Last Thursday, the heads of the biggest banks in the US met with President Obama and White House representatives. As far as I can tell this type of meeting is unprecedented. Even during the peak of the financial crisis in 2008 there was never any meeting I'm aware of between the commander in chief and the heads of the largest banks. True, there were meetings with the same banks and the head of the Federal Reserve, Ben Bernanke. Meetings with the Fed make some sense during times of economic crisis when the risk is systemic to the entire banking system. But the President? That would to me imply a political component that was being coordinated with economic policy and the largest banks.
Zerohedge points out this:
Correlation is not causation; but coincidence means you're on the right path. Looking at the charts of Stocks, Commodities, and Precious Metals, we wonder just what it was that President Obama said at his 11am ET White House meeting last Thursday...
Equity markets soared out of the gate on the 11th. Jobless claims beat expectations handily (shaking off the previous week's concerns) and all was well in the world... until just after 11am ET (when the CEOs of Wall Street's big banks - for no apparent reason - met with President Obama)... and this happened...
as did Crude oil...
So what did Obama tell them?
In addition, I saw a brief story today about all the big banks. It was being pointed out how they all had HUGE capital reserves even in excess of the coming Basel III requirements. Theses are the same banks that usually love to be levered 30 to 1 and use midnight Repo to meet capital requirements for just a few moments at midnight to be in compliance.
So why are they suddenly so conservative? Perhaps Obama gave them a heads up that some "political decisions" have been made. My guess, and its pure speculation, is that its about a Euro member that's about to be given the boot out of the EU. Or perhaps there is finally a recognition that we are in a recession/continued depression and they want to coordinate what's to come. Either way,the Gold sell off was a pre-emptive attack to push the price down before its taken much higher on central bank fear trades.
Has anyone else EVER heard of this type of meeting taking place before? In any administration?
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