General News:  Banking, Finance and Endgame Theatrics
 
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"The Greatest Crisis in Modern History" Video clip [90:00]   Text Transcript

  Refresh Panel   2010 Archives 

SEC conducting 'sweep exam' [09/10/10] "Documents reveal the U.S. Securities and Exchange Commission is conducting a far-reaching investigation of money managers who move client money to hedge funds. The investigation is called a "sweep exam," which means it is a broadly aimed review that aims to collect information, not a specific criminal case -- although what the SEC discovers could spark more specific investigations later, The Wall Street Journal reported Friday. Included in the investigation are questions concerning whether money management staffers made investments that were, essentially, private side bets that either paralleled or contradicted bets they were making on their clients' behalf. In the first phase of the investigation, the SEC is examining firms that manage $100 million to $15 billion in assets. In the past year, in the wake of the massive Ponzi scheme conducted by Bernard Madoff, who is now in prison, the SEC has revamped its examinations unit, placing former PricewaterhouseCoopers regulatory compliance partner Carlo di Florio in charge. Agency spokesman John Heine declined to comment on the sweep exam, the Journal said. [...]" 

"Bailout Barney" is Personally Sitting On, And Blocking, Glass-Steagall Revival [09/08/10] "As the U.S. economy and financial system continue to careen into the breakdown crisis, there are four pieces of legislation before the U.S. Congress — one in the Senate and three in the House of Representatives — which would revive FDR's Glass-Steagall provisions. [...]"   

Documentary:  “The Takedown of Glass-Steagall [09/08/10]   Video clip [82:00]  History of fascist banking empires vs. Roosevelt & Glass-Steagall Banking Act, Nixon ending the gold standard, how Alan Greenspan killed Glass-Steagall and shifted the industrial economy to the present financial service economy, how Rep. Barney Frank supported the Gramm-Leach-Bliley Act of 1999 and remains actively opposed to any re-enactment of Glass-Steagall. [...]"  Related: "Restore Glass-Steagall - Overview"  "The bankruptcy reorganization needed for our crumbling economic system today, which lies at the root of the LaRouche Plan, means removing all support for the Monetary system. All illegitimate debt claims on monetary assets of whatever form, will be canceled. The Glass-Steagall standard must be applied to all banking, and any bank engaged in deposit banking-functions will not be legally allowed to engage in speculation, and vice versa. No longer should purely fictitious monetary activity be financed; all financial activity must re-establish its functional relationship with those activities of the physical economy which define real economic value -- those activities which increase the productive powers of labor of our nation's workforce, the potential population density of our nation's territory, and the increase in technology and power available for our nation's manufacturers and farmers. This action, of bankruptcy reorganization, will free our national economy from the looming demise of the present system, and towards a more ideal configuration -- an economic system free from the disease of imperial monetarism. To that end, we have authored a resolution to be circulated and passed by local governments, sponsored and endorsed by policy makers and legislators, to identify a broadened call among the population and within institutions for a return to a legitimate economic system, and the intentions of our founding fathers.  [...]"  Note:  Glass-Steagall. The fascists hated it then, as much as they do now. Greenspan was responsible for policies supporting the shift from an industrial production economy to a financial services economy, and they didn't tell the population that were ruining everyone's lives. 

MSM: "US ' takes steps' against German-based Iranian bank" [09/08/10] "The United States has slapped sanctions on a German-based bank it accuses of helping Iranian institutions involved in illicit nuclear trade.  The Treasury Department announced Tuesday that it had taken steps against Europaeisch-Iranische Handelsbank that would isolate the bank from the U.S. financial system. Undersecretary for Terrorism and Financial Intelligence Stuart Levey calls the bank "a key financial lifeline for Iran" and says it has provided "financial services to Iranian WMD proliferators." The United States and Europe have been looking for further ways of pressuring Iran since the United Nations' Security Council passed international sanctions this year. [...]"  Note:  In earlier times, this would have been considered an act of war.

Afghanistan’s Kabul Bank Collapses, US Taxpayer Will Bailout Police and Afghan Army Payroll [09/07/10]  [1:47] 

Short Film: "Overdose – The Next Financial Crisis" NEW LINK [09/06/10] 3 Video clips "In times of crisis people seek strong leaders and simple solutions. But what if their solutions are identical to the mistakes that caused the very crisis? This is the story of the greatest economic crisis of our age, the one that awaits us.  [...]"  Related:  U.S. housing value down at least $4 trillion

A Public Pension Tsunami Approaches: The Beginning of the Great Deconstruction [09/06/10] "In the distant horizon, a giant wave is building. There are some who recognized the swell and raised the alarm. There are others who deny the possibility of such a wave. Most remain blissfully unaware. The wave is building and when it reaches our shores, it will hit with the force of a tsunami.  The wave is propelled by government spending and crested with unfunded pension obligations. The Pew Center on the States wrote in The Trillion Dollar Gap (February 2010), “A $1 trillion gap exists between the $3.35 trillion in pension, health care and other retirement benefits states have promised their current and retired workers as of fiscal year 2008 and the $2.35 trillion they have on hand to pay for them.”  Like any tsunami, the wave began long ago and very far out to sea. Thirty years ago the vast majority of union workers were in the private sector. Public employees in unions reached parity with private sector members by 2009. This was aided in part by campaign contributions from the unions to elect Democratic Party candidates and generous pay packages and retirement plans passed by those same politicians in return.  By 2010, the general public received a series of shocks. The first shock was the jobless recovery of the Great Recession that cost 8 million jobs. Most of the job losses occurred in the private sector yet the majority . [...] Related: Fury Over Public Pensions Sparks Disclosure Lawsuits 

Higher education bubble poised to burst [09/06/10] "Government-subsidized loans have injected money into higher education, as they did into housing, causing prices to balloon. But at some point people figure out they're not getting their money's worth, and the bubble bursts. A century ago only about 2 percent of American adults graduated from college; in 1910 the number of college graduates nationally was 39,755 -- smaller than the student bodies at many campuses today. [...]"    

Heavy in dollars, China warns of depreciation [09/06/10] "China on Friday offered a rare glimpse into its foreign exchange reserves, confirming that they are overwhelmingly allocated in dollars, while a central banker said the mountain of cash could face depreciation risks. The Chinese government's currency reserves, the world's largest such stockpile at $2.45 trillion, are held roughly in line with what was described as the global average: 65 percent in dollars, 26 percent in euros, 5 percent in pounds and 3 percent in yen. [...]"  

US denies taxpayer funds to bail out Kabul Bank [09/06/10] "The US Treasury Department denied media reports Saturday that American taxpayer funds would be put towards bailing out Afghanistan's beleaguered Kabul Bank. The White House said the allegations were not true and pointed to a statement from Deputy Treasury Secretary Neal Wolin that said the bank's troubles were "an Afghan issue." "They are taking immediate steps to ensure the stability of Kabul Bank and to protect the financial assets of the Afghan people," Wolin said. [...]"  Note:  No point in multiplying the illicit funds collected from the CIA, drug exports and other nefarious activitites ....

Commentary: "Why The Fourth Branch Needs To Be Abolished, And Why "Authority" Should Never Be Trusted" Tyler Durden [09/06/10] "Yesterday we presented Dylan Grice's thoughts on why economists and their opinions should be summarily dismissed as nothing but mere noise on the steep downward slope of a series of failed "authoritarian" policy decisions, which seek to validate one false choice after another, by presenting a hypothetical and fallacious counter-outcome as a certain reality (just consider the "apocalypse" we would be living in if Goldman had failed: of course, there is no justification for this except for what Bernanke et al claim is the one true alternative reality based on nothing but their own conflicted interests), which does nothing but discredit the "science" of economics more and more with each passing day. Yet in the grand scheme of things economists are merely pawns in the hands of the landed elite: the financial system set only on perpetuating the status quo of capital and wealth reallocation from the lower classes onto itself (until there is eventually nothing left), and a government whose only prerogative is to usurp ever more control and authority, until the entire system is one of central planning in economics, social affairs, religion, and every aspect of people's daily lives, all the while pretending to operate under the guise of a democracy, which, at least in America, died long ago. [...]"  

Panicked Afghans nearly collapse Kabul Bank after loan corruption scandal [09/04/10] "Branches of Kabul Bank across the country were crowded as anxious depositors joined hundreds of thousands of government employees queuing to collect their salaries, which were being paid through the bank on Saturday. The privately-owned bank has been the subject of reports alleging large-scale corruption by executives, though the government and central bank have said [...]"  

US:  Three Great Waves of Taxes Coming Beginning in 2011 [09/04/10] "In just a few months, on January 1, 2011, the largest tax hikes in the history of America will take effect.  They will hit families and small businesses in three great waves. [...]"  

CBS 60 Minutes: "2010-2012 deepening Banking Crisis - second wave of $1.5 trillion home loan defaults" [09/04/10]  Video clip [8:22]  

 Commentary: "Bernanke Admits He is a Lying Incompetent" [09/04/10] "In testimony before the Financial Crisis Inquiry Commission on September 2, Federal Reserve Chairman Ben Bernanke admitted that he is both incompetent and dishonest. [...]"   

Regulators Question If Market Manipulation Caused ‘Flash Crash’ [09/03/10] "The Securities and Exchange Commission is keeping a close eye on a stock market practice that may violate rules against market manipulation, the Wall Street Journal reported yesterday. The practice, called “quote stuffing,” happens when stock exchanges are flooded and, at times, clogged by huge numbers of buy and sell orders—orders that are ultimately cancelled.  Regulators are trying to determine if traders are using rapid-fire computerized trading systems to cause the inundation by design, purposefully gumming up the exchanges and giving traders an information advantage on small price movements in stocks. The Journal reported that the SEC is investigating whether quote stuffing may have been one of the causes of the May 6 “flash crash,” when the Dow briefly plunged 1,000 points in a matter of minutes.  To get an idea of the volume of quotes produced by high-speed, computerized trading, consider this: During the day of the flash crash, “there were hundreds of times that a single stock had over 1,000 quotes from one exchange in a single second,” according to Nanex, a ticker of quotes and trades. Or, for the visual learners out there, take a look at Nanex’s mesmerizing, time-delayed video clip that flashes all of the quotes for one stock, in this case Public Storage, in just one second.  If quotes from various exchanges clog the system, as the New York Stock Exchange admitted happened during the flash crash, some traders could profit. Nanex’s report explains why quote-stuffing could represent market manipulation:  [...]"   

Probe Circles Globe to Find Dirty Money [09/03/10] "A black-market financial investigation spreading from Iran to Sudan, London and Cuba began in a cluttered fifth-floor cubicle in an old-school district attorney's office in Manhattan featuring dark corridors and frosted glass. There, an intelligence analyst named Eitan Arusy began studying a slim lead. Suspicious money was flowing to and from an Iranian nonprofit operating in a Fifth Avenue office tower in Midtown Manhattan. Mr. Arusy's probe, later merged with a Justice Department inquiry, ultimately widened to some of Europe's vaunted banks, helping spark a global inquiry that found they actively evaded U.S. law in aiding sanctioned countries, banks or other enterprises move some $2 billion undetected. Nine banks have been caught up in the probe, and some are in discussions to settle, according to a person familiar with the case. Three have already. Last month, Barclays PLC in London agreed to pay $298 million and admitted to allowing payments on behalf of clients in Cuba, Sudan and other countries. Lloyds Banking Group in London and Credit Suisse Group in Zurich—banks that operated extensive transfer systems for Iranian clients—have agreed to settlements totaling $350 million and $536 million, respectively. [...]"  

Lehman CEO Blames Fed for Financial Crisis [09/03/10] "In a remarkable case of the pot calling the kettle black, Lehman Brothers' former CEO Richard Fuld pointed a finger at the US Federal reserve today, saying it worsened the financial crisis in September 2008. Testifying at a hearing, Fuld blamed the Fed for letting the investment bank fail. He said, “Only Lehman was denied that expanded access” that would have allowed for a more orderly wind-down of its business. Fuld continues to deny that the bank took too much risk and hid its true financial condition through off-balance-sheet financing. Also today, the FCIC released hundreds of emails and documents from the period leading up to the bank's collapse, which the FCIC chairman says reveal what appears to be a “conscious policy decision not to rescue” Lehman. In particular, the Financial Times notes an email from Chief of Staff Jim Wilkinson to then-Treasury Secretary Hank Paulson that read, “I just can’t stomach us bailing out Lehman. Will be horrible in the press. [...]" 

Moody’s Escapes SEC Lawsuit, Now Moves to Shield Itself From Liability [09/03/10] "Despite allegations that Moody’s Investors Service, one of the three major credit rating agencies, committed fraud when it failed to fix what it knew was an erroneous rating, the Securities and Exchange Commission announced on Tuesday that it wouldn’t sue the rating agency. It instead settled for a scolding, directed at ratings agencies generally. Historically, rating agencies have argued with some success that the First Amendment protects their ratings, but much of the examination done after the financial meltdown has cast blame on the agencies for caving into pressure from investment banks and compromising standards in order to preserve market share. It has also brought a string of lawsuits from investors and issuers alike. [...]"  

 Commentary: "The Slow Deliberate Collapse Created by The Fed" [09/03/10] "Almost two years ago the US Treasury was selling large amounts of short-term Treasury bills to fund bailouts and stimulus. That caused a major increase in debt. Most of that paper was 2-year bills and it is coming due for rollover shortly. While that transpires, October will report the annual fiscal deficit of 9/30/10 of about $1.5 trillion, a figure thought impossible just 1-1/2 to 2 years ago. This time around the Treasury will have to depend on the Fed and US banks and institutions to fund this mountain of paper. China has reduced its holdings of Treasury debt by about 6%, or by about $6 billion over ten months, or by about 10% or almost $100 billion over the past year or so. We know these figures are estimates because the Chinese government has the same trouble the US government has, it cannot discern truth from fiction. [...]"   Related: The Fed's Liquidity Trap: The American and world economies are in a deliberate state of slow collapse [09/03/10] "Almost two years ago the US Treasury was selling large amounts of short-term Treasury bills to fund bailouts and stimulus. That caused a major increase in debt. Most of that paper was 2-year bills and it is coming due for rollover shortly. While that transpires, October will report the annual fiscal deficit of 9/30/10 of about $1.5 trillion, a figure thought impossible just 1-1/2 to 2 years ago. This time around the Treasury will have to depend on the Fed and US banks and institutions to fund this mountain of paper. China has reduced its holdings of Treasury debt by about 6%, or by about $6 billion over ten months, or by about 10% or almost $100 billion over the past year or so. We know these figures are estimates because the Chinese government has the same trouble the US government has, it cannot discern truth from fiction. [...]"  Financial Backlash: "Quantitative Easing" Will Trigger Another Wave of Mergers and Acquisitions

Investors Spooked As Glitch Sends Gold to $3400 [09/01/10] "Investors were briefly panicked yesterday when the Yahoo Finance website indicated that gold had soared to over $3400 dollars an ounce, an instant jump of 175 per cent. Possible reasons for the shocking spike ranged from a simple mistake to a secret signal being communicated to insiders as to where the commodity was really heading. Just after 11am eastern time, the Yahoo Finance website gold graph indicated that the precious metal had jumped from $1235.60 an ounce to a whopping $3401.50 an ounce in the space of minutes. The commodity then quickly returned to its previous level almost immediately. The only event that could precede such a massive and instantaneous jump in gold would have to be something on the scale of a nuclear war or a sudden and total collapse of the U.S. dollar. Since the apparent glitch was only registered on the Yahoo website, many have attributed it to an in-house error. But that didn’t stop financial forums raging with speculation as to whether the snafu wasn’t some kind of hidden message being put out to insiders as to when gold will really hit such a level. [...]"  Note:  Well, if the total collapse of the dollar happened, the gold would be worth nothing, not $3400.

 Commentary: "The Poor Have No Chance of Joining the Rich, the Game is Rigged" [09/01/10] "Never have so few, done so little, and made so much, while screwing so many.  In 2005, the top 25 hedge fund managers "earned" $9 billion, or an average of $360 million. One year after a financial collapse caused by the financial innovations peddled by Wall Street, the top 25 hedge fund managers paid themselves $25 billion, or an average of $1 billion a piece. For some perspective, there were 7 million unemployed Americans in 2006. Today there are 14.6 million unemployed Americans. While the country plunges deeper into Depression, the barbarians pick up the pace of their plundering and looting of the remaining wealth of the nation. Bill Bonner and Lila Rajiva pointed out a basic truth in 2007, before the financial collapse. "On the Forbes list of rich people, you will find hedge fund managers in droves, but no one who made his money as a hedge fund client." - Mobs, Messiahs and Markets [...]"  

Oregon State Bank Proposed [08/31/10] "Recent headlines indicate that the State of Oregon faces another $1 billion in deficits. The trickle-down effect of the financial crisis that started with Wall Street banks has now come to all our Main Streets across Oregon.  Ironically, while Wall Street is handing out ever- bigger bonuses, State employees will be handed pink slips. In parallel, the private sector has handed out its own round of pink slips as unemployment sits at 10.6% (and almost 20% if one counts those who are off the roles but have given up trying to find employment.). Thus many will clamor for cutting more out of the State coffers, but we must remember that State employees shop at local stores, pay mortgages, get their hair cut and otherwise are an intricate part of the dance between the public and private systems that create Oregon. There’s no way to separate them….they are interdependent. So while cutting back on State expenditures looks effective, it is far less so when you factor in how that cuts back on private businesses too.  [...]"  Related: A Vision For State-Owned Banking in Wisconsin    

Satire: U.S. Economy Grinds To Halt As Nation Realizes Money Just A Symbolic, Mutually Shared Illusion [08/30/10] "The U.S. economy ceased to function this week after unexpected existential remarks by Federal Reserve chairman Ben Bernanke shocked Americans into realizing that money is, in fact, just a meaningless and intangible social construct. What began as a routine report before the Senate Finance Committee Tuesday ended with Bernanke passionately disavowing the entire concept of currency, and negating in an instant the very foundation of the world's largest economy. ....  As news of the nation's collectively held delusion spread, the economy ground to a halt, with dumbfounded citizens everywhere walking out on their jobs as they contemplated the little green drawings of buildings and dead white men they once used to measure their adequacy and importance as human beings.  At the New York Stock Exchange, Wednesday morning's opening bell echoed across a silent floor as the few traders who arrived for work out of habit looked up blankly at the meaningless scrolling numbers on the flashing screens above.  "I've spent 25 years in this room yelling 'Buy, buy! Sell, sell!' and for what?" longtime trader Michael Palermo said. "All I've done is move arbitrary designations of wealth from one column to another, wasting my life chasing this unattainable hallucination of wealth. "What a cruel cosmic joke," he added. "I'm going home to hug my daughter."  Sources at the White House said President Obama was "still trying to get his head around all this" and was in seclusion with his coin collection, muttering "it's just metal, it's just metal" over and over again. "The president will be making a statement very soon," press secretary Robert Gibbs told reporters. "At the moment, though, his mind is just too blown to comment. ... The realization that money is nothing more than an elaborate head game seems to have penetrated the entire country: In Wilmington, DE, for instance, a collection agent reportedly broke down in joyful sobs when he informed a woman on the other end of the phone that he had absolutely no reason to harass her anymore, as her Discover Card debt was no longer comprehensible. For some Americans, the fog of disbelief surrounding the nation's epiphany has begun to lift, with many building new lives free from the illusion of money. [...]"   

Economic Collapse is an INSIDE JOB - Movie Trailer [08/30/10] Video clip [2:19]  "From Academy Award® nominated filmmaker, Charles Ferguson ("No End In Sight"), comes INSIDE JOB, the first film to expose the shocking truth behind the economic crisis of 2008. The global financial meltdown, at a cost of over $20 trillion, resulted in millions of people losing their homes and jobs. Through extensive research and interviews with major financial insiders, politicians and journalists, INSIDE JOB traces the rise of a rogue industry and unveils the corrosive relationships which have corrupted politics, regulation and academia. Narrated by Academy Award® winner Matt Damon, INSIDE JOB was made on location in the United States, Iceland, England, France, Singapore, and China. [...]"   

Ex-UBS whistleblower hits out at ‘corrupt’ US justice [08/29/10] "Former UBS banker Bradley Birkenfeld hit out on Saturday against the "corrupt" US judiciary which sent him to jail even though he was the whistleblower who led to the US tax fraud case against the bank. "The Department of Justice's corruption is evident today -- why am I the only one in prison  [...]"   

Point the Finger: Congress Destroyed Banking [08/29/10] "Is there a group of people who you can point your finger and say with defined outrage, that they are the ones responsible for the economic depression we are in now? The answer is, yes. The answer is our own federal government and one law in particular. ‘Gramm – Leach – Bliley Act of 1999’ did many things, it gutted one very important depression era banking act, it amended the Banking Act of 1933 (Glass-Steagall Act) which forbid banking institutions from issuing,  speculating, and trading securities. Trading in securities is gambling in the sense that you are risking on an outcome with the investment of an asset or currency. When banks lose on their bad bets, such as valuation loss on created securities or stock declines, then the bank looses its minimum liquidity requirements and must be bailed out by the FDIC. From February 2007 to August 2010, there have been 292 bank failures requiring FDIC bailout to an accumulated tune of $69.5 billion dollars.  Why would congress write and enact a bill that removes such an important depression era financial safeguard? Several reasons, first, banking institutions wanted it and with $5 billion dollars worth of lobbyist effort and twenty years of persistence, got their wish. Second, congress thought that if they made banking exciting through the creation of a great whirling pool of cash, that it would create more jobs and money; well mainly money, then bailed out the bankers when their money pool ran afoul. Congress was locked into bailing out banks for if they allowed due process of FDIC reconstruction of the big banks, then the reason they went bankrupt would arise and indict congress for its participation. The system has been blinded by congress’s guilty heart, it obscures investigations, tosses snowball questions to perpetrators, appoints positions for those who participated, all while passing bailout funding with zero oversight. I am awed at the hardiness of the American Economy to continuously take blows from within the system and from without.  [...]" 

Beware That New Credit-Card Offer: Banks Flooding Consumers With 'Professional Cards' That Aren't Covered Under Reform  [08/28/10] Note: This should have been banned, as well. Bait and switch class scam.

America Facing Depression and Bankruptcy [08/28/10] "Twenty countries (including America) are headed into bankruptcy and more will follow. That brings up the subject of state debt in the US. America has been in an inflationary depression for 18 months. States have been cutting back for two years," but still face huge budget gaps required to be closed .... 2011 will be a terrible year (with) 80% of states expect(ing) deficits of more than $200 billion. 2012 looks even worse." Most worrisome, "there is no recovery and there never has been....the US economy and financial system is comatose." The worst is yet to come and will hit hard on arrival. [...]"   

Fed Ready to Dig Deeper to Aid Growth, Chief Says [08/28/10] "The Federal Reserve chairman, Ben S. Bernanke, signaled once again on Friday that the central bank was prepared to act if the economy continued to weaken, as yet another economic report confirmed that the recovery had slowed to a crawl.  [...]"   

Investigations: Banks’ Self-Dealing Super-Charged Financial Crisis [08/27/10]   "Over the last two years of the housing bubble, Wall Street bankers perpetrated one of the greatest episodes of self-dealing in financial history.  [...]"  Note:  Very well put together.  Related:  "A Crib Sheet on Wall Street’s Self-Dealing Money Machine"  ProPublica: by Marian Wang  "Last night, we published a story about self-dealing by the big Wall Street banks, cashing in on the world of structured finance. We know the subject matter is heady stuff, so together with our partners at NPR’s Planet Money, we’ve tried to make it as digestible as possible — with our first-ever cartoon, colorful charts (or “lovely chart porn,” as described by Barry Ritholtz), and an Auto-Tune song about the banks. Felix Salmon at Reuters, Ritholtz at The Big Picture and The New York Times’ Dealbook also have smart takes that you should be sure to catch. But for those of you who, unlike Felix Salmon, don’t care to read all the “juicy details” about the specific CDO names and narratives in the full story, we’ve pulled out some of the basic questions and answers right here. [...]"  

Analyst: Citigroup Is Cooking the Books [08/27/10] "An all-out war has broken out between Citigroup CEO Vikram Pandit and a prominent securities analyst who is saying that the big bank may be cooking the books by inflating its earnings through an accounting gimmick, FOX Business Network has learned. [...]"   

China Buys Euros as Fear of World Depression Grows [08/27/10] [7:11]  "The US Treasury has just announced that China’s official holdings of U.S. Treasury securities declined by about $30 billion between April and May of this year, from about $900 billion to some $868 billion. According to the US authorities, this means that Chinese holdings of US government paper are now at the lowest level in the past year. A 2% to 3% decline in a month does not qualify as massive dumping, but simply means that China is in the process of diversification. It is also very likely that China has more U.S. Treasury bonds than this official count would indicate, quite possibly through proxy purchases via Hong Kong and other places. With the sales of existing homes in the United States falling by 27% this morning, together with disastrous statistics regarding unemployment and foreclosures, it ought to be obvious that the US economy is in depression. Even experts interviewed on CNBC are beginning to wake up to this obvious fact. [...] On August 24, the Treasury’s two-year note reached its highest price in recorded history, meaning that the yield was at a record low. The entire world is piling into short-term U.S. Treasury paper, and many buyers cannot get enough. This makes a mockery out of the right wing reactionary refrain that the US equals Greece and soon will be unable to borrow. If, according to the crackpot Austrian theory, markets know things that individual humans cannot know, then surely the market is signaling a great desire for  Treasury bills and Treasury notes at the short end. The main reason for this demand is of course fear and panic – coming from the growing awareness that the world is indeed experiencing the second wave of a world economic depression of colossal proportions."   [...]  Related:  Commentary: It's Official: China is Unloading its Treasury Bonds  "It looks like the smart money these days is found in China. While American investors have been scrambling over each other to buy more Treasury bonds at historically low yields, China has begun quietly unloading some of its own enormous holdings. In June, the Middle Kingdom sold $21.2 billion of paper, reducing its net long to $839.7 billion. This is little more than 10% of the total $8.18 trillion in federal debt that Uncle Sam has outstanding. [...]"   

Fed Seeks Delay of Bank Data Release While Considering Appeal [08/27/10] "The Federal Reserve Board sought to delay the court-ordered release of documents identifying banks that might have failed without the U.S. government bailout while it considers an appeal to the U.S. Supreme Court. [...]" 

 Commentary: "The Most Fiscally Irresponsible Government in U.S. History" [08/26/10] "There is an instinctive conclusion among the American public that President Obama's stimulus package has failed to create a sustained recovery. Unemployment has increased, not declined; consumers have retrenched; housing starts have crashed along with mortgage applications; and there is a fear that a double-dip recession may very well be in the pipeline. The public perception, reflected in Pew Research/National Journal polls, is that the measures to combat the Great Recession have mostly helped large banks and financial institutions, and that's a view common to Republicans (75 percent) and Democrats (73 percent). Only one third of either political leaning thinks government policies have done a great deal or a fair amount for the poor.  There is another instinctive conclusion among the American people. It is that the national deficit, and the debts we have accumulated, are of critical political importance. On the national debt, the money the government has spent without the tax revenues to pay for it has produced mind-numbing numbers so large as to be disconnected from reality. Zeros from here to infinity. The sums are hard to describe; it is hard to describe an elephant, but you know one when you see one. The public knows that, shuffle the numbers as you may, the level of debt is unsustainable. [...]"    

Morgan Stanley Says Government Defaults Inevitable [08/25/10] "Investors will face defaults on government bonds given the burden of aging populations and the difficulty of securing more tax revenue, according to Morgan Stanley.  “Governments will impose a loss on some of their stakeholders,” Arnaud Mares, an executive director at Morgan Stanley in London, wrote in a research report today. “The question is not whether they will renege on their promises, but rather upon which of their promises they will renege, and what form this default will take.” The sovereign-debt crisis is global “and it is not over,” the report said.  Borrowing costs for so-called peripheral euro-region nations such as Greece and Ireland surged today, resuming their ascent on concern that governments won’t be able to narrow their budget deficits. Standard & Poor’s downgraded Ireland’s credit rating yesterday on concern about the rising costs to support nationalized banks.  Mares said debt as a percentage of gross domestic product is a false indicator of an economy’s health given it doesn’t reflect governments’ available revenue and is “backward- looking.” While the U.S. government’s debt is 53 percent of GDP, one of the lowest ratios among developed nations, its debt as a percentage of revenue is 358 percent, one of the highest, the report said. Conversely, Italy has one of the highest debt- to-GDP ratios, at 116 percent, yet has a debt-to-revenue ratio of 188, Mares said. [...]"  

LaRouche: "Brawls at the Fed, as the System Comes Down" [08/25/10] "A senior Washington intelligence source reported this morning that a serious fight has erupted inside the Federal Reserve over hyperinflation, and that people close to the Fed are going to be leaking details, which means the fight will intensify and become more public. [...]"   

Credit Card Debt Drops to Lowest Level in 8 Years [08/25/10] "The amount consumers owed on their credit cards in this year's second quarter dropped to the lowest level in more than eight years as cardholders continued to pay off balances in the uncertain economy. The average combined debt for bank-issued credit cards – like those with a MasterCard or Visa logo – fell to $4,951 in the three months ended June 30, down more than 13 percent from $5,719 in the same period a year ago, according to TransUnion. [...]"  

Fed loses court appeal to keep bailout details secret  [08/25/10] "Bloomberg News won another battle in its war to force the Federal Reserve to disclose details of its massive lending program during the financial system bailout. The full U.S. Court of Appeals in New York has refused to review a March decision by three of its judges requiring the Fed to release records of the $2 trillion in emergency loans it extended to banks and other institutions beginning in 2008. From Bloomberg: Unless the court stays its decision, the Fed will have seven days to disclose the documents. In the event of a stay, the central bank and the Clearing House Association LLC, an organization of 20 commercial banks that joined the Fed in defense of the lawsuit, will have 90 days to petition the Supreme Court to consider their appeal. The Clearing House has already said it will ask the high court to rule on the case. A Fed spokesman said the central bank was “considering our options.” Bloomberg sued the Fed in November 2008, arguing that the public has the right to know the names of the banks that borrowed from the agency, the amounts of the loans and what kind of collateral was posted.Bloomberg News won another battle in its war to force the Federal Reserve to disclose details of its massive lending program during the financial system bailout. The full U.S. Court of Appeals in New York has refused to review a March decision by three of its judges requiring the Fed to release records of the $2 trillion in emergency loans it extended to banks and other institutions beginning in 2008. From Bloomberg: Unless the court stays its decision, the Fed will have seven days to disclose the documents. In the event of a stay,  [...]"   

IMF recommends that the world adopt a global currency called the "Bancor"  [08/25/10] "Sometimes there are things that are so shocking that you just do not want to report them unless they can be completely and totally documented. Over the past few years, there have been many rumors about a coming global currency, but at times it has been difficult to pin down evidence that plans for such a currency are actually in the works. Not anymore. A paper entitled "Reserve Accumulation and International Monetary Stability" by the Strategy, Policy and Review Department of the IMF recommends that the world adopt a global currency called the "Bancor" and that a global central bank be established to administer that currency. The report is dated April 13, 2010 and a full copy can be read here. Unfortunately this is not hype and it is not a rumor. This is a very serious proposal in an official document from one of the mega-powerful institutions that is actually running the world economy. Anyone who follows the IMF knows that what the IMF wants, the IMF usually gets. So could a global currency known as the "Bancor" be on the horizon? That is now a legitimate question. So where in the world did the name "Bancor" come from? Well, it turns out that "Bancor" is the name of a hypothetical world currency unit once suggested by John Maynard Keynes. Keynes was a world famous British economist who headed the World Banking Commission that created the IMF during the Breton Woods negotiations. [...]" 

 Commentary: Wall Street Psycho: 15 Signs of Moral & Ethical Pathology, Soul-Sickness [08/24/10] "In The Battle for the Soul of Capitalism Jack Bogle no longer sees Adam Smith's "invisible hand" driving "capitalism in a healthy, positive direction." Today, his "Happy Conspiracy" of Wall Street plus co-conspirators in Washington and Corporate America are spreading a contagious "pathological mutation of capitalism" driven by the new "invisible hands" of this new "mutant capitalism," serving their selfish agenda in a war to totally control America's democracy and capitalism. The "Goldman Conspiracy" is the perfect B-School case study of Wall Street's secret contagious pathology, with insiders like Blankfein, Paulson and others pocketing billions more of the firm's profits than shareholders, evidence the new "mutant capitalism" has replaced Adam Smith's 1776 version which historically endowed the soul of American democracy as well as our capitalistic system. But sadly for America, Goldman's disease is rapidly becoming a pandemic spreading beyond Wall Street's "too-greedy-to-fail" banks, infecting our economy, markets and government, as it metastasizes globally. What are the symptoms of this growing "soul-sickness," this "pathological mutation of capitalism" Bogle fears? Recently we reviewed the consequences of this "soul-sickness." Today we'll edit and paraphrase news reports about fifteen symptoms spreading "soul-sickness" beyond the boundaries of this Goldman case study: These are the 15 signs of a moral pathology undermining not just banking, but American democracy and capitalism. [...]"  1. Gross denial of any moral damage caused by their rampant greed 2. Narcissistic egomaniacs with secret “God complexes”  3. Paranoid obsessives about secrecy, guilt and non-disclosure    4. Power-hungry need to control government using “Trojan Horses”  5. Borderline personalities who regularly ignore “conflicts of interest”    6. Pathological liars incapable of honesty even with own investors 7. Sole fiduciary duty to insiders, not investors, never the public   8. Moral issues are PR glitches, violations of “don’t get caught” rule  9. Charitable donations are tax and PR opportunities, not moral issues  10. When exposed in a massive fraud, feign humility, fake an apology   11. When bankruptcy threatens, bribe friends in “Happy Conspiracy” 12. Engage co-conspirators to cover-up, distract, do your dirty work   13. As money-hungry vultures, they will prey on vulnerable Americans   14. Treat everyone not in the “Happy Conspiracy” with “tough love” 15. Addicts blinded by greed: “Geezus would throw them out …” Note: Examples of each of these are provided, as well as other links.

Backlash with a Vengeance: Small Investors Pull $33 Billion From Wall Street Banksters [08/24/10] "Investors withdrew a staggering $33.12 billion from domestic stock market mutual funds in the first seven months of this year, according to the Investment Company Institute, the mutual fund industry trade group. Now many are choosing investments they deem safer, like bonds. If that pace continues, more money will be pulled out of these mutual funds in 2010 than in any year since the 1980s, with the exception of 2008, when the global financial crisis peaked. Small investors are “losing their appetite for risk,” a Credit Suisse analyst, Doug Cliggott, said in a report to investors on Friday.  [...]"  Related: Tony Robbins Economic Warning [15:00] LINK FIXED [08/24/10] "Tony Robbins, renowned success coach and motivational speaker shares an insight from some of the influential people he works with and why he believes a breakdown is underway."  Note:  Part 2 [8:58]

Commentary: Banks Siding Against the Customer in Fraud Cases [08/24/10] "Like most consumers, I had always assumed that banks and customers are united in wanting to curtail bank fraud. Unfortunately, I have learned that in fact bank fraud is a big and profitable business -- for the banks themselves; and that changes in electronic banking, combined with the power of lobbyists to sustain the status quo that is stacked against ordinary account holders, mean that if consumers' accounts are corrupted, they can face systemic stonewalling by the banks themselves -- and have little recourse. [...]"  

Credit Card Rates At Nine-Year High [08/24/10] "Interest rates continue to tumble for the U.S. Treasury, companies and home buyers alike. But for a large portion of 381 million U.S. credit-card accounts, borrowing rates have been moving only one way: up.  And average rates are likely to climb further in the near future. New credit-card rules that took effect Sunday limit banks' ability to charge penalty fees. They come on top of rule changes earlier this year restricting issuers' ability to adjust rates on the fly. Issuers responded by pushing card rates to their highest level in nine years.  [...]"  

US Said Preparing New Laws To Seize Americans Retirement Accounts [08/24/10] Note: Looking at the article, this wouldn't be a problem until after 2012. 

A Vision For State-Owned Banking in Wisconsin [08/23/10] "State-owned banks are finally being seen as a step in the right direction away from dependency on, and control by, the Federal government and its cohort, the private Federal Reserve. State-banking initiatives have now been undertaken in 14 states, with Wisconsin being a recent addition. The long-term goal of state-run banks is to end inflation, and reduce wars and business cycles by abolishing the Federal Reserve (and its unlimited supply of fake money), while allowing private mints to issue gold-backed, real currency. The short-term goal is to keep the profits and lending in the state to enhance local economic development. All states, except North Dakota, are subject to the rates and management judgments imposed by private banks. The states must deal with these banks for loans and other services just like any person. As a big customer, states pay many dollars in interest every year. Bonds are also a source of debt-financing. The Bank of North Dakota was founded in 1919 with the mission of "promoting agriculture, commerce and industry" in North Dakota. It was never intended for BND to compete with or replace existing banks.  Instead, Bank of North Dakota was created to partner with other financial institutions and assist them in meeting the needs of the citizens of North Dakota. Over the years, its fiscal responsibilities to the state have increased dramatically. Today, the Bank operates with more than $230 million in capital. The State of North Dakota began using bank profits in 1945 when money was first transferred into the General Fund. Since that time, capital transfers have become the norm to augment state budgets. It is important to look at the history of why exactly the state-run bank movement is so important, as well as the current conditions that indicate that a change of direction is essential for the survival of America as we know it.  [...]" 

 Commentary: Autumn in New York [08/23/10] ".... I have repeatedly commented in these pages that retirement had become impossible in America in principle. It takes some time for a principle to be actualized in reality, but gradually fewer and fewer people are making the decision to retire. The US News & World Report article makes it clear that we have passed the half way mark toward the society where retirement is impossible for most people. The reason is simple. To retire, your savings must grow, and the traditional way of doing this was by compound interest. But when the New Deal abolished the gold standard, it started to print paper money at a rate just about equal to the rate of interest. This, of course, means that you have been getting 0 real interest rate for the past 77 years. But at 0% interest money cannot grow, and this means that you cannot accumulate money for retirement.  Americans have responded by trying to make money for retirement by speculating in stocks. This is like making up for a cut in pay by beating your buddies in the Saturday night poker game. Speculating is a zero-sum game. Some may win, but an equal amount must be lost.  The myth is perpetrated today that the stock market always goes up. The stock market has gone up since 1933, but this has happened because the Fed stole money from bond (and other fixed income) investors to give it to stock speculators. FOR EVERYONE TO BENEFIT, NET WEALTH MUST BE CREATED. That is a point that the “Brain Trust” did not understand. Do you want to speculate in the stock market intelligently? Then watch the Fed. When the Fed eases credit and prints money, then stocks will go up (and bondholders will lose via the depreciation of the currency). When we are on the upswing of the commodity pendulum (as now), then be in gold or other commodities. When we are on the downswing of the pendulum, then be in stocks (or real estate). That is, in broad scope, the name of the game. [...]"  

US: New Credit Card Rules Go Into Effect [08/23/10] "New rules curbing credit card company shenanigans took effect on Sunday, as restrictions on “unreasonable late payment and other penalty fees” will now block the companies from charging excessive levies if users, to cite just one choice example, do not use their cards.  [...]"   

Op-Ed: "Appeasing the Bond Gods" Paul Krugman [08/22/10] "As I look at what passes for responsible economic policy these days, there’s an analogy that keeps passing through my mind. I know it’s over the top, but here it is anyway: the policy elite — central bankers, finance ministers, politicians who pose as defenders of fiscal virtue — are acting like the priests of some ancient cult, demanding that we engage in human sacrifices to appease the anger of invisible gods.  [...]"  Flashback: Paul Krugman Promotes Housing Bubble 

"Jump, You Fuckers!" (A Song For Wall Street) [08/22/10] [4:08]   "Open up the window, check out the view, and jump, you fuckers [...]"   

"Fannie and Freddie Can't Pay Feds Dividend As Part of Bailout Deal" [08/21/10] "these failed government agencies are in such bad shape that they can’t even pay Uncle Sam the dividends owed under the conservatorship deal reached two years ago. That’s right. In order to pay a $1.8 billion dividend on Treasury department stock, Fan and Fred had to borrow $1.5 billion from the Treasury. [...]"  

5 Trillion More Dollars to Fix "Fannie Mae" and "Freddie Mac"? [08/19/10] "Fannie Mae and Freddie Mac have become gigantic financial black holes that the U.S. government endlessly pours massive quantities of money into. Unfortunately, if the U.S. government did allow Fannie Mae and Freddie Mac to totally implode, both the mortgage industry and the housing industry in the United States would completely collapse. So essentially the U.S. government finds itself between a rock and a hard place. Prior to the financial crisis of the last few years, Fannie Mae and Freddie Mac were profit-seeking private corporations that also had a government-chartered mission of expanding home ownership in America. But now that they have been officially taken over by the U.S. government, they have become gigantic bottomless money pits. It is hard to even describe just how much of a mess Fannie and Freddie are in. However, the unprecedented intervention by Fannie Mae and Freddie Mac in the mortgage market over the past couple of years has been about the only thing that has kept it from plunging into absolute chaos. So what does the future hold for Fannie Mae and for Freddie Mac? Well, according to one estimate, it could take another 5 trillion dollars to "fix" Fannie Mae And Freddie Mac. [...]"  Note: So, what if  both the mortgage industry and the housing " industry" collapsed? It's a contrived parasitic 'industry' in the first place. Isn't it just as much a lie as the college-job dynamic, left over from the 1950's? See  Valedictorian Denouncing School and Jobs Scam [08/15/10] [9:27]   Related:  Barney Frank to Fannie: "Drop Dead"  "Barney Frank has been all over the airwaves this week with a clear and—we never thought we'd say this—perfectly sound message about Fannie Mae and Freddie Mac: "They should be abolished." In another sign that he's an avid reader of these columns, Mr. Frank even told Fox Business, "If we want to subsidize housing then we could do it upfront and let the budget be clear about that." That is certainly a more honest way to subsidize housing and makes us think we don't write in vain. [...]"   Video clip  [0:53]

Commentary: "The Purpose Behind Engineered Economic Collapse" [08/19/10] "Everyone loves money. Even people like myself who abhor the abuse of money and commerce, who understand the fraudulent nature of the system we live in, still work hard and save so that we might attain a sense of stability within that system. Many people see money as a focal point to their existence. But is it really money that they are after, or is it something else entirely? In truth, money represents ‘security’ in the minds of the masses. Money affords us the ability to survive, and the more of it we have, the safer we all feel. Because we subconsciously associate the extension of our very life with the variable health of the economic structure in which we live, we tend to become unwitting devotees to its continued existence, even if it is corrupt and condemned to failure. We gullibly deny the system or the currency that supports it is doomed to the contrary of all evidence because, even though it has beaten us bloody, we have never known anything else. In light of this entrenched way of perceiving things, especially in the U.S., it is difficult enough to convince some people that the economy is in fact not providing the security they desire, but is actually destroying their future completely. To explain to them that this is deliberate, that the economy is designed to self-destruct, that is another prospect altogether. Many people hit a proverbial wall on this issue because they simply cannot fathom that certain groups of men (globalists and central bankers) view money and economy in completely different terms than they do. The average American lives within a tiny box when it comes to the mechanics and motivations of finance. They think that their monetary desires and drives are exactly the same as a globalist’s. But, what they don’t realize is that the box they think in was BUILT by globalists. This is why the actions of big banks and the decisions of our mostly corporate establishment run government seem so insane in the face of common sense. We try to rationalize their behavior as “idiocy”, but the reality is that their goals are highly deliberate and so far outside what we have been taught to expect that some of us lack a point of reference. If you cannot see the endgame, you will not understand the steps taken to reach it until it is too late. [...]"  

Soros Bailing Out of U.S. Stock Market [08/19/10] "Billionaire trader and political manipulator, George Soros, is clearly not optimistic. The latest SEC filings are out on the Soros hedge fund, Soros Fund Management. Between the end of March and the end of June, Soros lowered his stock investments from $8.8 billion to $5.1 billion in the fund, Soros Fund Management. He sold most of his positions (over 95%) in Wal-Mart, J.P. Morgan Chase and Pfizer. [...]"  

US Says Bankruptcies Reach Nearly 5-Year High [08/18/10] "U.S. bankruptcy filings have reached the highest level since 2005, government data released on Tuesday show, as the economy slows and the unemployment rate hovers just below double digits. There were 422,061 bankruptcy filings between April and June, according to the Administrative Office of the U.S. Courts, up 9 percent from 388,148 in the prior three-month period, and up 11 percent from 381,073 a year earlier. [...]"  

China Slashes U.S. Government Bond Holdings by Largest Amount Ever [08/17/10] "China began reducing its holdings of U.S. government bonds again in June, and in fact cut just its holdings by the largest 1-month amount ever. The nation’s holdings of long-term Treasuries fell in June for the first time in 15 months, dropping by $21.2 billion to $839.7 billion, a U.S. government report showed yesterday.  [...]"   

The Most Debt-Laden Companies in the S&P 500 [08/17/10] "In recent months, numerous firms have been bolstering their balance sheets, but during the financial crisis, overleveraging was the kiss of death for many companies. Just as companies with zero debt on their books must be approached with caution , a company with a relatively heavy debt load isn’t necessarily in bad shape. [...]"  

Fixing the Economy with State-Owned Banks [08/16/10] [10:00]  "Ellen Hodgson Brown explains the rationale behind state owned banks. Due to the collapsing credit bubble which in turned popped the housing bubble, leading to recession, and perhaps, economic depression, there is not enough money and credit to keep the economy running. Three possible solutions are that the federal government issue debt-free money directly, that communities create alternate or community complementary currencies, or that a state create its own state owned bank, similar to the Bank of North Dakota. For example, a state owned bank in Michigan could provide credit to the state itself for infrastructure projects, help provide the capital for local banks, so they could in turn provide low interest loans to home owners, small and medium sized businesses, and students. In addition, a state owned bank could be used to help fund state expenses during tough times by providing loans. A major advantage of a state owned bank is that the state could borrow money from the bank at zero interest, for projects, saving between 50% and 100% of the cost of the project, since there would be no interest burden when repaying the loan. For Michigan, California, Florida, and other states looking to solve their economic problems, the state owned bank model, and the Bank of North Dakota in particular, should be studied in depth, as such a bank could provide the credit needed within that state economy during depressions and other tough economic times.  [...]" 

UAE Imports Five Tons of Fake Gold [08/16/10] "Several tons of gold imported into the UAE by traders and investors turned out to be fake on closer inspection, resulting in millions of dirhams in losses and high levels of stress to the victims. [...]"  Note: And people are supposed to 'feel' sad for these people? Somehow, I don't think so.  

"Endgame: The Monetary System of Empire" LaRouche [08/15/10] Video clip [17:58]  "The founders of the United States republic were aware of their legacy, of founding a new type of society, free from the control of a system of empire. It was that system of empire which had controlled all of civilization for thousands of years, and was a greater threat to the Americans during their revolution, than the canons pointed at Boston harbor. [...]"   Related:  Commentary: "We Have Reached the Turning Point" "... As of now, and as of what we had, so far this week, there is no question, but that the United States' economy, and implicitly the world economy, has now gone into the chain-reaction collapse, of the entire, present, world monetary-financial system. The economic system is not totally collapsed, but the financial-economic system, is now officially, in the state of collapse, which I forecast this year, for this period, the July-August period: It's now happened. There are still people who, in dreamland, imagine that it's not happened, or is not going to happen. But it's happened. The President is totally out of control. The economy, from the Presidency on down, is totally out of control. It's careening into a collapse, which threatens to become a chain-reaction, hyperinflationary collapse, if they continue the bailout process. There is no chance, in the meantime, that the United States will survive, if this President remains President. We're now, in the short term, that the very continuation of this President, as President, even within 30 days or so, that duration, could mean the finish of the United States. And a collapse of the United States, would mean a chain-reaction collapse of the entire world economy.  [...]"  

Hungary defies the IMF [08/14/10] "All bets are off between the IMF and the conservative Hungarian Prime Minister Viktor Orban. What's bitten the former golden boy of the Atlanticists for him to suddenly want to introduce taxes on financial profits when it would be easy to raise additional taxes on work? And what if Mr Orban is right, asks Jérome Duval. [...]"  

Trends: Capital Controls: The Final Phase in the Great Looting of America [08/13/10] "Instituting capital controls seems like the next big event in the government banking oligarchy's great looting of America. First, these vampires designed "free trade" agreements to use slave labor abroad at the expense of American jobs. Next, they moved their investment capital and assets abroad sucking the life-blood out of the U.S. economy. Then, they covertly used America's remaining wealth to prop up their bogus financial instruments like credit default swaps and derivatives, which came crashing down. Finally, they got their taxpayer bailout, and now they want your pension funds and cash deposits to stay under their control. This last stage of the mass looting requires your wealth to remain in their possession. They seem to be setting up several ways to control the remaining capital. One of the first tactics used by the banksters to control your money was to get the SEC to adopt a proposal to allow money market funds to suspend withdrawals during a financial crisis to prevent bank runs. As reported on ZeroHedge: [...]  A key proposal in the overhaul of money market regulation suggests that money market fund managers will have the option to 'suspend redemptions to allow for the orderly liquidation of fund assets.' Money Market funds, which account for nearly 40% of all investment company assets. The next time there is a market crash, and you try to withdraw what you thought was "absolutely" safe money, a back office person will get back to you saying, 'Sorry - your money is now frozen. Bank runs have become illegal.' [...] "    

The "Hindenburg Omen" Has Arrived -- Stock Market Crash Imminent? [08/13/10] " ... Granted, the Hindenburg Omen is not a guarantee of a crash, and the five criteria that must be met for a Hindenburg trigger typically need to reoccur within 36 days for reconfirmation. Yet the statistics are startling: "Looking back at historical data, the probability of a move greater than 5% to the downside after a confirmed Hindenburg Omen was 77%, and usually takes place within the next 40 days." The last Hindenburg Omen occurred during the lows of 2009. Today, we just had another (unconfirmed) Hindenburg Omen. It is time to batten down the hatches - something big is coming. As a reminder, the 5 criteria of the Omen are as follows: [...]  Today, all five conditions were satisfied. June 2008 was another such reconfirmed event, and as Barron's pointed out then, "there's a 25% probability of a full-blown stock-market crash in the next 120 days. Caveat emptor." Boy was the emptor caveating within 120 days (especially if said emptor was named Dick Fuld). Which brings us to the present: should the Omen be reconfirmed within 36 days, all bets are off."   

Pro-Publica: U.S. Bore AIG Bailout Risk, but Foreign Banks Reaped the Rewards, Says Watchdog [08/13/10] "Foreign financial firms indirectly reaped more than $14 billion in U.S. taxpayer dollars through Goldman Sachs alone after the U.S. Treasury bailed out AIG, according to the government’s bailout watchdog. That's just one example of how how the billions that the Treasury poured into the economy also bailed out foreign banks, according to a report released on Wednesday by the Congressional oversight panel. The report detailed how through Goldman Sachs, significant portions of the $70 billion that the Treasury committed to bailing out AIG has ended up in the hands of foreign investors. [...]"    

U.S. tax code encourages companies to rack up huge debt [08/12/10] "U.S. companies have had a long love affair with debt, and Washington has tacitly approved. Although the tax benefits are not the only driver of corporate America's preference for loans -- cheap rates and corporate strategy, as in Macy's case, are other major factors -- the tax code often tips the scales toward using debt for deals or for expanding a business.  Over the past generation, debt in America has exploded, becoming a way of life in nearly every sphere of society. And the tax code has been its handmaiden. Home buyers, towns and corporations all enjoy tax breaks that grow as they borrow more. Indeed, federal officials have found that the deductions for business debt are so generous that the government is, in many cases, essentially paying companies to borrow.  The surge in borrowing has opened new markets and financial industries. It has also at times powered economic growth -- for instance, the boom preceding the housing bust -- and activities that wouldn't have been possible under other conditions. Commercial developers build projects they otherwise wouldn't. Private equity firms are able to buy out companies with huge sums of borrowed money. Big banks that lend out all this borrowed money have come to play an outsize role in the economy. Debt in itself is not harmful, financial analysts say. But they also question whether the government should be prodding companies to borrow and favoring businesses that heavily rely on debt. "The tax code is interfering dramatically with the choice of how you finance and how you deliver returns in the corporate sector," said Douglas Holtz-Eakin, an economist who heads the American Action Forum. "Why would you build into the tax code a permanent bailout for corporate debt-financed investments?"  [...]"  Note: The Washington Post looks Macy's and beyond. 

Pro-Publica: Primer: Six Things Happening Right Now With Financial Regulation [08/12/10] "News about the Dodd-Frank financial reform legislation has come in smatterings. We’re well aware that there were people who weren’t impressed with its strength when it passed, and much of the bill leaves a lot still to be determined by regulators in subsequent rulemaking (By one law firm’s count [PDF], it requires 67 studies and 243 new rules to be created). And that leaves us with many moving parts, so here are a few—in motion right now—that pique our interest: [...]"   

Commentary: "Stock Market Tremors, Fed Pessimism, US Payments Deficit Presage Dollar Disintegration After Failure of US-UK Blitzkrieg Against Euro; Wall Street In Flight Forward Towards Iran War, Oil Price Spike To Prop Up Greenback" Webster G. Tarpley [08/12/10] [4:48]   

Commentary: "U.S. Is Bankrupt and We Don't Even Know It" Laurence Kotlikoff [08/12/10] Note: MSM musings, as time slips by ...

Student-Loan Debt Surpasses Credit Cards [08/11/10] "Bubble, bubble, toil and trouble: Look at overall inflation vs. college education inflation. Via: Wall Street Journal: Consumers now owe more on their student loans than their credit cards. Americans owe some $826.5 billion in revolving credit, according to June 2010 figures from the Federal Reserve. [...]"  

The Fed Has Admitted That It Has Totally Lost Control of the Crisis [08/11/10] "In its Aug. 10th meeting, where it escalated the hyperinflationary bailout, the Federal Reserve basically admitted that it has totally lost control of the financial crisis. With Kansas City Fed President Thomas Hoenig dissenting, the Fed vowed at the meeting to continue buying securities — reportedly, U.S. government debt — and reneged on its pledge to reduce it $1.4 trillion securities holdings—much of it mortgage-related toxic waste. The Fed will pour billions (up to $200 billion) of new non-existent money into buying new assets, because there is no recovery. Or, in their language, "the pace of recovery in output and employment has slowed." Hoenig, who had been the first of the Fed regional presidents to support reinstating Glass Steagall, opposed the Fed's reversal of its stated policy that it would bring down the $1.4 trillion in assets holdings by $200 billion. Another big bailout—with no need to ask the Congress or the American people—and another massive jump in hyperinflation. [...]"  Fed to Buy More of Its Own Debt [08/11/10] "Federal Reserve officials decided to reinvest principal payments on mortgage holdings into long-term Treasury securities, making their first attempt to bolster growth since March 2009 to keep the slowing U.S. economy from relapsing into recession.  [...]"  Note: And who says that's not convoluted?  Sounds like financial masturbation to me ... Bernanke announcement that central bank will buy US debt marks point of no return

‘Colbert Report’: "Wall Street Execs Are Like Drug Dealers" [08/11/10] Video clip "MSNBC’s Dylan Ratigan used to be on a show called “Fast Money” before he caught on that Wall Street’s big bankers were playing the people while they “paid themselves billions of dollars,” as he tells Stephen Colbert in this clip. Colbert, meanwhile, is relatively unimpressed by Ratigan’s rather obvious epiphany and wonders aloud, “Did you eat paint chips as a child?” [...]"    

"Criminals Wars and the Criminal Fed" [08/11/10] [5:22]  Ron Paul, interviewed on Andrew Napolitano's "Freedom Watch".

Trends:  Recession Causing a Banking Awakening in Tough-Hit Midwest [08/09/10] "A mass banking awakening seems to be happening throughout America, and the first pragmatic solution appears to be citizen-owned state banks. Since this model has been proven highly successful in North Dakota, many recession-ravaged states are now considering the idea of establishing state-run banks. [...]"   

Trends:  Fannie Mae, Freddie Mac losing political support as U.S. reshapes housing finance system [08/07/10]  "For several decades, whenever a question of housing policy came up in Washington, two companies dominated. Fannie Mae and Freddie Mac marshaled armies of lobbyists, deep political connections and millions of dollars in contributions to get their way. But now Fannie Mae and Freddie Mac, titans of the mortgage finance industry, are wards of the state, bailed out by Washington to the tune of $160 billion and banned from political activity. As the Obama administration and Congress prepare to take up overhauling the $12 trillion U.S. mortgage market, new interests are shaping the debate like never before.  [...]"  Note: So the "Freddies" will become defunct, and billions went to specific people, in the end. 

Trends: Berkshire net down 40 percent on derivative losses [08/07/10] "Warren Buffett's Berkshire Hathaway Inc (BRKa.N)(BRKb.N) said on Friday second-quarter profit fell 40 percent, as declining stock prices depressed the value of his derivative contracts [...]"  Note:  The chickens come home, and don't even roost.

Mossad Assassins Were Financed by U.S. Banks [08/06/10] "According to a Wall Street Journal report, U.S. Companies transferred funds to the assassins responsible for killing a senior Hamas leader. Mahmoud al-Mabhouh was found dead on Jan. 19 in a Dubai hotel room. He had been drugged, then suffocated. The botched assassination of al-Mabhouh has created a political scandal for Israel, and the ongoing investigation threatens to embroil the United States. Dubai authorities first released CCTV surveillance videos from the Dubai hotel where the murder occurred, then published photos and identifying information on 26 members of the hit team. At least twelve of the killers were Israeli citizens travelling with forged European passports. The discovery that the death squad used British, Irish, German, and Australian passports embarrassed the Tel Aviv regime, and caused the expulsion of Israeli diplomats from the UK, Ireland and Australia.  One man, “Uri Brodsky” has been apprehended in Poland. The state of Israel appealed to the Polish courts to have him extradited to Israel, but this was denied. Brodsky now faces extradition to Germany, and trial.  According to a Newsweek report, European investigators called Brodsky a high-level and experienced “facilitator” for the Mossad in Europe. The report also states that the individual known as ‘Brodsky’ used fraudulent documents to obtain a German passport in the name of “Michael Bodenheimer.” His real identity has not been determined. In March, Dubai police identified 13 US-issued debit-card accounts used by the suspects. These pre-paid debit cards were distributed by Payoneer Inc., and issued by Metabank, a subsidiary of Meta Financial Group Inc.  Although the company headquarters are listed as Storm Lake, Iowa, most of Metabank’s employees reside in Tel Aviv. The CEO of Payoneer is a man named Yuval Tal – a dual citizen of the United States and Israel, and a veteran of Israel’s Special Forces. In a 2006 FOX News interview, Tal was introduced as a “special ops commando”. The Israeli connections don’t end there. [...]"  Note:  Interesting report.   Video clip  [2:56]  

U.S. Freezes Iranian Assets [08/04/10] "The U.S. Treasury blacklisted 21 state-owned Iranian companies as part of a growing and coordinated international effort to undercut Tehran's ability to use units in Europe and Asia to facilitate financial transactions and weapons development. The Obama administration's point man in its financial war on Iran, Stuart Levey, also announced Tuesday U.S. sanctions against key leaders in Iran's elite military unit, the Islamic Revolutionary Guard Corps, as well measures targeting Iranian foundations accused of supporting militant groups in Lebanon, Afghanistan and the Palestinian territories. "As its isolation from the international financial and commercial systems increases, the government of Iran will continue efforts to evade sanctions, including using government-owned entities around the world," said Mr. Levey, Treasury's undersecretary for terrorism and financial intelligence. "Today's identifications will mitigate the risk that such entities pose." Treasury's moves mark the latest in an escalating response from the U.S., its overseas allies, and the United Nations to Iran's continued pursuit of nuclear technologies. Tehran says it is seeking to develop civilian nuclear power, but the U.S. alleges Iran is covertly developing atomic weapons. [...]"  Note:  That's pretty much an 'undeclared' act of war, I'd guess.  

Commercial real estate maturities will peak in 2012 – $350 billion in loans coming due and hundreds of additional bank failures [08/04/10] "What you see is a clear reduction in loans outstanding with BofA. At the same time, you see a massive increase in more investment activities. Wall Street has learned to leverage the easy money from the Federal Reserve to speculate on Wall Street instead of lending it out to Americans. [...]"   

"Son of Subprime" [08/04/10] "In 2007, the writing was on the wall. The famous "perfect storm" had gathered above the US housing market, its eye hovering over subprime loans. As you know, the storm came...and it rained, and rained, and rained... Ultimately, it washed away trillions of dollars in investor wealth. Now in an entirely different sector - probably the last place you'd look - the clouds are turning black once again. Strip out the finer details, and you'll find the very same mechanics that brought the subprime market from boom to bust: * Widespread investor acceptance * Complicated derivatives * Intense incentives for banks to make deals * Boneheaded assumptions of endless return on investment * Underqualified borrowers * Stunning amounts of leverage and debt * A loosely regulated multitrillion-dollar market * Overstated credit ratings from Wall Street * Social and political pressures to maintain growth This crisis-yet-to-be is... municipal bonds [...]"   

Geithner outlines regulatory priorities [08/03/10] "U.S. Treasury Secretary Timothy Geithner Monday outlined priorities for implementing domestic and international banking reforms.  [...]"  Note: This guy is dumber than a stone, and just a talking head ... many have commented that he doesn't even get 'economics 101' ... because he works for the banks, his position, as publicly maintained, is fraudulent and a criminal violation of their own laws ... but at this point, anyone can be 'appointed' by the delusional scum that has risen to the top.

Big Banks Fund Cluster Bombs [08/02/10] [2:53]  "Over ninety countries have promised to ban cluster bombs, whose mini explosives often fail to explode and lie like land mines for years. But campaigners say its the banks driving the trade now, with financial institutions showing few qualms about funding the world's weapon makers. [...]"  

Regulator issues 64 subpoenas to lenders [08/02/10] "A federal regulator issued 64 subpoenas to mortgage-lenders Monday, an attempt to find out if government-backed banks were deceived while buying securities. [...]"   

Europe’s class policy: A blank check for the banks, austerity for workers [08/02/10] "The same week that European officials announced the results of rigged bank stress tests, European Central Bank President Jean-Claude Trichet demanded that governments across the continent press ahead with austerity programs that will slash jobs, wages and social programs. [...]"  Note:  jobs, wages and social programs .... the society itself ... sounds like revolution is at hand ... to the bankers, overtly, people don't count. What if people withdrew their support ...

UK:  HSBC makes £7 Billion profit in just six months... then vows to hand its bankers £6 Billion in pay and bonuses [08/02/10] "Global banking giant HSBC unveiled bumper half-year profits of £7billion today - then outlined plans to hand more than £6 billion 'compensation' to its staff. But HSBC bosses immediately risked stirring public fury when they revealed that 'just over 20 per cent' of revenue had been allocated for pay and bonuses. [...]"  Note: HSBC is a parasitic criminal enterprise "sucking off the tit of the world".

A Modest Proposal To Transform the Fed into a Hamiltonian National Bank [08/02/10] "A very reliable source has proposed a plan to "reform" the Federal Reserve System into a Hamiltonian national bank. The proposal came in the context of discussion with Executive Intelligence Review about Lyndon LaRouche's proposal for the North American Water and Power Alliance (NAWAPA). [...]"  Note:  LaRouche is a brilliant man ... but he's on a world composed of stupid sequentials in charge ... who aren't listening.

 Commentary: The International Money Changers Reward the Euro for Forcing Austerity [07/31/10] "The Wall Street Journal reported Thursday that the Euro has reached an 11-week high against the dollar. This rise in strength comes just 3 months after the austerity measures were forced on the Greek people and the same steps being taken for the other PIGS (Portugal, Italy, Greece, and Spain). At the time, the global financial community debated whether the Euro would even survive because of fears that soveriegn debt of economically weak European Union member nations would destroy the Euro. Now that the International bankers got the austerity measures that they wanted, the money manipulators have rewarded them. The same game plan is playing out in the United States; ratchet up the rhetoric about debt and deficits with the veiled suggestions (threats) by the IMF for austerity, and then weaken the currency to a point where the body politic is forced to act on behalf of the banksters who manufactured the extreme over-leveraging. The growing noise for “solutions” to America’s very real debt problems is becoming louder as the calls for confiscating Social Security and Pensions are now everyday news. [...]"   

"IMF Says U.S. Financial System May Need Billions More" [07/30/10] "The U.S. financial system remains fragile and banks subjected to additional economic stress might need as much as $76 billion in capital, according to the results of International Monetary Fund stress tests. [...]"  Note: So those that run the IMF, which destroys and bankrupts nations, are also criminals in cahoots with Wall Street, the banks and the British monetary system. These 'stress tests' are just artificial constructions created to give the appearance of a 'filtering' effect, justifying whatever action is needed for consolidation of power and control. 

Europe Freezes Out Goldman Sachs [07/29/10] "Shocked by past deals with Italy and Greece, governments are excluding the Wall Street bank from sovereign bond sales. European governments are turning their backs on Goldman Sachs, the all-conquering investment bank that has suffered a series of blows to its reputation, capped by the biggest ever fine imposed on a Wall Street firm. According to data from Dealogic, Greece, Spain, France and Italy have all denied the bank a lead role in their recent sovereign bond sales. Last Thursday, Goldman agreed to pay a $550m fine to settle US regulators' claims that the bank misled investors in a mortgage-backed security. Goldman admitted that its marketing materials were incomplete, because they failed to state that the same third party that helped choose the assets had taken a bet against them. But governments have also been shocked at the emergence of past transactions between Goldman and Greece and Italy, where products the bank helped to sell aided both in hiding government debt. Greece, which used Goldman in a bond sale this year, is practically at war with the bank. A sharp contrast with the situation months before, when Goldman bankers dined with the prime minister in a private meeting overlooking the Acropolis. The relationship broke down, though, after news leaked earlier this year that Goldman was about to strike a bond sale deal with China's sovereign fund – which never materialised. [...]"  

The US Treasury Running on Fumes: The Obama regime has made War the Business of America [07/29/10] "The government cannot explain why the war is necessary, because it is not necessary to the American people. Any necessary reason for the war has to do with the enrichment of narrow private interests and with undeclared agendas. If the agendas were declared and the private interests being served identified, even the American sheeple might revolt. The Obama regime has made war the business of America. Escalation in Afghanistan has gone hand in hand with drone attacks on Pakistan and the use of proxy forces to conduct wars in Pakistan and North Africa. Currently, the US is conducting provocative  naval exercises off the coasts of China and North Korea and instigating war between Columbia and Venezuela in South America. Former CIA director Michael Hayden declared on July 25 that an attack on Iran seems unavoidable.   [...]"   

Smoking Guns of U.S. Treasury Monetization [07/29/10] "A significant feature of fiat money systems is the privilege for the custodian of the reserve currency to engage in regular practices of ham-fisted monetary management, even permission for fraudulent centers to flourish, surely developing a debt monster that an economy grows dependent upon. Fannie Mae might be the most offensive blight on such privilege. Unfortunately, many shenanigans have matured into grand fraud. They are smoking guns of USTreasury fraud and counterfeit, with strong whiffs of monetization. Much more monetization is to come, fully endorsed and sanctioned. Other clever techniques are being used, given the Quantitative Easing has officially been halted. A close look reveals that Excess Cash Reserves at the USFed are being drawn down, which are thus funding the USGovt deficits in the last couple months. Ironically, such reserves held by big banks at the US Federal Reserve were the only thing preventing vast insolvency. Now that cash is being used, and the USFed insolvency is slowly exposed. Details can be found in the July Hat Trick Letter reports. Evidence is compelling, and grand motive for foreign creditors to reject the USDollar, whose active control strings are traced to Wall Street. When recognized monetization destroys the last vestige of trust and confidence in the USDollar, when more official rounds of sponsored Quantitative Easing arrive, the USDollar will be on a downward spiral. In fact, all major currencies face the same prospect of vast monetary expansion. They will all fall sharply in value, and by counter-effect, the Gold price will rise powerfully. [...]"   

Failed Bank Disaster Largely Ignored by Mainstream Media [07/29/10] "Last week, bank failures quietly passed the 100 milestone for the year. I say “quietly” because the bank failure story has gone largely unreported or, at least, under-reported by the mainstream media. Just to give you an idea of how fast the bank insolvency problem is accelerating, last year, at this time, 64 banks had been taken over by the Federal Deposit Insurance Corporation. So far, this year, 103 banks have already been taken over by the FDIC. There is no question the bank failures the FDIC will have to deal with will be greater than the 140 insolvent banks closed last year. At this point, we just don’t know how many more, but dozens more than last year for sure.  [...]"   

Bankster Plot to Kill Off the Money Market Mutual Fund Industry [07/29/10] "Both the SEC and the President’s Working Group on Financial Markets (the Plunge Protection Team) are considering whether Money Market Funds should be forced away from their stable $1.00 value method of maintaining money market share prices. A move by regulators forcing money market funds away from the maintenance of the $1.00 price would cause huge hiccups in the industry and perhaps result in the end of the industry. At a minimum, it would cause huge withdrawals. That regulators are suddenly focusing on these funds and at the core element of their appeal is curious. Are the insider banks behind the idea in the hope that the money will flow to them? Does the government expect more of the money to flow into Treasury Bills (then already does0? Whatever is behind this focus, there is no legitimate reason behind an attempt at such a regulation. [...]"   

Corporate Fascism: SEC Exempt from Public Disclosure [07/28/10] "Under a little-noticed provision of the recently passed financial-reform legislation, the Securities and Exchange Commission no longer has to comply with virtually all requests for information releases from the public, including those filed under the Freedom of Information Act. The law, signed last week by President Obama, exempts the SEC from disclosing records or information derived from "surveillance, risk assessments, or other regulatory and oversight activities." [...]"  Note:  Is this to hide the SEC's failures? As you can see, Obama is a man of state command and control.

Goldman reveals where bailout cash went -- Banks Overseas [07/27/10] "Goldman Sachs sent $4.3 billion in federal tax money to 32 entities, including many overseas banks, hedge funds and pensions, according to information made public Friday night. Goldman Sachs disclosed the list of companies to the Senate Finance Committee after a threat of subpoena from Sen. Chuck Grassley, R-Ia. Asked the significance of the list, Grassley said, "I hope it's as simple as taxpayers deserve to know what happened to their money." He added, "We thought originally we were bailing out AIG. Then later on ... we learned that the money flowed through AIG to a few big banks, and now we know that the money went from these few big banks to dozens of financial institutions all around the world." Grassley said he was reserving judgment on the appropriateness of U.S. taxpayer money ending up overseas until he learns more about the 32 entities.  [...]"   

 Commentary: The Death of Paper Money [07/27/10] "As they prepare for holiday reading in Tuscany, City bankers are buying up rare copies of an obscure book on the mechanics of Weimar inflation published in 1974.  [...] Some might smile at the Bank of England "surprise" at the recent the jump in Brtiish inflation. Across the Atlantic, Fed critics say the rise in the US monetary base from $871bn to $2,024bn in just two years is an incendiary pyre that will ignite as soon as US money velocity returns to normal.  [...] "   

An A.I.G. Failure Would Have Cost Goldman Sachs, Documents Show [07/26/10] "Since the United States government stepped in to rescue the American International Group in the fall of 2008, Goldman Sachs has maintained that it would have faced few if any losses had the insurer failed. Though it was the insurer’s biggest trading partner, Goldman contended that it had bought credit insurance from financial institutions that would have protected it, but it declined to identify the institutions. A Congressional document released late Friday lists those institutions and shows that Goldman was exposed to losses in an A.I.G. default because some of the investment bank’s trading partners, such as Citibank and Lehman Brothers, were financially unstable and might have been unable to make good on large claims from Goldman. The document details every institution that had sold credit insurance on A.I.G. to Goldman as of Sept. 15, 2008, the day before the New York Fed arranged the insurer’s rescue with an $85 billion backstop. The document, supplied by Goldman Sachs, was released by Charles E. Grassley of Iowa, the ranking Republican on the Senate Finance Committee. Goldman had purchased credit protection on A.I.G. worth $402 million from Citigroup and $175 million from Lehman Brothers, the document shows. As of the date of the document, Lehman had already filed for bankruptcy protection. [...]" 

Continuing Wipeout of Cities' Services; Only Glass-Steagall Will Save Them [07/26/10] "The collapse of America's states, counties and cities is plunging the country into a Dark Age. As the cause is national and international, the only solutions begin on a national level, with Glass-Steagall. Looking for local causes is insane, but it is happening nevertheless. [...]"    

 Commentary: China: The US Is "Insolvent and Faces Bankruptcy"  [07/24/10] "... I think China is already diversifying their reserve portfolio, and more stealthily and effectively than one would imagine.  Further, I suspect that through the use of hedging short positions and derivatives such as Credit Default Swaps, China would be able to cover a greater portion of its reserves than the common mind might allow. And if this is in reality one theater in a global struggle for power, sacrificing a pawn or two, and even a bishop, would be a small price to pay to bring down the world's remaining superpower, as indirectly and gracefully as is possible. War is never cheaply waged.  It would most certainly be a nuclear option to outright dump Treasuries outright, and would raise the ire of what is still a formidable military power. But it is the Western mind that is so incapable of seeing the many shades of gray in every situation, the subtle gradations in a range of choices that I believe China not only sees but is already actively pursuing.  China is not the only country that resents the devastating frauds that the US has perpetrated on not only its own people but the rest of the world through its Wall Street banks and ratings agencies. Most Americans overlook this developing estrangement that is beginning to isolate the US and UK from even their traditional allies in Europe and South America and Asia. This is a serious error, but so typical of the short term mentality dominated by greed, dishonesty, and self-delusion that captured the American psyche in the latter part of The New American Century. [...]"   

 Trends: New York State Demands Billions From BofA and Merrill Lynch [07/24/10] "New York State Comptroller Thomas DiNapoli sued Merrill Lynch and Bank of America on Thursday, claiming that both companies knew that Merrill Lynch had tens of billions of dollars in unreported losses from the subprime mortgage meltdown. BofA shareholders, ignorant of the financial morass, authorized the $29.1 billion acquisition of Merrill Lynch, which quickly torpedoed profits, according to federal complaints. [...]" 

Financial overhaul completed, tax fight looms [07/24/10] Video clip included. "The temporary tax cuts that passed in 2001 and 2003 during the Bush administration are set to expire at year's end, and a battle is brewing over whether to renew them. Republicans want to make all the cuts permanent, but they haven't said how they'd pay for this in an era of record federal budget deficits. [...]"  

Finland targeted for EU/IMF austerity demands [07/24/10] "Last month, Finland was issued with a warning by the European Union commission over the size of its budget deficit, which is expected to rise above 4 percent of GDP this year. [...]" Note:  Perhaps there's a market for antler fuzz on the home world out there ...

Commentary: When will the SEC prosecute for market rigging? [07/23/10] "For thousands of years, gold has been a central monetary component of most civilizations. It is durable and has been able to retain its value even to this day. That, in and of itself, is extremely remarkable considering how many paper currencies that have went the way of the dodo. That is why the when Bill Murphy of GATA (Gold Anti-Trust Association) gave his testimony on April 9th before the CFTC (Commodity Futures Trading Commission), it may have been one of the most important testimonies in history for uncovering the massive fraud in today’s gold market. There are two central issues in today’s gold market: the massive short selling that artificially pushes the price down during certain option expiration periods and the paper ETF’s that are running a virtual ponzi scheme in the gold market. ... I would just like to make a comment. We are talking about the futures market hedging the physical market. But if we look at the physical market, the LBMA, it trades 20 million ozs of gold per day on a net basis which is 22 billion dollars. That’s 5.4 Trillion dollars per year. That is half the size of the US economy. If you take the gross amount it is about one and a half times the US economy; that is not trading 100% backed metal; it’s trading on a fractional reserve basis. And you can tell that from the LBMA’s website because they trade in “unallocated” accounts. And if you look at their definition of an “unallocated account” they say that you are an “unsecured creditor”. Well, if it’s “unallocated” and you buy one hundred tonnes of gold even if you don’t have the serial numbers you should still have one hundred tonnes of gold, so how can you be an unsecured creditor? Well, that’s because its fractional reserve accounting, and you can’t trade that much gold, it doesn’t exist in the world. So the people who are hedging these positions on the LBMA, it’s essentially paper hedging paper. [...]"   

Ron Paul vs. Ben Bernanke: Financial Services Hearing, July 22, 2010 [07/23/10] [8:30]  "Congressman Paul gives and opening statement and questions Ben Bernanke [...]"  

Geithner: Financial repeal 'inconceivable' [07/22/10] "A repeal of the Wall Street financial reforms, as argued by House and Senate Republicans, is "inconceivable," an Obama administration official says. [...]"  Note:  It would serve that little twerp right if it were repealed ...

LPAC Weekly Report [07/22/10] Video clip [67:15]  "Lyndon LaRouche appears on this week's report. [...]"  Note: Always interesting stuff. Nice update.

New Allegations in Madoff Case Against $1 Billion 'Enablers' [07/22/10] "One of Greenwich, Connecticut's wealthiest and most socially prominent financiers, Walter Noel, was accused today of "aiding, abetting, enabling and substantially participating" in Bernard Madoff's legendary Ponzi scheme. The allegations came in a complaint filed by the Madoff Bankruptcy Trustee against Noel and others who worked with him at the Fairfield-Greenwich investment fund, including one of his daughters and at least two sons-in-law. [...]"  

Mafia Money-Laundering Profits Swell in Credit Crisis [07/22/10] "The mafia has cranked up money laundering activities in Italy after the credit crunch prompted banks to stop lending, leaving a funding gap that criminal capital has filled, according to the Bank of Italy. “The crisis has given organized crime room to thrive because access to credit has become more difficult,” [...]"   

Bernanke Vows Fed Will Act If Uncertain Recovery Falters [07/22/10] "Federal Reserve Chairman Ben Bernanke said on Wednesday the U.S. economy faces "unusually uncertain" prospects, and that the central bank was ready to take further steps to bolster growth if needed. [...]"   

Commentary: Money Laundering and the Global Drug Trade Fueled by Capitalist Elites [07/21/10] "When investigative journalist Daniel Hopsicker broke the story four years ago that a DC-9 (N900SA) "registered to a company which once used as its address the hangar of Huffman Aviation, the flight school at the Venice, Florida Airport which trained both terrorist pilots who crashed planes into the World Trade Center, was caught in Campeche by the Mexican military ... carrying 5.5 tons of cocaine destined for the U.S.," it elicited a collective yawn from corporate media. And when authorities searched the plane and found its cargo consisted solely of 128 identical black suitcases marked "private," packed with cocaine valued at more than $100 million, the silence was deafening. But now a Bloomberg Markets magazine report, "Wachovia's Drug Habit," reveals that drug traffickers bought that plane, and perhaps fifty others, "with laundered funds they transferred through two of the biggest banks in the U.S.," Wachovia and Bank of America. The Justice Department charge sheet against the bank tells us that between 2003 and 2008, Wachovia handled $378.4 billion for Mexican currency exchanges, "the largest violation of the Bank Secrecy Act, an anti-money-laundering law, in U.S. history." "A sum" Bloomberg averred, equal to one-third of Mexico's current gross domestic product." Since 2006, some 22,000 people have been killed in drug-related violence. Thousands more have been wounded, countless others "disappeared," torture and illegal imprisonment is rampant. [...]"  Related: Wachovia Bank: Accused of laundering $380 billion in Mexican drug cartel money  | 

High cocaine levels present in Swiss water [07/21/10] "The waste water in Swiss towns contain surprisingly high traces of cocaine, according to a study by Bern University. Until now, only rough estimates have been possible of how much cocaine is consumed in Switzerland, based mainly on police seizures and anonymous questionnaires. According to those sources, cocaine consumption in Switzerland has increased exponentially over the past five years, with between 25,000 and 60,000 Swiss thought to take the drug every day. Now a pilot project conducted last year by a chemistry student at Bern University has produced more reliable data. Christoph Mathieu decided to write his dissertation on an analysis of the waste water of several Swiss cities: Zurich, Geneva, Bern, Basel and Lucerne. [...]"  Note: All those Swiss banks ...

Why The Healthcare Mandate Is Unconstitutional, If It Is A Tax [07/21/10] "In brief, the argument is: The tax is not an excise tax, and it could not be a constitutional excise tax because it is not uniform. The tax is not an income tax, and it could not be a constitutional income tax, because it is not a tax on derived income. Accordingly, the tax must be a capitation or direct tax. Article I, section 9 provides: ‘No capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken.’ The tax is not apportioned, and therefore is contrary to Article I, section 9.” Related:  “Of Constitutional Decapitation and Healthcare” U.S. Politics: Changing Stance, Administration Now Defends Insurance Mandate as a Tax [07/18/10] "When Congress required most Americans to obtain health insurance or pay a penalty, Democrats denied that they were creating a new tax. But in court, the Obama administration and its allies now defend the requirement as an exercise of the government’s “power to lay and collect taxes.” And that power, they say, is even more sweeping than the federal power to regulate interstate commerce. Administration officials say the tax argument is a linchpin of their legal case in defense of the health care overhaul and its individual mandate, now being challenged in court by more than 20 states and several private organizations. [...]" Related:  Obamacare and "Unlimited Federal Power"  "One of the tragic aspects of modern America is how few of our citizens understand that the powers of the Federal government are limited and defined by the Constitution. Most people shrug and figure the government can do whatever it wants. Our ignorance becomes a self-fulfilling prophecy. Whenever the government illegally usurps power and we let them get away with it, another bad precedent has been set. It becomes legally okay for them to do it again in the future because they did it in the past. o where does Washington supposedly get its authority to justify Obamacare and so much else? Two sources are particularly cited: The Commerce Clause and the General Welfare Clause. [...]" Reagan: " Government is the Problem" [4:01]   Flashback: Obama Says "Mandate Not a Tax" SEPT 2009 [07/19/10] [5:44] 

Discussion of Glass-Steagall is Everywhere [07/21/10] "Contrary to those who might think that the passage of the Dudd-Frank bill has closed the question, the issue of the need for an immediate Glass-Steagall reform is hotter than ever, as people realize that it represents the only hope for getting out of looming disaster. [...]"  

 UK: Prime Minister Raids (Steals from) Dormant Accounts as Minister Attacks Banks [07/19/10] "U.K. Prime Minister David Cameron announced plans to use “hundreds of millions of pounds” from dormant bank accounts to fund community projects, while Business Secretary Vince Cable said lenders “ripped off” customers. [...]"  The new Office for Budget Responsibility forecasts that 490,000 public-sector jobs will be lost by April 2015. Cameron said he will press ahead with a proposal set out in the coalition government’s program to establish a “Big Society Bank” to finance moves by charitable groups and not-for-profit companies to take over jobs currently done by the government. 

Hungary Minister: IMF Talks Break Off On Lack Of 'Austerity' [07/19/10] "Hungary's talks with the International Monetary Fund and the European Union broke off Saturday as the government refused to implement fiscal austerity measures to reach this year's budget deficit "target", Economy Minister Gyorgy Matolcsy said Sunday. [...]"  Note: Good for them. Related:  In Ireland, a Picture of the High Cost of Austerity [07/19/10] "As Europe’s major economies focus on belt-tightening, they are following the path of Ireland. But the once thriving nation is struggling, with no sign of a rapid turnaround in sight. [...]"  Moody’s Cuts Ireland’s Credit Rating  "Ireland’s efforts to pull out of a deep economic slump suffered a setback Monday when a major credit agency downgraded the country’s bond rating, citing a weak banking system and rising debt." Note: Everyone could just tell the US-controlled IMF, who does what they do ONLY with an eye to 'save the western financial system', to take a hike ... 

Meet America's New Financial Regulators [07/18/10] "The day after the Senate passed President barack Obama’s Wall Street reform legislation, the financial industry’s representatives are combing through the legislation and trying to figure out exactly who their new regulators in Washington will be. There are a lot of changes in store, naturally. And while almost everyone following the debate is already familiar with the new Consumer Financial Protection Bureau, not many have heard of the Office of Financial Research, or do they realize that the law will eliminate the Office of Thrift Supervision. Here’s a handy guide to the new regulators: [...]" 

Tarpley: 'Obama, the Wall St. Puppet'   [7:18]  Related: Obama-Dodd-Frank FinReg Monstrosity Delays Derivatives Curbs until '2022' [07/18/10] "The Obama-Dodd-Frank financial regulation bill, a miserable excuse for real Wall Street reform, is now about to gain final approval in the Senate. This wretched bill is now supported by the New England liberal (meaning Wall Street) Republican clique including Olympia Snow, Susan Collins, and Scott Brown, who are joined by the notoriously corrupt reactionary Democrat, Ben Nelson of Nebraska. This bill will create a multitude of new regulations and a number of large new bureaucracies, but it is utterly devoid of any bright-line prohibitions against the causes of the financial panic which struck the United States in 2008, and which continues to the present day in the form of a world economic depression. The cause of the 2008 banking panic was that zombie banks and hedge fund hyenas were speculating with toxic and highly leveraged derivatives. The new bill does virtually nothing to attack the causes of this ongoing financial disintegration. It is a total defeat for the interests of the American people, and an historic victory for the Wall Street financier oligarchy which owns both the Democratic and Republican parties... [...]" See below. 

Commentary: Who pays for the new financial regulation bill? [07/18/10] "Obama celebrated the passage of the new financial regulation bill yesterday. So did Chris Dodd and Barney Frank. And why not? It’s not as though they’ll have to pay for the new bureaucracies and regulation imposed on the American financial system. For that matter, it won’t be the bankers, either. Who pays? Three guesses, and the first two don’t count: [...] This is so basic that people inside the Beltway never learn it. Costs imposed on businesses get passed to consumers. It doesn’t matter where those costs originate, whether they come from materials, labor, rent, taxes, or regulation. All of those figure into the price paid by consumers for the product or service provided." .... How will consumers get hit with these new regulations? Expect more fees on more transactions, including paying premium prices for doing business face to face with bank tellers and other employees. Banks will start demanding higher minimum balances and start charging higher fees on accounts that don’t make the cut. Bank of America will lose between $7 and $10 billion just on charges for debit and credit cards alone, money that will get made up by its customers somewhere. In short, the bill will erode consumer buying power, harm retirement accounts that rely on the performance of financial institutions, and create more unemployment. What exactly did we get in return for all of this? An expansion of the regulatory bureaucracy that spent more time watching porn than protecting consumers the first time around. [...]" Related: Banks Gearing Up for New Fees to Combat Lost Revenues "Big banks facing big drops in revenue are looking to Main Street to make up the difference. [...]" 

Dazed Congress Passes Wall Street Bill [07/17/10] "The Senate approved the meaningless 2,300-page "Dodd-Frank Wall Street Reform and Consumer Protection Act," sending it to be signed by a spooked, disintegrating President Obama. Wisconsin Sen. Russ Feingold was the only Democrat voting no, with three Republicans, the Cabot family's poodle Scott Brown and Maine's Senators Snowe and Collins, voting for the Obama travesty. [...]"   Related:  With passage of financial regulation overhaul, Geithner to inherit sweeping influence  "The dramatic expansion of financial regulation approved by Congress this week bears the stamp of no one more than Treasury Secretary Timothy F. Geithner and gives him vast powers to determine the final form of the new rules. Half a year after some pundits were predicting he would be booted from the Obama administration for poor performance, Geithner is poised to inherit authority to shape bank regulations, financial market oversight and a new consumer protection agency. Few treasury secretaries have ever had such sweeping influence over such a wide realm. The bill not only hews closely to the initial draft Geithner released last summer, but also anoints him -- as long as he remains treasury secretary -- as the chief of a new council of senior regulators. The legislation also puts him at the head of the new consumer bureau until a director is confirmed by the Senate, allowing Geithner to mold the watchdog in coming months. And it will be up to him to settle a raft of issues left unresolved by the bill -- for instance, which financial derivatives will be subject to the tough new trading rules and which risky activities big banks will be required to spin off. [...]"  Note:  If you fail in the private sector, you lose your job. If you fail as President of the New York Federal Reserve: you wind up as Treasury Secretary under Obama with increased power.  The Uncertainty Principle—II Only 30 times more complicated than Sarbanes-Oxley  "The Dodd-Frank financial reform bill passed by the Senate yesterday promises to generate historic levels of red tape. But apparently the 2,300 pages are so complicated that a debate has broken out over precisely how many new regulatory rule-makings it will require. This week we reported on an analysis by the Davis Polk & Wardwell law firm that at least 243 new federal rule-makings are on the way, not to mention 67 one-time studies and another 22 new periodic reports. The attorneys were careful to note that this was a low-ball estimate, counting only new regulations mandated by the bill. Now comes Tom Quaadman of the U.S. Chamber of Commerce, who doesn't quarrel with the Davis Polk estimate but has added rule-makings authorized by this legislation to those that are mandated and says that American businesses should expect a whopping 533 new sets of rules. To put this number in perspective, Sarbanes-Oxley, Washington's last exercise in financial regulatory overreach, demanded only 16 new regulations. Thus he reasons that Dodd-Frank "is over 30 times the size of SOX." [...]"   

AIG agrees to $725m fraud payout [07/17/10] "The US insurance giant AIG agrees to pay $725m (£474m) to settle a long-running fraud case against it [...]"   

Goldman Settles With S.E.C. for $550 Million [07/16/10] "Goldman Sachs has agreed to pay $550 million to the Securities and Exchange Commission, one of the largest penalties ever paid by a Wall Street firm, to settle charges of securities fraud linked to mortgage investments. The S.E.C. filed a lawsuit against Goldman in April, accusing the bank of securities fraud. The settlement came just days before Goldman is scheduled to report its second-quarter earnings. Under the terms of the deal, Goldman will pay $300 million in fines to the Treasury Department, with the rest serving as restitution to investors in the mortgage-linked security. Goldman will not admit wrongdoing, though it will admit that its marketing materials for the investment “contained incomplete information.” The Goldman Fraud Case GS logoDealBook’s full coverage of the Securities and Exchange Commission’s lawsuit against Goldman Sachs over a mortgage-related security.  Goldman will also change several business practices, including the way it draws up marketing materials for complex mortgage securities and the way it educates employees in that part of its business. The settlement must still be approved by Judge Barbara S. Jones of federal district court in Manhattan. Goldman’s stock price climbed more than $5 in the last half-hour of trading after the S.E.C. said its director of enforcement, Robert Khuzami, would hold a news conference late Thursday afternoon. “Half a billion dollars is the largest penalty ever assessed against a financial services firm in the history of the S.E.C.,” Mr. Khuzami said in a statement. “This settlement is a stark lesson to Wall Street firms that no product is too complex, and no investor too sophisticated, to avoid a heavy price if a firm violates the fundamental principles of honest treatment and fair dealing.” The focus of the S.E.C. case, an investment vehicle called Abacus 2007-AC1, was one of 25 such vehicles that Goldman created so the bank and some of its clients could bet against the housing market. Those deals initially protected Goldman from losses when the mortgage market disintegrated and later yielded profits for the bank. As the Abacus portfolios in the S.E.C. case plunged in value, a prominent hedge fund manager made money from his bets against certain mortgage bonds, while investors lost more than $1 billion. [...]"   

Wachovia Bank: Accused of laundering $380 billion in Mexican drug cartel money [07/16/10] "Too-big-to-fail is a much bigger problem than you thought. We’ve all read damning accounts of the government saving banks from their risky subprime bets, but it turns out that the Wall Street privilege problem is far more deeply ingrained in the U.S. legal system than the simple bailouts witnessed in 2008. America’s largest banks can engage in flagrantly criminal activity on a massive scale and emerge almost completely unscathed. The latest sickening example comes from Wachovia Bank: Accused of laundering $380 billion in Mexican drug cartel money, the financial behemoth is expected to emerge with nothing more than a slap on the wrist thanks to an official government policy which protects megabanks from criminal charges. Bloomberg’s Michael Smith has penned a devastating expose detailing Wachovia’s drug-money operations and the government’s twisted response. The bank was moving money behind literally tons of cocaine from violent drug cartels. It wasn’t an accident. Internal whistleblowers at Wachovia warned that the bank was laundering drug money, higher-ups at the bank actively looked the other way in order to score bigger profits, and the U.S. government is about to let everyone involved get off scott free. The bank will not be indicted, because it is official government policy not to prosecute megabanks. From Smith’s story: [...]"  

Dropping a dime on Treasury-Goldman chats [07/15/10] "The federal commission look ing into the causes of the financial meltdown has copies of phone logs documenting calls between Lloyd (Doing God's Work) Blankfein and Hank ("I Talk With People Doing God's Work") Paulson. The first guy, as you already know, is the head of Goldman Sachs. The second was the ever-chatty Secretary of the Treasury who seemed to make -- in my humble opinion -- an awful lot of phone calls to Blankfein, a man whose company could have benefited greatly from these conversations.  [...]"    

JPMorgan Chase Earnings Jump 76% [07/15/10] "JPMorgan Chase's (JPM) second-quarter earnings rose 76% to easily top Wall Street estimates as lower losses on bad loans more than made up for a slowdown in its securities trading and underwriting business, the nation's second-biggest bank by assets said Thursday. [...]"  

Alan Greenspan's 1984 Pamphlet [07/15/10] Video clip [12:38] "Alan Greenspan was one of the key ideologues responsible for the threat to civilization today. Disguised as an "economist", his policy initiatives threaten to destroy the nation-state system. His hatred of FDR is a useful focus to understand what motivated his actions as Federal Reserve Chairman. Alan Greenspan released the pamphlet "Rethinking Glass-Steagall", declaring his hatred of FDR's insight into the nation-state principle. Greenspan had unique insight on how to destroy this idea, and did exactly this, culminating in the 1999 repeal of Glass-Steagall. [...]"  Related:  Review: Who Killed the Glass-Steagall Act? [07/14/10] [11:00]  "The Glass Steagall Act President Roosevelt signed into law was repealed. See who swept aside the banking firewall protections on the 12th of November 1999. The Gramm-Leach-Bliley Act (GLBA), also known as the Financial Services Modernization Act of 1999, is an act of the 106th United States Congress (1999-2001), signed into law by President Clinton which repealed part of the Glass-Steagall Act of 1933, opening up the market among banking companies, securities companies and insurance companies. The Glass-Steagall Act prohibited any one institution from acting as any combination of an investment bank, a commercial bank, and/or an insurance company. The Gramm-Leach-Bliley Act allowed commercial banks, investment banks, securities firms and insurance companies to consolidate. [...]"   

Goldman Sachs, Citigroup Sued Over Subprime Loans [07/14/10] "Goldman Sachs Group Inc., Citigroup Inc., Morgan Stanley and dozens more bank and brokerages were sued by a Boston area-based fund seeking reimbursement for losses related to subprime loans.  Cambridge Place Investment Management Inc., founded by ex- Goldman Sachs Group bankers Martin Finegold and Robert Kramer, lost more than $1.2 billion as a result of the banks’ untrue statements, according to a copy of the complaint filed July 9 in state court in Massachusetts.  The banks sold securities backed by mortgages that came from a “small group of now notorious subprime mortgage originators,” used faulty appraisals, accepted misleading information in loan applications, and violated their own standards for underwriting, the firm said in the lawsuit. The banks offered or sold $2.4 billion of residential mortgage- backed securities using untrue statements, according to the lawsuit.  “The Wall Street banks conducted inadequate due diligence and failed to satisfy their own responsibilities,” Cambridge Place said in the lawsuit.  The bundling of the riskiest type of mortgages into securities played a role in turning the U.S. housing slump into a global recession as foreclosures deflated bond values and toppled Wall Street firms including Lehman Brothers Holdings Inc. [...]"  Note: So, it's Fingold & Kramer vs. Blankfein ... battle of the Schmucks ..   Related: Goldman, BP sued over alleged SemGroup conspiracy  "The law firm McKool Smith announced the lawsuits by the Kansas, Oklahoma and Texas producers against Goldman's J. Aron & Co unit, BP Oil Supply Co and other defendants. It said the lawsuits were filed in Kansas and Oklahoma state courts. The complaints... [...]"    

International Monetary Fund: Next-Social Security? [07/14/10] " ... Last week, the IMF told the United States that it needs to start getting its budget deficit down. It put cutting Social Security at the top of the steps that the country should take to achieve deficit reduction. This one is more than a bit outrageous for two reasons. First, the IMF deserves a substantial share of the blame for the economic crisis that gave us big deficits in the first place. The IMF is supposed to oversee the operations of the international financial system. According to standard economic theory, capital is supposed to flow from rich countries like the United States to poor countries to finance their development. In other words, the United States should be having a trade surplus, which would correspond to the money that we are investing in poor countries to finance their development. However, the IMF messed up its management of financial crises so badly in the last 15 years that poor countries decided that they had to accumulate huge amounts of currency reserves in order to avoid ever being forced to deal with the IMF. This meant that capital was flowing in huge amounts in the wrong direction. One result of this reverse flow was that the United States ran a huge trade deficit instead of a trade surplus. The trade deficit in the United States was a big part of the story of the housing bubble. The trade deficit cost millions of workers their jobs. This was one of the main reasons that economy was so weak coming out of the 2001 recession. This weakness led the Fed to keep interest rates at 50-year lows, until the growth of the housing bubble eventually began to generate jobs in the fall of 2003. The IMF both bears much of the blame for the imbalances in the world economy and then for failing to clearly sound the alarms about the dangers of the bubble. While the IMF has no problem warning about retired workers getting too much in Social Security benefits, it apparently could not find its voice when the issue was the junk securities from Goldman Sachs or Citigroup that helped to fuel the housing bubble. The collapse of this bubble has not only sank the world economy, it also destroyed most of the savings of the near retirees for whom the IMF wants to cut Social Security. The vast majority of middle-income retirees have most of their wealth in their home equity. This home equity largely disappeared when the bubble burst. Maybe the IMF doesn’t have access to house price series and data on wealth, because if they did, it’s hard to believe that they would advocate further harm to some of the main victims of their policy failure. The other reason that the IMF’s call for cutting Social Security benefits is infuriating is the incredible hypocrisy involved. The average Social Security benefit is just under $1,200 a month. No one can collect benefits until they reach the age of 62. By contrast, many IMF economists first qualify for benefits in their early 50s. They can begin drawing pensions at age 51 or 52 of more than $100,000 a year. This means that we have IMF economists, who failed disastrously at their jobs, who can draw six-figure pensions at age 52, telling ordinary workers that they have to take a cut in their $14,000 a year Social Security benefits that they can’t start getting until age 62.   [...]"  Related: IMF Spells out Conditionalities--For U.S.A.   "With the full approval of the Obama Administration, the IMF just completed a mission to the United States, and produced a June 21st report, promoting murderous Schachtian austerity measures. It is clear that the so-called Simpson-Bowles austerity commission, created by an Obama Executive Order earlier this year, is nothing but a PR front for policies already written at the IMF. [...]"  

U.S. Subpoenas 64 Issuers of Mortgage Securities [07/13/10] "A federal regulator said it sent 64 subpoenas to issuers of mortgage-backed securities in an effort to probe whether the firms misled Fannie Mae and Freddie Mac, two of the biggest investors in privately issued bonds. The subpoenas, issued on Monday by the Federal Housing Finance Agency, which oversees the government-backed mortgage titans, could lead the government to recoup some of the billions of dollars that Fannie Mae and Freddie Mac lost when they scooped up mortgage-backed securities issued by Wall Street banks during the housing boom. The FHFA didn't disclose its targets. But the top private issuers of mortgage securities included Bear Stearns Cos. and Washington Mutual Inc., which were taken over by J.P. Morgan Chase & Co., as well as Countrywide Home Loans and Merrill Lynch, which were taken over by Bank of America Inc. Deutsche Bank AG and Morgan Stanley were also among the top issuers. All the banks declined to comment. [...]"  Note:  No word yet from Rahm Emanuel, formerly of Freddie Mac, on this one.

Crisis Awaits World’s Banks as Trillions Come Due [07/13/10] "The sovereign debt crisis would seem to create worry enough for European banks, but there is another gathering threat that has not garnered as much notice: the trillions of dollars in short-term borrowing that institutions around the world must repay or roll over in the next two years. The European Central Bank, the Bank of England and the International Monetary Fund have all recently warned of a looming crunch, especially in Europe, where banks have enough trouble raising money as it is. Their concern is that banks hungry for refinancing will compete with governments — which also must roll over huge sums — for the bond market’s favor. As a result, credit for business and consumers could become more costly and scarce, with unpleasant consequences for economic growth.  [...]"   

Lose the Derivatives, or Lose Civilization [07/13/10] "With London and the Bank of England at the center of the planning, new "financial reform regulations" have been put forward on a global basis by the Bank for International Settlements and the IMF, and simultaneously in various nations — including the wretched bag of loopholes called the Dodd-Frank bill in the United States. [...]"  

Controlling the wealth of America – top 1 percent control 83 percent of U.S. stocks [07/13/10] "Today Wall Street is in full command of our government. The impact of massive lobbying has guaranteed that many of our politicians are bought off and are serving as serfs to their feudal lords on Wall Street. How else can we explain the lack of reform in the financial industry after the biggest economic crisis since the Great Depression? Wealth is massively concentrated in a few hands in America. Just because you have access to debt does not make you wealthy. 83 percent of all U.S. stocks are in the hands of the top 1 percent. [...]"   

Secret Gold Swap Spooks the Market [07/13/10] "It takes a lot to spook the solid old gold market. But when it emerged last week that one or more banks had lent 380 tonnes of gold to the Bank of International Settlements (BIS) in return for foreign currencies, there was widespread surprise and confusion. The news that a mystery bank has just pawned the family jewels gave traders a jolt – nervous about the sudden transfer of almost 20pc of the world’s annual gold production and the possibility of a sell-off. In a tiny footnote in its annual report, the bank disclosed its unusually large holding of gold, compared with nothing the year before. The disclosure was a large factor in the correction of the gold price this week, which fell below $1,200 for the first time in more than a month. Concerns hinged on whether the BIS could potentially sell on this vast cache of bullion in the event of a default, flooding the market with liquidity. It appears to have raised $14bn for whoever’s been doing the swapping – small fry on the currency markets, but serious liquidity in the gold market. [...]"  Note: The BIS has been up to NO GOOD so often in the past ... another unethical bunch .. 

Individual investors running for cover again [07/12/10] "Small Investors Flee Stocks, Changing Market Dynamics. Small investors' faith in stocks, which surged in the 1990s, has collapsed since the technology-stock debacle and the Enron and WorldCom scandals of 2000-2002. The 2007-2009 financial crisis only made things worse. Now, the pullback among ordinary investors means they are a declining force in a market that is increasingly dominated by professionals.  [...]"  

 Commentary:  Is the IMF about Ready to Muscle U.S. Taxpayers? [07/11/10] "The IMF has long been a bought, and paid for, muscle arm of the U.S. government and the banking elite.  The play goes like this. Banks loan money to third world countries that have no chance in hell of paying the money back. The IMF comes in with "austerity" programs that include heavy new tax burdens on the working class. The revenue from the new taxes will, of course, go to payoff the banking elite. It's a sick game, but the elite seem to get their jollies by pulling this scam in country after country. It appears the elite appear to want to up the ante. It appears they are getting set to turn the guns inward and go after the hard earned money of Americans. [...]"  

Commentary: Waltzing at the Doomsday Ball - Capitalism is Dead, But We Still Dance With the Corpse [07/10/10] "As an Anglo European white guy from a very long line of white guys, I want to thank all the brown, black, yellow and red people for a marvelous three-century joy ride. During the past 300 years of the industrial age, as Europeans, and later as Americans, we have managed to consume infinitely more than we ever produced, thanks to colonialism, crooked deals with despotic potentates and good old gunboats and grapeshot. Yes, we have lived, and still live, extravagant lifestyles far above the rest of you. And so, my sincere thanks to all of you folks around the world working in sweatshops, or living on two bucks a day, even though you sit on vast oil deposits. And to those outside my window here in Mexico this morning, the two guys pruning the retired gringo's hedges with what look like pocket knives, I say, keep up the good work. It's the world's cheap labor guys like you -- the black, brown and yellow folks who take it up the shorts -- who make capitalism look like it actually works. So keep on humping. Remember: We've got predator drones. After twelve generations of lavish living at the expense of the rest of the world, it is understandable that citizens of the so-called developed countries have come to consider it quite normal. In fact, Americans expect it to become plusher in the future, increasingly chocked with techno gadgetry, whiz bang processed foodstuffs, automobiles,  entertainments, inordinately large living spaces -- forever. We've had plenty of encouragement, especially in recent times. Before our hyper monetized economy metastasized, things such as housing values went through the sky, and the cost of basics, food etc. went through the basement floor, compared to the rest of the world. The game got so cheap and fast that relative fundamental value went right out the window and hasn't been seen since. [...]"   Related:  Commentary: "Capitalism Is An Anti-Social Disease" [07/10/10] "... Let’s face it. Capitalism is a disease–an raging infection that causes its hosts to become sociopaths.  [...]  A second feature of mankind’s history until only the last few hundred years or so, has been that nature has been respected, and even revered. Capitalism has completely done away with this traditional reality of human existence. In capitalism, the welfare of a large proportion of society is simply ignored or openly put at risk. The capitalist views the low-wage worker and the unemployed person as just another resource to be subjugated and exploited, along with the rest of nature. Educated workers are sometimes treated slightly better, but only slightly, simply because they are deemed a bigger investment, worth hanging onto longer, until the investment has been amortized and they too can be trashed. In the final analysis, though, there is no concern for the society, for the well-being of the group. The only thing that matters, the only virtue, is profit maximization and increased share value, which means bigger bonuses for management and bigger returns for the investor. For a while, mankind, and the earth, could tolerate this sociopathic ideology, but we’ve clearly reached the point where it has to be recognized as a fatal disease. Capitalism and the greed it engenders and elevates to a virtue now threatens to finish us all off. [...] "  Lecture:  Crises of Capitalism [31:14] Animated Version [11:11]  "Radical sociologist David Harvey asks if it is time to look beyond capitalism." Note: I am reposting this on the finance page, because the animated version shows the whole layout of the current system, showing the deceptions ... very informative for 11 minutes.

Investing: When Cash Takes a Vacation [07/10/10] "Hedge funds, investors, and corporations are all sitting on piles of money. ... By definition, businesses must earn a return above their cost of capital, while fund managers must keep watch over their own performance. "Shareholders demand a return no matter what the economic environment," says Sean Kraus, who manages $2 billion in client assets as chief investment officer of CitizensTrust in Pasadena, Calif. "If you don't put cash to work, they will simply sell." And if you lose their money, as so many funds did in 2008, they will sell faster—hence the newfound preference for cash.  [...]"  

Commentary: The Con Of the Decade Part I [07/10/10] "In effect, it's a Third World/colonial scam on a gigantic scale: plunder the public treasury, then buy the debt which was borrowed and transferred to your pockets. You are buying the country with money you borrowed from its taxpayers. No despot could do better. [...]"   Related:  Then Con of the Decade Part II  Yesterday I described how the financial Plutocracy can transfer ownership of the Federal government's income stream via using the taxpayer's money to buy the debt that the taxpayers borrowed to bail out the Plutocracy. [...]"   

The US Treasury and the Federal Reserve are Manipulating the Gold Market [07/09/10] "As it has turned out the Treasury and the N.Y. Fed manipulates markets 24/7 worldwide, and they have a particular interest in the suppression of gold and silver prices; they being the antitheist of the US dollar. It should be noted that there were several times that the US Treasury and the privately owned Fed manipulated gold and silver prior to August 1988. We have found in 50 plus years of tracing this manipulative activity by the US government that it happens over and over again. [...]" 

Commercial real estate transactions collapsed 90 percent from 2007 to 2009 [07/08/10] "The massive commercial real estate market is already plaguing the weak balance sheets of banks. It is the case that each Friday, we are likely to see one U.S. bank fail because due to high levels of commercial real estate (CRE) debt on their books. This market is likely to cause the failure of hundreds of banks and put the economy down into another real estate funk. The amount of commercial real estate transactions shows no sign of recovery in this market. And why would there be any recovery? This is an area for hotels, strip malls, condos, and other projects that usually reflect a healthy and growing economy. We do not have that and the problems embedded in CRE are going to stifle any growth for years to come. [...]"   

Six Months to Go Until The Largest Tax Hikes in History [07/08/10] "In 2001 and 2003, the GOP Congress enacted several tax cuts for investors, small business owners, and families. These will all expire on January 1, 2011:  Personal income tax rates will rise. The top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which two-thirds of small business profits are taxed). The lowest rate will rise from 10 to 15 percent. All the rates in between will also rise. Itemized deductions and personal exemptions will again phase out, which has the same mathematical effect as higher marginal tax rates. The full list of marginal rate hikes is below: [...]"  

FDIC Business Checking Guarantees Extended [07/07/10] "The Federal Deposit Insurance Corporation has finalized rules extending the Transaction Account Guarantee program, under the Temporary Liquidity Guarantee Program which gives unlimited backing to transactions involving non-interest bearing accounts. [...]"   

Investors Fear Rising Risk of US Municipal Defaults [07/07/10] " “The risk in the second half of the year is that investor attention switches from Europe to the US,” said Robert Parker, senior adviser at Credit Suisse Securities, who singled out parts of California, as well as towns and cities in Illinois, Michigan and New York state as among the most vulnerable. “You will see investor concern about the viability of those cities and therefore you will see, inevitably, further spread widening in the municipal bond market.”  If these market swings are sustained, they could push up borrowing costs for local governments , which, in turn, could exacerbate the squeeze on local authority finances and place more stress on the federal budget. You might ask why this is so? The Heartland Institute explains the situation in Illinois:  In fiscal year 2008, 11,254 Illinois public school employees had annual salaries exceeding $100,000, up from 9,591 in 2007. When pensions, retirement health insurance, and employee insurance are added, public school employees’ total compensation is about 30 percent more than their salary. That means more than 40,000 Illinois public school employees, or about 25 percent, have total compensation of more than $100,000 per year.  And that $100,000 does not include the value of tenure or a nine-month work year.  As you can imagine. Barack Obama wasn't part of a "change" movement when he was in the Illinois state legislature. [...]"   Related:  Rohatyn Proffers Monopoly Money to U.S. Cities, To Snatch Their Infrastructure [07/07/10] "Felix Rohatyn, the Lazard banker, is still at it: he is telling financially- strapped U.S. cities, to drop their traditional unwillingness to sell off public assets (water and sewer systems, parks, properties, ports, airports, etc.) to "private foreign investors"—Rohatyn's euphemism for international funny money—and allow himself and cronies to grab it up. Rohatyn's pitch is featured in London's Financial Times today, in its coverage of how U.S. cities and states are in such financial distress, that maybe they can be trapped into going along with this corporatist crap. Rohatyn says, U.S. cities should get over their "wall of fear" of foreign takeover. "This dislike for foreign ownership is Kafka-esque..."  However, the attitude of most local authorities—though in trouble, and even in unofficial default—is to resist being stampeded into selling off assets, or even into bankruptcy. The mass-strike sense of revulsion against the Rohatyn-type vultures is in play. The critical factor is the LPAC-led intervention for FDR/Glass-Steagall emergency measures.  [...]"

China rules out option of dumping US debt [07/07/10] "The body which manages China's official currency reserves has called on the US to take 'responsible measures' to maintain the dollar's value but ruled out dumping its vast holdings of US Treasury securities ... [...]"  

Goldman Sachs Executive to Advise Head of Canada’s Central Bank, a Former Goldman Sachs Executive [07/06/10] "The chief executive of Goldman Sachs Canada has been named a special adviser to the head of Canada’s central bank. The Bank of Canada said Tuesday that Timothy Hodgson will advise central bank head Mark Carney, a former Goldman Sachs executive, on "financial reform".  [...]"  

Analysis:  Milton Friedman Unraveled by Murray N. Rothbard [07/06/10] "Mention "free-market economics" to a member of the lay public and chances are that if he has heard the term at all, he identifies it completely with the name Milton Friedman. For several years, Professor Friedman has won continuing honors from the press and the profession alike, and a school of Friedmanites and "monetarists" has arisen in seeming challenge to the Keynesian orthodoxy. [...] Friedmanism can be fully understood only in the context of its historical roots, and these roots are the so-called "Chicago School" of economics of the 1920s and 1930s. Friedman, a professor at the University of Chicago, is now the undisputed head of the modern, or second-generation, Chicago School, which has adherents throughout the profession, with major centers at Chicago, UCLA, and the University of Virginia. The members of the original, or first-generation, Chicago School were considered "leftish" in their day, as indeed they were by any sort of genuine free-market criterion. And while Friedman has modified some of their approaches, he remains a Chicago man of the thirties. The political program of the original Chicagoans is best revealed in the egregious work of a founder and major political mentor: Henry C. Simons’s A Positive Program for Laissez Faire.1 Simons’s political program was laissez faireist only in an unconsciously satiric sense.  It consisted of three key ideas:  1. a drastic policy of trust-busting of all business firms and unions down to small blacksmith-shop size, in order to arrive at "perfect" competition and what Simons conceived to be the "free market";  2. a vast scheme of compulsory egalitarianism, equalizing incomes through the income-tax structure; and 3. a proto-Keynesian policy of stabilizing the price-level through expansionary fiscal and monetary programs during a recession. Extreme trust-busting, egalitarianism, and Keynesianism: the Chicago School contained within itself much of the New Deal program, and, hence, its status within the economics profession of the early 1930s as a leftish fringe. And while Friedman has modified and softened Simons’s hard-nosed stance, he is still, in essence, Simons redivivus; he only appears to be a free-marketeer because the remainder of the profession has shifted radically leftward and stateward in the meanwhile."  Note:  Although a little dry, it's a penetrating look at the system which surrounds us. For this, Rothbard is the best, and he did this analysis in 1971. Chicagoans still maintain support of the Fed and want it to house a systemic risk regulator. They still want to patch up the existing system. Chicago, Harvard, and MIT are one family. Flashback: Greenspan Concedes Error on Regulation  "..Mr. Greenspan admitted that he had put too much faith in the self-correcting power of free markets and had failed to anticipate the self-destructive power of wanton mortgage lending. [...]"  

Ayn Rand: The Fountainhead of Greenspan's Errors [07/06/10] "Through their views on the virtues of free markets and individualism, Ayn Rand and the former chairman of the Federal Reserve Alan Greenspan will be forever linked as architects of the worst financial collapse since the Great Depression. Rand's name is regularly invoked when calling into question the Federal Reserve's actions in the years leading up to the crisis. Rand's strong free-market views, as expressed in her most famous works, "Atlas Shrugged" and "The Fountainhead," were the basis for the ideology Greenspan followed as he let the markets run free from any sort of regulation. This freedom meant that the derivatives markets and their extremely complex structured financial products operated in a wild west style world where the law had yet to show up. As we now know, that lawless culture contributed significantly to last year's financial meltdown. A year ago, Greenspan offered a mea culpa and admitted that he was at least partially mistaken in his view of the superiority of free markets over government regulation. [...]"   

With the US trapped in depression, this really is starting to feel like 1932 [07/06/10] ""The economy is still in the gravitational pull of the Great Recession," said Robert Reich, former US labour secretary. "All the booster rockets for getting us beyond it are failing." Investors are starting to chew over the awful possibility that America's recovery will stall just as Asia hits the buffers. China's manufacturing index has been falling since January, with a downward lurch in June to 50.4, just above the break-even line of 50. Momentum seems to be flagging everywhere, whether in Australian building permits, Turkish exports, or Japanese industrial output. On Friday, Jacques Cailloux from RBS put out a "double-dip alert" for Europe. "The risk is rising fast. Absent an effective policy intervention to tackle the debt crisis on the periphery over coming months, the European economy will double dip in 2011," he said.  [...]"  

At the US Money Factory, High-Tech Benjamins Roll Off the Presses [07/05/10] "CNET has a nice behind-the-scenes tour of the process of making the newly redesigned $100 bill, which the government unveiled in April. It won’t be in circulation until February 10, 2011, but CNET’s story provides a nice sneak peek.  [...]"    

Glass-Steagall Still In the Middle of Congressional Debate [07/05/10] "Two U.S. Senators demanded Glass-Steagall be restored June 22, in the ongoing debate over the ineffective Dudd-Frank "financial regulation" bill. And the political mass strike among the American people, which demands anti-bailout, anti-Wall Street action, was again evidenced in yesterday's Congressional political primaries in South Carolina and Utah. [...]" 

SEC Says Adviser Swiped Millions [07/05/10] "The SEC today charged a New York-based investment adviser with defrauding investors of tens of millions of dollars by misrepresenting multibillion-dollar collateralized debt obligations tied to mortgage-backed securities. Thomas Priore and ICP Asset Management "repeatedly caused the Triaxx CDOs to overpay for securities in order to make money for ICP and protect other ICP clients from realizing losses," the SEC said in announcing the federal complaint. [...]"   

Goldman Sachs – The Real Pirates behind America’s Economic Implosion [07/04/10] [10:51]  Note: Alex Jones talks with Max Keiser about who the real criminals are behind the implosion of the American economy.   Part 2 [10:56]| Part 3 [4:01] Related: Goldman Sachs Refuses to Release Derivatives Data [07/04/10] "Goldman Sachs Group Inc. refused a request from the Financial Crisis Inquiry Commission to reveal how much it makes trading derivatives, saying the bank doesn’t separate the figure from other businesses. [...]"   

Global Economic Crisis Explained [07/04/10] "...Radical sociologist Professor David Harvey visits the RSA to explain how capitalism came to dominate the world and why it resulted in the current financial crisis. Taking a long view of the current crisis, Professor Harvey exposes the follies of the international financial system, looking closely at the nature of capitalism, how it works and why sometimes it doesn’t. Examining the cycles of boom and bust in the world’s housing and stock markets, and the vast flows of money that surge round the world daily, Harvey shows that periodic episodes of meltdown are not only inevitable in the capitalist system but, in fact, are essential to its survival. Harvey argues that the essence of capitalism is its amorality and lawlessness and to talk of a regulated, ethical capitalism is to make a fundamental error. [...]"  Related:  Educational Lectures: David Harvy - Crises of Capitalism [31:14]  Animated Version [11:11]  "Radical sociologist David Harvey asks if it is time to look beyond capitalism, towards a new social order that would allow us to live within a system that could be responsible, just and humane." Note:  Very clever and informative. More of these kind of videos are being posted in the Notable Videos panel, as we get them formatted.

 UK: Departments told to draw up plans for 40% spending cuts [07/04/10] "Most government departments are being asked to produce "illustrative plans" for spending cuts of up to 40%.  The Treasury wants departmental heads to set out how they would cut spending by both 25% and 40% by the end of July. But education and defence have been given some protection from the worst of the cuts, and will have to draw up plans for cuts of 10% and 20%. Health will continue to have small rises in its budget, and international aid is also protected. [...]"  Note: Could the U.S. cut it's defense budget by 20%. Nope. War, death and greed are more important than the people. The UK "gets it" to some degree, but the money they save may not be applied to the people, either. We shall see.

 Trends: Who Needs Risk Rules? Pensions Acting on Their Own [07/04/10] "Several public and corporate pension funds are curtailing or revisiting their use of derivatives out of concern for hidden risks they may carry. In Oklahoma, a public pension fund replaced Pacific Investment Management Co., led by well-known investor William Gross, as one of its bond-fund managers, citing the risks of its use of derivatives whose values couldn't be cross-checked in audits.  Public pension funds in California and Maryland also are reviewing the risks of their exposure to derivatives. And state legislators in Illinois and New Jersey have introduced bills to curtail the use of derivatives by their states' pension funds, citing their role in the market meltdown.  Derivative contracts run from options and futures on individual stocks to complex swaps covering interest rates, currencies or other assets. The financial-overhaul bill pending in Congress includes new regulation of derivatives, including processing some trades through a clearinghouse, with parties posting margin to assure they can pay. The bill requires Wall Street dealers to segregate some riskier derivatives in separately capitalized subsidiaries, to make sure they can repay as well. Karyn Williams, a pension consultant at Wilshire Associates, says some corporate pension-fund managers are trying to monitor issues like "counterparty risk" being taken by their managers in derivatives known as swaps. "There's a big conversation about risks in these pension plans," she said. [...]"     

Sri Lankan budget imposes IMF austerity demands [07/03/10] "Sri Lankan deputy finance minister Sarath Amunugama presented a delayed interim budget for 2010 on Tuesday, outlining plans for austerity measures to meet the demands of the International Monetary Fund (IMF). [...]"  Note:  The IMF is influenced by the U.S, and it's deliberately setting out to cause social disorder in every country it can. 

 Report: Government for Sale: How Lobbyists Shaped the Financial Reform Bill [07/02/10] "Two weeks ago, along a marble corridor in the Rayburn House Office Building in Washington, I watched about 40 well-dressed men (and two women) delivering huge value for their employers. Except that we, the taxpayers, weren't employing them. The nation's banks, mortgage lenders, stockbrokers, private-equity funds and derivatives traders were.  [...]"  Note: Congress is supposed to write the bills, not lobbyists or corporations. That's what they're paid to do - write the bills, read them and vote on them. They do very little towards that end.  

Glass-Steagall vs. The Crash [07/02/10] "Everybody knows how British-run AIG, with its derivatives hot-shots at its Financial Products Division (AIGFP) in London, was central to accelerating the collapse of 2007-08 into the bank crash of September 2008; and how it then got the biggest and most corrupt bailout of the crash, at least $182 billion of taxpayer money to the benefit of Wall Street and foreign banks. Few understand that AIG's holding company's violating of the Glass-Steagall Act, beginning months before Glass-Steagall was repealed in 1999, was crucial in its triggering the crash. [...]"  

Dollar Plunges After UN Call To Ditch Greenback [07/02/10] "The dollar plunged today following a United Nations report which called for the greenback to be replaced as the global reserve currency by the International Monetary Fund’s special drawing rights (SDRs). [...]"  Note:  SDR's won't happen anytime soon, that I can see, based on reports I've read. Here is one : ".....  The next step for the elitists is to designate SDR’s, Special Drawing Rights, as the new world currency. Needless to say, it won’t have gold backing. The problem is they cannot implement it until they get worldwide carbon taxes to back up this new worthless currency. That is why BP, which is controlled by the Illuminists, had its false flag event in the Gulf of Mexico. This is the ruse to be used to pass such legislation in the US. The powers that be are desperate to find an alternative to the US dollar as a reserve currency because the US is broke. We might also direct you to the USDX, the dollar index, which is in the clutches of a long-term perfect head and shoulders, which is the most negative, powerful, technical formation achievable. Needless to say, this point has not been overlooked by the elitists. On the other hand as a result intelligent investors worldwide have been accumulating gold as an alternative, replacing the dollar as the world reserve currency. This is just as we said it would be in June of 2000. If you are not on board get onboard now before you are left at the station. More and more people are entering into gold and silver assets as they discover that frauds being perpetuated against them by their governments. They are not going to trust the SDR even if 20 currencies are indexed and funds from carbon taxing back the currency. Investors already recognize the SDR as just another fiat currency. All they will be doing is replacing one worthless currency with another, without gold backing and it isn’t going to fly. At the same time gold and silver will just move relentlessly higher. In addition what does the IMF do after all their gold is gone? They will be flat broke again. If you noticed, every time they sell gold the price goes higher. As a matter of fact some nations are buying gold and dumping dollars, so they are aware of what is going on. Some smaller nations are afraid to act. They know printing money is not the solution.  Europe is still struggling in an attempt to bailout the PIIGS, which if they take the loans they will live in financial bondage and depression for the next 30 years. We told the Greek people in a TV documentary last week to default, leave the euro, create the new drachma, lower taxes, make sure the rich pay their taxes, cut expenses in government by 30% and do not under any circumstances sell off any Greet assets, such as islands and utilities to foreign Illuminists for 20 cents on the dollar. The bankers created the money they lent out of thin air, so why should they be repaid. In addition they knew the risks and should have never made the loans in the fist place. The Illuminist-Bilderberg PM should be impeached for trying to destroy the country.[...]"

Goldman Sachs Refuses to Release Derivatives Data [07/02/10] "Goldman Sachs Group Inc. refused a request from the Financial Crisis Inquiry Commission to reveal how much it makes trading derivatives, saying the bank doesn’t separate the figure from other businesses. “Some other firms have provided us with that data when we’ve asked for it and Goldman Sachs hasn’t,” Commissioner Brooksley Born said today in Washington on the second day of a hearing investigating the role of derivatives in the 2008 credit crisis, which sparked the worst recession since the 1930s. “It makes one wonder why Goldman has the incentive or impetus to not release this information.” [...]"   

Commentary:  Audit-the-Fed Goes Down, 229-198 [07/02/10] "This is no surprise. Neither party wants to audit the counterfeiting enterprise that is at the dark heart of the regime. The Republicans voted for it only for partisan reasons. When they are in power, the bill will never even come up. But here is the victory: through this device Ron Paul has added many more people to the vast numbers he has educated on the true nature of the central bank. The only victory that matters is in the hearts and minds of the people; good will never come from the top down. Ron Paul has advanced the cause of truth by a huge margin, where it counts, educationally. We are being ripped off through inflation, business cycles, and redistribution, and through the corporatism and wars the Fed makes possible. That is Ron Paul’s lesson, and the reason we must End the Fed. See also his reading list. [...]"   

Europe approves US mass data grab [07/02/10] "Europe has signed a deal to hand over all bank transaction data to the US in order to help "the ongoing war on terrorism." [...]"  

Financial Reform Bill Delayed in Senate [07/01/10] "The U.S. House of Representatives passed a sweeping financial regulatory reform bill Wednesday by a 237 to 192 vote, but the bill will not be passed in the Senate until lawmakers return from the Independence Day recess, in mid-July.  [...]"  

World Economy: The G20 Is Betting That China Can Carry The Global Economy [07/01/10] "... There is no question that some weaker European countries, like Greece, Portugal and Ireland, had out-of-control budget deficits. Particularly if they are to pay back all their foreign borrowing — a controversial idea that remains the conventional wisdom — these countries need some austerity. But what about those larger countries, like Germany, France, Britain and the United States, which remain creditworthy? If these economies all decide to reduce their budget deficits, what will drive global growth? The answer in Toronto was obvious: China.  [...]"  Note:  As we see, they're pinning all their 'hopes' on something they can't control: Related: Fears of a Chinese economic slowdown  "There are mounting global concerns over China’s frenzied property speculation and the sustainability of its government’s stimulus measures, compounded by strikes in the auto industry. [...]"  

Global markets on 'cliff edge' amid fears over European banks [07/01/10] "Fears that government austerity packages will hinder global growth have combined with fresh anxiety about the health of European banks to hammer investor confidence.  Shares on both sides of the Atlantic dropped heavily amid warnings that markets were on a "cliff edge". In jittery trading ahead of a crucial repayment by Europe's banks of a €442bn (£362bn) European Central Bank loan on Thursday the rates at which banks lend to each other in euros rose to their highest levels in eight months as rumours swirled that some banks were finding it difficult to raise funds in the money markets. [...]"   

Discussion: To end the occupation, cripple Israeli banks [07/01/10] "The international banking sanctions campaign in New York against apartheid South Africa during the 1980s is regarded as the most effective strategy in bringing about a nonviolent end to the country’s apartheid system. The campaign culminated in President FW de Klerk’s announcement in February 1990, releasing Nelson Mandela and other political prisoners, and the beginning of constitutional negotiations towards a non-racial and democratic society. [...]"   

Goldman can’t say how much it made from housing crash [07/01/10] "A congressional commission pressed Goldman Sachs executives Wednesday to spell out how much their company has earned from its exotic bets against the housing market, including $20 billion in wagers that helped force a $162 billion taxpayer bailout of the American International Group.  However, Goldman's president and chief risk officer told members of the Financial Crisis Inquiry Commission that their company never breaks out its figures that way. "We can dig and dig and dig," Goldman President Gary Cohn said in sworn testimony. "We won't find that report."  [...]"  Note:   Video clip included.

National Debt Soars to Highest Level Since WWII [07/01/10] "The federal debt will represent 62% of the nation’s economy by the end of this year, the highest percentage since just after World War II, according to a long-term budget outlook released today by the non-partisan Congressional Budget Office. [...]"  U.S. debt "The U.S. national debt will be nearly two-thirds of the country's gross domestic product by the end of the current fiscal year. [...]" 

Russia Purchases Twenty-two Tons Of Gold In May [07/01/10] "Ten days ago we reported the most recent data on gold reserve holdings as presented by the World Gold Council, where we pointed out that Russia had purchased 27.6 tons of gold in the most recent reporting period, bringing its total to 668.6 tons. It appears Russia is only getting started. [...]"   

Bernanke, Geithner Put Taxpayers On The Hook For Junk Bonds: Told Congress They Were 'Investment Grade' [07/01/10] "Federal Reserve Chairman Ben S. Bernanke and then-New York Fed President Timothy Geithner told senators on April 3, 2008, that the tens of billions of dollars in “assets” the government agreed to purchase in the rescue of Bear Stearns Cos. were “investment-grade.” They didn’t share everything the Fed knew about the money.  The so-called assets included collateralized debt obligations and mortgage-backed bonds with names like HG-Coll Ltd. 2007-1A that were so distressed, more than $40 million already had been reduced to less than investment-grade by the time the central bankers testified. The government also became the owner of $16 billion of credit-default swaps, and taxpayers wound up guaranteeing high-yield, high-risk junk bonds.  By using its balance sheet to protect an investment bank against failure, the Fed took on the most credit risk in its 96- year history and increased the chance that Americans would be on the hook for billions of dollars as the central bank began insuring Wall Street firms against collapse. The Fed’s secrecy spurred legislation that will require government audits of the Fed bailouts and force the central bank to reveal recipients of emergency credit.  “Either the Fed did not understand the distressed state of some of the assets that it was purchasing from banks and is only now discovering their true value, or it understood that it was buying weak assets and attempted to obscure that fact,” Senator Sherrod Brown, an Ohio Democrat and member of the Senate Banking Committee, said in an e-mail when informed about the credit quality of holdings in the Maiden Lane LLC portfolio. The committee held the April 3 hearing.  [...]"   

MSNBC’s Ratigan: Stock market an ‘obviously corrupt’ fraud [07/01/10] "On his afternoon show Tuesday, MSNBC host Dylan Ratigan explained why he believes the usual explanations given in the media for why the stock market went up or down on a given day are nonsense.  "Seventy percent of the volume [of trades on the stock market] is computers that are run by the banks playing ping pong with stocks for 10 seconds at at time," Ratigan said. "The stock market at this point, which used to be a reflection of the future value of actual businesses in this country, has been turned by our government and our banks into little more than a paper shredding facility [about which] we can make up reasons why it goes up and down," Ratigan said. "But when the computers ... at the banks are controlling the action, most everything else is kind of silly." Ratigan concluded that it's time to create an "alternative investment structure" that would allow people to invest their money without putting it "into the obviously corrupt stock market in this country." Ratigan was referring to the recently new phenomenon known as high-frequency trading: High-speed computer programs that are able to "peek" at stock trades less than a second before the trades are made. If the computer sees that a trade about to be made will raise the price of a particular stock, it can purchase the stock in the split-second before that trade is made. [...]"   

Investigations: Treasury’s ‘Point Man’ on AIG Bailout That Benefited Goldman, Owned Goldman Stock [07/01/10] "Deep in an article today on the government's bailout of AIG, The New York Times cites sources saying that the Treasury Department's "point man" on AIG, Don Jester, was a former Goldman Sachs employee who owned stock in the bank even as he was making decisions on the bailout that ultimately channeled billions of taxpayer dollars to Goldman.  Owning stock in a company an official oversees typically is verboten, but because Jester was working as an outside contractor rather than an official employee, he was exempt from conflict-of interest rules. Goldman Sachs stood to benefit from the AIG bailout because Goldman had roughly $20 billion in insurance-like credit-default swaps with AIG -- essentially bets by the investment bank that the housing market would go south. But if AIG collapsed, Goldman wouldn't be able to collect on the bets. When the government instead bailed out AIG, taxpayers paid out the swaps at full face value, and Goldman Sachs got $12.9 billion -- more than any other of AIG's customers. Jester was Goldman's deputy CFO when he left the firm in 2005. And here's what the Times says about his investments in Goldman: Mr. Jester, according to several people with knowledge of his financial holdings, still owned Goldman stock while overseeing Treasury's response to the A.I.G. crisis. We contacted Jester this morning to comment on the story and confirm the stock ownership; we'll post an update when we get a response. His spokesperson, Michelle Davis, told the Times that Jester followed what the paper paraphrases as an "ethics plan to avoid conflict with all of his stock holdings." (According to a federal database search, Jester received $30,000 for six months consulting at the Treasury Department.) [...]" 

EU Moves to Cap Bank Bonuses [07/01/10] "Under a deal agreed with the European Parliament, bankers will receive no more than 30% of their bonus immediately and in cash, or 20% for larger bonuses.  The remaining bonus payments will be delayed and linked to long-term performance, with 50% paid in shares. Hedge funds will also be covered by the new rules, the BBC has learned. [...]"  Note: Looks like banking executives in EU member nations will have to settle for slightly less ginormous bonuses in the coming year, once the European Parliament puts its official stamp on an agreement to limit banking bonuses and severance packages. 

House passes US financial reform [07/01/10] "The US House of Representatives approves a lankmark bill designed to overhaul regulation of the US financial system. [...]"   

Regulators Made Sure Goldman Sachs Got All of its Bailout Money [07/01/10] "A devastating report in the New York Times documents how Timothy Geithner’s New York Fed worked tirelessly to make sure that AIG was forced to pay banks such as Goldman Sachs 100 percent on dubious contracts that might otherwise have been slashed or subjected to lawsuits. Geithner, of course, was promoted for his efforts to run the rest of the nation’s economy.  The article is full of revelations that would be mind-numbing if we weren’t so used to reading about how taxpayers have been fleeced in the meltdown.  At one point, a regulator sends Goldman’s CEO an e-mail thanking the bank for its patience. The Treasury Department’s point man for the AIG bailout, a former Goldman executive, still held Goldman stock when working out the deal, reports the Times.  AIG itself was forced to sign a waiver giving up the right to sue banks over suspect contracts.  You don’t have to be a conspiracy theorist to follow the money: In the $182 billion bailout of AIG, Goldman Sachs and other banks that helped cause the financial crisis made out like, well, bandits.  [...]"  

German Government Moves Towards Glass-Steagall Principle [07/01/10] "The coalition government in Germany has drafted a bank-restructuring bill premised on the core principle of Franklin Roosevelt's Glass-Steagall law: that the government has the responsibility to salvage necessary commercial banking functions, but does not accept responsibility for bailing out investment banking and speculation. [...]"   

Chinese Regulator Calls For "Firewall" To Maintain Glass-Steagall Banking Requirements [06/30/10] "Speaking on June 26 in Shanghai to the Liujiazui Forum, an annual forum that brings together businessmen, government officials and banking regulators from all over China to discuss the topic of the financial system in the post-crisis world, Liu Mingkang, the director of the China Banking Regulatory Commission, listed the measures that were being taken to secure the stability of the Chinese financial system. First and foremost was the central focus of the maintenance of a Glass-Steagall-like "firewall" [fanghuoqiang]. [...]"  

UN calls for scraping dollar as the main global reserve currency  [06/30/10] "A UN report released on Tuesday calls for abandoning the US dollar as the main global reserve currency to achieve greater stability in the world financial system. [...]"  

MSM: Banks Financing Mexico Gangs Admitted in Wells Fargo Deal [06/29/10] "Just before sunset on April 10, 2006, a DC-9 jet landed at the international airport in the port city of Ciudad del Carmen, 500 miles east of Mexico City. As soldiers on the ground approached the plane, the crew tried to shoo them away, saying there was a dangerous oil leak. So the troops grew suspicious and searched the jet.   They found 128 black suitcases, packed with 5.7 tons of cocaine, valued at $100 million. The stash was supposed to have been delivered from Caracas to drug traffickers in Toluca, near Mexico City, Mexican prosecutors later found. Law enforcement officials also discovered something else.  The smugglers had bought the DC-9 with laundered funds they transferred through two of the biggest banks in the U.S.: Wachovia Corp. and Bank of America Corp., Bloomberg Markets magazine reports in its August 2010 issue.  This was no isolated incident. Wachovia, it turns out, had made a habit of helping move money for Mexican drug smugglers. Wells Fargo & Co., which bought Wachovia in 2008, has admitted in court that its unit failed to monitor and report suspected money laundering by narcotics traffickers -- including the cash used to buy four planes that shipped a total of 22 tons of cocaine.  [...]"   

Former SEC Chairman Sees Financial Reform as "Changes on the Margins" [06/29/10] "After a 20-hour, all-night session, Senate and House negotiators agreed last Friday on a compromise financial reform bill meant to prevent future economic meltdowns. Just before the bill was being finalized, former SEC Chairman Arthur Levitt wrote a scathing op-ed in The Wall Street Journal, saying the bill was “bled dry of nearly every meaningful protection of investors.” Levitt headed the SEC from 1993 to 2001, leaving just before the accounting scandals of Enron and WorldCom erupted, and is now an adviser to Goldman Sachs and the Carlyle Group, a private equity firm.  [...]"  Note:  So this guy was BLIND to what Enron was doing while working at the SEC.  Nice .. reliable ... an idiot! Related: Bank stocks soar on "financial regulation agreement" "Bank stocks shot higher Friday after an agreement on a financial regulation bill reassured investors that new rules won't devastate financial companies' profits. Banks outdistanced the rest of the market after congressional negotiators agreed on a bill that increases the regulation of financial companies, but that doesn't include some of the harshest provisions that the government originally proposed. The legislation imposes new rules on the complex investments known as derivates, but the rules aren't as strict as investors feared. It also includes a far milder version of what's been called the Volcker rule. That rule, named after former Federal Reserve Chairman Paul Volcker, would have banned commercial banks from trading simply to increase their profits, a practice known as proprietary trading. "They come out of this big-time winners," Bob Froehlich, senior managing director at Hartford Financial Services, said of financial companies. "Two years later, people will look back and say 'My gosh, nothing really changed.'" [...]"   

 Commentary: Commercial Real Estate (CRE) [06/29/10] "The problems for commercial real estate are deep and significant and have the potential of stifling any sort of recovery. Rather than looking at commercial real estate (CRE) as a reason for more stimulus or bailouts the question should examine why so many CRE locations are defaulting. Can this be a sign that demand for goods, strip malls, condos, and other large projects are simply not in demand from a middle class that is confronting a new austerity? The problems in commercial real estate have the potential of causing the same amount of market volatility as residential loans for a handful of reasons. Unlike residential loans, there is little sympathy for CRE owners. It is expected that those who buy into million and billion dollar projects understand what they are doing (even if this assumption is wrong as we are finding out). So the potential for massive support here is limited from the public but we have seen the U.S. Treasury and Federal Reserve bail out virtually anything with a connection to the banking industry. The CRE market is enormous: [...]"     

New York Fed Probes Wall Street Exposure to BP Say Sources [06/29/10] "The Federal Reserve Bank of New York has been probing major financial firms' exposure to BP Plc to ensure that if the oil giant buckles under the costs of the Gulf oil spill, it won't put Wall Street or the global financial system at risk, according to two sources familiar with the matter. [...]"  

Sen. Scott Brown may scuttle financial reform bill [06/28/10] "The financial reform bill designed to prevent another economic blowout like the one seen in 2008 may die in a Republican filibuster after Sen. Scott Brown (R-MA) announced he has serious reservations about it. Brown is seen as being the necessary 60th vote in the Senate to overcome a filibuster. Though he had voted in favor of the bill in May, Brown now says he can't abide by the recent inclusion of a $19-billion tax on banks in the bill. The new tax is meant to pay for the oversight agencies being created under the financial reform package. "Brown's possible defection from the bill increases the chance of a successful Republican filibuster this time unless Democratic leaders can find another vote," Reuters reported Sunday. "While I'm still reviewing the bill's details, these provisions were not in the Senate version of the bill which I previously supported ... I've said repeatedly that I cannot support any bill that raises tax," Brown said. “While I’m still reviewing the bill’s details, these provisions were not in the Senate version of the bill which I previously supported,” Brown said, as quoted at the Boston Herald. [...]"  

 Commentary: Obama's Treasury Department Rewrote Lincoln Amendment and Trashed It [06/27/10] "After Obama finished with it, Arkansas Senator Blanche Lincoln's Title VII of the so-called Wall Street Reform Act, which originally prohibited banks from dealing in derivatives, prohibited them from dealing in only TEN PERCENT of the derivatives which they now deal in, and which caused the great blowout of 2007-10. That is, what remains of Title VII is a joke, as is the rest of the "Dudd" bill. [...]" 

 Commentary: The G8 "Solution" to the Crisis is the Cause of Economic Collapse  [06/27/10] [3:11]  "The G8 has been accused of failing to honour aid commitments made five years ago at its summit in Scotland. According to the Organisation for Economic Co-operation and Development, donor countries have only reached around 60 percent of their targets. Professor Michel Chossudovsky from the University of Ottawa says even this money fails to help those who need it most." 

Ben Bernanke needs fresh monetary blitz as US recovery falters [06/26/10] "... Key members of the five-man Board are quietly mulling a fresh burst of asset purchases, if necessary by pushing the Fed's balance sheet from $2.4 trillion (£1.6 trillion) to uncharted levels of $5 trillion. But they are certain to face intense scepticism from regional hardliners. The dispute has echoes of the early 1930s  [...]"  Note: "Recovery" means lack of visible signs of collapse, to them. 

Glass-Steagall Gains Steam in Italy, Resolution Presented in Chamber of Deputies [06/25/10] "The Hon. Catia Polidori has presented a resolution calling for a return to Glass-Steagall, that has already been signed by 24 other Parliamentarians in the Italian Chamber of Deputies. Polidori is a member of the majority "Freedom People" (Pdl) party, and a former national chairwoman of the confederation of small enterprises (Confapi). The resolution, which is similar to that presented by Sen. Oskar Peterlini last week, has been picked up by several news agencies, such as AGI and Radiocor; the latter is run by the country's main financial daily, Il Sole 24 Ore. [...]"   

Obama Strategy for G-20 in Ottawa: Push Euro Down, Attack Germany, and Keep Toxic Derivatives in Charge of the World Economy  Webster G. Tarpley [06/25/10] "With Obama’s letter to the G-20 countries released at the end of last week, the US strategy for the upcoming Ottawa summit is clear: Obama will attempt to sabotage the meeting with a two-pronged attack designed to knock China and Germany off balance, and to prevent any urgent measures from being discussed which might roll back the exorbitant proliferation of derivatives, impose a Tobin tax on speculators, or regulate and restrain the hedge fund hyenas whose activities are ravaging the globe. Obama, as usual, operates under a veil of dissembling and deception. His letter talks first of all in edifying terms about the priority which must be given to economic recovery and growth. He says he wants to encourage the growth of internal consumption, especially in countries with large trade surpluses, meaning China and Germany, or possibly Japan. He sheds crocodile tears about the drastic austerity policies of the type being introduced by the Merkel government in Berlin. He tells countries which have built their strategy around exports that it is unwise to rely on exports. Much of this represents an attempt to prevent the Germans from bringing up the issues that are important to them and to the world, such as the need to restrain over-the-counter derivatives, especially the extremely toxic naked credit default swaps which Berlin has now banned in regard to government bonds denominated in euros. Obama does not want to hear about the German government’s plans for a Tobin tax on speculative turnover. He also wants to divert attention away from the European Union efforts to regulate and restrain hedge funds, which have played a prominent role in exacerbating the current world economic depression. [...]"  Related: MSM: Tarpley: 'Obama's plans are hogwash'   [7:21]  "As demonstrators get ready to descend upon the G-20 Summit to protest against the establishment, the heads of state might be getting ready to protest each other. At the forefront of the conference is the United States and China, clashing already over possible money manipulation. Webster Tarpley says that President Obama's administration is sabotaging Blanche Lincoln's bill in congress that bans derivatives [...]"  Toronto gets ‘secret’ arrest powers ahead of G20 protests"A government changes a law to allow police to arrest people without probable cause. It does so without any legislative debate. Then it keeps the change a virtual secret, until someone is arrested under those new powers.  The Soviet Union circa 1950? Nope. Try Canada, June 2010. Civil liberties advocates and political activists are up in arms after it emerged Friday that police in Toronto have been given special powers to arrest anyone near the site of the G20 summit if they fail to identify themselves.  What's more, the government of the province of Ontario, which green-lit the new powers, didn't tell anyone about it until after someone was arrested under the new powers.  Thirty-one-year-old Dave Vasey was arrested near the G20 perimeter security fence in downtown Toronto Thursday afternoon after refusing to identify himself to a police officer. [...]"  

House, Senate lawmakers finalize deal on bank bill [06/25/10] "One year in the making, a sweeping overhaul of Wall Street rules forged in the aftermath of a financial crisis cleared congressional negotiations early Friday and headed to the House and Senate for final votes. Lawmakers hope to have a bill on President Barack Obama's desk by July 4. Success came at 5:39 a.m., hours after Obama administration officials helped broker a deal that cracked the last impediment to the bill — a proposal to force banks to spin off their lucrative derivatives trading business.  The legislation, the most ambitious rewrite of financial regulations since the Great Depression, touches on an exhaustive range of financial transactions, from a debit card swipe at a supermarket to the most complex securities deals cut in downtown Manhattan. Eager to avoid a recurrence of the 2008 financial meltdown, lawmakers set up a warning system for financial risks, created a powerful consumer financial protection bureau to police lending, forced large failing firms to liquidate and set new rules for financial instruments that have been largely unregulated. [...]"  Related: Commentary:  Finally, The Farce That Is Finance Regulation Reform Passes And Wall Street Can Resume Its Rapid March To Financial Armageddon  " ... And, sorry, you can't even vote some of the idiots that passed this garbage out: after all there is a retiring lame duck in charge of it all. We can only hope his annual Wall Street (i.e. taxpayer funded) annuity will satisfy his conscience for destroying any hope America could have of a credible financial system. [...]"  | MSM: Treasury, Dodd Sell Out To Wall Street  "The most crucial element in the re-regulation of Wall Street has been gutted. At least for now, there will be no limits on how much money Wall Street can borrow to do its business. It's an invitation to dare a new meltdown or financial crisis. The big banks' lobbyists have convinced Treasury and Sen. Chris Dodd, D-Conn., chairman of the Senate Banking Committee, not to support Rep Barney Frank's, D-Mass., insistence on limiting the leverage Wall Street can use to trade securities. At the moment, Frank has lost the battle to limit Wall Street to borrowing $15 for every $1 in capital. If there is no limit it means the risk taking that triggered the demise of Lehman and Bear Stearns, the shotgun marriage of Merrill Lynch and the costly bailouts of Citigroup ( C - news - people ), and Bank of America ( BAC - news - people ), and other financial institutions, is again a very real possibility. [...]"  

Analysis: A Bankrupt BP – Worse For The Financial World Than Lehman Brothers? [06/25/10] "The BP crisis in the Gulf of Mexico has rightfully been analysed (mostly) from the ecological perspective. People’s lives and livelihoods are in grave danger. But that focus has equally masked something very serious from a financial perspective, in my opinion, that could lead to an acceleration of the crisis brought about by the Lehman implosion. People are seriously underestimating how much liquidity in the global financial world is dependent on a solvent BP. BP extends credit – through trading and finance. They extend the amounts, quality and duration of credit a bank could only dream of. The Gold community should think about the financial muscle behind a company with 100+ years of proven oil and gas reserves. Think about that in comparison with what a bank, with few tangible assets, (truly, not allegedly) possesses (no wonder they all started trading for a living!). Then think about what happens if BP goes under. This is no bank. With proven reserves and wells in the ground, equity in fields all over the planet, in terms of credit quality and credit provision – nothing can match an oil major. God only knows how many assets around the planet are dependent on credit and finance extended from BP. It is likely to dwarf any banking entity in multiples. And at the heart of it all are those dreadful OTC derivatives again!  [...]"  

Deutsche Bank: U.S. Financial Conditions Just Collapsed Back To Crisis Levels [06/25/10] "... Deutsche believes this is a red flag for the economy, and explains why we should expect ultra-low interest rates from the Federal Reserve to continue for quite some time. The worsening of financial conditions increases negative risks for economic prospects going forward and tends to delay the expected timing of Fed rate hikes. We will consider in more detail next week the implications for economic activity of the recent tightening of financial conditions. Still, DB has a pretty benign U.S. GDP outlook going forward, so it seems they only believe the risk mentioned above is a low-probability event, or perhaps they haven’t downgraded their official expectations yet. [...]"    

Commentary: Central Banking in Crisis: Some Twenty Countries on the Verge of Insolvency [06/25/10] "Presently almost all governments are in trouble. If they haven’t made a dog’s breakfast out of their own economies they have bought bonds from those who have and stand to take stiff losses. Look at the euro zone’s almost $1 trillion bailout of the PIIGS. Do you really think those bonds will ever be paid off – we don’t. It is this concept of interconnectivity that as the players are finding out it is a disaster. How can solvent European countries even contemplate a $2 trillion bailout for nations that really do not care if the debt is ever paid off?  [...]"  

Justices Say Australian Bank Can't Be Sued in U.S. [06/25/10] "Foreign investors can't sue the National Australia Bank in the United States, the Supreme Court ruled Thursday after upholding an appeals court decision to toss three Australian investors' lawsuit because American courts lack jurisdiction. [...]"  

James K Galbraith: Economic Crises Rooted in Fraud [06/24/10] "If fraud or even the perception of fraud comes to dominate the system, then there is no foundation for a market in the securities. They become trash. And more deeply, so do the institutions responsible for creating, rating and selling them. [...]"   

Commentary: The Bank Lobby Gets Desperate on Derivatives [06/24/10] ".... In reality, the U.S. has extremely broad authority to crack down on derivatives activity abroad, we just don’t have a whole lot of good rules on derivatives for regulators to enforce. It’s extremely difficult for financial institutions to simply offshore their risky derivatives business to avoid oversight. Under current law, the Commodity Futures Trading Commission has the authority to regulate any trading done by foreign firms on behalf of U.S. clients, any trading of U.S. assets conducted by foreign institutions and any trading that causes a “substantial disruption” in U.S. markets. Just about anything the CFTC wants to get its hands on, it can, and the current CFTC Chairman, Gary Gensler, is a committed reformer. We just need to write good rules for his agency to enforce. Moreover, finance tricksters will have no incentive to move their destructive derivatives trading abroad, because the rules in other countries are, in fact, much tougher than those the U.S. is currently considering. There are a lot of ways to crack down on Wall Street, but none of them will work without reining in the insane, secretive market for derivatives—speculative instruments that allow financiers to gamble on anything from subprime mortgages to the price of corn. Right now Wall Street is making a big push to roll-out new derivatives on movie box-office receipts, allowing the financial world to place raw bets on how much money a movie is going to make. It sounds crazy and destructive, and it is. [...]"  

World's rich got richer amid recession [06/23/10] "The rich grew richer last year, even as the world endured the worst recession in decades. A stock market rebound helped the world's ranks of millionaires climb 17 percent to 10 million, while their collective wealth surged 19 percent to US$39 trillion, nearly recouping losses from the financial crisis, according to the latest Merrill Lynch-Capgemini world wealth report. [...]"   

Corbett Report:  The Meaning of "Austerity" [06/23/10] [8:00]   

Madoff's Hidden $9 Billion [06/21/10] "Ponzi king Bernard Madoff is telling fellow jailbirds that he secretly funneled $9 billion in swiped funds to three people before he was nabbed, an inmate told The Post.  Madoff says that his partner in crime Frank DiPascali knows who the recipients are -- and that he suspects DiPascali is using that information to cut a better deal with the feds, according to the inmate at the medium-security prison in Butner, NC.  "I think it was personal friends," the inmate said of the recipients of the mega-bucks. DiPascali, 52, pleaded guilty last year to 10 felonies in connection with helping Madoff swindle investors out of more than $60 billion at his Manhattan financial firm. [...]"    

"Crony capitalism reigns US economy" [06/21/10] "A prominent US economic and banking expert has portrayed a grim outlook for the world's most powerful economy, saying the "crony capitalism" runs rampant in the US. [...]"  

Pension Dynamics: Top Illinois public school administrators split nearly $1 billion in pensions [06/21/10] "It’s a huge pile of money when you learn what it’s for: the pensions of just the top 100 public school administrators in Illinois. That’s nearly $1 billion dollars for the pensions of 100 people, or an average yearly pension of $306,181.30 per administrator. That’s nothing to sniff at. The highest pension was valued at over $26 million dollars for a 29 year period. This is more money than most people make in a lifetime – just in pension payments for a public sector employee. [...]"  Related:  In Budget Crisis, States Take Aim at Pension Costs "Many states are acknowledging this year that they have promised pensions they cannot afford and are cutting once-sacrosanct benefits, to appease taxpayers and attack budget deficits.  [...]"  Note:  But not corrupt Illinois ...  Illinois pension fund uses OTC derivatives to recoup returns, jeopardizes pensions

Chossudovsky: US and China Clashing Over Currencies' [06/21/10] [6:57] "Obama is urging China to review its currency policy despite Chinese officials made it clear that they are not going to tolerate any interference from abroad to this issue. Is this going to become a major topic of the G-20 meeting in Canada and what's the mood their on the eve of the summit? Michel Chossudovsky says that the financial crisis is not over as President Barack Obama has hinted at. "  ... Flashback:  " US will start WW3 by attacking Iran"  [02/19/10] [8:41] "Michel Chossudovsky, who's from an independent Canadian policy research group, believes that what Iran says hardly matters, because the U.S. is planning for war..."  

Commentary: "Lure People Into That Calm and Then Just Totally Fuck 'Em": How All of Us Pay for the Derivatives Market [06/21/10] "For the Wall Street reform package currently making its way through Congress to work, it has to accomplish two broad goals: It must take a huge bite out of banking profits and end the too-big-to-fail oligopoly that encourages megabanks to take megarisks and stick taxpayers with the tab. Neither of these goals can be accomplished without taking on derivatives -- the wild, unregulated market that brought down AIG. Right now, the U.S. government pays big banks for operating derivatives casinos. If we're going to clean up the derivatives mess, we have to move taxpayer money out of the market. [...]"   

New overdraft rules could force banks to recoup revenue through other charges [06/21/10] "Bank of America is still suffering the wrath of District resident Philip Becnel. More than a decade ago, when he was a student at George Mason University, Becnel overdrew his Bank of America checking account when he bought a cup of coffee, resulting in a penalty of about $40. Unaware that he was out of money, he kept using his debit card and getting whacked with penalties, racking up hundreds of dollars in overdraft charges. Becnel paid the fines, shut down his account and switched banks. To this day, he refuses to do business with Bank of America, even though his new bank is farther from home. "That was kind of the final straw for me," said Becnel, now a private investigator with the Dinolt Becnel & Wells Investigative Group. "The compounding of fees, it's almost criminal." Banks have long walked a thin line on overdrafts. They are a sore point for many consumers, but the fees generate billions of dollars of revenue each year. Now the Federal Reserve has stepped in to craft new regulations aimed at preventing complaints like Becnel's. Starting July 1, the rules will prohibit banks from automatically charging overdraft fees. Instead, consumers can decide whether they want to use the service or would rather simply have their debit cards declined. In addition, some banks have stopped charging overdraft fees if the account is a few dollars in the hole -- eliminating the infamous $40 cup of coffee -- and are capping the number of charges each day. According to market research firm Mintel, about 25 percent of consumers it surveyed this spring indicated they would enroll in overdraft services. About 15 percent said they did not want to sign up, and the rest were either unsure or were not aware of the changes.  [...]"   

SEC Steps Up Probe of Crisis Deals By Fund [06/20/10] "The Securities and Exchange Commission is stepping up its investigation into the complicated mortgage securities at the heart of the financial crisis, focusing on deals by an Illinois-based hedge fund that made big profits as these securities went sour. [...]"   

China Signals a Gradual Rise in Value of Its Currency [06/20/10] "China announced on Saturday evening that it would allow greater flexibility in the value of its currency, a move that could deflect growing international criticism of its fiscal policies and defuse one of the greatest sources of tension between Beijing and Washington.  [...]"  

Hungary: New government presents radical austerity package [06/20/10] "Only one week after taking office, the new Hungarian government led by Victor Orban has put forward an unprecedented package of austerity measures. [...]"   

French government announces plan for pension cut [06/20/10] "The French government announced a major pension cut on June 16 to balance its budget on the backs of the working class. [...]"  

Wall Street Reform Could Cost Goldman Sachs Billions [06/19/10] (so it won't happen) "The proposed financial reforms pending before Congress could cost Goldman Sachs nearly a quarter of its annual profits, Citigroup analysts estimate in a new report. Goldman, the most profitable securities firm on Wall Street, could lose up to $5.06 in earnings on a per-share basis if Congress passes a bill that forbids banks from trading for their own profit, owning or sponsoring hedge funds and private equity funds, and compelling them to move most of their derivatives dealing into regulated markets, according to the research note. [...]"  

Glass-Steagall Resolution Introduced in the Italian Senate [06/19/10] "Italian Senator Oskar Peterlini introduced a resolution in the Italian Senate on Thursday, calling on the Italian government to adopt a Glass-Steagall type of separation of commercial banking and investment banking, and in particular to work to establish international agreements based on this principle. [...] 

Bernanke Rejects Glass-Steagall, Two Regional Fed Presidents Support It [06/18/10] "While two regional Federal Reserve presidents have now called for the reinstitution of Glass-Steagall, on Wednesday Federal Reserve Chairman Ben Bernanke rejected the reinstatement of Glass-Steagall in response to a question, while speaking at a conference sponsored by the Squam Lake Group of academic economists and former policymakers in New York City. [...]"    

New Lawsuit Against JPMorgan Over Interest Rate Swaps; Cities Toppling from Swindles [06/18/10] "Counties, towns and other government entities—e.g., water, school, and other districts—are now reeling from the economic collapse, and also the effects of all kinds of floating-interest-rate debt, credit default swaps, and other deals foisted on them in recent years by the swarm of brokers and shysters associated with Wall Street and London. Dozens of major cities are bankrupt, though still mostly without official designation, for various legalistic reasons. [...]"   

Exposé: The Israeli Role in the Plundering of Iceland Part I - The Israeli Connection [06/18/10] "The discovery of large amounts of Super-Thermite in the dust of the World Trade Center is solid scientific proof that the government and media version of 9-11 is nothing but a pack of treasonous lies. The evidence indicates that the Twin Towers were exploded using sophisticated nano-composite forms of Thermite and cutter charges. Thanks to the Internet, the truth about 9-11 is out and understood by millions of people across America and around the world. Although it may come as an unpleasant surprise to some, it is a proven fact that the same network of Zionist Jews is behind the false-flag terrorism of 9-11 and the huge financial crimes of the past few years. Maurice "Hank" Greenberg, for example, the disgraced former CEO of the fraudulent A.I.G., is a member of this criminal network. The first airplane flew directly into the secure computer room of Marsh McClennan (MMC), a Greenberg-owned company (headed by his son Jeffrey) on 9-11. Another Greenberg-owned company, Kroll Security, was responsible for security at the World Trade Center. [...] | "The Israeli Role in the Plundering of Iceland Part II -The Hallmarks of an Israeli Operation   "Shortly before the catastrophic collapse of Iceland's three major banks in the fall of 2008, the island nation was ranked as one of the wealthiest and most productive nations in the world. The financial damage caused by the plundering of Iceland's banks is the worst suffered by any country in economic history relative to the size of its economy. Iceland is a volcanic island nation of about 320,000 people. [...] When the privatized banks of Kaupthing, Glitnir, and Landsbanki collapsed in October 2008 they had reportedly amassed debts equivalent to 12 times Iceland's gross domestic product. The looting of the Nordic nation's banks did not happen by accident, but was done through a conspiracy that has the distinct hallmarks of an Israeli intelligence operation. Recognizing these hallmarks is essential to solving the crime and preventing it from occurring to other nations.  When the Icelandic banks were privatized in 2002-2003, through "a series of insider dealings," the stage was set for massive amounts of debt to be "uploaded" to the newly-deregulated banks through the acquisition of foreign companies that were net debtors. When they finally collapsed under a mountain of debt, the three major Icelandic banks reportedly held an estimated foreign debt of nearly $100 billion. For a nation the size of Kentucky, with a population of a small U.S. city (about 320,000 like Aurora, Colorado), the banks' debt translates to more than $200,000 per resident. [...] "  

CNBC Analyst: ‘President Has Created His Own Sense of Legal System’ [06/18/10]   Video clip [1:51]  

Sooner or Later the Deflationary Depression and Purging Will Come [06/18/10] "International Forecaster Bob Chapman has a different view of the near term effects on our economy than what you may have gotten from the hyperinflation forecast by the NIA in their documentary Meltup.  Chapman, who has long suggested that we will eventually end up with hyperinflation akin to Weimar, Zimbabwe or Argentina, and that a total collapse of the system as we know it will occur some time between mid 2011 and 2012, seems to have changed his outlook for the near term.  Chapman, among others like Mike Shedlock and Karl Denninger, suggests that a Deflationary Depression and Purging is Coming.  We believe an inflationary depression began in February of 2009, and little has changed. Since then factory output has increased, as have inventories and other outward signs, such as retail sales. We believe that one-year spurt is ending, unless a new stimulus program is put in place. This past week we saw a $78 billion addition to unemployment benefits and Larry Summers has said they need an additional $200 billion. In order to keep the economy going sideways a total of another $800 billion will be needed. The Fed may have cut back the creation of money and credit to zero, but it is still dishing out trillions to domestic and foreign banks, which can only affect the domestic economy in a residual way. The key is real personal income. Including government programs it has fallen $500 billion over the past 16 months. In addition real unemployment remains at a high of 22-3/8%. That is U-6 less the birth/death ratio. This terrible dilemma is a first and is surprising in as much as government addition to income has gone past 18% for the first time ever. We expect that part of the reason for both situations is the perpetual drag of free trade, globalization, offshoring and outsourcing, which has continued unabated. [...]"   

"Volcker rule" seen freezing M&A by U.S. mega-banks [06/18/10] "he "Volcker rule" provision of Wall Street reform legislation being finalized by Congress would put a lid on domestic mergers and acquisitions by the largest U.S. banks, analysts said on Thursday. Further growth through M&A would be blocked for Bank of America, JPMorgan Chase, Citigroup and Wells Fargo, said Barclays Capital analysts. "A law like this would restrict banks' ability to do M&A," said Blake Howells, director of equity research at Becker Capital Management in Portland, Oregon. [...]"   

Classics: The Case Against the Fed  Murray Rothbard [06/18/10]  PDF file

More Than 90 Banks Miss TARP Payments [06/18/10] "More than 90 U.S. banks and thrifts missed making a May 17 payment to the U.S. government under its main bank bailout program, signaling a rising number of lenders are struggling to meet their obligations.  The SNL Financial statistics show 91 banks missed their dividend payment under the Troubled Asset Relief Program. The statistics, compiled by SNL Financial from U.S. Treasury data, showed 91 banks and thrifts skipped the May dividend payment under the Troubled Asset Relief Program, or TARP. It was the first missed payment for 23 of the banks; for the others, it was at least their second miss. The number of banks missing their TARP payments rose for the third straight quarter. In February, 74 banks deferred their payments; 55 deferred last November. [...]"  

China's US govt debt holdings hit 2010 high: Treasury [06/17/10] "China's holdings of US debt climbed to the highest level this year, the US Treasury said Tuesday even as Beijing stepped up attacks on the United States for its burgeoning debt. The cash-rich Chinese government raised its US Treasury bond holdings to 900.2 billion dollars in April, its highest level since November 2009, while posting the second consecutive monthly rise, according to a report on international capital flows. China, the world's largest holder of foreign-exchange reserves, has been constantly criticizing Washington for its snowballing debt levels, fearing that Beijing's investment in US government bonds could turn sour if a debt crisis overwhelms America. [...]"  

Swiss Legislators Sell Americans Down the River to Bailout Big Bank [06/17/10] "Swiss legislators have destroyed decades of tradition for the benefit of a sloppy Swiss-based big bank. The legislators have approved a law that clears the way for the government to hand over the names of thousands of alleged U.S. tax evaders, dodging the risk that the U.S. would reopen a bruising tax case against Swiss bank UBS AG, according to WSJ. [...]"   

8 House members investigated over fundraisers held near financial reform vote [06/17/10] "The Office of Congressional Ethics is investigating eight lawmakers who held fundraisers within 48 hours of a major House vote on a Wall Street reform bill or received substantial donations from business people with a financial stake in the bill, according to congressional sources and letters. [...]"  

Eurosystem Heading Toward July 1 Liquidity Shock [06/17/10] "The mechanics of the euro system are grinding to a halt. The sovereign debt crisis is pushing liquidity to places considered "safe." Every night, banks of the eurozone deposit ever more funds at the ECB, even though the yield they get is only a miniscule 0.25 percent, because they do not trust the solvency of any of the other private banks enough to lend to them. On Monday morning, 384 billion euros were on deposit at the ECB — an astonishing figure, since this was only a few billion euros per day before the 2008 financial crisis. [...]"    

Bank of America Ordered Traders: No Oil Deals with BP Beyond June 2011 [06/16/10] "Bank of America Merrill Lynch has ordered its traders not to enter into oil trades with BP Plc that extend beyond June 2011, a market source familiar with the directive told Reuters. The order to the bank’s traders came from a high-level executive and was made on Monday, according to a source familiar with it.  [...]"  For this and related stories, see Special Articles panel, "Oil and the Environment".

Soros: European recession next year "almost inevitable" [06/16/10] "Flaws built into the euro from the start had become acute, Soros told a seminar, warning that the euro crisis could have the potential to destroy the 27-nation European Union. The euro's lack of a correction mechanism or of a provision for countries to leave it could be a fatal weakness, he said. [...]"   

Obama Out to Defeat Derivatives Ban; More Fed Officials to Support Sen. Lincoln [06/16/10] "There is growing support—including from additional Federal Reserve officials—for the tough anti-derivatives measure introduced by Sen. Blanche Lincoln (D-Ark.), who defied the White House-George Soros-SEIU forces last week in winning her Arkansas Democratic primary for the Senate nomination on June 8. But Obama, in another service to the Queen and Wall Street, is going all out to stop this measure from passing, according to the Huffington Post, which ran its lead article on June 14 under the title, "Obama's Treasury Dept. [...]"  

SEC’s Senior Senior Staff/Inmates Are Running the Asylum [06/16/10] "Just how egregious are some of the findings made by the Office of the Inspector General? Let’s navigate and review the report from POGO highlighting 18 separate instances in which the OIG recommended disciplinary action and in which ‘no action’ was taken. I found the following six to be the most outrageous. [...]"   

SEC: Government Destroyed Documents Regarding Pre-9/11 Put Options [06/16/10] "On September 19, 2001, CBS reported: Sources tell CBS News that the afternoon before the attack, alarm bells were sounding over unusual trading in the U.S. stock options market. An extraordinary number of trades were betting that American Airlines stock price would fall.  [...]"  

Commentary:  "We Ain’t Seen Nothin’ Yet" [06/16/10] Audio clip  "What does the state-bank-military complex plan next? As the second stage of the financial crisis hits, says Gerald Celente, we can expect them to start another war to divert people’s attention from the wholesale robbery of the productive. He also fears that WWIII will start when Israel or the US attacks Iran. It could go nuclear, or involve biological WMD. But that won’t prevent the default of the UK, Spain, Ireland, and the rest, and the continued rip-off the people by the “Harvard-Princeton-Yale-Bullets-Bombs-Banks” regime. The result, says Gerald, will be worldwide civil unrest. This is, after all, a bunch that can’t stop an oil leak. [...]"   

Obama's Treasury Sides With Wall Street To Fight Derivatives Overhaul [06/15/10] "A Senate proposal to force banks to shed their lucrative yet risk-laden derivatives units -- which is vehemently opposed by Wall Street -- is gaining steam, picking up the support of some regional Federal Reserve chiefs with more on the way. Yet President Barack Obama's Treasury Department, led by Timothy Geithner, continues to oppose the measure, Senate aides say, who add that Treasury is supporting Wall Street over Main Street by opposing the measure considered of "utmost importance" to financial stability. "It shows the access of the major Wall Street banks in the Treasury Department in spades," one Senate aide said on the condition of anonymity. Assistant Treasury Secretary for Financial Institutions Michael S. Barr is said to be leading Treasury's efforts. Senate aides say that more letters of support from other regional Fed presidents are on the way. Treasury is joined in its opposition to the measure by the Federal Reserve's Washington-based Board of Governors and the head of the Federal Deposit Insurance Corporation, Sheila Bair. Meanwhile, supporters include the longest-serving policy maker in the Fed, Federal Reserve Bank of Kansas City President Thomas Hoenig, Federal Reserve Bank of Dallas President Richard Fisher, Nobel Prize-winning economist Joseph Stiglitz and House Speaker Nancy Pelosi. Hoenig and Fisher wrote letters of support last week to Senate Agriculture Committee Chairman Blanche Lincoln, the author of the provision, referring to it as "of utmost importance to our nation's long-term financial and economic stability." [...]"     

Israel’s Leader Capital Markets CEO “Commits Suicide” [06/15/10] "The chief executive of Leader Capital Markets, one of Israel’s top investment banks, has committed suicide, a company spokeswoman said on Sunday. Danny Barak, 48, jumped from his office on the 17th floor of one of Tel Aviv’s most prominent office towers on Friday, the spokeswoman said.  [...]"   

$34 Billion Asset Manager Says Market Prices Are Manipulated [06/15/10] "As part of the SEC’s process to fix the broken market, it is currently soliciting public feedback on a variety of issues. Why it is doing so, we don’t know – after all anything that does not conform to the SEC’s preconception of what the most lucrative market to the SEC’s recent batch of clients (see earlier news about an SEC director going to HFT specialist Getco) is, just ends up in the shredder anyway. At this point to believe that the SEC will do anything remotely in the interest of investors instead of millisecond speculators, is naive beyond compare. Nonetheless, while combing through some of the recent public responses on the topic of market structure, we came across the following presentation by $34 billion Southeastern Asset Management (SAM), titled “Comment & Analysis on Equity Market Structure” which must be brought to the attention of all those who have the temerity to defend HFT as an altruistic source of liquidity provisioning. SAM’s 4 points are simple, and laid out very easily so that even the mildly retarded public, pardon, GETCO servants at the SEC can understand it: “1) The intent of the Securities Exchange Act of 1934 as provided for in its preamble is being twisted and abused for the benefit of gamblers and to the detriment of investors. 2) The markets are not “fair and honest”, 3) Securities prices are presently “susceptible to manipulation and control, and the dissemination of such prices gives rise to excessive speculation, resulting in sudden and unreasonable fluctuations in the prices of securities. 4) The preceding three issues are fixable by the SEC.” Let’s dig in. [...]"   

Concepts and Practices:  Naked CDS Trading Should Be Banned, EU Lawmakers Say in Report [06/14/10] "Naked credit-default swaps trades should be banned, European Parliament lawmakers say in a report that adds to demands by German and French leaders for curbs on products accused of exacerbating the region’s fiscal woes.  “CDS transactions with no underlying credit which are purely speculative transactions involving bets on credit defaults,” should be banned, members of the Economic and Monetary Affairs Committee wrote in the draft report on derivatives scheduled to be voted on by the Parliament in Strasbourg, France, tomorrow.  French President Nicolas Sarkozy and German Chancellor Angela Merkel called on the European Commission last week to speed up curbs on financial speculation, saying some bets against stocks and government bonds should be banned as markets suffer a resurgence of “strong volatility,” in the wake of the Greek debt crisis.  “There are some political groups that want to ban naked sovereign CDS,” said Werner Langen, the sponsor of the report at the EU assembly, whose role is to amend proposed laws drawn up by the commission.  Langen, a German Christian Democrat member of the Parliament, said he personally doesn’t support calls for a ban, inserted by socialist and Green lawmakers on the committee. He said he favors giving “regulatory authorities the possibility to check on a case by case basis.”  The commission, 27-nation EU’s executive body, last week promised to accelerate its plans to regulate credit-default swaps, without saying if it would favor a ban on some transactions. [...]"   

Big Risk: $1.2 Quadrillion Derivatives Market Dwarfs World GDP [06/13/10] "One of the biggest risks to the world's financial health is the $1.2 quadrillion derivatives market. It's complex, it's unregulated, and it ought to be of concern to world leaders that its notional value is 20 times the size of the world economy. But traders rule the roost -- and as much as risk managers and regulators might want to limit that risk, they lack the power or knowledge to do so.  A quadrillion is a big number: 1,000 times a trillion. Yet according to one of the world's leading derivatives experts, Paul Wilmott, who holds a doctorate in applied mathematics from Oxford University (and whose speaking voice sounds eerily like John Lennon's), $1.2 quadrillion is the so-called notional value of the worldwide derivatives market. To put that in perspective, the world's annual gross domestic product is between $50 trillion and $60 trillion.  To understand the concept of "notional value," it's useful to have an example. Let's say you borrow $1 million to buy an apartment and the interest rate on that loan gets reset every six months. Meanwhile, you turn around and rent that apartment out at a monthly fixed rate. If all your expenses including interest are less than the rent, you make money. But if the interest and expenses get bigger than the rent, you lose. [...]" 

Some Insiders Share LaRouche's View: Crash Is Imminent [06/13/10] "It's becoming increasingly clear that a number of finance world insiders are bracing for a near-term disaster of monumental proportions, and are, thus, increasingly moving in the direction of Lyndon LaRouche's forecast of a June-July blowout, unless a Glass-Steagall reorganization of the banks is implemented now. Among the voices for a breakup of the too-big-to-fail financial institutions are at least two regional Federal Reserve Bank presidents, a former International Monetary Fund chief economist, and New York University Stern School of Business Prof. Nuriel Roubini. [...]"  | Bangor Paper Endorses Glass-Steagall  

Pennsylvania City Passes First Glass-Steagall Resolution; Outrage At Wall Street Grows [06/13/10] "At its regular monthly meeting on June 9, the Borough Council of Lansford, Pennsylvania unanimously adopted the LaRouche PAC resolution, "To Save Our Nation, Congress Must Pass Glass-Steagall and Shut Down Derivatives Now!" [...]"  

Congressional Oversight Panel Takes Treasury and Fed to Task Over AIG Bailout [06/11/10] "The Congressional Oversight Panel released a report yesterday which says that the government's actions in rescuing AIG continue to have a "poisonous effect on the marketplace." "The AIG rescue demonstrated that Treasury and the Federal Reserve would commit taxpayers to pay any price and bear any burden to prevent the collapse of America's largest financial institutions and to assure repayment to the creditors doing business with them." The report noted that the government failed to "exhaust all options" before committing taxpayers' funds to AIG. [...]"  

Soros: The collapse of the financial system as we know it is real, and the crisis is far from over [06/11/10] "Billionaire investor George Soros said “we have just entered Act II” of the crisis as Europe’s fiscal woes worsen and governments are pressured to curb budget deficits that may push the global economy back into recession. “The collapse of the financial system as we know it is real, and the crisis is far from over,” Soros said today at a conference in Vienna. “Indeed, we have just entered Act II of the drama.” [...]"   

Japan’s premier warns of impending economic collapse [06/11/10] "apan's new premier has warned of the country's impending economic collapse, urging the government to take measures to avoid a Greek-style debt crisis.  On Friday in his first major speech after taking office, Naoto Kan highlighted that his country's public debt is now nearly double its gross domestic product (GDP,) prompting the government to devise strategies of averting public debt crisis. However he hasn't revealed the financial changes he may implement to revitalize Japan's economy. "Our country's outstanding public debt is huge... our public finances have become the worst of any developed country," the BBC quoted him as saying. Kan, a populist known for standing up to bureaucrats, is popular for his advocacy of increasing Japan's sales tax to fund healthcare and welfare.  [...]"  

SEC Opens Another Probe of Goldman; Goldman Sued by Hedge Fund [06/11/10] "While Goldman Sucks has been trying to make a deal with the SEC in order to sweep their criminality under the rug, the SEC has opened another probe of the firm, and an Australian hedge fund has sued Goldman for false representations. [...]" 

US lawmakers open final Wall Street overhaul drive [06/11/10] "Key US lawmakers crafting the most sweeping finance industry overhaul since the Great Depression of the 1930s vowed Thursday to resist any "last-minute lobbying blitz" to weaken the bill.  Delegates from the Senate and House of Representatives held their first "conference" meeting aimed at melding the two chambers' rival versions of the legislation into a compromise congress could send to President Barack Obama. House Financial Services Committee Chairman Barney Frank and Senate Banking Committee Chairman Chris Dodd, both Democrats, have said they aim to get the president a final bill before lawmakers leave for their July 4 break. As the discussions began, Dodd said he had "a warning to those who still hold out hope we will, at the end of the day, let our bill be weakened by a last minute lobbying blitz" that they would be disappointed. "This bill, made so strong over the course of the last year, will not be weakened in the last throes of the debate," he said. "This is a very strong bill and it is time we get it on the president's desk." [...]"  Note:  So we can see 'what's in it'. 

Chairman of Goldman Sachs International Was - Until Last Year - Also Chairman of BP [06/11/10] "A window into how the power structure of our world really works can probably be found by looking at the biography of Peter Sutherland taken from a new Washington's Blog article: [...]"   

U.S. Firms Hold Most Cash Since 1952 [06/11/10] "U.S. companies are holding more cash in the bank than at any point in the past 58 years, underscoring persistent worries about the sustainability of the economic recovery and the potential for a renewed financial crisis.  The Federal Reserve reported Thursday that non-financial companies had socked away $1.84 trillion in cash and other liquid assets as of the end of March, up 26% from a year earlier and the largest increase on records going back to 1952. Cash made up about 7% of all company assets including factories and financial investments, the highest level since 1963. [...]"   

U.S. asset managers worried Obama could confiscate gold [06/10/10] "Anecdotal evidence suggests some major U.S. asset managers prefer to hold gold outside the U.S. for fear of confiscation in an echo of Roosevelt's 1933 decree. Speaking at the FT Silver conference in London yesterday, lead-off speaker John Levin, HSBC Bank's Managing Director, Global Metals and Trading (HSBC is one of the world's top precious metals traders and its vaults in the U.S. and Europe hold huge holdings of gold and silver bullion) recounted conversations with some of the U.S.'s top asset managers controlling massive amounts of capital asking if HSBC had the capacity in its vaults to store major gold purchases. On being told that the bank's U.S. vaults had sufficient space available he was told that they did not want their gold stored in the U.S.A. but preferably in Europe because they feared that at some stage the U.S. Administration might follow the path set by Franklin D. Roosevelt in 1933 and confiscate all U.S. gold holdings as part of the country's strategy in dealing with the nation's economic problems. While in Mineweb's view such a move is unlikely, one needs to bear in mind that President Obama is a keen follower of Roosevelt's views and policies and that the very fact that some asset managers controlling huge volumes of money feel that such a move is possible is a significant factor - and one that is perhaps heightened by the huge amounts of money flowing into gold at the moment in both ETFs and bullion.  As a reminder to readers - Section 2 of Roosevelt's Act read as follows: [...]"  

Obama orders cuts in federal building costs, could affect thousands of leases [06/10/10] "It soon could be lights out at thousands of government buildings across the country with President Obama scheduled to sign a memo Thursday ordering federal agencies to cut $8 billion worth of building costs by the end of the 2012 fiscal year. The new orders could result in thousands of renegotiated or canceled leases and the divestment of government-owned office towers, courthouses, overseas embassies, storage warehouses and shacks along the Appalachian Trail. The ongoing closures and consolidations tied to the Defense Department's Base Closure and Realignment Commission would account for $5 billion of the savings, while the rest would come primarily from the departments of Energy, Homeland Security and Transportation, officials said. The federal government is the nation's largest landowner, owning about 1.2 million buildings and other structures with a total annual operating and maintenance budget of $19 billion, according to the Office of Management and Budget. But an inventory process started during the George W. Bush administration has identified about 14,000 vacant structures and about 55,000 others that are underused. [...]"  

German chancellor’s austerity measures recall the Weimar Republic [06/10/10] "The €80 billion austerity package announced last weekend by the German government has triggered outrage and shock in wide sections of the population. The €80 billion austerity package announced last weekend by the German government, calling for brutal attacks on the poor, has triggered outrage and shock in wide sections of the population.  Many feel that the cuts targeting the unemployed, the ending of the child allowance for those on welfare, the abolition of the heating subsidy for those on housing benefits, and the cancellation of pension insurance contributions for the long-term unemployed are profoundly antisocial, unjust and cowardly. Meanwhile, the banks, speculators and those responsible for the crisis remain unscathed and dictate the cuts in social spending. The provocative character of the policy is calculated. The attack on the weakest members of society is not just the result of the pathological high-handedness and arrogance of Free Democratic Party (FDP) leader Guido Westerwelle and the efforts of Chancellor Angela Merkel (Christian Democratic Union—CDU) to save her ailing government coalition. The significance of the austerity package is more fundamental and far-reaching than that. It means that the ruling elite have decided to place the entire burden of the financial and economic crisis on the backs of ordinary people. This cannot be done without a major confrontation and is, in the end, incompatible with the maintenance of democratic structures.  These events are reminiscent of the final years of the Weimar Republic. Then, as now, the ruling class exploited the world economic crisis in order to enrich itself beyond measure. And as with Merkel’s austerity measures today, it was claimed that there was no alternative to the emergency decrees of the Brüning government. In the end, popular resistance was suppressed by fascist terror and dictatorship.  The Merkel government is opening up a new stage of class struggle with its cowardly attack on the most vulnerable members of society. The policy of social mediation, which the German bourgeoisie adopted following the tragedy of Weimar and the catastrophic outcome of Nazism, is irrevocably over. The working class cannot avoid a confrontation. It must prepare for great class battles. This makes necessary a relentless and thorough political accounting.[...]"     Related: Obama, Democrats abandon stimulus for austerity  "With long-term unemployment at its highest level since records began in the 1940s, the Obama administration and Democratic congressional leaders are abandoning even the wholly inadequate economic stimulus measures of last year and focusing instead on budget-cutting and austerity. n testimony before the House Budget Committee Wednesday, Federal Reserve Chairman Ben Bernanke reiterated his earlier demands that Congress and the White House formulate a plan to sharply reduce the US deficit, projected to reach $1.6 trillion this year. He told the committee: “Even after economic and financial conditions have returned to normal, however, in the absence of further policy actions, the federal budget appears to be on an unsustainable path.” He went on to focus on health care costs, both for retirees and non-retirees, as a central area where government spending had to be slashed. Even as he was calling for austerity policies in the coming period, he made clear that unemployment would remain extremely high in the US for years to come.  [...]"  Note:  There will be similar plans, and identical social responses, in other countries ... Uranus in Aries will provide the 'tune' .... "to revolt"

Online Retailer Hits PayPal with Class Action [06/10/10] "Online retailers claim in a federal class action that PayPal closed their accounts and held onto their money for 6 months, offering only the vague and unfounded excuse of suspicious account activity. [...]"  Note:  Well, they are shady because they're greedy.

Joint Sarkozy-Merkel Initiative Against CDS Derivatives [06/10/10] "French President Sarkozy and German Chancellor Merkel have sent a joint letter to European Commission President Jose Manuel Barroso, calling for action against CDS derivatives. Although in the EU framework, what is particularly interesting in this initiative is that the French President herewith gives support to the German naked sales ban, which means the German government no longer is isolated among the big European powers, on that issue. [...]" 

Zavtra Publishes Interview with LaRouche: "The Rapacious Paws of the System" [06/10/10] "The prominent Russian weekly Zavtra published an interview with American economist Lyndon LaRouche on Wednesday, who succinctly outlined the utter, systemic bankruptcy of the "British Empire-in-fact," which has dominated the world through the Inter-Alpha Group banks since the final break-up of the Bretton Woods fixed exchange-rate system in 1971. [...]"   

US attacks China currency stance [06/10/10] "Global economic reforms are being impeded by China's refusal to revalue its currency, the US Treasury Secretary says. [...]"   

 

Fla. 'Mini-Madoff' Gets 50 Years for $1.2B Scam [06/10/10] "Former lawyer Scott Rothstein was sentenced to 50 years in federal prison Wednesday for using his Fort Lauderdale law firm to run a $1.2 billion Bernie Madoff-style Ponzi scheme that brought him yachts and sports cars and allowed him to make sizable contributions to Florida politicians. [...]"  

LaRouche: Only Solution to the Crisis, For Europe and the World, Begins With U.S. Restoration of Glass-Steagall [06/09/10] "German Chancellor Angela Merkel believes that austerity measures are necessary at this juncture. If so, that is an understandable mistake by her. This suggests that the root of her mistaken policy would be her intention to 'work within the existing system,' without considering those reforms in the system without which the already approaching early doom of Europe under the existing system were virtually inevitable. [...]"   

Goldman Sachs subpoenaed for failing to cooperate with finance probe [06/08/10] "A high profile panel investigating the causes of the financial crisis announced Monday it had subpoenaed Goldman Sachs for failing to cooperate with the probe. "The Financial Crisis Inquiry Commission has issued a subpoena to Goldman Sachs & Co. for failing to comply with a request for documents and interviews in a timely manner," the body said in a statement. It is the latest controversy for the New York-based bank, which is facing civil and potentially criminal charges for misleading investors. "The Commission has made it clear that it is committed to using its subpoena power if there is a lack of, or delay in, compliance," the commission's chair Phil Angelides said in statement. "Failure to comply with a Commission request is viewed with the utmost seriousness, as the Commission will not be deterred from getting desired information." [...]"  

 Trends: Local banks push back against feds' controversial industry overhaul provision [06/08/10] Video clip [4:19]  "Local bankers who thought they'd survived the worst of the meltdown are now fighting a provision in the pending federal financial reform bill that would force them to go out and raise more capital. If the language in the Senate's version of the financial services industry overhaul survives in the final bill, banks such as Wintrust Financial Corp. that thought their capital was more than sufficient will have to tap investors for hundreds of millions of dollars — or reduce their lending. [...]"   

Commentary: Congressional Record: JP Morgan & Co purchased all major media for propaganda: 1917. And now…? [06/06/10] "Congressman Oscar Callaway lost his Congressional election for opposing US entry into WW 1. Before he left office, he demanded investigation into JP Morgan & Co for purchasing control over America’s leading 25 newspapers in order to propagandize US public opinion in favor of his corporate and banking interests, including profits from US participation in the war. Mr. Callaway alleged he had the evidence to prove Morgan associates were working as editors to select and edit articles, with the press receiving monthly payments for their allegiance to Morgan. [...]"   

Madoff: "Fuck my victims. I carried them for 20 years, and now I'm doing 150." [06/06/10] "Prisoners had assiduously followed his criminal career on the prison TVs. “Hey, Bernie,” an inmate would yell to him admiringly while he was at his job sweeping up the cafeteria, “I seen you on TV.” In return, Madoff nodded and waved, smiling that sphinxlike half-smile. “What did he say?” Madoff sometimes asked. But that evening an inmate badgered Madoff about the victims of his $65 billion scheme, and kept at it. According to K. C. White, a bank robber and prison artist who escorted a sick friend that evening, Madoff stopped smiling and got angry. “Fuck my victims,” he said, loud enough for other inmates to hear. “I carried them for twenty years, and now I’m doing 150 years.” [...]"  Note: Long New York Magazine article on Bernie Madoff

LPAC Nails Rep. McDermott on Glass-Steagall At Townhall Meeting [06/06/10] "At the third Congressional town hall meeting intervention in two days in Seattle, four organizers met a good response from a typically unfriendly crowd associated with Congressman Jim McDermott. The Congressman was confronted with questions regarding Glass-Steagall, the mass strike and impeachment from organizers, but not before a member of audience asked when was Congress going to put some heat on the White House for not bringing much change about since the last administration. [...]"    

BP Chief Tony Hayward Sold Shares Weeks Before Oil Spill [06/06/10] "The chief executive of BP sold £1.4 million of his shares in the fuel giant weeks before the Gulf of Mexico oil spill caused its value to collapse. Tony Hayward cashed in about a third of his holding in the company one month before a well on the Deepwater Horizon rig burst [...]"  Note: Why, so did Lloyd Blankfein of Goldman Sachs .... Hmmm.  Related: Goldman Sachs sold $250 million of BP stock before spill

Financial industry hired 1,400 former government staffers as lobbyists in 2009 [06/05/10] "This small army of registered financial services sector lobbyists includes at least 73 former members of Congress, of whom 17 served on the banking committees of either the U.S. House of Representatives or the Senate," Public Citizen said in their release. "At least 66 industry lobbyists worked for these committees as staffers, while 82 additional lobbyists once worked for congressional members who currently serve on these key committees." "Further, at least 42 financial services lobbyists formerly served in some capacity in the U.S. Treasury Department," the group added. "At least seven served in the Office of the Comptroller of the Currency, including two former comptrollers."  “Companies pay a premium for lobbyists who’ve spun through the revolving door because it can be a small price to pay relative to the huge payoff if they can shape legislation," Sheila Krumholz, executive director of the Center for Responsive Politics, said in a statement. "These lobbyists tap insider knowledge and personal relationships, knowing that their old friends and former co-workers won’t want to let them down.”  In May, the Associated Press also noted that the financial services industry has outdone every other industry in donations to political campaigns. [...]"  Note: All of this should have been prohibited activity. Look what it has resulted in. 

Peter Schiff Accuses Goldline of Overcharging for Gold By 67% [06/05/10] [9:56]  "... Peter Schiff, founder of Euro Pacific Capital and soon to be gold dealer Euro Pacific Precious Metals, did his own research, and determined that Goldline was charging at least 67% “commission” while his company charges just 2% - 3% above the spot price. In his June 1, 2010 Schiff Report video blog, Schiff says it’s not illegal for Goldline to up-charge prices, but there may be some concern as to whether or not fraud has been committed [...]"   

Exposé:  The Madoff Circle: Who Knew What? [06/05/10] "When Bernard Madoff pleaded guilty to running the biggest Ponzi scheme in history, he insisted he was the lone perpetrator, asserting that no one – not his family, not his colleagues, not his friends – knew of the fraud. But an alternate narrative is emerging from the pile of Madoff-related civil suits and court motions that have been filed in the last two years – one in which a small circle of men played knowing, integral roles in the scheme, in some cases benefiting more from it than even Madoff himself. [...]"   

Desperate Financial Situation, Biggest Debt Bubble in World History: Fifty Statistics About The U.S. Economy [06/05/10] "The truth is that what we are experiencing is not simply a "downturn" or a "recession". What we are witnessing is the beginning of the end for the greatest economic machine that the world has ever seen. Our greed and our debt are literally eating our economy alive. Total government, corporate and personal debt has now reached 360 percent of GDP, which is far higher than it ever reached during the Great Depression era. We have nearly totally dismantled our once colossal manufacturing base, we have shipped millions upon millions of middle class jobs overseas, we have lived far beyond our means for decades and we have created the biggest debt bubble in the history of the world. [...]" 

Debt fears hit Hungary's currency [06/05/10] "The value of Hungary's currency falls sharply against the euro on fears the country could be facing a Greek-style debt crisis. [...]"  Related:  Hungary Close to Default "Euro wreck continues, now trading below $1.20. Via: Bloomberg: Credit-default swaps on sovereign bonds surged to a record on speculation Europe’s debt crisis is worsening after Hungary said it’s in a “very grave situation” because a previous government lied about the economy. The cost of insuring against losses on Hungarian sovereign debt rose 63 basis points to 371 [...]"  

Investment Firms Grab Stock Data First, and Use It Seconds Before Others [06/05/10] "This is an easy to understand piece about high frequency trading.   Some fast-moving computer-driven investment firms are getting an edge by trading on market data before it gets to other investors, according to market players and researchers who have studied the trading.  [...]"   

The Looting of Greece begins [06/04/10] "Now that the Greek debt crisis has been solved with even more debt--the bankers are now moving in for the kill--the final takedown of infrastructure, public utilities and natural resources. Greece begins to sell off the National Post Office, Utilities, Casinos, Natural Gas Pipelines, Ports, Water Works, Airports, and Railroads...  [...]" 

Diebold Settles with SEC for $25 Million [06/04/10] "Diebold will pay $25 million to settle allegations that it committed accounting fraud to inflate the company's reported earnings, the SEC said Wednesday. The SEC said it also is pursuing charges against three former Diebold executives in a separate, related complaint in Cleveland. The lawsuits are sure to ring alarm bells among critics who fear that electronic voting systems, such as Diebold's, could open a Pandora's box of electoral fraud. [...]"   

JP Morgan gets record £33m fine [06/04/10] "City regulator fines JP Morgan a record £33m for putting its clients' money at risk by failing to keep it separate from its own. [...]"  

Glass-Steagall Mobilization Taken Up In City Councils [06/04/10] "The LaRouche Political Action Committee hit city meetings in Massachusetts on June 1, and similar testimony was set up in town meetings across Pennsylvania for the next two weeks, as LPAC's Glass-Steagall mobilization keeps tapping the 75%-plus support for FDR's famous Wall Street crackdown. Without the Glass-Steagall principle applied internationally, Lyndon LaRouche insists, the world stays in history's worst economic collapse. [...]"   

House Passed Bill Which Closes the “Offshore Outsourcing” International Corporate Tax Scheme [06/03/10] "In the American Workers, State, and Business Relief Act of 2010, passed by the House last Friday, there are little observed provisions to remove tax incentives to offshore outsource your job.  The bill ties income to the foreign tax credit, so no longer can a corporation claim the tax credits yet park the actual profits money offshore in a low tax country. As one can see if one gets credits yet doesn’t have to actually pay tax on profits accrued when offshore, this encourages the movement of assets, production overseas, including jobs. [...]"  

Foreign Banks Find Fortune in Crisis [06/03/10] "Foreign banks are flexing newfound muscle in Washington, spreading their money and influence while winning government business that’s off-limits to their politically toxic American cousins. While Congress and President Barack Obama have been bashing big American banks as the cause of the nation’s economic troubles, foreign banks have been quietly increasing their presence in Washington with unprecedented lobbying and campaign spending. The foreign companies have found a lucrative niche, essentially acting as brokers for the federal government’s bailout money. Domestic banks with the size and expertise for that role are largely banned from competing for the contracts because they have been recipients of the emergency funds.  [...]"   

Exposé:  Curious Trading by Federal Reserve Advisor May Result in JPMorgan Chase $1.264 Billion Windfall [06/03/10] "There is some mighty curious trading going on in Maiden Lane LLC, the entity set up by the Federal Reserve to buy some of Bear Stearns' assets. [...]"   

Credit Union Demands $42 Million, Claims Fannie Mae Bought 'Stolen' Mortgages [06/03/10] "Fannie Mae refuses to return $42 million worth of "stolen" mortgages to Suffolk Federal Credit Union, the credit union claims in Federal Court. The credit union, which says its members are "predominantly blue collar workers from Suffolk County, New York ... including firefighters, police officers, emergency medical technicians, social services workers, and other low to middle income employees," claims Fannie Mae had its head in the sand when it bought the stolen mortgages, and now refuses to return them. [...]"   

Goldman Sachs sold $250 million of BP stock before spill [06/02/10] "Firm's stock sale nearly twice as large as any other institution; Represented 44 percent of total BP investment The brokerage firm that's faced the most scrutiny from regulators in the past year over the shorting of mortgage related securities seems to have had good timing when it came to something else: the stock of British oil giant BP. [...]"    

Vatican bank under scrutiny [06/02/10] "Italian prosecutors are investigating the Vatican bank on suspicion of involvement in money laundering, La Repubblica daily reported on Tuesday. [...]"   

Commentary: Fannie, Freddie still pose threat to U.S. finances [06/02/10] "... Fannie and Freddie are the two "government-sponsored enterprises," or GSEs, whose accumulation of subprime mortgages has required (and is requiring) the infusion of tens of billions of taxpayer dollars to keep the organizations solvent. Thanks to the federal government's implied assurance that Fannie and Freddie were too big and important to fail, they ended up among the biggest beneficiaries of the Bailout Era. Amazingly, reform still hasn't touched them. They remain GSEs. They remain the primary repository for subprime mortgages, which themselves seem to have escaped reform. And they remain threats to the stability of the country's financial future. [...]"   

 Commentary: Treasonous Banking Cartel Ordered Glass-Steagall Repeal in 1999 by John Hoefle [06/01/10] "The death of the Glass-Steagall regulatory safeguard in 1999 was a disaster, not only for the United States, but also for the rest of the world. This vital restriction on speculative activities, put through in 1933, though weakened significantly over the years by deregulation zealots, remained a major legal impediment, until its final demise at the hands of the ill-conceived and corrupt Gramm-Leach-Bliley Act of 1999.  Freed from the prohibition against mixing commercial banking and investment banking, the largest U.S. banks turned more and more to Wall Street speculation. To "make money" the fastest and the mostest, they abandoned investment in the physical economy, especially those substantial projects which require decades to "pay off," not only for them, but for the population as a whole. They turned increasingly toward using their depositors' money to fund gambling sprees in the global casino, using their growing power to manipulate markets, looting both their own customers, and the rest of society. They became the personification of greed; and that greed, unchecked by regulatory safeguards, destroyed our economy. [...]"   

LaRouche:  What Your Accountant Never Understood: The Secret Economy  [06/01/10] "Fortunately, at least a relatively few leading talents among U.S. economists have understood certain essentials of "the how and why" of my uniquely successful record in economic forecasting, that since 1956-57, to the present date. Unfortunately, many other economists have not yet understood this. The root of the failures by the relatively larger number of economists, as shown by virtually all accountants, and all but a few leading economists, is that they are, essentially, worshipful victims of a widely taught delusion, known as monetarism: the worship of an imagined monetary "magic of the marketplace," their foolish belief in money as such. [...]"   

Wall Street Operative Geithner Rebuffed in Berlin on Mission to Make World Safe for Derivatives [05/31/10] "On the most important stop of last week’s desperate mission to make the world safe for derivatives, US Treasury Secretary Geithner has been dealt a decisive rebuff. Geithner’s obvious attempt to sabotage the recent prohibition enacted by the German government against naked credit default swaps (among the most toxic of derivatives) was rejected in Berlin on Thursday by German Finance Minister Wolfgang Schäuble.  At their joint press conference, Geithner and Schäuble could hardly hide the atmosphere of tension and hostility, even though both were determined to mask the clash for domestic political reasons. A Handelsblatt blog pointed to the language of mutual dislike, and this newspaper headlined that the transatlantic conflict was escalating. The Washington Post published a photograph on Friday, May 28, 2010 showing the German minister scowling at the feckless featherweight Geithner. Geithner assured the journalists that there was a “broad agreement on regulatory reform,” but in reality there was no such common ground.  Schäuble has now emerged as the strongman in the German cabinet, due precisely to his willingness to take the point in the fight against derivatives. “Ban Bolsters Schäuble’s Sway,” headlined the Wall Street Journal. German officials are reported to be increasingly dismissive of the carping criticism coming from other countries which have failed to act against the world derivatives plague. The Germans know exactly what they are doing, Schäuble stressed: “We have done our national homework,” he added. It is abundantly clear that Germany is determined to act unilaterally against speculation, especially in the form of derivatives. This means maintaining the current ban on naked credit default swaps, and supplementing this with a ban on naked short sales of German stocks, euro-denominated government bonds, and of the euro itself.  [...]"  Related: Geithner Rushes to Sabotage German Derivatives Ban; Schäuble Prepares New Moves Against Speculators "The German government is now fully committed to escalating its ongoing counterattack against international financial speculation. These moves represent an historical watershed as Germany becomes the first major economic power to roll back the tide of financial globalization, under which crackdowns on hedge funds, derivatives, and the world gambling casino were branded as taboo for national governments.  [...]"  

Greece urged to give up euro [05/31/10] "THE Greek government has been advised by British economists to leave the euro and default on its €300 billion (£255 billion) debt to save its economy. The Centre for Economics and Business Research (CEBR), a London-based consultancy, has warned Greek ministers they will be unable to escape their debt trap without devaluing their own currency to boost exports. The only way this can happen is if Greece returns to its own currency. [...]"  

 LaRouche:  The Spanish Banking System Is a Goner; London Is Next [05/31/10] "If you value your life, don't get caught standing next to a Spanish bank in the early part of next week. London-based Fitch Ratings downgraded Spain's sovereign debt on Friday May 28, after markets had already closed; but they were simply taking note of a fact which Lyndon LaRouche has been warning about for months: That the entire Spanish banking system is a goner, and as it implodes, it will bring down the entire British banking system with it. [...]"   

French Minister: EU Bailout Violates No-Bailout Clause [05/30/10] "None other than a top government official of France has announced that the Eur 440 billion European Union bailout is a violation of the Lisbon Treaty. Pierre Lellouche, the French government's State Secretary for Europe, said that the eurozone's Eur 440 billion debt guarantee scheme is a clear violation of the no-bailout clause of the Lisbon Treaty, and he compares it to a NATO-style mutual defense clause. [...]"  

Spanish Debt Crisis Has Now Erupted [05/30/10] "The financial and economic situation in Spain can implode at any moment. The Bank of Spain has issued new rules to banks where they have to set aside reserves of up to 30% on property holdings, according to City of London mouthpiece Ambrose Evans-Pritchard. Writing in today's Daily Telegraph Evans-Pritchard said the new rules hit particularly the cajas, Spain's savings banks, which hold much of the Eur 445 billion of property debt. This follows the failure of Cajas Sur which forced the government to take it over last week after it lost Eur 596 last year. [...]"    

Austerity measures throughout Europe [05/30/10] "In the two weeks since European heads of state and the IMF reached agreement on a €750 billion rescue package for the euro, not a day has gone by without the announcement of a new round of draconian measures ... [...]"    

China’s Currency Manipulation: About to Cause a Global Explosion? [05/30/10] "China’s currency continues to be a subject the U.S. is willing to tap dance around diplomatically. Because when the gloves eventually do come off, U.S./China relations could rapidly collapse. [...]"  

Berkshire confirms Buffett subpoenaed to testify [05/30/10] "Berkshire Hathaway Inc. confirmed on Friday that Warren Buffett will testify under subpoena before a U.S. panel examining the causes of the 2008 financial crisis. [...]"   

Ron Paul: Inside Sources Told Me Fed Is Panicking At Mass Awakening [05/28/10] 2 Video clips [22:00] "Appearing on The Alex Jones Show yesterday, Congressman Ron Paul revealed that through his inside sources he had learned that the people who control the Federal Reserve are panicking about the fact that Americans are waking up to the fact that the U.S. is controlled by the central bank. “I had some information passed on to me, sort of inside information, somebody who knew somebody who was well tuned to the people at the Federal Reserve – and they said they are really really concerned about our movement to expose the Fed for what they’re doing,” said Paul, adding, “What they’re upset or worried about is the fact that more and more people are aware of the Federal Reserve now like never before,” explaining that exposure will lead to change and a reform of the Federal Reserve. [...]"   

BankWatch: TARP Investments Lead to Huge Losses for U.S. Treasury [05/28/10] " As struggling banks get acquired or fail, the U.S. Treasury is shouldering a growing burden: Its investments in TARP are turning out to be a bust, leading to huge losses. And there are signs of more trouble ahead. You'll want to read the whole article. Where would TARP have been without Senate Obama voting for it? The government as an investor is a grand failure. [...]"     

MSM: US money supply plunges at 1930s pace as Obama eyes fresh stimulus "The M3 money supply in the United States is contracting at an accelerating rate that now matches the average decline seen from 1929 to 1933, despite near zero interest rates and the biggest fiscal blitz in history.  [...]"  

Lehman remnant sues JP Morgan [05/27/10] "Lehman Brothers Holdings is suing JP Morgan Chase in an effort to recover tens of billions of dollars in "lost value". [...]" 

Markets Down On Korean War, Debt Fears  [05/26/10] "Shares around the world tumbled today as a new chill swept through world markets, sending the FTSE 100 index to its lowest level since last September. Investors were rattled by fears of war between North and South Korea, compounded by fresh worries about Europe's debt problems and the shaky euro. On Wall Street, the Dow Jones dropped more than 250 points in early trading, falling to 9816, a drop of 2.5%. [...] The slump in banking stocks follows fears that Spain will become the next victim of the European financial crisis. Last night the International Monetary Fund urged the Spanish government to reform its banking sector and its "dysfunctional" labour market. [...] " 

Germany 'to extend trading ban' [05/26/10] "Germany is considering widening a ban on "naked" short-selling to cover all shares, proposals in a draft bill have shown. [...]"  

"The Triffin Dilemma" [05/25/10] "There is a fundamental incompatibility between the attainment of global economic stability and having a single national currency perform the role of the world's reserve currency. This is hardly a new revelation. But events of the past few months have brought this topic back into the spotlight.  Belgian born American economist Robert Triffin first highlighted this incompatibility in the 1960s. He observed that having the US dollar perform the role of the world's reserve currency created fundamental conflicts of interest between domestic and international economic objectives. On the one hand, the international economy needed dollars for liquidity purposes and to satisfy demand for reserve assets. But this forced, or at least made it easy, for the US to run consistently large current account deficits. Triffin argued that such persistent deficits would eventually put pressure on the US dollar and lead to the demise of the Bretton Woods system of international exchange. The Triffin Dilemma, therefore, argued that the demands on an international currency meant that excess supply would undermine its value.  [...]  After WWII the Bretton Woods international monetary system came into being. This was a fixed rate currency regime with the US dollar as the global reserve currency. But to ensure stability and financial discipline, the major currencies were fixed to the US dollar and the US dollar was fixed to gold at the rate of US$35 an ounce. This is where the Triffin Dilemma kicked in.  [...]" 

The Next Bailout: $165B for Unions [05/25/10] "A Democratic senator is introducing legislation for a bailout of troubled union pension funds. If passed, the bill could put another $165 billion in liabilities on the shoulders of American taxpayers.  The bill, which would put the Pension Benefit Guarantee Corporation behind struggling pensions for union workers, is being introduced by Senator Bob Casey, (D-Pa.), who says it will save jobs and help people. As FOX Business Network’s Gerri Willis reported Monday, these pensions are in bad shape; as of 2006, well before the market dropped and recession began, only 6% of these funds were doing well.  Although right now taxpayers could possibly be on the hook for $165 billion, the liability could essentially be unlimited because these pensions have to be paid out until the workers die. [...]"  Note: It will never actually happen. The pension money was diverted and stolen over the years, or promised and never saved for ... con artists now want to tap the public.

UK: Markets stabilise but “smell of fear” is in the air [05/24/10] "Global markets stabilised at the end of last week but there are deepening concerns that the turmoil resulting from the eurozone financial crisis is only just beginning.  The Financial Times cited one market analyst who wrote to his clients that “the smell of fear is in the air”. He had not felt this way since the collapse of the US investment bank Lehman Brothers in September 2008. [...]"   

Hedge Fund Manager Gets 2 Years [05/24/10] "The former manager of a Bear Stearns hedge fund was sentenced to 27 months in federal prison for his role in the largest hedge fund insider trading case in history. Mark Kurland pleaded guilty in January to insider trading and securities fraud. [...]"   

CEO Gets 8 Years for Stock Manipulation [05/24/10] "The CEO of Smart Online was sentenced to 8 years in federal prison for manipulating the company's share price, and his brother was sentenced to 18 months. A jury convicted CEO Dennis Michael Nouri and his brother, Reza Eric Nouri, of conspiracy, fraud and bribery [...]"   

Commentary: The Future of Money By Mary Mellor. [05/24/10] "The recent global economic crisis has revealed the contradictions of privatised finance. If taxpayers have to prop up the system when it fails, why should they not also have control over the supply and allocation of money in the first place? [...]"  Note: An interesting rant, however, it's pretty much moot in the end. Another failure for the Orion mindset ... they cannot overcome their own nature. 

AP: "New financial rules may not prevent next crisis" [05/24/10]   Note: Financial sector propaganda bulletin which attempts to narrowly define a set of problems and propose a narrow set of solutions with obvious flaws ... in other words, nothing of any value.

  Obama Hand Seen in Justice Department Ending Criminal Probe of AIG Executives [05/24/10] "Responding to news that the Justice Department has dropped its criminal probe of two AIG executives, Lyndon LaRouche commented yesterday that extraordinary pressure must have been exerted on the Attorney General for him to have taken such a step, and that it was undoubtedly Obama himself, along with sidekick Timothy Geithner, who put the screws on the DOJ. After all, when Obama held his press conference to crow about the passage of the cloture motion on the "finance reform" May 20, he led off by saying, "Our goal is not to punish the banks...." [...]"   

More Blowback Against Senate Vote on Financial Reform Bill [05/23/10] "Evidence continues to pile on that the so-called leadership of the U.S. Senate won't get away with their effort, last week, to bury Glass-Steagall. The Huffington Post, yesterday, published a chart from Google Finance showing that big bank stocks, including Goldman Sachs, JPMorgan Chase, Bank of America, and Citigroup, rose almost 5% in the first couple of hours of trading on the New York Stock Exchange on Friday morning, May 21, following the Senate vote, Thursday night. [...]"  

Senate Bill Lets Gov't Collect Financial Records of Customers [05/23/10] "Senate Democrats united to pass a financial regulatory bill that allows the government to collect data on any person operating in financial markets at any level, including the collection of personal transaction records from local banks, including customers’ addresses and ATM receipts. The Senate voted 59-39 on Thursday to pass the bill – the chief aim of which is to more-heavily regulate the financial industry – sending it to a conference committee in the House of Representatives, where differences between the House and Senate versions will be ironed out.  The bill, if it becomes law, will create the Bureau of Consumer Financial Protection and empower it to “gather information and activities of persons operating in consumer financial markets,” including the names and addresses of account holders, ATM and other transaction records, and the amount of money kept in each customer’s account.  The new bureaucracy is then allowed to “use the data on branches and [individual and personal] deposit accounts … for any purpose” and may keep all records on file for at least three years and these can be made publicly available upon request.  Senator Richard Shelby (R-Ala.) said that Democrats who claim this new bureaucracy will protect consumers are misleading the public.  “[T]he American people are being misled,” Shelby said on the Senate floor on Thursday night. “The authors of this bill are telling them that this legislation has been drafted to address the recent financial crisis and that it will ‘tame’ Wall Street. I am afraid that they are going to be disappointed.”  Shelby slammed the new consumer bureaucracy, saying that it was meant not to protect consumers but to “manage” them by monitoring their behavior.  “Mr. President, make no mistake, behind the veil of anti-Wall Street rhetoric is an unrelenting desire to manage every facet of commerce under the guise of consumer protection.  “They may be interested in protecting consumers, but they are more interested in managing them,” Shelby said.  Shelby also criticized the idea that Americans need government to watch over their every financial move, saying that it was better to allow people the freedom to make their own choices and fail than to never allow them the freedom to choose at all. [...]"  

Austria and Belgium May Follow Germany Soon, in Banning Short Sales [05/23/10] "The spreading European policy chaos was evidenced once again by the stonewalling which Germany's Finance Minister Wolfgang Schaeuble ran up against in Brussels, when presenting his nine-point financial reform plan, which apparently was rejected mainly because it was a proposal coming from a country that has unilaterally decreed a ban on short sales. But that will backfire, because it will enrage the Germans even more, so that more of such unilateral decisions are possible and likely. [...]"    Related:  Germany moves against short sellers [05/20/10] "German authorities on Tuesday night cracked down on what Berlin views as destablising speculation. [...]" | Euro Momentarily Stabilized — German Ban on Naked Credit Default Swaps Is Working  "Tuesday’s German ban on naked credit default swaps – a measure repeatedly demanded by this web site over recent months — has been in effect now for about three days, and it is working. The panic slide of the euro has been stopped for now, [...]" 

Germany's Parliament Votes To Give 66% Of Country's Annual Income Tax Revenue To Banks [05/23/10] "The Merkel government has just announced a raft of deep cuts and tax hikes, which will increase the proportion of the country’s income flowing to the banks and accelerate an economic collapse that could be much more severe than the Great Depression of the 1930s.  The transfer of almost the country’s entire tax revenues to the banks shows that the politicians in Germany are working hand in glove with banks to loot the people on an unprecedented scale under the smokescreen created by the mainstream media. Though sold by the controlled media as “aid for Greece”, none of the money will go to the people of Greece. [...]"    

‘Nervous’ Wall Street Waits for Congress to Kill Swaps Limit [05/23/10] "The Senate bill demands that companies like Bank of America Corp., JPMorgan Chase & Co., and Goldman Sachs Group Inc. conduct derivatives trading outside of their commercial banking units that benefit from federal support. U.S. commercial banks held derivatives with a notional value of $212.8 trillion in the fourth quarter, according to the Office of the Comptroller of the Currency. The five banks with the biggest holdings of derivatives -- JPMorgan, Goldman Sachs, Bank of America, Citigroup Inc., and Wells Fargo & Co. -- hold $206.2 trillion, or 97 percent, of that total, the OCC said. [...]"  

Bloomberg Article Open About Blatant Collusion Of Congress And Wall Street [05/22/10] "Yes, we all know power corrupts and the U.S. Congress is owned by Wall Street and that Obama would never say such a thing because he prefers to talk some baloney about "this great country" and all that jive.  In any case, reading this article in Bloomberg, it is at least remarkable how open the writers are about the apparent collusion of Wall Street and the Congress to eliminate any provisions in legislation which Wall Street might not like. They are like team members who are both under stress from their attackers, "the public", who must now be conned into thinking something is being done, when in reality nothing is being done. It's the same old story, but it is one that seems to be becoming very relevant under the Obama "Change" administration. Faking an anti-establishment change, when in reality if anything a consolidation of power by the establishment is underway.  See in the following passages how the only reason lawmakers seem to have for getting tough with Wall Street in any way is to appease "voter sentiment."  I guess if they had things THEIR way, Wall Street would BE the government. In other words, exactly what we have now just without the phony pandering to pretend they are doing what we want them to.  Lawmakers have been telling Wall Street the Senate provision would fail, “but it passed, so people are nervous,” said Paul Miller, analyst at FBR Capital Markets in Arlington, Virginia. “The problem is that everybody in Congress wants it out, but nobody wants the responsibility of taking it out.”....(or on the issue of Blanche Lincoln) “The conventional wisdom has been that if she gets the nomination, she has the political room to drop the provision, but as long as she’s running for re-election she’s going to want to continue to take a tough-on-banks stance... It's all just a show... [...]"  Related: The Unbelievably Rampant Corruption On Wall Street  "For decades, the American people did have faith in Wall Street. But now that faith is being shattered by a string of recent revelations. It seems as though the rampant corruption on Wall Street is seeping up almost everywhere now. In fact, some of the things that have come out recently have been absolutely jaw-dropping. The truth is that the corruption on Wall Street is much deeper and much more systemic than most of us ever dared to imagine. As the general public digests these recent scandals, it is going to result in a tremendous loss of faith in the U.S. financial system. Once faith in a financial system is lost, it can take years or even decades to get back. So how is the U.S. financial system supposed to work properly when large numbers of people simply do not believe in it anymore?  Just consider some of the recent revelations of Wall Street corruption that have come out recently….  [...]" 

The Senate Swapped Protecting the People for Protecting Derivatives Traders [05/22/10] "Sen. Maria Cantwell, the sponsor, with Sen. John McCain, of the amendment to restore the 1933 Glass-Steagall Act, was organizing Republican Sen. Richard Shelby and Saxby Chambliss to support the bill yesterday, and specifically, to add language making swaps dealers legally liable if they didn’t “clear” trades on a legally recognized clearinghouse, when a messenger from “Old Hob” intervened.  The International Swaps Dealer Association protested that such language would open the floodgates to litigation. With this pronouncement from the deep, the language was dropped, a source close to Cantwell told Newsweek.  As the Financial Reform bill currently stands, nothing states that a swap which does not comply with the statute is illegal; and in fact, the bill actually says the swap cannot be voided. There is no legal consequence for counterparties who enter into uncleared swaps even after a finding by the Commodity Futures Trading Commission or the SEC that the swaps must be cleared. Spokesmen for Shelby and Chambliss refused to comment. The source says that in Sen. Cantwell’s view, “The bill is a joke. The clearing of derivatives and exchange trading is the heart of the whole bill.”[...]"    

Sen. Carl Levin Denounces "Long Arm of Wall Street" [05/21/10] "On May 18, Senator Carl Levin went to the floor of the U.S. Senate to denounce the fact that Wall Street had succeeded in preventing a vote on the Merkley-Levin amendment, i.e., the "Volcker Rule." Despite the fact that the "Volcker Rule" is being used against the McCain-Cantwell Glass-Steagal amendment, nonetheless Levin's statement, reported immediately below, transcends his own ostensible position and reflects the dynamic impact of the mass-strike process against the British bailout policy as a whole. [...]"  Related: White House Caught Lying Again [05/18/10] "On May 18, EIR correspondent Bill Jones raised the question of White House support for Glass-Steagall to Obama Press Secretary Robert Gibbs at the daily White House press briefing. A destabilized Gibbs replied that he had nothing on it. The dean of the Washington Press corps, Helen Thomas, then followed up EIR's question, asking whether Gibbs' silence was related to the swarm of bankers around town. Gibbs tried to defend himself behind the Dodd bill. [...]"  

Sequentials At Large:  Facebook CEO Faces Accusations Of Securities Fraud [05/21/10] "It's been a rough couple of weeks for Facebook CEO and co-founder Mark Zuckerberg. Facebook's new privacy policies have sparked a user backlash, with over ten thousand users organizing a coordinated exodus from the site on Quit Facebook Day. But that's not the only thing troubling the 26-year-old social media tycoon. Zuckerberg is now facing allegations of securities fraud regarding the out-of-court settlement Facebook made with a rival company whose owners claim Zuckerberg stole their source code. These allegations have followed Zuckerberg since his Harvard days, when he was hired by a student-run dating website called Harvard Connection (now called ConnectU), which at the time was similar to Zuckerberg's startup TheFacebook. Tyler and Cameron Winklevoss, the creators of ConnectU, brought suit against Facebook in 2003. They settled for a reported $65 million in 2008 and turned ConnectU over to Facebook.  [...]"  Related: Facebook CEO Allegedly Mocked Users For Sharing Personal Data With Him At Harvard  "In the electronic back-and-forth, Zuckerberg allegedly told his friend "if you ever need info about anyone at Harvard [...] just ask" and called users who had shared information with him "dumb fucks." ... the message makes it clear that Zuckerberg was aware of the potential invasions of privacy to which users of The Facebook were often unwittingly exposing themselves." | Report: Facebook caught sharing secret data with advertisers  "The privacy issues that have been hounding Facebook may be coming to a head. A report in the Wall Street Journal indicates that the Facebook, along with MySpace, Digg, and a handful of other social-networking sites, have been sharing users' personal data with advertisers without users' knowledge or consent. The data shared includes names, user IDs, and other information sufficient to enable ad companies such as the Google-owned DoubleClick to identify distinct user profiles. [...]"   

Financial Terrorists Want Global Currency, Global Central Bank [05/21/10] "During a recent speech at a conference of elitists in Zurich Switzerland, IMF chief Dominique Strauss-Kahn called for the introduction of a global currency backed by a global central bank which would act as the “lender of last resort” in the event of a severe economic crisis, which would represent another lurch towards fascist centralization of power by financial terrorists busy exploiting the fiscal chaos they created in order to impose world government. [...]"  

The Israeli Role in the Plundering of Iceland [05/21/10] "The looting of much of the wealth of Iceland is one such mega-crime in which we find Israelis involved at the highest level. The First Lady of Iceland, Dorrit Moussaieff, is an Israeli Jew, which adds a significant wrinkle to the whole plot.  The Israeli Dorrit Moussaieff is the "fabulously wealthy socialite wife of the President of Iceland." So why did a "fabulously wealthy" Israeli Jew marry the president of a small Nordic nation in the North Atlantic? [...]"  

LaRouche Demands Congress Shut Down Derivatives [05/21/10] "Lyndon LaRouche issued the following statement today in response to the vote in the U.S. Senate to end debate on the so-called Financial Reform Bill... [...]"   Note: Congress says, no, we won't.

Bill to Overhaul Financial Rules Clears Hurdle in Senate Vote [05/21/10] "The Senate on Thursday neared passage of a far-reaching financial regulatory bill, putting Congress on the brink of approving a broad expansion of government oversight of the increasingly complex banking and financial markets. [...] Concern about the derivatives provisions also led Senator Maria Cantwell, Democrat of Washington, to vote against ending debate, saying it still included a dangerous loophole that would undermine efforts to regulate derivative trades. Senator Russ Feingold of Wisconsin was the other Democrat to oppose ending debate on the measure, saying it was not forceful enough in preventing risky behavior by financial companies.  [...]"  Note: Not one mention of Glass-Steagall. 

U.S. companies lobby Congress on derivatives-WSJ [05/21/10] "At least 42 nonfinancial companies and trade associations are lobbying the U.S. Congress to push back on proposals that regulate the over-the-counter derivatives market, the Wall Street Journal said on Friday. [...]"  Note:  So, why does anyone in  Congress have to listen to them? Aren't 62 treasonous members of the Senate enough?  Related: Merkel Government Announces Sovereign Ban on Certain Categories of Derivatives [05/20/10] "After the close of European markets on May 18, Germany's financial services regulator Bafin announced a ban on naked short-selling and credit default swaps, effective immediately, arguing that there was "exceptional volatility" in the markets and systemic threats. [...]"  

A Black Day For Obama and the British [05/20/10] "Barack Obama and his British masters lost a key vote on cloture in the United States Senate on Wednesday afternoon, which they had hoped would allow them to quickly shut off debate on the Dodd financial reform bill, and move for its prompt passage— without the all-important Cantwell-McCain amendment, which calls for a return to the Glass-Steagall standard in U.S. banking. [...]"  

Judicial Watch Files Lawsuit against Federal Reserve to Obtain AIG and Lehman Brothers Bailout Documents [05/20/10] "Judicial Watch, the public interest group that investigates and prosecutes government corruption, announced today that it filed a Freedom of Information Act (FOIA) lawsuit on May 11 against the Board of Governors of the Federal Reserve system related to the financial bailouts of American International Group (AIG) and Lehman Brothers on behalf of former FDIC employee Vern McKinley. The lawsuit is part of Judicial Watch’s comprehensive investigation to determine under what legal authorities and lawful rationales the federal government initiated the Wall Street bailouts. [...]"  

Lyndon LaRouche Discusses 'The Secret Economy' [05/20/10] MP3 Audio clip - listen or download  [20:00]  "The recorded audio remarks below are excerpted from a discussion Lyndon LaRouche had to day with associates, detailing the prospect for the immediate period ahead, and the coming of "The Secret Economy article he's been working on for some time." [...]"   

LaRouche Issues Emergency Call: Put Glass-Steagall In Place [05/20/10] "German Chancellor Merkel, with her sovereign ban on parts of the derivatives market as of May 19, has done the right thing, acting to protect her nation from the devastation of the speculators," LaRouche added. "The U.S. government must be forced to take the same action, immediately. [...]" 

Alea Iacta Est: The Die Has Been Cast [05/20/10] "We have crossed the Rubicon and events in the world economy are now likely to unfold in a totally uncontrollable fashion. Clueless governments still don’t understand that it is their ruinous actions that have created a credit infested and bankrupt world. They will continue to prescribe the same remedy that caused the problem in the first place, namely more credit and more printed money. The consequences are clear; we will have hyperinflation, economic and human misery as well as social unrest. [...]"   Note:  Glass-Steagall may moderate this process, IF it is implemented.  

Financial Regulatory Bill Leaves Big Loophole Open [05/20/10] "Goldman Sachs, Morgan Stanley and other big Wall Street firms have been able for years to set up commercial banking businesses while avoiding the strict regulation this activity typically entails. [...]"  

Senate Delays Vote on Financial Reform [05/20/10] "The Senate voted 57 to 42 Wednesday to delay a final decision on the financial reform package, providing lawmakers more time to consider additional amendments to the bill. [...]"  Note: This is an important update to read, if you're interested in what's going on with this now. 

Senate Seeks to Limit State Powers Over Banks [05/20/10] "The Senate passed an amendment Tuesday that would limit states' authority over national banks as part of financial reform. Senators voted 80-18 to give states some authority over federally chartered banks but lets federal regulators have the final say. [...]"  

 Commentary: Germany Is About to Pull the Plug On Europe [05/20/10] "... All this talk we have heard about “bailing out Greece” is just smoke and mirrors. The European Central Bank and Western governments know full well that if they do not “bail out Greece” that those banks which bought Greek Bonds, swaps and other financial instruments will detonate much like they did in the last Great Depression. This is not a bailout of Greece, as it will do nothing but saddle the Greeks with even more debt. The goal here has been to give money to Greece which it can then use to pay off the billions they owe to their financiers, in this case, German and French banks. But the German people don’t want anything to do with it. And, it seems, that the politicians in Germany may be caving to their demands. The reported $1 Trillion bailout package prepared for Europe the day after the fat-finger heard round the world includes significant contributions from Germany, but the German people have not yet approved their portion of this. Zero Hedge is reporting that the short selling rules applied yesterday are a preemptive move to help prevent complete collapse of the German banking system once the Germans pull the plug on any talk of bailout. [...]" 

Dow Theorist Richard Russell: "Sell Everything, You Won't Recognize America By The End Of The Year" [05/20/10] "Richard Russell, the famous writer of the Dow Theory Letters, has a chilling line in today's note:  Do your friends a favor. Tell them to "batten down the hatches" because there's a HARD RAIN coming. Tell them to get out of debt and sell anything they can sell (and don't need) in order to get liquid. Tell them that Richard Russell says that by the end of this year they won't recognize the country. They'll retort, "How the dickens does Russell know -- who told him?" Tell them the stock market told him. [...]"    

Business as Usual: Banks Caught Ripping Off Municipalities [05/20/10] "Even as Wall Street has flooded Washington, DC, with lobbyists in a desperate attempt to head off the effort to re-impose Glass-Steagall, more and more crimes come to light to show why the return to Glass-Steagall is absolutely necessary. The latest example to surface publicly is widespread fraud against municipalities and state agencies, in which banks and financial advisors colluded to rig bids in the market for guaranteed investment contracts (GICs). [...]"   

Britain on its own if markets strike: French official [05/20/10] "Britain may find itself on its own if it comes under pressure from the markets, France's chief financial regulator warned on Tuesday, after London refused to join Europe's trillion-dollar rescue package. [...]"  

Big Bank Lobbyists Fighting Financial Reform Outnumber Pro-Reform Lobbyists by 11-1 [05/20/10] "Since the beginning of 2009, nearly 1,000 lobbyists have worked on at least one of nine key bills designed to rewrite the rules governing derivatives, a new Public Citizen report shows. These lobbyists have overwhelmingly represented organizations opposing or attempting to water down proposed regulation, according to Public Citizen’s analysis of lobbying disclosure data filed with the U.S. House of Representatives. Lobbyists representing opponents of strong derivatives reform have outnumbered pro-reform lobbyists by more than 11-to-1 (903 to 79 lobbyists). Among the clients represented by the anti-reform lobbyists were the nation’s five largest banks, several major financial trade associations and the U.S. Chamber of Commerce. [...]"  Note:  Lobbying by certain parties, especially former government employees, ought to be banned from Congress.

Glass-Steagall Fight Breaks Into the Major Italian Media [05/20/10] "Corriere della Sera, Italy's largest daily newspaper, published an article by economics editor Massimo Mucchetti on Monday, May 17, endorsing the Cantwell-McCain amendment now before the U.S. Senate, which would re-establish the Glass-Steagall separation of commercial and investment banking, and calling for its emulation in Europe. [...]"  

Americans for Financial Reform to Back Glass-Steagall [05/20/10] "After thousands of mobilization calls by LaRouche PAC organizers to elected officials, citizens, labor leaders, activist organizations, etc., to mobilize support for the Glass- Steagall Amendment, the Americans for Financial Reform coalition put out a statement on its website, called "Support Cantwell McCain #3884, which restores the Glass-Steagall Act's key safeguards," urging its members to mobilize to pressure their Senators with the following message:  [...]"    

  Exposé: Conspiracy of Banks Rigging States Came With Crash  [05/19/10] "A telephone call between a financial adviser in Beverly Hills and a trader in New York was all it took to fleece taxpayers on a water-and-sewer financing deal in West Virginia. The secret conversation was part of a conspiracy stretching across the U.S. by Wall Street banks in the $2.8 trillion municipal bond market. The call came less than two hours before bids were due for contracts to manage $90 million raised with the sale of West Virginia bonds. On one end of the line was Steven Goldberg, a trader with Financial Security Assurance Holdings Ltd. On the other was Zevi Wolmark, of advisory firm CDR Financial Products Inc. Goldberg arranged to pay a kickback to CDR to land the deal, according to government records filed in connection with a U.S. Justice Department indictment of CDR and Wolmark.  West Virginia was just one stop in a nationwide conspiracy in which financial advisers to municipalities colluded with Bank of America Corp., Citigroup Inc., JPMorgan Chase & Co., Lehman Brothers Holdings Inc., Wachovia Corp. and 11 other banks. They rigged bids on auctions for so-called guaranteed investment contracts, known as GICs, according to a Justice Department list that was filed in U.S. District Court in Manhattan on March 24 and then put under seal. Those contracts hold tens of billions of taxpayer money.  [...]"   

Iowa Senate Candidate Fiegen Supports Glass Steagall Amendment; Challenges Grassley [05/19/10] "Thomas L. Fiegen, candidate in the Iowa Democratic Party primary for the U.S. Senate race against Republican Chuck Grassley, issued the following press release on May 17 to immediately intervene in the U.S. Senate debate on financial reform. "Glass-Steagall Amendment to S.3217 Restoring American Financial Stability Act of 2010 [...]"     

Senator Dodd offers "compromise" on "derivatives deadlock": Postpone for 2 years and then drop regulation [05/19/10] "Sen. Christopher J. Dodd (D-Conn.) has offered a last-minute compromise to resolve one of the few remaining disputes over the Senate's landmark bill on financial regulation: a disagreement over derivatives that has sent shudders through Wall Street. Three minutes before the noon deadline for amendments, Dodd filed a proposal addressing language in the bill that would force the nation's largest banks to stop trading nearly all kinds of derivatives -- a move that would dramatically reshape several critical markets and deprive the firms of a major source of revenue. Under the compromise, the Senate would keep the sweeping provision, but delay its implementation for two years while it's studied and quite likely kill it at the end. Dodd's plan calls for submitting the derivatives rules, which were initially proposed by Sen. Blanche Lincoln (D-Ark.), for study by a federal council of regulators. Several key members of the council and Treasury Secretary Timothy F. Geithner, who could have final say under the compromise, have serious reservations about forcing banks to get out of the derivatives business altogether. [...]"  Note: Dodd should be shot at dawn ... asshole, sequential and pawn of the British ...

Senators load financial overhaul with irrelevancies [05/19/10] "Sen. Jim DeMint, R-S.C., wants the government to finish building the 700-mile fence between the U.S. and Mexico. Sen. Patrick Leahy, D-Vt., wants to end the health insurance industry's antitrust protection. West Virginia's two senators want help with mine and oil rig safety. They all want to add these things to the financial regulatory overhaul bill that's moving through the Senate, even though their ideas have little or nothing to do with oversight of financial markets. Senators have proposed 326 amendments to the bill, whose chief purpose is to revamp the system that's regulated financial institutions since the Great Depression, but failed to prevent the current deep recession. The bill could be the last major legislation this Congress approves — and draw enormous media attention — before November's congressional elections. That's why it's attracting a lot of extraneous amendments. [...]"  Note:  Traitors and buffoons.

SEC proposes new rules for avoiding market plunges [05/19/10] Note: Major exchanges to impose stock 'circuit breakers' to prevent plunges under new SEC rules  

Blair Murdered Glass-Steagall, Charges French Society of Financial Analysts [05/18/10] "Nicolas J. Firzli, the chair of the Paris-based Canadian European Economic Council (CEEC) and former officer of Axa Investment Managers, wrote a long article in defense of Glass-Steagall called "Financial orthodoxy and Banking Regulation: The Lessons of the Glass-Steagall Act," Published in the first quarter issue of Analyse Financiere, the magazine of the French Society of Financial Analysts (SFAF). [...]"   

E.U. faces tough questions as euro continues to slide [05/18/10] "The once-mighty euro, which briefly plunged to a four-year low against the dollar on Monday, may be doomed to keep falling whether or not European leaders can contain the region's roiling debt crisis.  The euro clawed back from a deep spiral in Asian trading Monday, closing down 0.2 percent at 1.239 against the dollar. But after its slide of almost 4 percent against the greenback over the past week, analysts say the euro's continued fall over the coming months may be inevitable given the economic turmoil gripping the region.  Assuming there is no full-blown run, the decline may not be all that bad for Europe -- a weaker currency, after all, would make German BMWs and Spanish wines cheaper overseas, heightening demand. By the same token, a surging dollar would make U.S. products less competitive. For Europe, the real danger is yet to come. If the euro's fall accelerates, investors could begin to question the viability of what was considered the world's most ambitious monetary experiment when it was introduced 11 years ago. There could even be pressure to eject members of the 16-country eurozone if they cannot get their finances in order, although there is currently no mechanism to do so. "There are still no guarantees the euro can pull through intact from this crisis," said Jane Foley, research director at Forex.com in London. "No matter how this goes, the euro is likely to suffer looking ahead."  [...]"   

LaRouche's EIR Puts White House Against the Wall on Glass-Steagall Legislation [05/18/10] "White House Spokesman Robert Gibbs received a one-two punch at the May 17 White House Briefing, over the White House's sabotage of the Glass-Steagall legislation now pending before the Senate. EIR founder Lyndon LaRouche is leading a national mobilization demanding the passage of the McCain-Cantwell amendment (calling for a return to FDR's Glass-Steagall) to the Dodd bill, which is now being debated by the Senate, as vital to the survival of the U.S. and international economy under current conditions of global breakdown crisis. [...]"   

Blondet on LaRouche and Tremonti [05/18/10] "In a subscription-only article on his online magazine Effedieffe Giornale Online May 15, Maurizio Blondet reported at length on the 2007 meeting with LaRouche and Tremonti as an event that sparked hope. The article is entitled "On Truth as a Friend," and is an answer to a reader who asks whether Blondet felt isolated after he "predicted," in a 1994 book, the collapse of the financial system. ....  'Rarely do you meet a political leader able to roam through to history with references as LaRouche has done today,' Tremonti said and it is desirable that the political debate generally offer more such occasions. Tremonti said to be convinced that, if not exactly a collapse of the system, beneath the apparent normality, there are historical changes occurring; even if he feels unable to judge whether LaRouche's comparison with the 14th-century collapse (Bardis and Peruzzis) is right, it is certain that the ongoing changes will have deep consequences for the world. Tremonti concluded saying that the LaRouchean idea of building a world network of great infrastructure can appear like 'the vision of a fool, but history walks on fools' visions, too.' Surely, these ideas should be spread, he concluded.  "More than what he said, the simple fact struck me, that Tremonti was there, to listen seriously. Without hanging onto his handy like politicians usually do, and without waiting for his turn at the mike, eventually saying what he has to say in a prepared speechlet.  "I do not know whether you understand how unprecedented this event was. No Italian politician, and maybe no foreign one, goes to a meeting of people without power and notoriously without money, from whom he can expect no payment, no bribes, no quid-pro-quos, at least in terms of electoral votes. "The LaRouchists have never been able to deliver such things. And yet, Tremonti had come to listen. He liked to listen to this story about the Bardis and Peruzzis, and about the other Venetian bankers who caused the 14th-century crisis, because (like the Goldmans and the Soroses of today), they got a 40% profit through their financial business as lenders to kings and as arbiters of gold and silver prices. They ended up strangling a real economy which, being pre-industrial, produced a 3-4% profit yearly (all this you find in my book Slaves to the Banks). [...]"  

The Politicizing Of Bankruptcy [05/18/10] "Is America moving away from being a nation ruled by law to one ruled by men? That's the question senators should consider this week as they move to vote on Sen. Chris Dodd's financial reform legislation. How the legislation is finalized could have long-term adverse consequences on America's bankruptcy process. Little thought has been given to that question in the rush to financial reform. But Senate and House legislation would discard 200 years of bankruptcy case law, replacing it with a special, one-of-a-kind resolution authority, managed by the Federal Deposit Insurance Corp. The agency will soon have absolute authority over failing big banks, empowered to borrow up to 90% of the assets of the companies it seizes and provide unlimited guarantees to "solvent" institutions. While providing the big banks with a permanent, codified source of bailout funds, the expanded powers of the FDIC will include its mediating with creditors. It will make decisions that bankruptcy judges, legal counsel and courts historically have made. An organization that was founded to provide insurance for depositors will now provide insurance for companies that are too big to fail. [...]"  Note:  Capitalism and the rule of law go hand in hand. Statism and arbitrary decisions are the hallmarks of authoritarianism.  Related:  FDIC has inherited some 250 CDOs that are potentially worthless  "The Federal Deposit Insurance Corp., and by extension the U.S. taxpayer, owns more than 250 collateralized debt obligations that were purchased by small institutions that later failed. Although the bonds have a book value of more than $400 million, they are a headache for the agency as it grapples with the toxic assets flowing from many banks around the country. [...]"   

Muscardini Files a Glass-Steagall Resolution in European Parliament [05/17/10] "On May 17, Cristiana Muscardini, Deputy Chairman of the International Trade Committee in the European Parliament, filed a resolution to be voted on in the European Parliament. The resolution is entitled "On the Advisability of Re-Establishing the Principles of the 'Glass-Steagall Act' in the New Rules To Be Defined To Overcome the Systemic Financial Crisis." It reads: "The European Parliament, considering the various meetings of the Ecofin and Eurozone member countries to confront the crisis of the euro, which since January has lost 14% of its value with respect to the U.S. dollar, considering the previous resolutions on the financial crisis and the need to define new rules to avoid the growth of speculative bubbles, "A. Considering the function played in the U.S.A. in 1933 by the 'Glass-Steagall Act,' which in the midst of the 'Great Depression' protected banking deposits from speculation;  "B. Considering the amendment filed in the U.S. Senate last May 6 by Democratic Sen. Maria Cantwell and Republican Sen. John McCain, as an amendment to President Obama's financial reform introduced by Sen. Chris Dodd, modeled after the Glass-Steagall legislation that separated commercial banks from investment banks, preventing the latter from using taxpayer money;  "C. Considering the inadvisability of bailing out bankrupt banking operations with taxpayer money; "Invites the Council and the Commission  "1. To consider the advisability of referring to the principles of the 'Glass-Steagall Act' in defining new rules to overcome the systemic financial crisis; "2. To propose initiatives to reduce the excessive expansion of virtual money and to favor actions aimed at fostering investment for development, the only type of investment that produces real wealth and that can actually contribute to reducing debt." [...]"  Related: Muscardini Introduces Interrogatory To European Commission on Glass-Steagall  "Member of the European Parliament Cristina Muscardini of Italy, submitted the following interrogatory to the European Commission regarding the McCain-Cantwell Amendment, and its appropriateness for adoption as a EU policy. Muscardini is the vice-president of the European Parliament Committee on International Commerce, and a former Italian Deputy. Here is the translation of her interrogatory. [...]"  

365,000 Charities to Lose Their Tax-Exempt Status at Midnight  [05/17/10] "Hundreds of thousands of small non-profits, from Little League teams to community soup kitchens, could lose their tax-exempt status on Monday because of an IRS filing requirement. [...]"  Note: Here, the time-tested concept of promotion of social welfare is dashed to the ground.   

Major Senate Loophole May Block Reform Of Unregulated Derivatives Market [05/17/10] "A section of the bill dealing with derivatives, financial instruments that transfer risk, contains a major loophole, according to an email from a consumer-advocacy organization to the Senate Banking Committee obtained by the Huffington Post. The loophole is wide enough to undermine the whole effort to reform a part of the financial market -- those derivatives traded between financial firms, like AIG, outside of any government oversight -- that's largely blamed for worsening the financial crisis. [...]"  

LaRouche Candidates Take Campaign for Glass-Steagall to the Streets [05/14/10] "The national LaRouche campaign, led by Congressional candidates Rachel Brown, Kesha Rogers, and Summer Shields, took the urban centers in their districts yesterday, to mobilize the population for Glass-Steagall. In Boston and Houston, the candidates brandished huge banners, and drove sound cars, to create as much of a stir as possible. [...]"  

SEC Warns About Bogus Operator [05/14/10] "The SEC has issued an "Investor Alert" about a company that calls itself the "U.S. Securities and Equities Administration." The company claims to operate out of Boston and operates a Web site in which it claims that, for money in advance, it can remove restrictions on stock or get people government money, the SEC says. [...]"   

Bankers jailed, sued as Iceland seeks culprits for crisis [05/14/10] "Since Iceland's three largest banks -- Kaupthing, Landsbanki and Glitnir -- collapsed in late 2008, their former executives and owners have largely been living untroubled lives abroad. But the publication last month of a parliamentary inquiry into the island nation's profound financial and economic crisis signaled a turning of the tide, laying much of the blame for the downfall on the former bank heads who had taken "inappropriate loans from the banks" they worked for. On Wednesday, the administrators of Glitnir's liquidation announced they had filed a two-billion-dollar (1.6-billion-euro) lawsuit in a New York court against former large shareholders and executives for alleged fraud. [...]"   

Merkel warns against euro plunge [05/14/10] "German Chancellor Angela Merkel has warned against the devaluation of euro against other currencies, saying it is threatening the whole European Union project. [...]"  Related:  Sweden critical of Euro budget review  "Sweden's prime minister says a European Commission plan to scrutinize the budgets of member states should be limited to nations with financial problems. [...]"  

Bank of England: U.S. Faces Same Problems as Greece [05/14/10] "Mervyn King, Governor of the Bank of England, fears that America shares many of the same fiscal problems currently haunting Europe. He also believes that European Union must become a federalised fiscal union (in other words with central power to tax and spend) if it is to survive. [...]"   

Morgan Stanley Conjured Doomed CDO Product, Shorted It [05/14/10] "In June 2006, a year before the subprime mortgage market collapsed, Morgan Stanley created a cluster of investments doomed to fail even if default rates stayed low — then bet against its concoction. Known as the Baldwin deals, the $167 million of synthetic collateralized debt obligations had an unusual feature, according to sales documents. [...]"  

Wall Street Probe Widens : J.P. Morgan, Citigroup, Deutsche Bank and UBS Also Face Prosecutors' Scrutiny [05/14/10] "Federal prosecutors, working with securities regulators, are conducting a preliminary criminal probe into whether several major Wall Street banks misled investors about their roles in mortgage-bond deals, according to a person familiar with the matter.  The banks under early-stage criminal scrutiny—J.P. Morgan Chase & Co., Citigroup Inc., Deutsche Bank AG and UBS AG—have also received civil subpoenas from the Securities and Exchange Commission as part of a sweeping investigation of banks' selling and trading of mortgage-related deals, the person says. Under similar preliminary criminal scrutiny are Goldman Sachs Group Inc. and Morgan Stanley, as previously reported by The Wall Street Journal. [...]"  Related: NY AG Andrew Cuomo Subpoenas Eight Banks in Widening Probe  "In a growing avalanche of investigations of the money changers on Wall Street, New York AG Andrew M. Cuomo, issued subpoenas on Wednesday night to eight banks in an investigation as to whether the banks misled ratings agencies about the quality of mortgage securities they were offering. The banks are Citigroup, Credit Agricole, Credit Suisse, Deutsche Bank, Goldman Sachs, Morgan Stanley, USB, and Merrill Lynch, now part of Bank of America. The companies that rated the mortgage deals are Standard & Poors, Fitch Ratings, and Moody's Investors Service. [...]"    

LaRouche Democrat Candidates Drive To Ram Through McCain-Cantwell Amendment [05/14/10] "After a discussion with Lyndon LaRouche and campaign coordinators, it was decided that the campaigns would take full responsibility for ramming through the McCain-Cantwell amendment, with an all-out mobilization for immediate implementation of Glass-Steagall, and a drive to throw the traitors out, beginning with that British Imperial puppet Barack Obama. [...]"   

Fed Scrambles to Ram Through "Weimar II;" Opposition Begins [05/14/10] "Fed Chairman Ben Bernanke has gone into overdrive, to try to convince the U.S. Congress not to oppose the decisions of the Obama Administration to provide untold sums of U.S. dollars, to bail out the European banks. Bernanke held a behind-closed-doors session with Senators on Tuesday the 11th, during which, according to Senator Richard Shelby, he warned that the "European" problem" had "ramifications probably on a lot of our banks and banking system if there was no intervention." [...]"   

 LaRouche:  Firewall Then, Glass-Stegall Now [05/13/10] Video clip [84:00] "The documentary featured here was released in early 2008, just months after Lyndon LaRouche forecast the blowout of the financial derivative infested housing bubble, triggering the blowout of the entire U.S. financial system as a whole. That same week the blowout occurred. Soon after, Lyndon LaRouche was the only person to demand the one thing that could solve the crisis: the Homeowner's and Bank Protection Act. Calling a for a freeze on foreclosures for homeowners, and a firewall to separate commercial banking practices like the selling of mortgages from the parasitical practices of investment banks, hedge funds, and other criminal enterprises that speculated on those mortgages, this speculation threatened to put millions of homeowners out on the streets with a Wiemar 1923 style hyperinflationary blowout of the whole system. This firewall, the Homeowner’s and Bank Protection Act, would be the first step to a larger, general bankruptcy reorganization of the entire U.S. financial system, where commercial banks would be made solvent again through the clean out of fake money, like mortgage backed securities and other derivatives, and given, instead, credit uttered by the Federal government for the purpose of launching the needed recovery of the U.S. economy, beginning with the funding of large scale capital intensive infrastructure projects. The "Firewall" documentary, which traces the history of the hyperinflationary blow out of 1923 Weimar Germany, was released during a nationwide LaRouchePAC mobilization which garnered the support of hundreds of local city, and state governments across the country for the LaRouche's firewall legislation, but despite the cries of the American people, the U.S. government under President George W Bush, Nancy Pelosi, and Barney Frank, then, and President Barack Obama, Nancy Pelosi, and Barney Frank, now, have committed themselves to rewarding criminal banking institutions through unconstitutional bail outs, and in doing so, have committed the United States to its own destruction. This can no longer be tolerated. Today we have reached a critical point in the world system, like that of 1923 Germany, with the recent blowout of the European financial system. The world cannot survive the collapse of the current British-run world financial system. LaRouche's recent call for a return to the Glass Steagall Act, a firewall, will solve the problem. As we speak the Glass-Steagall Act exists as an amendment to the Financial Stability Act sponsored by Sen. John McCain and Sen. Maria Cantwell, now sitting in the Senate waiting for a vote. We must not wait. We must come out in droves to support this revival of the Glass-Steagall Act, it is the only piece of legislation that will protect our United States from the chaos of the imminent global collapse. So, Call your Senator, mobilize your neighbors, and move rapidly with a deeper understanding of what we face and what we must do to win this fight, provided here by LaRouche PAC’s "Firewall" documentary. [...]"   

California Is More Likely to Default than Iceland or Iraq [05/13/10] "The Federal Reserve isn't the only one who owns credit default swaps betting that California will default. As Ed Harrison points out, credit default traders have now ranked California in the top 10 governments likely to default, with a 20% default probability: [...]"  

Ex-VP Says JP Morgan Chase Retaliated [05/12/10] "A former vice president says J.P. Morgan Chase Bank fired her after she blew the whistle on fraud involving one of the bank's long-term clients. In her federal complaint, Jennifer Sharkey says she was managing more than 75 "high net worth" clients with combined assets of $500 million when she found evidence that "a high-revenue-producing Israeli client" was involved in illegal activities. [...]"   

'Vampire Squid' Goldman Sachs confesses it is being investigated for helping Greece hide its debts [05/12/10] "Goldman Sachs has admitted that it is under investigation for helping Greece to hide its vast debts. The controversial Wall Street bank - nicknamed the Vampire Squid because its tentacles stretch far and wide - is accused of having profiteered out of a complex currency deal that helped Greece massage its finances. [...]"     

U.S. Probes Morgan Stanley [05/12/10] "U.S. prosecutors are investigating whether Morgan Stanley misled investors about mortgage-derivatives deals it helped design and sometimes bet against, people familiar with the matter said, in a step that intensifies Washington's scrutiny of Wall Street in the wake of the financial crisis. [...]"   

LaRouche: Some Traitors in the Senate, as Obama Tries To Kill Glass-Steagall [05/12/10] "The discredited Sen. Christopher Dodd, retiring and rejected by Connecticut voters, is continuing to try to control the "financial regulation" debate in the Senate, and as the Obama White House's agent to stop the Senate from passing the Glass-Steagall amendment the American public's majority wants. [...]"  

Roubini Endorses Glass-Steagall [05/12/10] "Der Spiegel runs an interview with Nouriel Roubini, who, they note, has acquired the moniker "Dr. Doom," for predicting the onset of the financial collapse. Roubini declares that his notions of "financial reform" are much more radical than Obama's. "What I am proposing goes back to Glass-Steagall Act types of restrictions between commercial and investment banking, regulations that already existed until about 10 years ago," he says, adding, "They worked well." He says the idea of the "financial supermarket model" has failed, that, "this all has to be broken into pieces." [...]"  

Soros, Frantic To Protect Derivatives, Runs Arkansas Primary Campaign vs Sen. Lincoln [05/12/10] " The apparatus of British Empire mega- speculator George Soros originally set in motion, and is now funding, the campaign to unseat U.S. Senator Blanche Lincoln, author of the pending bill to bar banks from trading in derivatives. The Soros mob is sponsoring Arkansas Lieutenant Governor Bill Halter in the May 18 Democratic primary race against Lincoln. Soros-slave Andy Stern, president of Service Employees International Union (SEIU), got the ball rolling late last year. [...]"   

Lehman Bros. linked to drug money [05/12/10] [4:53]  "Mario Ernesto Villanueva Madrid, former governor of the Mexican state that holds Cancun and dozens of other Caribbean beach resorts, has been extradited to New York on charges of accepting bribes from a violent drug cartel that smuggled hundreds of tons of cocaine into the U.S. and then laundering the bribe money through Lehman Brothers."  

Obama Out to Kill Glass Steagall, While Pushing Weimar Hyperinflation [05/12/10] "Lyndon LaRouche today fiercely denounced the Obama White House and Treasury Department, for simultaneously conducting a vicious campaign to kill the Glass Steagall amendment, introduced by Senators Maria Cantwell (D-Wash.) and John McCain (R-Ariz.), while pushing through a "Super-TARP" bailout of Europe, at American taxpayers expense. "If the Super-TARP bailout is allowed to go forward," LaRouche warned, "there will be blood in the streets. [...]"   

Senate votes to audit the Fed, 96-0 [05/12/10] "The Senate on Tuesday approved a proposal to examine the Federal Reserve's role in the Wall Street bailouts of 2008-2009 as part of a broad financial regulation reform bill.  The proposal from independent Senator Bernie Sanders would order congressional investigators to conduct a single audit of the U.S. central bank's use of its emergency lending authority since December 2007. It would require the Fed by December 1 to disclose which banks received its help. It passed by a vote of 96 to 0. "Though the measure was always popular, it faced extraordinary opposition from the White House, Wall Street and the Fed itself," Talking Points Memo's Eric Lach noted Tuesday. "Late last week, in a move that defused the opposition, and may have saved Wall Street reform legislation, Sanders agreed to limit the scope of the audit to emergency lending only, exempting other Fed activities.  "That preserved the broad intent of the plan, which was always aimed at bringing the Fed's shadowy activities during the financial crisis into the daylight," Lach added. "Under the terms of the proposal, the Fed will also be required to make public which companies received upwards of $2 trillion in aide from the Fed, and under what terms." [...]"   U.S. Senate rejects broader Fed audit amendment "The U.S. Senate rejected an amendment on Tuesday that would have exposed the Federal Reserve to broader scrutiny by Congress, which critics said would extend to monetary policy decisions. [...]"  Note: Not surprising, of course. 

BP: From Oil Spilling to Financial Reform Killing [05/12/10] "The under-fire oil company isn't too busy to be fighting financial regulation in Washington. [...]"  

The Financial Oligarchy Reigns: Democracy’s Death Spiral From Greece to the United States [05/11/10] "As the Economic Elite continue their plunder, the people in Greece riot and the big banks score yet another big blow against the people of the United States. [...]" Analysis: "High Frequency Terrorism: How the Big Banks and Federal Reserve Maintained Their Death Grip Over the United States" By David DeGraw & Max Keiser [05/11/10] "The stock market plunge on May 6th was an act of domestic financial terrorism in America. A day that will live in infamy. [...]"   

Ron Paul: Euro Bailout Will Lead To Currency Collapse [05/11/10] [2:59]  "As Europe is bailed out to the tune of nearly $1 trillion dollars, Congressman Ron Paul warns that the constant monetization of debt, allied with taxpayer-funded bailouts, will inevitably lead to runaway inflation and the collapse of paper currencies. [...]"    

Federal Reserve opens credit line to Europe [05/11/10] "The Federal Reserve late Sunday opened a program to ship U.S. dollars to Europe in a move to head off a broader financial crisis on the continent.  Other central banks, including the Bank of Canada, the Bank of England, the European Central Bank, the Swiss National Bank and the Bank of Japan also are involved in the dollar swap effort. The move comes after the European Union and International Monetary Fund pledged a nearly $1 trillion defense package for the embattled euro, hoping to calm jittery markets and halt attacks on the eurozone's weakest members. The ECB also jumped into the bond market Sunday night, saying it is ready to buy eurozone bonds to shore up liquidity in "dysfunctional" markets.  The Fed's action reopens a program put in place during the 2008 global financial crisis under which dollars are shipped overseas through the foreign central banks. In turn, these central banks can lend the dollars out to banks in their home countries that are in need of dollar funding to prevent the European crisis from spreading further.  The Fed said action is being taken "in response to the reemergence of strains in U.S. dollar short-term funding markets in Europe," and to prevent the spread of that strain to other markets and financial centers. [...]"  Note: "The program is unconstitutional under Article 1 of the U.S. Constitution which states, “No money shall be drawn from the treasury, but in consequence of appropriations made by law.” In addition to the credit swap program being re-enacted, the IMF portion of a separate European bailout package amounts to around $287 billion dollars. Since American taxpayers represent around 20 per cent of IMF funding, they will fork out something in the region of $57 billion dollars which which primarily go straight to French and German banks, not to mention the billions more in transfers of wealth that will occur through the Fed’s credit swap program."

Exchange CEOs clueless about what caused shock Wall Street sell-off; Congress announces probe [05/11/10] "A key US congressional committee looking into last week's shock Wall Street sell-off announced Monday it would question US financial regulators and executives from major exchanges about the plunge.  US Securities and Exchange Commission (SEC) chair Mary Schapiro and top officials at NASDAQ and the New York Stock Exchange were to appear Tuesday before a House of Representatives Financial Services subcommittee to discuss the stunning dive. The director of the SEC's Division of Trading and Markets, Robert Cook, and US Commodity Futures Trading Commission chair Gary Gensler were also to appear before the panel. NYSE Euronext chief operating officer Lawrence Leibowitz, NASDAQ Transaction Services executive vice president Eric Noll, and Terrence Duffy, executive chairman of the CME Group, were also due to testify. A day after the brief sell-off Thursday, which sent a wave of panic across global stock markets, President Barack Obama vowed an investigation into the "unusual market activity" that sent the Dow down almost 1,000 points in minutes in intraday trade. [...]"     

The Glass Steagall Principle is a War Between British and US Interests LaRouche [05/10/10] "Sunday saw a worsening of the collapse-crisis of the euro, with the British euro-bailout policy apparently claiming the government of German Chancellor Angela Merkel. The 27 fools of "Ecofin" — the finance ministers of the the so-called Eurozone countries, which have all bankrupted themselves by bailing out their banks while their revenues plunged in the crash — met all day in a race to announce as many as three new bank bailouts before the Asian markets opened on Monday, when a new stage of collapse is expected. [...]"   

IMF gives Greece $40bn rescue loan [05/10/10] "The International Monetary Fund has approved a 30-billion-euro ($40 billion) rescue loan for the debt-ridden Greece. [...]"   Note: That will sink the Euro, over a short period of time.  

EU Crafts $928 Billion Loan Package in Attempt to Halt Euro Decline [05/10/10] "European finance ministers put together an unprecedented loan package that may be worth 720 billion euros ($928 billion) for debt-swamped governments in a bid to restore faith in the euro and prevent Greece’s fiscal woes from unleashing a global crisis. Jolted into action by last week’s slide in the currency to a 14-month low and [...]"   Note: See a comment by LaRouche, about this kind of dynamic.

Europe Financial Defense Package: Agreement Reached On Massive Preemptive Bailout [05/10/10] "The European Union and the International Monetary Fund pledged a massive nearly $1 trillion defense package for the embattled euro Monday, hoping to finally turn back relentless attacks on the eurozone's weakest members and allow the continent to resume its hesitant economic recovery. [...]"  Note: It won't work. Listen to LaRouche's  May 8 webcast, below, for why. 

Exposé: No joke: Goldman Sachs shorted Gulf of Mexico [05/10/10] "It turns out that Goldman Sachs really did place shorts on TransOcean stock days before the explosions rocked the rig in the Gulf of Mexico sending stocks plunging while GS profits soared — benefitting once again from a huge disaster, having done the same with airline stocks prior to 911 then again with the housing bubble.  On Apr. 30, the Huffington Post published a story stating:  In what is looming as another public relations predicament for Goldman Sachs, the banking giant admitted today that it made “a substantial financial bet against the Gulf of Mexico” one day before the sinking of an oil rig in that body of water.  The new revelations came to light after government investigators turned up new emails from Goldman employee Fabrice “Fabulous Fab” Tourre in which he bragged to a girlfriend that the firm was taking a “big short” position on the Gulf.  “One oil rig goes down and we’re going to be rolling in dough,” Mr. Tourre wrote in one email. “Suck it, fishies and birdies!” [...]"  Note: How did they know beforehand to short the Gulf? How could they know the event would happen in that time frame? 

Stock Market Collapse: More Goldman Market Rigging? by Dr. Ellen Brown [05/10/10] "Last week, Goldman Sachs was on the congressional hot seat, grilled for fraud in its sale of complicated financial products called “synthetic CDOs.” This week the heat was off, as all eyes turned to the attack of the shorts on Greek sovereign debt and the dire threat of a sovereign Greek default. By Thursday, Goldman’s fraud had slipped from the headlines and Congress had been cowed into throwing in the towel on its campaign to break up the too-big-to-fail banks. On Friday, Goldman was in settlement talks with the SEC. Goldman and Wall Street reign. Congress appears helpless to discipline the big banks, just as the European Central Bank appears helpless to prevent the collapse of the European Union. . . . Or are they?" [...]"  

Feds probing JPMorgan trades in silver pit [05/10/10] "Federal agents have launched parallel criminal and civil probes of JPMorgan Chase and its trading activity in the precious metals market, The Post has learned. The probes are centering on whether or not JPMorgan, a top derivatives holder in precious metals, acted improperly to depress the price of silver, sources said. [...]"     

Kucinich: Federal Reserve paying banks NOT to make loans - " One Fraud after Another" [05/10/10] [5:48]  "U.S. Congressman Dennis Kucinich (D-Ohio, 10th District) questions Neil M. Barofsky, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), testifying before the House Committee on Oversight and Government Reform, about interest payments made to banks that keep their TARP funds and other government (taxpayer) bailout money with the Federal Reserve, instead of making loans to struggling Americans (the original intent of the TARP, remember?) The Fed makes generous interest payments to the banks for "parking" their "excess reserves" at the Fed.  [...]"  

"The Greatest Crisis in Modern History" [05/09/10]  Video clip [90:00] Note: LaRouche Webcast: May 8, 2010      Note: I recommend this. It will bring you up to speed in regard to this parallel dynamic which parallels the movement of Uranus into Aries, which is coming soon.

Alan Grayson Blows the Roof Off of One of the Fed’s Secret Acquisitions [05/09/10] [11:32]  "This has to be one of the most amusing—yet disturbing—salvos that anti-Fed representative Alan Grayson (D-FL) has tossed at the central bank to date. Pay close attention at the end of the video to hear what this liberal politician says about socialism/ communism in the United States. Also, listen to what the economically-ignorant representative who relinquished his time to Grayson says about Grayson’s extraordinary presentation. Rep. Alan Grayson discussed the Federal Reserve's purchase of debt from Bear Stearns, including debt from recently foreclosed Red Roof Inn's. [...]"   

Documentation: McCain-Cantwell Amendment and Feingold's Floor Remarks on Glass-Steagall [05/09/10] "Following is the text of S.Amendment 3884, introduced by Senators Cantwell, McCain, Kaufman, Harkin, Feingold, and Sanders; the amendment is identical to the "Banking Integrity Act of 2009" introduced by Cantwell and McCain in December. [...]"     

Senators Organize for Glass-Steagall to Defend the U.S. from the British Empire [05/09/10] "The Senators who are sponsoring the bipartisan Glass-Steagall amendment—John McCain (R-AZ), Maria Cantwell (D-WA), Russ Feingold (D-WI), Ted Kaufman (D-DE), and Tom Harkin (D-IA)—are waging a concerted campaign for the reinstatement of Glass-Steagall, with press conferences, interviews, press releases, and Senate floor statements, dating back to December, 2009, when the reinstatement of Glass-Steagall was introduced as a bill by McCain and Cantwell with several co-sponsors. [...]"    

Merkel Pressured By British To Set Up Fund To 'Defend Euro' [05/09/10] "According to the German financial daily Handelsblatt, German Chancellor Angela Merkel was pressured by French President Nicolas Sarkozy and EU Commission President Jose Manuel Barroso to agree at a summit of the Eurozone heads of state and government to the creation of a new mechanism to defend the euro. Details of the new mechanism will not be released until after a meeting on Sunday, May 9, in Brussels of the 27 EU Finance Ministers and the mechanism will go into effect before the markets open on Monday in Asia. [...]"  

EU to Set Up Fund to Prevent Spread of Greek Crisis [05/09/10] "European leaders agreed to set up an emergency fund to halt the spread of Greece’s fiscal woes, seeking to prevent a sovereign debt crisis from shattering confidence in the 11-year-old euro. Jolted into action by the sliding currency and soaring bond yields in Portugal and Spain, leaders of the 16 euro countries said the workings of the financial backstop will be hammered out before Asian markets open late tomorrow European time. [...]"  

Celente: World Market Will Crash Before 2011 Begins [05/09/10] [6:51]  "The Dow Jones industrial market is down and looks to continue to head that direction. This is not good news for the worlds economies that are trying to bounce back after this recession hit many different nations. Is this