| Ukraine Bans Gold Transactions Over $125, Currency Derivatives and Interbank Purchases Exceeding $10,000; Update on Black Market Rates in Ukraine Posted: 04 Mar 2015 07:29 PM PST Today the National Bank of Ukraine announced new capital controls on currency transactions. All Interbank Transactions Over $10,000 are Banned. The national Bank of Ukraine has expanded the list of administrative restrictions for stabilization of the hryvnia, in particular, completely prohibiting the withdrawal of foreign dividends and limiting the purchase of foreign currency on the domestic markets.
Resolution No. 160 is effective from March 4, 2015 and is valid until June 3, 2015.
Previously, prohibitions did not target dividends on securities that are traded on stock exchanges.
The NBU has also introduced limits on the balance of banks' operations on the interbank market at the end of the day and banned financial institutions from using currency derivatives on stock exchanges.
These restrictions apply to customer's accounts over $10,000 as valued by the official rates.
Gold Buying Prohibited
In addition, the NBU banned precious metal transactions in amounts over 3,000 UAH [about $125], and also the transfer of currency abroad in excess of 15 thousand UAH [about $625]. The list goes on and on, I translated what I could understand. Interbank RatesFor my gold and currency estimates, I used today's interbank rate of approximately 24 UAH per 1 US dollar even though the official rate is ridiculous. Reader John whose sister lives in Lviv informs me the current rates in Ukraine are as follows. - As of 2:30PM today, the official rate is 23.7712 UAH to the dollar. (Rate was at 24.8206 on March 3)
- The trading range of the USD tightened into the range of 21.5 - 23.5 UAH in the Interbank market. The Euro traded in the range of 24 - 26 UAH per Euro.
Back Market RatesOn the streets of Lviv, the rates are as follows ... - BUY 1 USD = 22.00 UAH
- BUY 1 EURO = 25.00 UAH
- SELL 1 USD = 27.00 UAH
- SELL 1 EURO = 30.00 UAH
The third line is key. It takes 27 hryvnia to buy a dollar on the black market in Lviv, an improvement over the mid-30s last week. For how long? Imports Will Dry UpI caution that capital controls on gold and foreign exchange is a huge sign of weakness. And if the IMF doers not give Ukraine a " loan" or gives Ukraine less of a loan than expected, I expect street rates will quickly hit 50 if not 100 to the US dollar. Finally, importers are going to be under extreme pressure at artificial rates. Imports will dry up. Merchandise in stores will not be available at almost any price because there will be not be any imported merchandise to speak of at all. If this reminds you of Venezuela, it should. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
| Toronto's Hypocritical Real Estate Boards Suppress Price Information; One Broker Strikes Back with "Pay-What-You-Want" MLS Listing Posted: 04 Mar 2015 02:47 PM PST Hypocrisy of the Toronto real estate board is stunning. The board threatened brokers who list sales prices. Their excuse is "privacy". " If 41,160 members have access to this information and are free to give it to [clients], I don't think it is private information." said Fraser Beach, a broker who caved into the demand out of fear he would lose access to the data himself. " I think that the public is well-served if they can do their own due diligence," Beach says. Self-Serving Hypocrites Suppress DataPlease consider Toronto Real Estate Board Demands Brokers Halt Online Sales Stats. This week, three real estate brokers are cutting off customers' online access to recent final home sales prices — coveted information that can help buyers and sellers gauge a property's worth.
The trio are the latest to give in to a threat made by the Toronto Real Estate Board (TREB) to stop doling out home sales information or risk losing a lifeline to all privileged industry data.
Late last night, real estate broker Fraser Beach posted an online alert he called "bad news."
He explained to his almost 30,000 registered users that he is temporarily halting daily emails connecting them online to the latest prices of homes sold in Toronto.
"In light of recent developments, we fear that making this information available to you, in this form, may be threatening our ability to continue operating as a real estate brokerage," he wrote.
The broker feels Canadians should have access to sales information online. He believes when Realtors control and selectively distribute the data, they may provide only details that benefit their business, not the client.
TREB gives agents access to recent final sales prices that they can offer to their personal clients. But Canada's largest real estate board maintains that Realtors cannot widely distribute the information over the internet because of privacy issues.
Battle not over
The battle is waging on another front. Canada's Competition Bureau goes head to head with TREB at a hearing in May. The bureau wants to break the board's monopoly over vital real estate information like sales stats.
It's a test case that could end up affecting other real estate markets in Canada.
Already in Nova Scotia, and for years across the U.S., realty websites publicly post home sales history online.
In the meantime, brokers Beach and Mamourian are determined to find a way to relaunch their services.
"We're going to sit down and find a more creative way to get this information to the public in the future," says Mamourian.
Beach ended last night's online alert with the pledge: "Stay tuned … We will be back." Fraser Beach Strikes BackBeach has 30,000 registered users of his site. That sounds like he is doing something right. Are the other brokers a bit envious perhaps? Are prices falling? Sales declining? All three? Regardless of the answer, in his Good News and Bad News blog post, Beach made an announcement that he is launching a Pay-What-You-Want MLS® listing. The Toronto Homes Sold report has been distributed as an email linking to all residential listings reported sold on the Toronto Real Estate Board's MLS® system since May of 2011.
During that time we have received countless expressions of appreciation from our growing list of subscribers now approaching 30,000. But in light of recent developments, we fear that making this information available to you, in this form, may be threatening our ability to continue operating as a real estate brokerage.
We firmly believe that unfiltered information about the real estate market is necessary to fully inform home buyers and sellers. Others say that agents are necessary to "interpret" market information … we would use a different word.
But stay tuned … WE WILL BE BACK.
Now the Good News
Today we are officially launching a one-of-a-kind brokerage service … the Pay-What-You-Want MLS® listing.
Our Feeless MLS® Listing is a solution for you to list, promote and manage the sale of your property at a cost determined by you. While other real estate brokerages contract for substantial percentage fees, our mission is to empower our clients to realize more — both figuratively and literally. The price you pay for our MLS® listing, marketing and agency services is completely up to you.
We know, we know … what's the catch?
Well, there isn't one. We call it FairFee. If you appreciate and value the service you receive from us we'd truly appreciate your kind consideration.
You see, our approach to real estate brokerage is built on trust – and trust is a two way street. If we are asking you to trust us to represent your best interests, then it's only right that we trust you to be fair with us. How Does it Work?Anyone striking back at the hypocrisy of real estate agencies, especially an insider who sees trust as a two-way street, wants accurate price disclosure, and puts his business at risk while doing so, gets a free plug from me. Here are details of the Pay-What-You-Want program. Finally, this is not an endorsement of Toronto real estate, or any real estate. Readers know I believe Canada is in a bubble. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
| 60 Minute Investigation shows Lumber Liquidators Laminate Flooring Contains Toxic Amounts of Formaldehyde; Democrats Want Federal Probe Posted: 04 Mar 2015 11:45 AM PST People in California complain their flooring is making them sick. The complaints have one source in common, Lumber Liquidators laminate flooring from China with toxic levels of Formaldehyde, up to 20 times the maximum amount in one test. US manufactured flooring does not have the same defects. Health and Safety ViolationsPlease consider Lumber Liquidators Linked to Health and Safety Violations. The following is a script from "Lumber Liquidators" which aired on March 1, 2015. Anderson Cooper is the correspondent. Katherine Davis and Sam Hornblower, producers.
Lumber Liquidators is the largest and fastest-growing retailer of hardwood flooring in North America, with over 360 stores in 46 states and revenues of more than a billion dollars a year. But hardwood isn't the only product they sell. More than 100 million square feet of the company's cheaper laminate flooring is installed in American homes every year. Lumber Liquidators is a U.S. company, but much of its laminate flooring is made in China, and as we discovered during our investigation, may fail to meet health and safety standards, because it contains high levels of formaldehyde, a known cancer causing chemical.
Lumber Liquidators insists its Chinese-made laminate flooring is safe, but it doesn't appear that way based on what we learned from our own reporting and from the work of people like Denny Larson [executive director of a nonprofit group called Global Community who teamed up with Richard Drury, a prominent environmental attorney, to test Lumber Liquidators Chinese-made laminate flooring.]
Anderson Cooper: You want the company to remove all the flooring?
Denny Larson: Every single board. At their cost and replace it with clean flooring.
Anderson Cooper: How much is that gonna cost?
Denny Larson: You know what? I don't care. Because they're guilty of selling people product that could make them sick. These worried California homeowners, who didn't want to be identified, aren't waiting for Lumber Liquidators. They are ripping up their floors now. But many can't afford to replace the flooring on their own.
Anderson Cooper: Do you have any idea how much of this wood is in people's homes right now?
Richard Drury: We believe there are probably tens of thousands of households in California that have installed Lumber Liquidators Chinese laminates that may exceed formaldehyde standards.
Drury and Larson bought more than 150 boxes of laminate flooring at stores around California and sent them to three certified labs for a series of tests. The results? While laminate flooring from Home Depot and Lowes had acceptable levels of formaldehyde, as did Lumber Liquidators American-made laminates, every single sample of Chinese-made laminate flooring from Lumber Liquidators failed to meet California formaldehyde emissions standards. Many by a large margin.
Richard Drury: The average level in Lumber Liquidators products that we found was over six to seven times above the state standard for formaldehyde. And we found some that were close to 20 times above the level that's allowed to be sold. ... It's a startling amount. It was so high, in fact, that one of our test labs thought their machine was broken. ...It hit the upper limit on the radar gun. And they thought it was broken.
Dr. Philip Landrigan: It's not a safe level, it's a level that the US EPA calls polluted indoor conditions. ... I would say long-term exposure at that level would be risky because it would increase the risk for chronic respiratory irritation, change in a person's lung function, increased risk of asthma. It's not going to produce symptoms in everyone but children will be the people most likely to show symptoms at that sort of level.
Denny Larson: You're in a chamber so you're living with it. You're sleeping in there. And you're constantly exposed. That's the threat. The constant exposure to a potent carcinogen over a long period of time.
Because formaldehyde can cause myeloid leukemia and nasopharyngeal cancer at high levels and respiratory issues as well as eye, nose and throat irritation at even low levels, California has strict standards for how much of the chemical the core boards in laminate flooring can emit.
Every box of laminate flooring Lumber Liquidators sells carries this label - stating its CARB Phase 2 Compliant - CARB is an acronym for the California Air Resources Board, which sets strict standards for formaldehyde emissions in wood flooring. Congress adopted California's limits when it passed the Formaldehyde Standards Act in 2010. That law is scheduled to take effect nationwide this year.
Drury and Larson only had wood tested that was being sold in California. But we wondered if the Chinese-made laminate flooring that Lumber Liquidators is selling nationwide also has high levels of formaldehyde. So we went to stores in Virginia, Florida, Texas, Illinois and New York, and bought 31 boxes of it.
We sent the samples for testing at two certified labs. It turns out of the 31 samples of Chinese-made laminate flooring, only one was compliant with formaldehyde emissions standards. Some were more than 13x over the California limit. Both labs told us they had never seen formaldehyde levels that high.
...
Posing as buyers, and using hidden cameras, the investigators visited three different mills that manufacture laminates for Lumber Liquidators.
Employees at the mills openly admitted that they use core boards with higher levels of formaldehyde to make Lumber Liquidators laminates, saving the company 10-15 percent on the price. At all three mills they also admitted falsely labeling the company's laminate flooring as CARB 2, meaning it meets California formaldehyde emissions standards, and the new U.S. federal law.
Manager [at Chinese factory]: This is a best-seller for Lumber Liquidators.
Investigator: Is this CARB 2?
Manager: No, no, no... I have to be honest with you. It's not CARB 2.
Investigator: Can I get CARB 2?
Manager: Yes, you can. It's just the price issue. We can make CARB 2 but it would be very expensive.
Investigator: All this stuff here, Lumber Liquidators... All their labeling is CARB 2 right? But it's not CARB 2?
Employee: Not CARB 2.
Anderson Cooper: Employees at all three mills told us the laminates they make are not CARB 2 compliant. Senate Democrat Calls for Federal Probe MarketWatch reports Lumber Liquidators Shares Turn Sharply Lower as Senate Democrat Calls for Federal Probe. Sen. Bill Nelson of Florida called on the government to investigate whether Lumber Liquidators has made false marketing claims about the safety of its products. "Because this could affect millions of homeowners, it's imperative we get some answers quickly," Nelson said.
Lumber Liquidators has already released one statement challenging the testing used by "60 Minutes" and insisting its products are completely safe. The statement also questioned the on-camera accounts from the Chinese suppliers, saying the company didn't recognize any of the individuals interviewed.
The company insists it is under "attack" from short sellers who are colluding to drive down its stock price. It is currently being sued by environmentalists, backed by a group of Wall Street short sellers, who accuse the company of violating California's toxic-warning statute.
Pressure has stepped up on the Environmental Protection Agency to complete and enforce the legislation that Congress passed in 2010. U.S. Sens. Amy Klobuchar, a Minnesota Democrat, and Mike Crapo, a Republican from Idaho, along with U.S. Rep. Doris Matsui, a Democrat from California, sent a letter to the EPA on Tuesday, urging swift action. The law was meant to be completed no later than Jan. 1, 2013, they wrote.
"New reports that certain laminate flooring products may still contain dangerous levels of formaldehyde should be a serious wake-up call that spurs action to protect consumers," Klobuchar said in a statement.
EPA officials were not immediately available for comment. Lumber Liquidators Chart Ahead of the report, shares of Lumber Liquidators (LL) had already plunged. Someone sure knew what was in the report in advance. It may have been publicly announced. Front month strike $60 puts may have been available a week or so ago for something like $0.25. They are now worth over $24.00. No, I did not buy any. CBOE OptionsOut of curiosity I checked Put Activity of LL on CBOE. It looks like this.  Someone or some ones bought over 15,000 LL strike 60 puts. I do not know what they paid, but my guess is something like $0.25 (that guess could be way off). Each put represents 100 shares. So 15,000 puts would be the equivalent of shorting 1,500,000 shares. Current price is $35.81. Let's call the profit roughly $24 per share. That's a cool aggregate profit of $36 million. Not bad for a week's work. Shorts Not to BlameNo one should blame the shorts here. In fact, everyone should thank the shorts. They are the ones who laid out money, did tests, and conducted an investigation into the environmentally unsafe products of Lumber Liquidators. When companies play the "blame the shorts" game, they are usually in serious trouble. Whether LL executives knew what was going on or not is a separate issue. If they did, then they should be criminally prosecuted. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
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