There is now overwhelming evidence that Wall Street firms have entered a race to the bottom in high-tech trading wars. To grab the best programming talent, Wall Street firms are paying top dollar for the best and brightest coders and developers and potentially sapping the ability of other U.S. industries – those that make real products – to compete.
Just this month, Jamie Dimon, CEO of JPMorgan, told the firm’s shareholders in his annual letter that JPMorgan employs “nearly 30,000 programmers, application developers and information technology employees who keep our 7,200 applications, 32 data centers, 58,000 servers, 300,000 desk-tops and global network operating smoothly for all our clients.”
According to Anish Bhimani, Chief Information Risk Officer at JPMorgan Chase, in an interview published at the Information Networking Institute (INI) at Carnegie Mellon, JPMorgan has “more software developers than Google, and more technologists than Microsoft…we get to build things at scale that have never been done before.”
Former managing director of Goldman Sachs – and head of the international analytics group at Bear Stearns in London (Nomi Prins) - notes:
Throughout the century that I examined, which began with the Panic of 1907 … what I found by accessing the archives of each president is that through many events and periods, particular bankers were in constant communication [with the White House] — not just about financial and economic policy, and by extension trade policy, but also about aspects of World War I, or World War II, or the Cold War, in terms of the expansion that America was undergoing as a superpower in the world, politically, buoyed by the financial expansion of the banking community.
In the beginning of World War I, Woodrow Wilson had adopted initially a policy of neutrality. But the Morgan Bank, which was the most powerful bank at the time, andwhich wound up funding over 75 percent of the financing for the allied forces during World War I … pushed Wilson out of neutrality sooner than he might have done, because of their desire to be involved on one side of the war.
Now, on the other side of that war, for example, was the National City Bank, which, though they worked with Morgan in financing the French and the British, they also didn’t have a problem working with financing some things on the German side, as did Chase …
When Eisenhower became president … the U.S. was undergoing this expansion by providing, under his doctrine, military aid and support to countries [under] the so-called threat of being taken over by communism … What bankers did was they opened up hubs, in areas such as Cuba, in areas such as Beirut and Lebanon, where the U.S. also wanted to gain a stronghold in their Cold War fight against the Soviet Union. And so the juxtaposition of finance and foreign policy were very much aligned.
So in the ‘70s, it became less aligned, because though America was pursuing foreign policy initiatives in terms of expansion, the bankers found oil, and they made an extreme effort to activate relationships in the Middle East, that then the U.S. government followed. For example, in Saudi Arabia and so forth, they get access to oil money, and then recycle it into Latin American debt and other forms of lending throughout the globe. So that situation led the U.S. government.
James A Kidney
Since the launch of the new Michael Lewis book, “Flash Boys,” at the end of March with wall to wall media coverage, including his pronouncement on 60 Minutes that the stock market is rigged against average investors, there has been a whirlwind of damage control.
The FBI announced that an investigation was already in the works, the New York State Attorney General is issuing subpoenas and a civil war (frequently not so civil) has broken out among industry titans staking out their media turf on whether the market is or is not rigged by high frequency traders. Not in dispute is the fact that these high frequency traders have armed themselves with superfast computers, algorithms and artificial intelligence programs, all of which the New York Stock Exchange and NASDAQ have obligingly allowed – for annual fees running into tens of thousands of dollars – to co-locate next to the exchange’s own computers so the high speed traders can jump in front of the less tech savvy traders and steal pennies from millions of trades each and every day – a loss of billions of dollars to pensions and ordinary investors each year.
Catherine Austin Fitts is the Founder and President of Solari. She served as Managing Director and Member of the Board of Directors of the Wall Street investment bank, Dillon, Read & Co., Inc. She also served as Assistant Secretary of Housing/Federal Housing Commissioner at HUD in the first Bush Administration and was the President and Founder of Hamilton Securities Group, Inc.
We’ll discuss if financial fraud and market manipulations are actually mechanisms for financing the black budget and if centralized governance is necessitated by high-tech secrecy. There may be as much as $100 trillion dollars worth of hardware flying the skies powered by anti-gravity and field-propulsion technologies. This has significant implications for the ownership and design of manufacturing and energy infrastructure on planet earth. Continue reading
Financial expert Rob Kirby says global central bank fraud is propping up the economy. Kirby contends, “The amount of fiat money that has to be created on a go forward basis rises exponentially over time. So much, much money is being created whether the Fed says they are ‘tapering’ or the Fed says they’re not ‘tapering’ is irrelevant to what is really happening. The money is being created, and they have to find places to hide it.
“What else has happened? Internationally, we see the likes of Russia and China basically setting up to trade in other than dollars because they know what’s going on with the dollars, and they know too many dollars are being created. They know this story of too many dollars being created ends very badly. . . .
Fiat money by its very nature is designed to fail. Fiat money by its nature needs to be increased. Fiat money at the beginning has a very shallow incline, and then you hit an inflection point where the amount of fiat money being produced literally has to go vertical. We are into the vertical part of that curve now.”
BATR April 16 2014
No one has ever claimed that the financial markets are a level playing field. Equities, bonds, currencies, options and futures are not arenas that operate by equivalent standards for all parties. Great fortunes were built not by chance, but on superior information, known to the few. Professional traders are not risk gamblers, but operate on the premise of special advantage. Through advance and proprietary techniques that reduce exposure hazards and provide exclusive head start triggers, which virtually guarantee profits, the elite firms dominate Wall Street.
Business Week states in the article, Is High-Frequency Trading Insider Trading?, that
“Classically defined, insider trading means having access to material, non-public information before it reaches the rest of the market; it’s like getting a heads-up about a merger before it’s announced, or maybe a phone call from a Goldman Sachs (GS) board member saying that Warren Buffett is about to invest $5 billion in the bank.”
With the introduction of super computers and Financial Algorithmic Trading, the era of generated trading strategies emerged that fill automatically, when predetermined prices are reached. Some would argue that exchanges were simply applying the latest technology to the time honored system of flipping positions.
Best-selling author Nomi Prins warns, “Never before have the Government and the Fed collaborated so extensively by propping up the banking system to the detriment of the population.” Prins lays out a long history of the relationships between U.S. Presidents and bankers that date back to Teddy Roosevelt and JP Morgan.
On her new book titled “All the Presidents’ Bankers,” Prins contends, “That connection with Teddy Roosevelt was a very powerful established entity between two people that has allowed all this stuff that has happened in the last hundred years to really happen. The friendships, the social ties, the idea that the bankers could sort themselves out with Treasury Department help if it needed to. Of course, it’s epic now. All of that was solidified then. Banks being hands-off with respect to the oval office was all solidified then. We’ve only been consolidating that message throughout the century since.”
In what may have big implications for the organic-food industry, Wal-Mart Stores Inc’s WMT largest unit, Walmart U.S., has teamed up with Wild Oats to sell a collection of pantry staples that will be much cheaper than national branded organic foods already on Walmart shelves.
Wild Oats, formerly the No. 2 U.S. organic grocer which Whole Foods WFM -0.53% agreed to buy in 2007 before it was forced to sell it in 2009 on anti-trust concerns, will offer about 100 items, from salsa to pasta, exclusively at about 2,000 Walmart stores across the country. Walmart eventually plans to roll the line out to its 4,000-store fleet and carry additional items. For Wild Oats, the introduction marked the brand’s relaunch.
“We are trying to disrupt the market,” Jack Sinclair, Walmart U.S.’s executive vice president of grocery, said in an interview. “What it is that makes organic products so expensive? Where’s the point of inefficiency? We want to bring accessibility” to organic items.
Walmart said the Wild Oats products will be priced at least 25% below those of the national organic brands it carries. For instance, Wild Oats has a 15-ounce organic tomato sauce that will sell for 88 cents, versus $1.38 for a rival national organic brand. Walmart, which currently carries 1,600 organic grocery items, said Wild Oats’ collection will be priced on par with other national non-organic brands. Its own Great Value private-label line, which doesn’t feature organic products, will still have the lowest price. Walmart has its own organic fresh produce under the Marketside label.
This is pretty interesting. ~G