ETF Profit Strategy Newsletter explains the process concisely and understandably in a few pages. [chart]


POMO vs. Free Market As mentioned above, I am a free stock market romantic and believe that normal market forces will drag the market down as swiftly as it's come up. But, POMO should not be underestimated. It's success rate in lifting the market is in some instances higher than 80% and the Fed is holding a lot of POMO purchases before the November 2nd elections, probably in an attempt to keep prices up (a detailed analysis of the POMO effects on the S&P and schedule of future POMO purchases is available in the November ETF Profit Strategy Newsletter). Whether you are bullish, bearish or confused, the coming days/weeks seem to be pivotal in determining whether POMO will drive prices up, or market forces will push prices down. The ETF Profit Strategy Newsletter includes a forecast for the days, week, and month ahead, along with safety and target levels that help navigate the market and stay on the right side of the trade.

Sharp Declines Send DJIA Back Below 11,000 Midnight Trader Oct 19, 2010 --

• NYSE down 147.5 (-1.9%) to 7,423.65
• DJIA down 165.07 (-1.5%) to 10,979
• S&P 500 down 18.8 (-1.6%) to 1,166
• Nasdaq down 43.71 (-1.8%) to 2,437

GLOBAL SENTIMENT

Hang Seng up 1.25%

Nikkei up 0.43%

FTSE down 0.67%

UPSIDE MOVERS

(+) EMC reports jump in profit.

(+) GS beats with earnings.

(+) MEE said to be looking at strategic options.

(+) CSCX sold for $2.30 a share.

(+) COIN says debt eliminated.

(+) KO tops with Q3 results.

DOWNSIDE MOVERS

(-) AAPL continues evening decline that followed earnings beat but mixed outlook.

(+) BAC gained initially then fell after mostly improved earnings, mortgage concerns.

(-) IBM beats and guides above Street but struggles in wake of results.

(-) VMW unable to hold initial gain after earnings beat.

(-) INFN down sharply after results.

(-) CWTR continues evening slide after earnings warner.

(-) MSFT says chief software architect leaving post.

(-) HOG beats with earnings, shy with revenue.

(-) JNJ shifting between positive and negative territory after profit gains.

MARKET DIRECTION

Stocks were down 2% at one point and end around 1.5% to 1.8% lower. The blue-chip Dow is back below 11,000, putting up its worst performance since August 11 after China hikes rates sooner than expected and as key tech earnings provide little incentive for fresh broad-market gains.The major indexes had advanced Monday, with the Dow industrials ending at their highest level since May 3, an area that likely triggered some profit taking early Tuesday.In addition to tech declines, financial shares were broadly lower.Bank of America shares fell 2.6% after a Bloomberg report, citing people familiar with the matter, said investors PIMCO and BlackRock as well as the New York Federal Reserve Bank were seeking to force the lender to repurchase $47 billion in mortgage bonds.A morning report showing improvement in a measure of home construction starts provided little traction for stocks.Commodities finished broadly lower as crude futures suffer their worse one-day loss in eight months. Gold also finished lower.Crude oil for November delivery closed down 4.3%, or $3.59, to settle at $79.49 a barrel. Meanwhile, gold shares are lower as traders responded to a jump in the dollar. Gold for December delivery closed down 2.6% to $1,336 an ounce.Earnings weighed on stocks from the start of the regular session.

IBM (IBM) shares are lower after it reported Q3 EPS of $2.82 per share, better than the analyst consensus of $2.75 per share on Thomson Reuters. Also, Apple (AAPL) is lower as it reported Q4 revenue of $20.34 billion, blowing past Street estimates of $18.9 billion. For Q1, the company expects revenue of $23 billion and EPS of $4.80 per share. The Street is at $22.3 billion in revenue and earnings of $5.07 per share.Google Inc. (GOOG) is lower after the Internet group ended its contract with seven Chinese advertising resellers from Oct. 27. The companies had been given a month's notice. According to Credit Suisse, the seven distributors contributed about $226 million in gross revenue last year, which represents about 40% of Google's overall revenue in China. Google gave no specific reason for ending the contracts, but the company has been facing censorship conflicts with the Chinese government in recent years.Microsoft Corp (MSFT) fell in morning trade after its chief software architect, Ray Ozzie, stepped down. Ozzie was tapped by founder Bill Gates five years ago as his successor in the role, but CEO Steve Ballmer said that no one will be named to replace the outgoing Ozzie.Intel (INTC) shares are lower after the chip making giant said it will invest between $6 billion and $8 billion on future generations of manufacturing technology in its American facilities. The projects will support 6,000 to 8,000 construction jobs and result in 800 to 1,000 new permanent high-tech job, the company said.BP Plc. (BP) plans to shutter its Lingen oil refinery in Germany in the third quarter for maintinence, Bloomberg reported. The company plans to stop the Gelsenkirchen refinery in Germany in the fourth quarter of 2011.The Lingen refinery has oil-processing capacity of 93,000 barrels a day, the report said. The Gelsenkirchen has a capacity of 266,000 barrels a day, the report said.In other earnings news, Goldman Sachs (GS) is just firmer as it reports Q3 earnings of $2.98 per share, well ahead of the analyst consensus of $2.32 per share but down from $5.25 per share a year ago. Revenue was $8.90 billion, down from $12.37 billion a year ago. The Street was looking for $7.9 billion in revenue.Bank of America (BAC) is looking to restart foreclosure affidavits in 102,000 cases where judgement is pending, Bloomberg reported. The bank will "defend our shareholders" said CEO Brian Moynihan in an interview with Bloomberg, according to the report. He went on to say that most claims "don't have the defects that people allege," the report said. BofA reported a third-quarter loss of 77 cents a shares compared to the Thomson Reuters mean analyst estimate for $0.16 per share.

Will Floating QE2 Sink the Economy? McMorris In 2007, savers in America actually were "dis-saving" or saving at negative rates of about -2%, according to the Federal Reserve. But now that Americans understand the need to cut debt, savings rates have rebounded correspondingly to over 6%. Question: If we view the 8% swing as a one-time step down to a new baseline, could we grow GDP at a 3-4% desired rate from that baseline and maintain a 6% savings rate? My answer? No! The 8% change in savings behaviour has a significant impact on aggregate consumption. What is saved is not spent. With 70% of the American GDP dependent on Consumption, such a significant impact will necessarily have a negative impact to GDP.To better understand this secular (generational) change in behaviour, here is the formula for GDP:

GDP = Consumption (Private) + Investment + Govt Spending + Net Trade (where imports are negative)

For GDP to grow, one or all of those elements must grow. Consumption is said to have a 70% weighting ($10.3T of $14.6T in Q1 2010), so its growth is most important (at an 8% delta in consumption, the impact to GDP is 5.6%). Exports are negative, and no matter how much we depreciate the dollar, X will probably not turn positive, so no help there. Government spending subtracts from Consumption and Investment in reality, since it is not productive. So, though it has been 15% of the equation historically, it has moved toward 25% as Consumption has declined. Government Spending must be reduced for a healthy economy, so no growth there, but contraction. Investment does not include Savings, Bond or Share Purchases, so what has been lost in Consumption to Savings is lost to GDP growth. So, while the step function towards savings brought GDP down to 1%, what will happen to move it back up, and therefore allow profits to continue to expand and eventually for businesses to re-employ? Got me. We are in a classic "liquidity trap", just like Japan. I think our population is inherently more biased to consumption, so I don't think we stay trapped for as long. But it won't be easy to get out. By component: Consumption has been impacted by both unemployment increases and savings increases. It may not continue to shrink, but it won't grow much either (therefore the PIMCO-inspired label "New Normal"). We do have the benefit in this country of an annual population increase of around 1%. That helps as compared to Japan which has no immigration. Considering the consumer commitment to debt reduction and static unemployment, I think another 2% of growth, on top of population, is probably all that can be asked for. So, 3% x .70 weighting = 2.1% contribution. But Savings will continue to subtract from GDP (since it reduces Consumption). Savings does not turn into investment until businesses conduct capital expansion projects, and replacement does not count. For the same reason, equity ownership of businesses does not count either as it is mostly a matter of trading existing shares. An IPO or secondary offeirng would contribute to GDP if the proceeds were used for capital purchases. I don't think govt financed "Infrastructure Projects" count either, as they are mostly replacement or repair of existing public capital (roads and sewers). Businesses sitting on big piles of cash detracts from GDP as the money is not Invested in the GDP sense. 1% contribution, best case? Government spending continues to contract (especially state and local). No help here for GDP growth and instead it is likely to subtract from GDP over the coming years by 2-3% as pension and other government benefit programs undergo a squeeze. The real estate tax base is not coming back anytime soon and so spending must also be contracted. Net Exports may become less negative with a dollar devaluation policy. But the impact will be small. Most other exporting economies are depreciating their currencies in kind so as to not lose competitive advantage. The only beneficiary are commodities and precious metals. Maybe we go from -2% to -1%. No real help. Bottom line: where do we get GDP growth? I show (2.1 + 1 - 2 - 1) = 0.1%. This is the a normal that is different than in the past and a wise investor will consider if this is the economic environment that will lift the value of equity markets. Author's Disclosure: No positions in stock discussed in this article

Homebuilders Remain Pessimistic


Nicholas Perna: Downside Risks Are Greatest in Coming Year

From Global Depression to Global Governance Andrew Gavin Marshall | We now stand at the edge of the ‘Great Global Debt Depression,’ where nations are beginning to implement ‘fiscal austerity’ measures to reduce their deficits.

Why California is About to Fall Off Into an Ocean of Unpayable Debt EconomicPolicyJournal.com | By around 2012 or 2013, the three major state pensions’ obligations will be more than five times as large as total state tax revenue.

Dollar Declines for Fifth Week on Prospects of More Monetary Easing by Fed Bloomberg | The dollar fell for a fifth week against the euro as traders speculated the Federal Reserve will further ease monetary policy, debasing the greenback.

Leaked Budget Reveals UK Plan To Fire 1% Of The National Population The UK austerity measures are starting to go from bad to worse.Photographers snapped photos of Treasury Secretary Danny Alexander holding an open copy of the unreleased Strategic Defence and Security Review, according to Daily Mail. Now British are going crazy guessing whether or not this was an intentional leak to the press.

The New Tax Man: Big Banks and Hedge Funds Nearly a dozen major banks and hedge funds, anticipating quick profits from homeowners who fall behind on property taxes, are quietly plowing hundreds of millions of dollars into businesses that collect the debts, tack on escalating fees and threaten to foreclose on the homes of those who fail to pay.

Here Is The Real Reason Why The Fed Is Delaying The New $100 Bill A few weeks ago, the Fed announced that the new $100 dollar note has been delayed, and will not make broad circulation by the February 2011 scheduled date.

Mortgages Were Fraudulently Pledged to Multiple Buyers at the Same Time April Charney – a consumer lawyer with Jacksonville Area Legal Aid – and CNBC’s Dennis Kneale noted in February 2009 that courts have found that some mortgages have been sold again and again to different trusts, when they should have only been sold once.

(10-19-10) Dow 10,978 -165 Nasdaq 2,436 -44 S&P 500 1,165 -19 [CLOSE- OIL $79.49 (-54% for year 2008) (RECORD TRADING HIGH $147.27) GAS $2.74 (reg. gas in LAND OF FRUITS AND NUTS $3.11 REG./ $3.26 MID-GRADE/ $3.35 PREM./ $3.69 DIESEL) / GOLD $1,336 (+24% for year 2009) / SILVER $23.78 (+47% for year 2009) PLATINUM $1,663 (+56% for year 2009) / DOLLAR= .72 EURO, 81 YEN, .63 POUND STERLING, ETC. (How low can you go - LOWER)/ 10 YR NOTE YIELD 2.47% …..… AP Business Highlights ...Yahoo Market Update... T. Rowe Price Weekly Recap – Stocks / Bonds / Currencies - Domestic / International This Is a Secular Bear Market and The End of Buy and Hold … and Hope MARKET MANIPULATION AND HOW THE LATEST BUBBLE-FRAUD PRE-COMING CRASH IS BEING ACCOMPLISHED 3-11-10 6 Theories On Why the Stock Market Has Rallied 3-9-10 [archived website file] Risks Lurk for ETF Investors The bull market that never was/were beyond wall street b.s. when measured in gold Property Values Projected to Fall 12% in 2010 Jan 31, 2010 The Week Ahead: Risk Is Off the Cliff; Unwind Has Begun Jan 31, 2010 01-13-10 Forecast for 2010 from Seeking Alpha Contributor THE COMING MARKET CRASH / CORRECTION 1-28-10 Maierhofer (01-15-10) 11 Clear Signs Economy Sinking Economic Black Hole 1-22-10: 20 Reasons Why The U.S. Economy Is Dying And Is Simply Not Going To Recover Current Economic / Fiscal Charts Trendsresearch.com forecast for 2009 1-7-10 Crash is coming! ‘WORST ECONOMIC COLLAPSE EVER’ Must Read Economic / Financial Data This Depression is just beginning The coming depression… thecomingdepression.net MUST READ: JEREMY GRANTHAM’S QUARTERLY UPDATE 25 January 2010 (850 on the S&P) by TPC The Next Wave of Collapse is Coming Sooner than you think Sliding Back Into the Great Depression ABSOLUTELY, ABSURDLY, RIDICULOUS! SELL / TAKE PROFITS WHILE YOU CAN SINCE MUCH, MUCH WORSE TO COME!

National / World

Whistleblower Speaks On Fraudclosure Zero Hedge has been approached by an individual who participated directly in the various aspects of what is now broadly known as Fraudclosure.

The Biggest Bank Robbery In History? More Quantitative Easing = Backdoor Bailouts The U.S. Federal Reserve is getting ready to conduct another gigantic bailout of the big banks, but this time virtually nobody in the mainstream media will use the term “bailout” and the American people are going to get a lot less upset about it.

U.S. Debt Woes Expose Hidden Austerity and Looting of Public Assets The austerity sharks are circling their wounded prey. The U.S. economy continues to collapse amid dwindling stimulus funds, while states are barely able to keep their heads above water.

Democrats Announce Plan to Bribe Seniors with $250 Check as Election Nears Kurt Nimmo | Democrats insist the bribe is meant to make up for a second year without a cost-of-living increase.

Analysts And Democrats Slam Attack On Rand Paul, Washington Post Persists With Smear Steve Watson | Paul hits back with his own campaign ad, may boycott final debate with Conway.

EU Dictators Plan Fresh Looting Of Tax Slaves Paul Joseph Watson | Brussels bastards want to impose direct tax on already destitute Europeans laboring under draconian austerity measures.

Establishment Republicans Poised to Take Control of House from Establishment Democrats Kurt Nimmo | Every four years or so one party replaces the other and the same basic policies are pursued with new vigor.

Will Americans Follow French Example Of Mass Civil Unrest? Paul Joseph Watson | Or will the sleeping middle classes continue to scratch their butts and watch Dancing with the Stars?

Terrorists storm Chechen parliament killing 3, security repels raid A group of militants who broke into the parliament of Russia’s Republic of Chechnya have all been killed in a shootout with special forces. At least three other people died after the gunmen stormed into the building in the capital Grozny.

China Raises Benchmark Rate By 25 bps Undoubtedly, this is its response to not being labeled a currency manipulator. However, as the US will most likely never raise rates again, and with the Yuan still pegged to the dollar, unlike in a typical recovery, where this would signal the elimination of excess liquidity in an attempt to prevent inflation, this time it is a largely symbolic move.

Foreign worker numbers surge to a record 2.4m as Eastern Europeans return to Britain The number of foreigners working in Britain has hit an all-time high despite the fragile state of the recovery. This summer, the total topped 2.4million for the first time after thousands arrived from abroad in the spring.

As French Strikes Continue, Country Runs Out Of Gas As the ongoing strikes in France against austerity continue, and see increasingly more participation, the latest development is all too familiar to all those who travelled through Athens in the summer: huge lines for gas.

Violent French Protests Show Why A New Debt Crisis Is Inevitable French protests continue to rock France, with marchers throwing Molotov cocktails and blocking fuel supplies.

CIA sues former agent for publishing book... Gertz [ Suit filed in virginia, near Langley and D.C., you don’t have to be a clairvoyant to know how that suit turns out … which is always great for the court hearing the case since ‘bonus money’ is invariably involved ... such an outcome is a real tragedy for this defacto bankrupt and pervasively corrupt nation and the world. ] ‘The CIA has filed a breach of contract lawsuit against a former deep-cover agent who published a book critical of the agency without allowing CIA censors to remove large portions of the manuscript before publication. Ishmael Jones, pen name for the 20-year CIA veteran and Arabic speaker who said he sought to expose corruption in the agency, is facing a civil lawsuit over his 2008 book, "The Human Factor: Inside the CIA's Dysfunctional Intelligence Culture."The book is a detailed account of his career inside the CIA's clandestine service and his work as a "nonofficial cover" operative in the Middle East and Europe."The book contains no classified information and I do not profit from it," Mr. Jones told The Washington Times. "CIA censors attack this book because it exposes the CIA as a place to get rich, with billions of taxpayer dollars wasted or stolen in espionage programs that produce nothing …’

Drudgereport: SHOWDOWN: French Strikes Intensify...
Sarkozy vows crack down...
DAY 6: Violent turn...
Thousands protest against looming cuts in London...
SHOWDOWN: China halting key minerals to USA...
ANGER...
HAS THE FED RUN OUT OF IDEAS? [ Quite some time ago, actually. ]
THE 'INFLATION' OPTION...
Dollar Declines for Fifth Week...
Support for Afghanistan war at all-time low...
17 SOLDIERS KILLED IN PAST 3 DAYS...
Limbaugh: Obama looks 'demonic' in new photos … and limbaugh knows demonic, himself and relative wobama ... [Obama Distant Cousins with Palin, Limbaugh, Bush | CNSnews.com Obama Distant Cousins with Palin, Limbaugh, Bush. Obama's Related to Palin. Wednesday, October 13, 2010. By Jocelyn Noveck, Associated Press ... www.cnsnews.com/news/.../obama-distant-cousins-palin-limbaugh-bushes (wobama, palin, limbaugh, bush distant cousins … I knew there were some dark secrets there … hillbilly heroin, etc.. – Wow! Talk about the nation-declining dangers of inbreeding! Poor defacto bankrupt, pervasively corrupt america never had a chance! ) ]
ABCNEWS: 63 Dem House Seats in 'Serious Danger'...
Barone: Dems find careers threatened by ObamaCare votes...
GALLUP: Unemployment at 10.0% in Mid-October...

Cartels beef up presence in U.S. (Washington Post) [ I strongly recommend the entertaining, albeit exaggerated for shock effects, films by the talented director Robert Rodriguez, ‘Machete’ and ‘Once Upon a Time in Mexico’. The important point in the films is the manipulation and interwoven money connections, pieces of the action, bribes, etc. (see infra, RICO case, 10-15-10 letter to the FBI , ( http://www.albertpeia.com/112208opocoan/ricosummarytoFBIunderpenaltyofperjury.pdf http://www.albertpeia.com/112208opocoan/PeiavCoanetals.htm ). While I assume he’s of Mexican-American descent, and only slightly biased as a consequence, realize that a real life american story, names, etc., wouldn’t get made / distributed. Those Cartels referenced in this article wouldn’t be here without inside american help, very, very high up and quite officially unofficial. ] When a major Mexican drug cartel opened a branch office in San Diego, U.S. authorities tapped into their cellphones -- then listened, watched and waited.

Previous: Large U.S. paramilitary presence in Afghanistan (Washington Post) [ Yeah … defacto bankrupt america can really afford it … you know, to protect (and participate in) their resurgent heroin trade to the benefit of the few ‘insiders’. ] Existence of covert CIA teams, operating near the Pakistan border, is revealed in a new book by Bob Woodward and documents released by WikiLeaks.

U.S. (accidently on purpose) says Chinese bypassing sanctions (Washington Post) [ Riiiiight! ‘Johnny-on-the-spot’ defacto bankrupt america all over this one … Riiiiight! Come on … what’s defacto bankrupt america gonna’ do … threaten not to let China buy ever more worthless american paper … not let Apple produce their computers, ipods, ipads, iphones, components there, etc., among other so-called american companies. ]

Majority says federal workers are overpaid for work they do (Washington Post) [ A glaring instance where the majority is clearly right, and accurate polls as those done by the Washington Post are welcomed! ‘A new Post poll finds negativity toward federal workers.’ Previously posted: GOP targets federal workers' pay (Washington Post) Issue becomes midterm flash point in wake of high unemployment, stagnant private-sector wages. Poll: Are federal government salaries too high? The obviousness of the answer to this question brings to mind such rhetorical queries as ‘do bears s*** in the woods’ and ‘is the Pope Catholic’, etc.. Of course, unequivocally responding in the affirmative does not do justice either to the obvious response or to the preposterousness of the sense of importance attached to these so-called employees who have to be considered the most over-paid, incompetent, and most cases corrupt (all 3 branches of the u.s. government included, along with the fed, etc., … and what about those lifetime appointments … abolish them! ) and lazy employees anywhere, anytime. Indeed, given the damage they’ve done, they should be paying the taxpayers! ]

The ugly truth about the economy (Washington Post) [ Well, Mr. Sloan is quite right to be talking about the ugly truth about the economy; except, it’s far uglier than even he dares to imagine or put down in writing, particularly for defacto bankrupt, pervasively corrupt america … Economists Herald New Great Depression The world is currently experiencing the modern day equivalent of the Great Depression, according to a prominent economist who has added his voice to scores of others now forecasting ongoing economic doom on a scale not seen since the 1930s.) , and my position and that of demographer Dent (This is a global depression. This is a secular bear market in a global depression. The past up move was a manipulated bull (s***) cycle in a secular bear market. This has been a typically manipulated bubble as has preceded the prior crashes with great regularity that the wall street frauds and insiders commission and sell into. This is a typical wall street churn and earn pass the hot potato scam / fraud as in prior crashes’. This national decline, economic and otherwise, will not end until justice is served and the wall street frauds et als are criminally prosecuted, jailed, fined, and disgorgement imposed. Krugman: It's All Downhill From Here Cullen Roche Love him or hate him Paul Krugman has been awfully right with regards to the macro picture in the last few years. He’s one of the rare economists who had the foresight to see the housing bubble and the likelihood of economic downturn that would result from it. Krugman recently caused a stir when he said the US economy was headed for the third depression. He isn’t back down from that outlook:

I’ve had a couple of conversations lately with people who follow politics and public affairs, but aren’t that close to the economic discussion — and I’ve discovered that there are two comforting delusions still out there.

Delusion #1 is that we’re on the road to recovery, just more slowly than we’d like; to be fair, the White House keeps saying this.

But it’s not at all true. GDP is growing below potential; employment, even if you focus just on private employment, is growing more slowly than the working-age population. If you ask how long it will take us to return to, say, 5 percent unemployment on the current track, the answer is forever.

Delusion #2 is the belief that the stimulus may yet do the trick, because there are still substantial funds unspent. I tried to deal with this last year. The level of GDP depends not on total funds spent, but on the rate at which funds are being spent, which has already peaked; GDP growth on the rate of change in the rate at which funds are being spent, which peaked last year. It’s all downhill from here.

If you can ignore the schizophrenic market for just a second it’s hard to reject Krugman’s macro outlook. The private sector has been running on fumes since the debt bubble burst in 2007. The government’s extraordinary actions helped bolster the economy, but merely papered over what was a very weak private sector. As we see the government step aside it’s difficult to imagine that the weakness at the private sector won’t again be exposed for what it really is.
Here Are 13 Signs That We’re Actually In A Depression Right Now Gregory White | David Rosenberg has outlined, in his latest letter, the 13 reasons with this so-called recovery is actually a depression… David Rosenberg has outlined, in his latest letter, the 13 reasons with this so-called recovery is actually a depression.Rosenberg sums it up like this:

This is what a depression is all about — an economy that 33 months after a recession begins, with zero policy rates, a stuffed central bank sheet, and a 10% deficit-to-GDP ratio, is still in need of government help for its sustenance.

Harry Dent, Jr. Economy will be in a Depression by 2011
The worst of this next depression is likely to hit between mid-2010 and mid-2013, especially around early 2011, but if the banking system continues to implode a deep downturn or depression could begin sometime in 2009 instead of 2010.
Dow will Fall to 3,800 – 4,500 by 2012
Nasdaq will Fall Below 1,100, its 2002 low, by late 2010 or mid-2012 at the latest.
Inflation will Increase until mid- 2010 and then turn to Deflation
Interest Rates will Increase
U.S. Dollar will Decline
Housing will Decline by 40 – 60% from Today’s Levels
Greatest Economic and Banking Crisis since the 1930s will Occur Between 2010 and 2012). ]

Survey: Half of Wall Street expects bigger bonus this year (Washington Post) [ This is nothing short of incredible … What they should be expecting, for the sake of the nation and the world, is an 8 by 10 jail cell! ] Bloomberg The percentage anticipating a bigger bonus increased from last year.

Gerald Celente: “The selloff of America” Financial institutions on Wall Street are preparing to pay a shocking record $144 billion dollars in compensation & benefits. This amid spiraling foreclosures and an economic crisis that has devastated Americans, leaving many out in the street. Gerald Celente of the Trends Research Institute says that the gap between rich and poor in the US will continue to get larger because of the bank bailout that Washington shelled out in 2008.

] If you look at things rationally rather than politically, you'll see that Washington has far less power over the economy, and far less maneuvering room, than people think.

Housing sales paralyzed by foreclosure crisis (Washington Post) [ If it were only the Sunshine State, there’d at least be a modicum of light at the end of defacto bankrupt america’s tunnel to h***; as with stocks (infra, Weisenthal) there’s still plenty of room to fall! ]Few places are feeling the impact of the sudden halt to transactions related to mortgage foreclosures more than the Sunshine State, where foreclosures and short sales account for more than one out of every three home sales.

Feds press mortgage lenders to fix documents (Washington Post) [ Fix documents? In matters involving far more serious crimes of far more significance longer term to the nation, I’d be content with mere adherence to clear law applied to the documented facts, no matter where and to whom the crimes lead … see infra… ] White House says Obama will not sign foreclosure bill [ Oooooh, whoops … Sounds like a plan!] Consumer advocates and state officials argue legislation would make it difficult for homeowners to challenge documents prepared in other states. [When talking about the pervasively corrupt american legal / judicial system, you’re truly talking about tips of the iceberg! Judges rule without title, lenders can't foreclose (Washington Post) [ Rules of law? I didn’t think they cared. That’s certainly the direct experience I’ve had with the pervasively corrupt american legal / judicial system (along with the other two branches of the u.s. government and defact bankrupt america generally). Court decisions could call into doubt the ownership of mortgages, raising urgent challenges for both the real estate market, wider financial system. Connecticut, California join probe of Ally (Washington Post) [I’d be much more impressed if they initiated a probe of more readily discernible criminal offenses in violation of the RICO Act http://albertpeia.com Frauds/Liars (sic-lawyers)Covering Up for Other Frauds/Liars (sic-lawyers). In Productive Societies as China, Japan, etc., Fraudulent Liars (sic-lawyers) and the Fraudulent u.s. System They're a Part of Are Unheard Of/Non-existent. List of Files Regarding Filed Attorney Grievance Against Fraud coan et als Or Here For A Clearer View Of Filed Grievance Complaint, Response, Exhibits, and Related RICO Filings Note the Committee of Frauds/Liars (sic-lawyers). Included are DOJ Rep., State Court Rep., State Atty. General Office Rep., and even a Vegetable Garden yale law prof who probably never practiced law in his life. How Pathetic! http://albertpeia.com/fbiofficela91310 ] Justice: FBI improperly opened probes (Washington Post) [ I just hope they’re as zealous (in probing readily discernible crime) with regard to my RICO matters and the corruption in the (judicial / legal) process since, in the final analysis, it will have been the corruption within that will have brought the nation down irrevocably and totally.

October 15, 2010 (*see infra)

Steven M. Martinez, Assistant Director In Charge
Federal Bureau of Investigation, USDOJ
11000 Wilshire Blvd., Suite 1700

Los Angeles, CA 90024

Dear Sir:

I enclose herewith 3 copies of the within DVD rom autorun disk (which will open in your computer’s browser) as per your office’s request as made this day (the disk and contents have been scanned by Avast, McAfee, and Norton which I’ve installed on my computer to prevent viral attacks / infection and are without threat). I also include 1 copy of the DVD as filed with the subject court as referenced therein (which files are also included on the aforesaid 3 disks in a separate folder named ‘112208opocoan’). The (civil) RICO action (as you’re aware, the RICO Act is a criminal statute which provides a civil remedy, including treble damages and attorney fees, as an incentive for private prosecution of said claims probably owing to the fact that the USDOJ seems somewhat overwhelmed and in need of such assistance given the seriousness and prevalence of said violations of law which have a corrupting influence on the process, and which corruption is pervasive). A grievance complaint against Coan was also filed concurrently with the subject action and held in abeyance pending resolution of the action which was illegally dismissed without any supporting law and in contravention of the Order of The Honorable Robert N. Chatigny, Chief Judge, USDC, District Connecticut. The files below the horizontal rule are the referenced documents as filed. (Owing to the damage to the financial interests of both the U.S. and the District of Congresswoman Roybal-Allard, viz., Los Angeles, the Qui Tam provisions of the Federal False Claims Act probably would apply and I would absent resolution seek to refer the within to a firm with expertise in that area of the law with which I am not familiar).

The document in 5 pages under penalty of perjury I was asked to forward to the FBI office in New Haven is probably the best and most concise summary of the case RICO Summary to FBI Under Penalty of Perjury at Their Request (5 pages) [ ricosummarytoFBIunderpenaltyofperjury.pdf ].

The correspondence I received from the Congresswoman by way of email attachment (apparent but typical problem with my mail) along with my response thereto is included on the 3 disks as fbicorrespondencereyes.htm . With regard to the calls to the FBI’s LA and New Haven, CT offices: There was one call to the LA office and I was referred to the Long Beach, CA office where I personally met with FBI Agent Jeff Hayes to whom I gave probative evidentiary documents of the money laundering which he confirmed as indicative of same (he was transferred from said office within approximately a month of said meeting and his location was not disclosed to me upon inquiry). The matter was assigned to FBI Agent Ron Barndollar and we remained in touch for in excess of a decade until he abruptly retired (our last conversation prior to his retirement related to the case and parenthetically, Rudy Giuliani whose father I stated had been an enforcer for the mob to which he registered disbelief and requested I prove it, which I did – he served 12 years in prison, aggravated assault/manslaughter? – and no, there is no Chinese wall of separation – Andrew Maloney’s the one that prosecuted gotti).

In contradistinction to the statement in said correspondence, there is a plethora of information including evidence supporting the claims set forth in the RICO VERIFIED COMPLAINT (see infra). Such includes and as set forth in the case, inter alia,

1. A judgment had been entered in my favor in the case, United States District Court Case #3:93cv02065(AWT)(USDCJ Alvin Thompson), worth approximately now in excess of $300,000 remains unaccounted for and which could be used for payment to creditors, Los Angeles, etc..
2. Counsel Robert Sullivan on my behalf documented by way of certification upon investigation that Alan Shiff, USBCJ, had falsely stated a dismissal upon which false statement he predicated a retaliatory and spurious contempt proceeding against me causing substantial damage, and for which he sought Judicial Notice of those and related proceedings as did I in some of my filings.
3. The Order of Dismissal With Prejudice by Alan Shiff, USBCJ, owing to Defendant Coan’s failure to file anything whatsoever by the court’s deadline causing creditors and me substantial damages: [ Shiff Order of Dismissal With Prejudice on Coan’s Failure to File Page 1 Page 2 ]
4. Defendant Coan had filed an action against me to prevent me from suing him which necessitated me to fly to Connecticut for a hearing before The Honorable Robert N. Chatigny, Chief Judge, USDC, District of Connecticut, who denied Coan’s requested relief as to Coan but precluded my action against Shiff (although there is no immunity, judicial or otherwise, for criminal acts, ie., fraud connected with a case under Title 11, USC, etc.) . [ transcript in pertinent part - crossexamofcoanbypeia.pdf ]
5. Newly appointed judge, Maryanne Trump Barry, Donald Trump’s sister, was assigned the RICO case despite the conflict of interest in light of hundreds of thousands of dollars of illegal (drug) money being laundered through the Trump casinos by the RICO defendants, and despite my motion to recuse her which motion she heard herself and denied, and U.S. Trustee Hugh Leonard with whom I met personally refused to join or file a separate motion to recuse and not long thereafter left said office for private practice at Cole, Shotz, et als on retainer with the RICO defendants as his primary client.
6. Probative and evidentiary documents, affidavits, exhibits, including those turned over to FBI Agent Jeff Hayes in Long Beach, CA, had been given to Assistant U.S. Attorney Jonathan Lacey with whom I met personally at the U.S. Attorney’s Office in Newark, N.J., at which time Samuel Alito was U.S. Attorney, and went over said documents and their probative value with him. Within approximately a month thereafter upon inquiry I was told that Jonathon Lacey was no longer with the office, that the file/documents could not be located, and that there was no further information available concerning contacting him or his location. I thereupon delivered by hand, copies of said documents to the office of then U.S. Attorney Alito, addressed to him, with assurance they would go directly to him. In addition to being inept [ I looked in on the one mob case he had brought, bungled, lost (accidently on purpose?) since I was suing some mob-connected under RICO and the court (I had known / previously met outside of court the judge Ackerman through a client) was absolute bedlam and a total joke since incompetent corrupt Alito brought in all 20 mob defendants (rather than prosecute one or a few to flip them first) who feigning illness had beds/cots in the courtroom along with their moans during testimony and had the jury in stitches. As much as I hate the mob, it truly was funny, if not so tragic.], Alito is also corrupt (and maybe corrupt because he is inept). After a reasonable (but still rather short) time I called to determine the status and was told that Alito was no longer with the Office of the U.S. Attorney, that he was (appointed) a federal judge, and that neither the documents nor any file or record of same could be located. Alito did parley the same / cover-up into quid pro quo direct lifetime appointment to the Court of Appeals, 3^rd circuit, despite the absence of judicial experience or successful tenure as U.S. Attorney (Maryanne Trump Barry as well). This is the same Sam Alito that now sits on the purported highest court in the land. The real application of the illegal rule ‘don’t ask, don’t tell’.

There is applicable insurance / surety coverage and neither LA, nor creditors, nor I should continue to have been damaged by this brazened corrupt and illegal scenario, which should be resolved in accordance with the meaningful rules of law apposite thereto.

Sincerely,

Albert L. Peia

611 E. 5^th Street, #404

Los Angeles, CA 90013

(213) 219-**** (cell phone)

(213) 622-3745 (listed land line but there are unresolved problems with the line, computer connection may be the reason but I hesitate to chance greater non-performance / worsening by their ‘fix’ so cell phone best for contact).

----------

*The foregoing and as indicated therein was previously send 9-14-10 but delivery confirmation was flawed as set forth below and my inquiries to the u.s. postal service rebuffed (I believe tampered with inasmuch as your office could not locate same). This cover letter (9-13-10) is on the 3 disks with navigable hyperlinks to the subject files for ease of reference, including the files in the RICO action as indicated. (10-15-10) I spoke with Rose, FBI, ADIC Secretary, who indicates once again that your office has not received the aforesaid and which can reasonably be presumed to have been tampered with, and hence, a violation of the federal statute concerning same.

-----

Label/Receipt Number: 0310 1230 0000 0862 8183

Expected Delivery Date: September 15, 2010

Class: Priority Mail®

Service(s): Delivery Confirmation™

Status: Delivered

Your item was delivered at 10:14 am on September 15, 2010 in LOS ANGELES, CA 90024.

Track and Confirm

Enter Label/Receipt Number.

Enter Label / Receipt Number.

Detailed Results:

Bullet Delivered, September 15, 2010, 10:14 am, LOS ANGELES, CA 90024

Bullet Arrival at Post Office, September 15, 2010, 4:12 am, LOS ANGELES, CA 90024

Bullet Processed through Sort Facility, September 14, 2010, 8:29 pm, LOS ANGELES, CA 90052

Bullet Acceptance, September 14, 2010, 4:04 pm, LOS ANGELES, CA 90017

----

Sent Postage Prepaid: United States Mail - VIA Priority Mail, Delivery Confirmation and VIA Certified Mail this ___ day of October, 2010.

Signed: ___________________________________

Albert L. Peia

-------------

Label/Receipt Number: 7009 2250 0002 1116 5915
Expected Delivery Date: October 6, 2010
Class: Priority Mail^®
Service(s): Certified Mail^™
Status: Delivered

Your item was delivered at 11:42 am on October 06, 2010 in LOS ANGELES, CA 90024.

Detailed Results:

	Delivered, October 06, 2010, 11:42 am, LOS ANGELES, CA 90024
	Arrival at Unit, October 06, 2010, 4:15 am, LOS ANGELES, CA 90024
	Acceptance, October 05, 2010, 11:12 am, LOS ANGELES, CA 90017

---------------------------

Label/Receipt Number: 0309 3220 0000 4028 9039
Expected Delivery Date: October 6, 2010
Class: Priority Mail^®
Service(s): Delivery Confirmation^™
Status: Delivered

Your item was delivered at 9:03 am on October 06, 2010 in LOS ANGELES, CA 90024.

Detailed Results:

	Delivered, October 06, 2010, 9:03 am, LOS ANGELES, CA 90024
	Arrival at Post Office, October 06, 2010, 6:10 am, LOS ANGELES, CA 90024
	Acceptance, October 05, 2010, 11:11 am, LOS ANGELES, CA 90017

-------

Sent VIA UPS Courier this 15th day of October, 2010.

Signed: Albert L. Peia

------------

] Federal regulators seek to prevent the growing furor over improper foreclosures from escalating, pressing mortgage lenders to replace flawed and fraudulent court documents while insisting that foreclosures continue apace. But advocates say the policy is soft on banks and may have little effect, because many lenders are already taking such steps.