American Markets- Leading News -Update 2

 More Anti-Gold Hysteria from London!!

By Ben McLannahan
Financial Times, London
Wednesday, May 16, 2012


TOKYO — Okayama Metal & Machinery has become the first Japanese pension fund to make public purchases of gold, in a sign of dwindling faith in paper currencies.

Initially, the fund aims to keep about 1.5 per cent of its total assets of Y40 billion ($500 million) in bullion-backed exchange-traded funds, according to chief investment officer Yoshisuke Kiguchi, who said he was diversifying into gold to “escape sovereign risk.”

The move into a non-yielding asset comes as funds in the world’s second-biggest pension market are under increasing pressure to meet promised payments, as domestic interest rates remain rooted near zero. This year, the first of Japan’s baby boomers turn 65, becoming eligible for payouts….

Accidentally Released — and Incredibly Embarrassing — Documents Show How Goldman et al. Engaged in ‘Naked Short Selling’

By Matt Taibbi
Rolling Stone, New York
Tuesday, May 15, 2012…

It doesn’t happen often, but sometimes God smiles on us. Last week he smiled on investigative reporters everywhere, when the lawyers for Goldman, Sachs slipped on one whopper of a legal banana peel, inadvertently delivering some of the bank’s darker secrets into the hands of the public.

The lawyers for Goldman and Bank of America/Merrill Lynch have been involved in a legal battle for some time — primarily with the retail giant, but also with Rolling Stone, the Economist, Bloomberg, and the New York Times. The banks have been fighting us to keep sealed certain documents that surfaced in the discovery process of an ultimately unsuccessful lawsuit filed by Overstock against the banks.

Last week, in response to an motion to unseal certain documents, the banks’ lawyers, apparently accidentally, filed an unredacted version of Overstock’s motion as an exhibit in their declaration of opposition to that motion. In doing so, they inadvertently entered into the public record a sort of greatest-hits selection of the very material they’ve been fighting for years to keep sealed.


I contacted Morgan Lewis, the firm that represents Goldman in this matter, earlier today, but they haven’t commented as of yet. I wonder if the poor lawyer who FUBARred this thing has already had his organs harvested; his panic is almost palpable in the air. It is both terrible and hilarious to contemplate. The bank has spent a fortune in legal fees trying to keep this material out of the public eye, and here one of their own lawyers goes and dumps it out on the street.

The lawsuit between Overstock and the banks concerned a phenomenon called naked short-selling, a kind of high-finance counterfeiting that, especially prior to the introduction of new regulations in 2008, short-sellers could use to artificially depress the value of the stocks they have bet against. The subject of naked short-selling is a) highly technical, and b) very controversial on Wall Street, with many pundits in the financial press for years treating the phenomenon as the stuff of myths and conspiracy theories.

Now, however, through the magic of this unredacted document, the public will be able to see for itself what the banks’  attitudes are not just toward the “mythical” practice of naked short selling (hint: they volubly confess to the activity, in writing), but toward regulations and laws in general.

“Fuck the compliance area — procedures, schmecedures,” chirps Peter Melz, former president of Merrill Lynch Professional Clearing Corp. (a.k.a. Merrill Pro), when a subordinate worries about the company failing to comply with the rules governing short sales.

We also find out here how Wall Street professionals manipulated public opinion by buying off and/or intimidating experts in their respective fields. In one email made public in this document, a lobbyist for SIFMA, the Securities Industry and Financial Markets Association, tells a Goldman executive how to engage an expert who otherwise would go work for “our more powerful enemies” — i.e., would work with Overstock on the company’s lawsuit.

“He should be someone we can work with, especially if he sees that cooperation results in resources, both data and funding,” the lobbyist writes, “while resistance results in isolation.”

There are even more troubling passages, some of which should raise a few eyebrows, in light of former Goldman executive Greg Smith’s recent public resignation, in which he complained that the firm routinely screwed its own clients and denigrated them (by calling them “Muppets,” among other things).

Here, the plaintiffs’  motion refers to an “exhibit 96,” which refers to “an email from [Goldman executive] John Masterson that sends nonpublic data concerning customer short positions in Overstock and four other hard-to-borrow stocks to Maverick Capital, a large hedge fund that sells stocks short.”

Was Goldman really disclosing “nonpublic data concerning customer short positions” to its big hedge fund clients? That would be something its smaller, “Muppet” customers would probably want to hear about.

When I contacted Goldman and asked if it was true that Masterson had shared nonpublic customer information with a big hedge fund client, their spokesperson Michael Duvally offered this explanation:

“Among other services it provides, Securities Lending at Goldman provides market color information to clients regarding various activity in the securities lending marketplace on a security specific or sector specific basis. In accordance with the group’s guidelines concerning the provision of market color, Mr. Masterson provided a client with certain aggregate information regarding short balances in certain securities. The information did not contain reference to any particular clients’ short positions.”

You can draw your own conclusions from that answer, but it’s safe to say we’d like to hear more about these practices.

Anyway, the document is full of other interesting disclosures. Among the more compelling is the specter of executives from numerous companies admitting openly to engaging in naked short selling, a practice that, again, was often dismissed as mythical or unimportant.

A quick primer on what naked short selling is. First of all, short selling, which is a completely legal and even beneficial activity, is when an investor bets that the value of a stock will decline. You do this by first borrowing and then selling the stock at its current price, then returning the stock to your original lender after the price has gone down. You then earn a profit on the difference between the original price and the new, lower price.

What matters here is the technical issue of how you borrow the stock. Typically, if you’ re a hedge fund and you want to short a company, you go to some big-shot investment bank like Goldman or Morgan Stanley and place the order. They then go out into the world, find the shares of the stock you want to short, borrow them for you, then physically settle the trade later.

But sometimes it’s not easy to find those shares to borrow. Sometimes the shares are controlled by investors who might have no interest in lending them out. Sometimes there’ s such scarcity of borrowable shares that banks/brokers like Goldman have to pay a fee just to borrow the stock.

These hard-to-borrow stocks, stocks that cost money to borrow, are called negative rebate stocks. In some cases, these negative rebate stocks cost so much just to borrow that a short-seller would need to see a real price drop of 35 percent in the stock just to break even. So how do you short a stock when you can\t find shares to borrow? Well, one solution is, you don’t even bother to borrow them. And then, when the trade is done, you don’t bother to deliver them. You just do the trade anyway without physically locating the stock.

Thus in this document we have another former Merrill Pro president, Thomas Tranfaglia, saying in a 2005 email: “We are NOT borrowing negatives. … I have made that clear from the beginning. Why would we want to borrow them? We want to fail them.”

Trafaglia, in other words, didn’t want to bother paying the high cost of borrowing “negative rebate” stocks. Instead, he preferred to just sell stock he didn’t actually possess. That is what is meant by, “We want to fail them.” Trafaglia was talking about creating “fails” or “failed trades,” which is what happens when you don’t actually locate and borrow the stock within the time the law allows for trades to be settled.

If this sounds complicated, just focus on this: Naked short selling, in essence, is selling stock you do not have. If you don’t have to actually locate and borrow stock before you short it, you’re creating an artificial supply of stock shares.

In this case, that resulted in absurdities like the following disclosure in this document, in which a Goldman executive admits in a 2006 email that just a little bit too much trading in Overstock was going on: “Two months ago 107% of the floating was short!”

In other words, 107% of all Overstock shares available for trade were short — a physical impossibility, unless someone was somehow creating artificial supply in the stock.

Goldman clearly knew there was a discrepancy between what it was telling regulators, and what it was actually doing. “We have to be careful not to link locates to fails [because] we have told the regulators we can’t,” one executive is quoted as saying in the document.

One of the companies Goldman used to facilitate these trades was called SBA Trading, whose chief, Scott Arenstein, was fined $3.6 million in 2007 by the former American Stock Exchange for naked short selling.

The process of how banks circumvented federal clearing regulations is highly technical and incredibly difficult to follow. These companies were using obscure loopholes in regulations that allowed them to short companies by trading in shadows, or echoes, of real shares in their stock. They manipulated rules to avoid having to disclose these “failed” trades to regulators.

How they did this is ingenious, elaborate, and complex, and we’ll get into it more at a later date. In the meantime, this document all by itself shows numerous executives from companies like Goldman Sachs Execution and Clearing (GSEC) and Merrill Pro talking about a conscious strategy of “failing” trades — in other words, not bothering to locate, borrow, and deliver stock within the time alotted for legal settlement. For instance, in one email, GSEC tells a client, Wolverine Trading, “We will let you fail.”

More damning is an email from a Goldman, Sachs hedge fund client, who remarked that when wanting to “short an impossible name and fully expecting not to receive it” he would then be “shocked to learn that [Goldman's representative] could get it for us.”

Meaning: when an experienced hedge funder wanted to trade a very hard-to-find stock, he was continually surprised to find that Goldman, magically, could locate the stock. Obviously, it is not hard to locate a stock if you’re just saying you located it, without really doing it.

As a hilarious side-note: when I contacted Goldman about this story, they couldn’t resist using their usual P.R. playbook. In this case, Goldman hastened to point out that Overstock lost this lawsuit (it was dismissed because of a jurisdictional issue), and then had this to say about Overstock:

“Overstock pursued the lawsuit as part of its longstanding self-described ‘Jihad’ designed to distract attention from its own failure to meet its projected growth and profitability goals and the resulting sharp drop in its stock price during the 2005-2006 period.”

Good old Goldman — they can’t answer any criticism without describing their critics as losers, conspiracy theorists, or, most frequently, both.

Anyway, this galactic screwup by usually-slick banker lawyers gives us a rare peek into the internal mindset of these companies, and their attitude toward regulations, the markets, even their own clients. The fact that they wanted to keep all of this information sealed is not surprising, since it’s incredibly embarrassing stuff, if you understand the context.

More to come: until then, here’s the motion, and pay particular attention to Pages 14-19.


Hedge Funds Schooling Jamie Dimon

Unlocking the Crude Oil Bottleneck at Cushing

Gold Tumbles Into Bear Market on Greece Euro-Exit Concern

A bit behind posting this, but it shows the market mindset as manipulated by the CB and Media. Gold is rallying today.

Gold declined for a fourth straight session in New York and entered a so-called bear market as concern that Greece will have to leave the euro boosted the dollar and cut the metal’s appeal as an alternative asset.

The U.S. Dollar Index, a measure against six major counterparts, rose for a 13th day to a four-month high after Greece’s political leaders failed to form a ruling coalition. Bullion has dropped 20 percent from its intraday record in September, the common definition of a bear market. On a closing basis, futures need to settle at $1,513.52 to post a 20 percent drop.

Gold declined for a fourth straight session in New York and entered a so-called bear market as concern that Greece will have to leave the euro boosted the dollar and cut the metal’s appeal as an alternative asset.

The U.S. Dollar Index, a measure against six major counterparts, rose for a 13th day to a four-month high after Greece’s political leaders failed to form a ruling coalition. Bullion has dropped 20 percent from its intraday record in September, the common definition of a bear market. On a closing basis, futures need to settle at $1,513.52 to post a 20 percent drop.

Facebook Said to Raise Size of IPO to 421 Million Shares

CFO Tweets Himself out of Job

I would fire anyone who had a Twitter or Facebook account simply as too political or too low of an IQ to understand the potential for spying and constructing a database. Corporate ‘Facebook’ and ‘Twitter’ needs to be very carefully controlled by the Marketing Department.  Somehow people think because ‘celebrities’ use spy organizations Twitter and Facebook it is ‘hip’ but what is ‘hip’ is only using those for disinformation campaigns or not at all.

F.B.I. Inquiry Adds to JPMorgan’s Woes

JPMorgan: a hedge too far?

S&P 500 Snaps 3-Day Slump on Better-Than-Forecast Data

U.S. stocks advanced, snapping a three-day decline in the Standard & Poor’s 500 Index, as better- than-estimated reports on housing starts and industrial production bolstered confidence in the world’s largest economy.

JPMorgan Chase & Co. (JPM) and Goldman Sachs Group Inc. increased at least 1 percent to pace gains in financial companies. General Motors Co. climbed 3.8 percent as Berkshire Hathaway Inc. disclosed a stake. General Electric Co. (GE) rose 3.3 percent as its finance unit plans to pay a special dividend of $4.5 billion to the parent company. Target Corp. (TGT), the second-largest U.S. discount retailer, added 1.5 percent as profit topped estimates.

The S&P 500 rose 0.2 percent to 1,333.31 at 11:06 a.m. New York time. The benchmark measure for U.S. equities pared a gain of 0.8 percent. The Dow Jones Industrial Average gained 25.24 points, or 0.2 percent, to 12,657.24.

“We’ve had some good economic data supporting the U.S. growth story,” E. William Stone, chief investment strategist at PNC Wealth Management in Philadelphia, said in a telephone interview. His firm manages about $112 billion. “It looks like we’re seeing stabilization in housing. Industrial production was a nice surprise. It’s just then fighting with headlines and rumors coming out of Europe.”

Equities gained as data showed output at factories, mines and utilities increased 1.1 percent last month, the most since December 2010, after a 0.6 percent decline in March that was revised from no change. Economists forecast a 0.6 percent gain. Earlier today, a report signaled that the residential real estate industry is stabilizing.

Europe’s Crisis

The benchmark gauge for American equities had dropped 2 percent over the previous three days amid concern Greece will leave the euro. European Central Bank President Mario Draghi indicated that while his “strong preference” is that Greece stays in the euro area, the bank won’t compromise on its principles to prevent an exit.

“The U.S. economic data is consistent with the bottom not falling out of the equity market,” Barry Knapp, the New York- based head of U.S. equity strategy at Barclays Plc, said in a telephone interview. “Yet the situation in Europe is extremely precarious. Everybody wants Greece to stay in the euro, but does Greece want to stay? More needs to be done. You can’t have a lot of confidence that assets will stabilize.”

Eight of 10 groups in the S&P 500 rose today as commodity, industrial and financial shares advanced. A measure of homebuilders in S&P indexes climbed 1.1 percent. JPMorgan increased 1 percent to $36.61. Goldman Sachs added 1.3 percent to $101.12.

Boosting Stakes

Hedge funds Moore Capital Management LLC and Blue Ridge Capital LLC boosted their stakes in JPMorgan, while Kingdon Capital Management LLC divested, before the shares plunged because of a $2 billion trading loss.

Moore, the New York-based firm run by Louis Moore Bacon, bought 6 million shares of JPMorgan and its $297.3 million stake was its largest U.S. stock holding as of March 31. John Griffin’s New York-based Blue Ridge purchased 1.85 million shares, raising its stake in the bank to 6.14 million.

JPMorgan slumped 21 percent from the end of the first quarter through yesterday, including an 11 percent decline following the company’s disclosure of losses tied to synthetic credit derivatives. Chief Executive Officer Jamie Dimon said the New York-based bank made “egregious mistakes.”

GM rallied 3.8 percent to $22.24. Warren Buffett’s firm had 10 million shares of the automaker on March 31, Omaha, Nebraska- based Berkshire said yesterday in a filing disclosing U.S. stockholdings.

GE Rallies

GE gained 3.3 percent to $19.02. Payments to the parent company will begin with a $475 million quarterly dividend for the three months through June, according to a statement today. For the year, the dividend is targeted to be 30 percent of GE Capital’s earnings, excluding the special payment.

Target rose 1.5 percent to $55.91. The retailer increased same-store sales 5.3 percent in the quarter, its best performance in six years, as the warmest temperatures in North America in 50 years encouraged shopping.

Cisco Systems Inc. (CSCO), the biggest maker of computer- networking equipment, jumped 1.7 percent to $16.83. Barclays Plc raised its recommendation to the equivalent of buy.

J.C. Penney Co. slumped 15 percent, the most in the S&P 500, to $28.35. The department-store chain led by Apple Inc.’s former retailing chief reported a first-quarter loss and sales that fell more than analysts projected.

Missing Estimates

Abercrombie & Fitch Co. (ANF) fell 12 percent to $39.96. The operator of namesake and Hollister stores reported first-quarter revenue that missed analysts’ estimates and said same-store sales will decline this fiscal year amid weakness in Europe.

Arena Pharmaceuticals Inc. (ARNA) sank 5.8 percent to $5.71. The San Diego-based drugmaker said it will sell shares in a public offering, its first since July 2009. It didn’t specifying the size of the deal.

Facebook Inc. (FB) investors including Accel Partners and Goldman Sachs Group Inc. raised the number of shares they’re selling in the social network’s initial public offering, boosting the sale to as much as $16 billion.

Existing holders will offer 241.2 million shares, bringing the total on offer to 421.2 million, a regulatory filing today shows. Accel, the biggest seller in the IPO, boosted its amount 28 percent to 49 million, and Digital Sky Technologies increased its amount 74 percent to 45.7 million.

“Everybody is cashing out,” said Trung-Tin Nguyen, a hedge-fund manager at TTN AG in Zurich. “It’s normal for private equities and venture capitals to cash out, but the obvious question is whether they are stretching it too far.”

Largest Ever

Facebook, gearing up for the largest-ever IPO of a technology company, had already increased the offering’s price range to $34 to $38 apiece, from $28 to $35 previously. At $16 billion, Facebook’s debut would surpass that of General Motors Co. (GM) to be the second-largest in U.S. history, excluding so- called over-allotments, which let underwriters buy more shares at a later date, data compiled by Bloomberg show.

Investors will be able to avoid losses in the broader equity market this year by buying stocks with larger-than- average dividends, said David Kostin, chief U.S. equity strategist at Goldman Sachs Group Inc.

“The scarcest commodity in the world is yield,” the New York-based strategist said in a radio interview today on “Bloomberg Surveillance” with Tom Keene and Ken Prewitt. “You have negligible returns” in most asset classes. “Where are you getting any income? You are going to get it in the form of dividends.”

Kostin has a year-end projection for the equities gauge of 1,250, according to a weekly survey by Bloomberg News. The S&P 500 has a dividend yield of 2.1 percent, according to Bloomberg data. Ten-year Treasuries yield 1.8 percent.

Mortgage Delinquencies in U.S. Fall to Lowest Since 2008

Housing Starts Join U.S. Factories Topping Forecasts

Housing starts and industrial production exceeded forecasts in April, pointing to strength in the U.S. economy at the start of the second quarter.

Starts rose 2.6 percent to a 717,000 annual rate from March’s revised 699,000 pace that was stronger than previously reported, Commerce Department figures showed today in Washington. Industrial production climbed 1.1 percent, the most since December 2010, the Federal Reserve said.

USA Industrial Production Rises

Industrial production in the U.S. climbed more than forecast in April, propelled by gains in auto manufacturing and utility use.

Output at factories, mines and utilities increased 1.1 percent last month, the most since December 2010, after a 0.6 percent decline in March that was revised from no change, the Federal Reserve reported today in Washington. Economists forecast a 0.6 percent gain, according to the Bloomberg News survey median. Manufacturing, which makes up about 75 percent of total production, rose 0.6 percent. Utility output climbed the most in two years….


Gold Eclipsed by Dollar Haven as Goldman Sees Rally

Investors are reducing gold holdings for a third month, the longest stretch since 2004, and favoring the dollar as a haven from Europe’s debt crisis, even as Goldman Sachs Group Inc. predicts record prices for the metal.

Bullion erased its gains for 2012 this week as the dollar rose against a basket of currencies for a record 12 straight days. Gold held in exchange-traded products fell 30.8 metric tons since reaching a record 2,410.2 tons on March 13, data compiled by Bloomberg show. Royal Bank of Scotland Plc, ABN Amro Bank NV and Barclays Plc cut their forecasts in May, though Goldman expects prices to rise 25 percent to $1,940 an ounce in 12 months.

Gold rallied for 11 consecutive years and prices rose more than sevenfold, with demand accelerating in 2008 amid the global recession. Now, mounting concern that Greece may exit the 17- nation euro and prospects for faster U.S. growth are boosting the dollar, making it more attractive than bullion to some investors seeking to protect their wealth. Hedge funds are the least bullish on the metal since December 2008.

“Gold is just another risk asset,” said Michael Aronstein, the president of Marketfield Asset Management in New York, who predicted the 2008 slump that drove commodities down 66 percent in seven months and then the rebound in 2009. “It made you a lot of money if you took the risk eight or 10 years ago. A real safe haven would be a pile of high-denomination Swiss franc or dollar notes, stored in a safety deposit box.”

Trading Partners

Futures dropped 1.1 percent this year to $1,549.10 on the Comex as of 10:40 a.m. in New York. The Standard & Poor’s GSCI Index of 24 commodities declined 1.3 percent, and the MSCI All- World Index of equities climbed 2.4 percent. The Dollar Index, a gauge against six major trading partners, added 1.3 percent after retreating as much as 2.6 percent. Treasuries returned 1 percent, a Bank of America Corp. index shows.

Bullion slid as much as 21 percent from its intraday record in September, the common definition of a bear market. On a closing basis, futures need to settle at $1,513.52 an ounce to record a 20 percent drop from its August peak.

Gold’s correlation to the Chicago Board Options Exchange Volatility Index, a measure of U.S. equity derivatives known as the fear gauge, has now dropped to near zero after moving in lockstep as recently as September, when New York futures touched a record $1,923.70 before plunging 19 percent. The 30-week correlation coefficient between the greenback and bullion is now at -0.66, compared with -0.24 in September, with a figure of -1 meaning the two move opposite to each other.

Barclays, RBS

The metal will average $1,740 in 2012, compared with $1,673.76 so far this year, according to the median estimate of 11 analysts tracked by Bloomberg since March. Barclays cut its outlook by 8 percent to $1,716 last week and RBS lowered its forecast by $25 to $1,725 on May 4. ABN Amro said May 2 its prediction dropped to $1,550, from $1,600 in January.

The European Central Bank will be forced to pump more money into the euro region in response to the debt crisis, reviving the appeal of gold, Hussein Allidina, the head of commodity research at Morgan Stanley in New York, wrote in a report May 14. The ECB already flooded markets with more than 1 trillion euros ($1.28 trillion) to avert a credit crunch. Prices will rebound to an average of $1,825 this year and $2,175 in 2013, Morgan Stanley forecasts.

The Federal Reserve is likely to start a third round of stimulus in June, Goldman’s commodity research team, led by Jeffrey Currie in New York, wrote in a report May 9. The metal rose about 70 percent as the Fed bought $2.3 trillion of debt in two rounds of so-called quantitative easing ending in June 2011. It’s too early to say the dollar has reclaimed its status as the currency of last resort over gold, the team wrote.

Soros, Paulson

Billionaire investor George Soros raised his stake in the SPDR Gold Trust, the biggest exchange-traded product backed by bullion, according to a filing yesterday reflecting first- quarter holdings. Paulson & Co., the hedge fund founded by billionaire John Paulson, maintained its investment in the ETP last quarter, while Steven A. Cohen’s SAC Capital Advisors LP cut.

Record-low interest rates from the U.S. to Europe may prop up demand for gold, which generally earns investors returns only through price gains. The Fed has pledged to keep rates at “exceptionally low levels” at least through late 2014. Central banks are buying bullion at the fastest pace in five decades, adding 439.7 tons in 2011. They may purchase a similar amount this year, the London-based World Gold Council estimates.

VIX Correlation

When gold reached its record Sept. 6, it was moving in tandem with the VIX as Europe’s debt crisis and mounting concern about the U.S. recovery spurred investors to buy the metal to diversify their assets. At the time, the metal’s correlation coefficient with the VIX surged to as high as 0.92. A reading of 1 indicates that the two securities trade in lockstep. The correlation is now less than 0.1 percent.

The Dollar Index gained for 12 sessions through May 15, the longest rally since its inception in 1973. The leadership vacuum in Greece and concern that the country would quit the common currency spurred investors to sell euros and buy dollars. That also diminished demand from investors who use gold to hedge against a weaker greenback. Open interest, or contracts outstanding, in U.S. futures dropped 18 percent since July, data compiled by Bloomberg show.

Holdings in ETPs backed by gold retreated 0.3 percent this month after dropping 0.7 percent during the previous two months, data compiled by Bloomberg show. In the second quarter, the VIX (VIX) has surged more than 40 percent while gold has dropped 6.9 percent, poised for the biggest quarterly loss since June 2004.


Hedge funds and other speculators are holding a net-long position of 92,498 futures and options, down from 253,653 contracts in August, Commodity Futures Trading Commission data show.

“Usually, gold could be viewed as a safe haven or a contra play to the U.S. dollar,” said Bill Greiner, who helps manage $13 billion of assets as chief investment officer at Mariner Wealth Advisors in Kansas City, Missouri. “It’s really doing neither right now. It’s highly possible that we’ll see gold and commodities in general continue to drift down until the Fed steps in with some sort of quantitative easing package.”

Democrats See Leverage as Congress Nears Budget Cliff

Congressional Democrats say they can prevail in a year-end fiscal showdown with Republicans, so long as President Barack Obama and Democrats hold firm in their insistence on higher taxes for the rich.

The Democrats are emboldened by the president’s stated refusal to renew expiring income tax cuts for top earners, and they welcome a sequence of deadlines that they say will diminish Republicans’ bargaining power. Treasury Secretary Timothy F. Geithner said yesterday that Congress probably won’t need to raise the federal debt ceiling until 2013, allowing a December tax debate to occur without the risk of an imminent default…

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