U.S. lawmakers questioned whether MF Global Holding Ltd. decision to replace Michael Roseman as chief risk officer a year ago was driven by his warnings over bets on European debt that helped push the firm to bankruptcy.

Roseman, who said that his concerns were dismissed as “implausible” by then-Chairman and Chief Executive Officer Jon S. Corzine, testified today along with his successor, Michael G. Stockman, at a House Financial Services Investigation subcommittee hearing in Washington.

“It appears Mr. Roseman was the chief risk officer until he stopped telling Mr. Corzine what he wanted to hear,” Representative Michael Capuano of Massachusetts, the panel’s top Democrat, said during a question-and-answer session.

This Bloomberg story, along with the above graph, is also courtesy of Elliot Simon...and the link is here.

The drafters of the Dodd-Frank financial reform law got an important thing right. Despite fierce pushback from the banks — and lackluster support from the White House at critical moments — the legislators communicated a key new intent: megabanks must be able to fail, and the Federal Deposit Insurance Corporation should be in charge of that liquidation process.

The F.D.I.C. was an inspired choice for this role, because it is less captivated by the “magic” of Wall Street and less captured by its money and influence than any other group of officials.

The F.D.I.C. has also long been in the business of shutting down banks while limiting the damage to taxpayers, although it did not previously have complete jurisdiction over the largest banks when they got into trouble. It could only deal with those parts that had federally insured “retail” deposits, and this turns out not to be where the biggest problems have occurred in recent times.

Simon Johnson was the former chief economist at the IMF. This very interesting [but fairly long] commentary showed up in The New York Times yesterday...and I thank Phil Barlett for sending it along. The link is here.

Prime Minister Wen Jiabao said Thursday that China would consider working with the IMF to help shore up Europe’s finances. But he left unclear whether China was willing to drop conditions that so far have made its proposed help unappealing to European nations.

One big question, though, is what kind of political or trade concessions China might want in exchange for assistance.

When Mr. Wen suggested last September that the European Union could dismantle its legal protections against low-price Chinese exports, the idea was immediately condemned by European trade officials.

An opinion article Thursday in the official China Daily newspaper raised Mr. Wen’s trade condition again and suggested that the European Union should also make political concessions — like lifting a longstanding ban on arms exports to China. “As a Chinese saying goes, one does not visit the temple for nothing,” the column warned.

This New York Times article from yesterday also comes courtesy of Phil Barlett...and the link is here.

International debt inspectors believe they have found another €15bn (£12.5bn) black hole in Greece’s public finances caused by the deepening recession, delivering the crippled nation another devastating blow.

Sources told news organisations in Brussels that weak growth will make it even more difficult for Greece to resolve its debt problem, leaving the eurozone and the International Monetary Fund with the prospect of an even larger bail-out than the €130bn planned.

The warning came as the Organisation for Economic Co-operation and Development (OECD) said the emergency bail-out funds are not big enough.

Greece, Portugal, Italy, Ireland and Spain need to repay a total of €700bn this year and €400bn next year.

This story was posted in The Telegraph just after midnight GMT...and is Roy Stephens first offering of the day. The link is here.

A leading architect of the austerity programme in Greece – one of the harshest ever seen in Europe – has admitted that its emphasis on fiscal consolidation has failed to work, and said economic recovery will only come if the crisis-hit country changes tack and focuses on structural reforms.

Poul Thomsen, a senior International Monetary Fund official who oversees the organisation's mission in Greece, also insists that, contrary to popular belief, Athens has achieved a lot since the eruption of the debt crisis in December 2009.

"We will have to slow down a little as far as fiscal adjustment is concerned and move faster – much faster – with the reforms needed to modernise the economy," he told the Greek daily Kathimerini, adding that the policy shift would be "reflected" in the conditions foreign lenders attached to a new rescue programme for Athens.

This story was posted in The Guardian on Wednesday...and I borrowed it from yesterday's edition of the King Report. The link is here.

Germany's Bundesbank has entirely exhausted its stock of private assets and run up a quarter of a trillion euros in liabilities propping up the eurozone system, testing the political limits of EMU solidarity in Germany.

The operations are part of the European Central Bank's 'TARGET2' network of automatic payments between the national central banks of the Euroland club. The Bundesbank has already provided €496bn (£413bn) to countries in trouble, chiefly Greece, Ireland, Italy and Spain.

"This is reaching the danger point. It is already one and a half times the total budget of the German government," said Professor Frank Westermann of Osnabrück University. "If any of the crisis countries exits the euro or if there is an EMU break-up, the Bundesbank bears extreme risks."

The Bundesbank - the dominant body in the euro system - used to keep a stock of €270bn of private securities (refinance credit) before the start of the financial crisis. This was depleted last year as it sold assets to meet growing demands on the TARGET2 scheme.

This Ambrose Evans-Pritchard offering from The Telegraph on Wednesday is another story that I lifted from yesterday's King Report...and the link is here.

Fund manager Rob Arnott told King World News yesterday that central bank intervention is destroying markets and thus national economies as well.

Arnott says: "The three major developed economy centers are all pursuing a process of cranking the printing press to suppress natural market response and natural market interest rates. It represents a powerful distortion for the capital markets. It represents a powerful impetus for people to do one of two things: take risks they might not otherwise have been willing to take, creating the risk-on trade, or take their money off the table altogether. Think of gold as an example -- it's a way of taking money out of circulation."

The link to the KWN blog is here...and I thank Chris Powell for wordsmithing the introduction.

Gold mining entrepreneur, trader, and market analyst Jim Sinclair this week gave two interviews to the German Internet site Metallwoche, one with the freelance journalist Lars Schall, in which he concurs with GATA's view of currency market rigging and gold's role as money, and another in which he argues that China and the Federal Reserve are pretty much managing the value of the euro. Audio of the interviews is posted here.

MineWeb's Lawrence Williams quoted precious metals market analyst Jeff Nichols of American Precious Metals Advisers and Rosland Capital about China's gold production and gold reserves, indicating again the unreliability of official gold production and reserve data, a point long made by GATA.

Williams' report is headlined "China's Gold Output and Demand Could Be Far Greater than 'Official' Data Suggest". Once again I thank Chris Powell for providing the introduction to this story...and it's posted at the mineweb.com website. The link is here.

The Fed's FOMC may well have a gold bug within its midst, because we were rather surprised to find that none other than the Dallas Fed's Dick Fisher, who however is no longer a voting Fed president in the 2012 year, is a proud owner of at least $1 million worth of Gold in the form of the GLD ETF....and another up to $250K in physical (not paper) platinum.

This zerohedge.com piece was sent to me by reader 'David in California' yesterday...and the link is here.

Last month, Newt Gingrich, seeking to widen his support in the days leading up to the South Carolina primary, promised that he would appoint a new gold commission. "Part of our approach ought to be to re-establish something Ronald Reagan did in 1981 and that is to have a commission on gold to look at the whole concept of how do we get back to hard money," he said in a speech.

"Hard money is a discipline," he added. "It is very important for us to understand in finance that the entire contraption that has been built up over the last 30 or 40 years has so much paper in it, so much debt, so much leverage, that we probably have a fifteen- or twenty-year period of working our way out of it. And yet, the alternative is to get sicker and sicker and sicker."

That call may have helped him in South Carolina, where he scored a victory over Mitt Romney, but it did not do much for him in Florida, where he finished a distant second in this week's primary. His strategy now is to present himself as the only conservative with a chance, and thereby persuade supporters of Rick Santorum and Ron Paul to unite behind him. Support for a gold standard is a major part of Mr. Paul's platform.

As the headline states, this 2-page story was posted in The New York Times yesterday...and I extracted it from a GATA release yesterday. It's worth running through...and the link is here.

Eric sent me both blogs yesterday. The J-M Eveillard blog is headlined "Central Banks & Investors Crush Gold Technicals"...and the Peter Schiff blog bears the title "Gold Headed Higher as Dollar to Continue Plunge".

Troy Asset Management began buying gold at $450 an ounce in 2005 and now has 16pc of its £60m Troy Spectrum fund invested in the precious metal. Troy's co-manager Francis Brooke tells Robert Miller why he believes the value of gold will continue to rise.

This 4:42 minute video interview was posted over at The Telegraph yesterday afternoon and I thank Roy Stephens for bringing it to my attention...and the link is here.

Newcrest Mining, the world's No.3 gold producer, expects gold to trade as high as $2,500 an ounce and retain its safe harbour status for as long as the world's financial system remains in crisis mode.

Newcrest chief executive Greg Robinson told a business lunch on Thursday [that] gold will remain a hedge against a global financial breakdown, citing risks such as a devaluation of the U.S. dollar, the global currency, European economies in dire shape and persistent political tensions throughout the globe.

I don't exactly agree with Robinson's call for the gold price over the next five years...but I don't expect too much from a company that got absolutely crucified when they got caught with a huge hedge book just as the bull market started in gold over ten years ago.

This short Reuters piece was filed from Melbourne yesterday...and I thank Roy Stephens for sending me this story. The link is here.

This month, the Hong Kong Census and Statistics Department reported that China imported 102,779 kilograms of gold from Hong Kong in November, an increase from October’s 86,299 kilograms. Beijing does not release gold trade figures, so for this and other reasons the Hong Kong numbers are considered the best indication of China’s gold imports.

Analysts believe China bought as much as 490 tons of gold in 2011, double the estimated 245 tons in 2010. “The thing that’s caught people’s minds is the massive increase in Chinese buying,” remarked Ross Norman of Sharps Pixley, a London gold brokerage, this month.

From there, this story posted over at forbes.com on January 29th goes straight into the toilet. I can't remember the last time I read such disinformation and drivel about China and gold. I don't know whether the author is ignorant, or just plain stupid...and the only reason I'm posting it, is because of the photo of the nice stack of gold kilo bars. I thank Washington state reader S.A. for sending it along...and the link is here.