Is forex market controlled by someone? - page 33
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RBS Suspends Bonuses of 18 Traders Amid FX Rigging Fine
Royal Bank of Scotland Group Plc suspended bonuses of 18 traders as part of a review of its foreign-exchange business in the wake of a $634 million fine.
The bank is reviewing the conduct of more than 50 current and former traders who worked at the investment bank, it said in a statement today. Six employees face disciplinary action, with three of them suspended pending investigations.
A former RBS trader was arrested on Dec. 19 in relation to the U.K. Serious Fraud Office’s investigation into currency rigging, according to a person with knowledge of the situation, who asked not to be identified because the details are private. Regulators in the U.S., Britain and Switzerland last month ordered six banks, including RBS and HSBC Holdings Plc (HSBA), to pay about $4.3 billion to settle a probe into the rigging of foreign-exchange rates.
“We are undertaking a robust and thorough review into the actions of the traders that caused this wrongdoing and the management that oversaw it,” Jon Pain, RBS’s head of conduct and regulatory affairs, said in the statement. “No further bonus payments will be made or unvested bonus awards released to those in scope of the review until it has concluded.”
The SFO confirmed it had last week arrested a man in Billericay, a town in Essex, east of London. The agency declined to comment on his identity or employment.
RBS was up 0.6 percent to 390.2 pence at 3:19 p.m. in London trading, valuing the bank at 44.7 billion pounds ($69 billion).
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Poor guys : no bonuses
And what about the jail?
2014: The Year Propaganda Came Of Age
From just about as early in my life as I can remember, growing up as a child in Holland, there were stories about World War II, and not just about Anne Frank and the huge amounts of people who, like her, had been dragged off to camps in eastern Europe never to come back, but also about the thousands who had risked their lives to hide Jewish and other refugees, and the scores who had been executed for doing so, often betrayed by their own neighbors.
And then there were those who had risked their lives in equally courageous ways to get news out to people, putting out newspapers and radio broadcasts just so there would be a version of events out there that was real, and not just what the Germans wanted one to believe. This happened in all Nazi – and Nazi friendly – occupied European nations. The courage of these people is hard to gauge for us today, and I’m convinced there’s no way to say whom amongst us would show that kind of bravery if we were put to the test; I certainly wouldn’t be sure about myself.
Still, without wanting to put myself anywhere near the level of those very very real heroes, please don’t get me wrong about that, that’s not what I mean, I was thinking about them with regards to what is happening in our media today. I’ve mentioned before that I don’t think Joseph Goebbels had anything on US and European media today.
That propaganda as a strategic and political instrument has been refined to a huge extent over the past 70-odd years since Goebbels first picked up on Freud’s lessons on how to influence the unconscious mind, and the ‘mass-mind’, as a way to ‘steer’ an entire people, not just as a means to make them buy detergent. These days, the media can make people believe just about anything, and they have the added benefit that they can pose as friends of the people, not the enemy.
But there is a reason why such a large ‘industry’ has developed on the web with people writing articles that don’t say what the mass media say. That reason for is, obviously, first and foremost that not everybody believes whatever they are told. The problem is equally obvious: not nearly enough people are being reached to make a true difference, and to question the official narratives.
Me, I have no claim to fame outside of the appreciation I get from first, my readers and second, from my colleagues and peers. I get a lot of both, and I thank you for that, but this certainly is not about me. If anything, it’s about trying to live up to the desire for truth in the face of odds squarely stacked against it, and against the people I try to reach out to. Trying to do just 0.1% of what the WWII underground press was about.
A few days ago, I wrote in About That Interview :And that truly defines 2014 for me. A level of propaganda I don’t recognize, and I don’t think I’ve ever seen before. 2014 has for me been the year of utter nonsense. To wit, it just finished in fine form with a 5% US GDP growth number, just to name one example. Really, guys? 5%? Really? With all the numbers presented lately, the negative Thanksgiving sales data – minus 11% from what I remember -, the so-so at best Christmas store numbers to date, shrinking durable goods in November and all? Plus 5%?
It really doesn’t matter what I say, does it? You have enough people believing ridiculous numbers like that to make it worth your while. After all, that’s all that counts. It’s a democracy, isn’t it? If a majority believes something, it becomes true. If you can get more than 50% of people to believe whatever you say, that’s case closed.
With well over 90 million working age Americans counted as being out of the labor force, and with 43 million on food stamps, you can still present a 5% GDP growth number, if only you can get a sufficiently large number of people to ‘believe’. And you do, I’ll give you that. As far as the media goes, we have achieved the change we can believe in. We may not have that change, but we sure do believe we have, don’t we? And isn’t that what counts? Are congratulations in order?
Well, not where I’m at, they’re not. I should do a shout out to the likes of Zero Hedge, Yves Smith, David Stockman, Wolf Richter, Mish, Steve Keen, Jim Kunstler, and so many others, we’re a solid crowd by now even if we’re neglected, and please don’t feel left out if you’re not in that list, I know who you are. The problem is, we’re all completely neglected by the mass media, even though there are a ton of very sharp minds in this ‘finance blogosphere’. And perhaps we should make it a point to break through that ridiculous black-out in 2015.
And if you would like to raise doubts here, the very existence of finance blogosphere I mentioned before is proof that we indeed have raised a generation of sheep. If we had functioning media, there’d be no need for that blogosphere. We are the people who keep on pointing out where the mass media fail, let alone the politicians, simply by being there and being supported to the extent we are by the few people who escape the sheep mentality.
But that’s not nearly enough. Journalists, reporters, whatever they call themselves, working for Bloomberg, Reuters, CNBC etc. should at the very least quote Zero Hedge on a daily basis, and Mish, and Steve, and Yves, and perhaps even me – though it’s fine if they continue to ignore me, as long as they give the rest their rightful place.
There are many people in the blogosphere who are many times smarter than the people who write for the mass media, and that’s a very simple and hardly disputable fact that needs to be recognized. When you read something in your paper or at your online news provider, it should be second nature to ask yourself: but what would Tyler Durden say, or the Automatic Earth, or Naked Capitalism, or David Stockman?
But we’re nowhere near that, are we? We’ve been fooled with economic stats for years, not just in the US, not even just in the west, but all over, they all grabbed on to the potential of providing people with numbers that have little to do with reality, but that simply feel good. Or even just look good.
Still, boy, have we been, and are we being, fooled. Then again, most of you wouldn’t know, would you? We people tend to discount the future, to see today as more important than tomorrow, and in the same manner we find our children’s future much less important than our own. Because that feels good too. If we are comfy right now, screw them. Not that we’d ever put it into those terms.
But you know, that’s really all old hack by now. 2014 brought us a whole other class of nonsense. And we swallowed it all hook line and entire sinker.
2014 gave us Ukraine. And you just try and find anyone today who doesn’t think Vladimir Putin is and was the evil genius mind behind the whole thing, including the 4500+ people who died there over the past 10 months. Why is it so hard to anyone who doubts that narrative? Because our media told us Putin is the bogeyman. And ‘we’ never asked for any proof. That is, except for those of us in that same blogosphere.
Meanwhile, round after round of sanctions against Russia have been set up and activated by EU and US, causing hardship for both Russian people and European businesses. But why, what exactly is Putin allegedly guilty of?
The US/EU installed a government in Kiev in February (yeah, yap about it), which is still in place, with a bunch of US citizens recently added for good measure – and for profit-. The chocolate prince president was indeed elected months later, but the prime minister – Yats – was handpicked by America, and is still -amazingly – in place. That’s the same government that had it own army murder thousands of its own citizens, and not a thing has been resolved so far.
The whole thing came to a head when MH17 was shot down over the summer. That too was blamed on Putin. Or was it? Well, not directly, nobody said Putin ordered that plane to be shot. Nor did anyone say Russia shot it. There is the accusation that Russian speaking Ukrainian ‘rebels’ did it, but proof for that was never provided in the 6 months since the incident. And there must be a best before date in there somewhere.
Is it possible the ‘rebels’ did it? We can’t exclude it, but that’s for the same reason we can’t exclude the option that little green Martians did it: we don’t know. But even then, even if they did, there’s the question whether that would have been on purpose. Which seems really stretching it: nothing they want would be served by shooting down a plane full of European, Malaysian and Australian holiday goers.
But here we are: no proof and layer upon layer of sanctions. And nary a voice is raised in the west. If one is, it’s to denounce the Russians as bloodthirsty barbarians. Even though there is no proof they did anything other than protecting what they see as their own people. Something we all would do too, no questions asked.
Ukraine defines 2014 as the year western propaganda came into its own. Not just fictional stories about an economic recovery anymore, no, we had our politico-media establishment ram an entire new cold war down our throats. And we swallowed it whole. We may have had a million more years of higher education than our parents and grandparents, but we sure don’t seem to have gotten any smarter than them.
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n't think we can point out someone to say that FX market is controlled by that person or that authority or country, I think its an open market and market sentiment and market news decide the movement of the particular currency movement, so I can't say that FX Market is controlled by a particular authority or country.
The Rigging Triangle Exposed: The JPMorgan-British Petroleum-BOE Cartel Full Frontal
The name Dick Usher is familiar to regular readers: he was the head of spot foreign exchange for JPMorgan, and the bank's alleged chief FX market manipulator, who was promptly fired after it was revealed that JPM was the bank coordinating the biggest FX rigging scheme in history, as initially revealed in "Another JPMorganite Busted For "Bandits' Club" Market Manipulation." Subsequent revelations - which would have been impossible without the tremendous reporting of Bloomberg's Liam Vaughan - showed that JPM was not alone: as recent legal actions confirmed, virtually every single bank was also a keen FX rigging participant. However, the undisputed ringleader was always America's largest bank, which would make sense: having a virtually unlimited balance sheet, JPM could outlast practically any margin call, and make money while its far smaller peers were closed out of trades... and existence.
But while the past year revealed that FX rigging was a just as pervasive, if not even more profitable industry for banks than the great Libor-fixing scandal (for details see "How To Rig FX Like A Pro "Bandit", And Make Millions In The Process"), the conventional wisdom was that it involved almost exclusively bankers at the largest global banks including JPM, Goldman, Deutsche, Barclays, RBS, HSBC, and UBS.
Now, courtesy of some more brilliant reporting by Vaughan, we can finally link banks with the other two facets of what has emerged to be an unprecedented FX-rigging "triangle" cartel: private sector companies that have no direct banking operations yet who have intimate prop trading exposure, as well as central banks themselves.
By "banks" we, of course, refer to the ringleader itself: JP Morgan, and its former head of spot forex trading in London, Dick Usher. As for the company that benefited from its heretofore secret participation in the biggest FX rigging scandal in history, it is none other than British Petroleum.
We learn about all this thanks to a story that begins with, of all thing, a story about freshwater fishing at a lake in Essex called "Wharf Pool."
As Bloomberg reports, "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. 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. "
The plot thickens: was there more than a passing connection between the head FX trader at JPM and White "who’s known in the market as Tubby, is one of half a dozen spot currency traders working for British Petroleum (BP) in London. He and his colleagues, most of them ex-bankers, decide which firms will carry out their foreign-exchange transactions. That makes them prized clients for banks seeking a slice of the business and a glimpse into potentially market-moving trades. Passing on information was a way to curry favor."
In short, a typical Over The Counter relationship between a banker and a buyside client, one which is largely unregulated and where the bank hopes to be able to frontrun the client's orders by providing the client with confidential market moving information, thus generating more business with the client in the future. In this case, however, the buyside client was not a typical hedge fund, but the FX trading group at one of the world's largest energy companies: a group which trades enormous amounts of FX every single day, both with intent to hedge, and to generate a profit.
The trading unit’s primary role is to manage the firm’s exposure to financial risks, including fluctuations in interest rates and foreign exchange, according to the company’s website. Unlike at most corporations, it also is run as a profit center, which means that in addition to hedging risks, traders can place their own bets on the direction of markets. The company doesn’t break out how much money the treasury unit makes
Basically, BP's energy operations were just a balance sheet funding cover: what its FX traders did in the front office was trade for a profit pure and simple, just like any prop trading desk or hedge fund anywhere else in the world. And it did so in collusion with a small group of market rigging individuals all located at the biggest, market-moving banks around the globe.
A quick reminder on the "Cartel":
The four banks in the Cartel controlled about 45 percent of the global spot-currency market, according to a survey by Euromoney Institutional Investor Plc, so information about their plans was valuable. Some days they worked together to push around the 4 p.m. fix, settlements with the banks show.
The Cartel chat room was started by Usher as early as 2009, according to a person with knowledge of the matter. Usher had risen quickly to the top of his profession. After joining HBOS Plc in 2001, he was hired by Royal Bank of Scotland Group Plc in 2003 and a year later collected an industry award on his employer’s behalf.... The four members of the chat room ribbed each other like high school buddies. Usher was referred to as Feston because he resembled an overweight version of British chef Heston Blumenthal, according to people who have seen the chats. Matt Gardiner, a UBS trader based in Zurich, was called Fossil because he was a few years older than the others. Rohan Ramchandani, Citigroup’s cricket-loving head of spot trading, was called Ruggy, while Chris Ashton, the last one to join, was dubbed Robocop.
Now we can add BP too, a BP which doesn't even hide the prop-trading nature of its FX "hedging" group, which is located two blocks away from, wait for it, JPMorgan!
The two dozen traders in BP’s treasury trading unit are housed above a Porsche showroom on the second and third floors of the company’s office in Canary Wharf, an area of reclaimed docklands three miles east of the City of London, the historic financial district. The building, two blocks from JPMorgan’s, was completed in 2003 on the cusp of an oil boom. Lights in meeting rooms flick from green to white when someone enters, in keeping with the company’s corporate colors.
And while until today the last sentence would be pure conjecture, thanks to Bloomberg's release of exchanges between JPM and BP revealing the extent to which the "cartel" would stoop in order to make money for its members on a daily, risk-free basis, it is not a fact.
From Bloomberg:
Copies of messages sent to BP traders over the course of a year were provided to Bloomberg News by a person with access to the online conversations. The person, who redacted the names of banks sending the messages and dates of conversations, said they came from firms whose senior foreign-exchange traders belonged to a chat room called “The Cartel” that was set up by Usher and included dealers at JPMorgan, Citigroup Inc., Barclays Plc and UBS Group AG.
The information offered an insight into currency moves minutes, sometimes hours before they happened. The messages could drag the U.K.’s biggest energy company into a scandal that has enveloped 11 banks and led to more than 30 traders from London to Singapore losing or being suspended from their jobs. Last month six banks were fined $4.3 billion for passing along information about their clients and working together to rig foreign-exchange markets.
Presenting BP: collusive, insider trading hedge fund extraordinaire. All comparisons and similarities to Enron are purely coincidental.
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.
Of course, in any non-banana republic, whose regulatory and enforcement divisions were not captured by the same megacorp that is in question here, this would have been the basis for a massive lawsuit, one which would ultimately seek to break apart the company's "profitable" FX trading division from its core energy business. But not in this republic: after all, between one of the world's biggest banks and one of the world's biggest corporations, and a corrupt, crony government it should be clear to everyone by now just who calls the shots.
BP of course is quick to note that it did nothing illegal: after all the last thing the company needs is its own Enron-type scandal, where an ancillary business manages to drag down the entire company. Sure enough it has promptly denied everything:
BP said in a statement that it conducted an internal review after regulators began probing currency markets. “BP’s FX desk has relationships as a customer with 26 relationship banks, including JPMorgan, Citibank and Barclays,” the London-based company said. “BP has a robust framework of compliance requirements and internal controls which are constantly reviewed, and maintains an open dialogue with the appropriate regulators.”
The firm, the third-largest publicly traded company in the U.K., hasn’t been investigated by regulators looking into currency manipulation, according to a person with knowledge of the matter. Chris Hamilton, a spokesman for the U.K. Financial Conduct Authority, declined to comment, as did representatives of JPMorgan, Barclays, Citigroup and UBS.
So how does one explain the joint equity interest in - for example - the little fishing lake ?
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Here Comes Johnny 5: HFT's Favorite Exchange BATS To Acquire FX Trading Platform
Reuters just reported that none other than the HFT's bestest buddyexchange, BATS, which earlier this week was slapped with the biggest monetary penalty ever for continuing the practice of Hide Not Slide (at least until UBS' dark pool was slapped with an even bigger fine for conducting subpennying without informing most of its clients), is about to buy the FX trading platform of KCG, formerly Knight Capital which too blew up after one of its algos went haywire and blew up the firm in milliseconds.
Which, of course, is great news for all those who have stepped back from the rigged circus and merely enjoy "markets" for the comedic farce they have become. Because when the USDJPY suddenly trades from 115 to 0.0001 in 1 millisecond just because some frontrunning BATS algo went haywire, and causes the Bank of Japan to be margin called out of existnece, anyone who isn't laughing yet, will have no other choice.
Oh my God, reading this thread make me afraid to trade in forex. In some forums also said that some broker manipulate their market movement and cheating their clients.
Russia tried to learn how to use high-speed trading to rock market, U.S. says
Russia sought to use spies to get more information about high-frequency trading in a potential bid to destabilize the market, according to a court document released by the U.S. government on Monday.
The U.S. government on Monday made one arrest and charged two other diplomats with spying on behalf of Russia.
The Federal Bureau of Investigation says the trio sought information, and sought to set up a spy ring, to find out about a number of topics, including the impact of the economic sanctions the U.S. has imposed on Russia and an airplane manufacturing deal.
But one of the topics Russia wanted to know more about is a topic the U.S. government is also struggling to comprehend: high-frequency trading. Russia apparently wanted to use such trading to destabilize the market.
According to the FBI, a banker, Evgency Buryakov, was told to tell a Russian state-owned news outlet to get information on three specific questions. This was a conversation he had with the Russian trade representative, Igor Sporyshev, as translated by the FBI:
Buryakov: You can ask about ETF... E-T-F. E, exchange.
Sporyshev: Yes, got it.
Buryakov: How they are used, the mechanisms of use for destabilization of the markets.
Sporyshev: Mechanism — of — use — for —market — stabilization in modern conditions.
Buryakov: For destabilization.
Sporyshev: Aha.
Buryakov: Then you ask them what they think about limiting the use of trading robots... You can also ask about the potential interest of the participants of the exchange to the products tied to the Russian Federation.
A spokeswoman for the IntercontinentalExchange ICE, +0.48% , which owns the NYSE, declined to comment. An email to the Russian Embassy’s press office was not immediately returned.
High-frequency trading has been blamed by some for adding instability to markets.
In the book “Flash Boys,” author Michael Lewis says a surprisingly large number of the people pulled in by the big Wall Street banks to build the technology for high-frequency trading were Russians.
One, former Goldman Sachs programmer Sergey Aleynikov, was convicted of stealing trade secrets, before his conviction was overturned.
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What a BS
Everybody in the whole wide world knows how HFT is used to control the market. You can read it at any web site. Spying to find out how to use HFT for that is the stupidest excuse FBI could find for doing what they did.
We should have a FBI joking thread - they have too much things like that