New found fed conservatism means open season on Citicoup shares.

Citigroup (AKA Citicoup) is a bankrupt entity masquerading as a financial institution.   It might appear profitable because of the ongoing suspension of normal rule of financial law, AKA FASB rule 157.  FASB157 is also known as the "mark to market law".  It basically states that assets on your books cannot be held at imaginary, fantasy valuations when FASB157 is in effect.  You have to show how you could sell the asset today for the value you are claiming.  Back in 2009, the fed considered suspending this law because it knew all of the banks would be insolvent otherwise but then it also understood how this would detract from confidence in the con game.  So instead of straight up suspending the rule, they changed it so that it could be ignored in times of stress.

The Fed then went on to start buying up every crappy mortgage and "asset" from its buddy banks so that they would not feel the stress that they so richly deserved.  Now that asset valuations are again pumped to the sky, the fed is feeling like the system can take a little rejection without folding up into a crying ball (note: they are dead wrong about that.  The system will collapse the next time a stiff wind hits it.  It is literally GW bush's "house of cards").  In addition, with credit drying up globally, the fed is worried about domino defaults.  Finally, the new fed chief has to be worried about becoming the fall guy for the bubbles that Greenspan and Bernanke blew.  So instead of letting Citicoup do a massive share buy back that would benefit insiders and large "investors" right at the top of the scam, Yellen said no.

The timing of this proposed looting of what is left of Citicoup (thus leaving even more liability to US taxpayers when it eventually implodes for good) was not random.  The con men insiders know how to read a chart.  They know what a pump and dump debt Ponzi is.  They know what tapering eventually means for them (pain).  They are parading around like Citicoup is suddenly rich now and thus its "buy backs and divvy increases for everyone".  But this is only possible if they do not mark their balance sheet to market.  That is the elephant in the living room that everyone wanted to ignore. That is what the fed meant when it said (paraphrased) "the bank is not sufficiently prepared to handle a potential financial crisis".  That's con men speak for "sorry dude, if I let you stick the taxpayer with more fraudulent losses while you make billions, they will kill us all in the street".

Read more at http://globaleconomicanalysis.blogspot.com/#65wrPwIYumuc7vIq.99

the bank is not sufficiently prepared to handle a potential financial crisis
Read more at http://globaleconomicanalysis.blogspot.com/#65wrPwIYumuc7vIq.99

At this point the global credit is drying up and the festering federal reserve is tapped out with no easy way to bail anyone out going forward, Yellen is telling the leaders of Citicoup that they are not going to get one final quick cash out before the crash.  Again, I think this is more to avoid getting killed in the streets than anything else but it will be perceived as a new conservatism.  Which in some ways, I guess the beginning of fear of retribution of the people is in fact a conservative move.  Liberals tend to think that the people don't matter; they can do whatever they want and the herd will just take it.   Conservatives have been on a few cattle roundups before and they know that when the herd decides to stampeded you get the Hell out of the way or you get trampled.

Bottom line: shorts need not be afraid of share buy backs anymore because mommy just slapped the hand of the insolent child who tried to get away with even more atrocities against the American slave laborer.  Because of this, it's officially open season on buying long term puts on Citicoup.  Once it gets rolling, the crash should be fast and furious.