Tag: banks

As police arrested hundreds of protesters on the Brooklyn Bridge in New York City, more demonstrations began to spring up across the U.S.

The anger against Wall Street isn’t likely to burn out anytime soon. Not all, but most, of the US economic problems can be traced to the Wall Street casino and the refusal of the Wall Street bankers to accept their losses instead of forcing them on an unwilling public. The fact that the federal government connived with the bankers to do so doesn’t make the action legal or legitimate.

Every bank that received a bailout, direct or indirect, should be shut down, its executives arrested, and their bonuses seized. Remember, in 1946, the financial institutions accounted for 0.85% of all U.S. debt. Sixty years later, that percentage had risen to 32.7 percent, nearly three times more than the 11.6% owed by the federal government.

The government is far from innocent, but for the most part, it has exacerbated the debt-deflation problem that the bankers created. Occupying Wall Street should only be the beginning of the debt cleansing process. However, what neither the Occupy Wall Street activists on the left nor the Tea Party activists on the center-right appear to understand is that BOTH Wall Street and the federal government are responsible for the present situation.

Washington can’t fix Wall Street because it is wholly owned by the bankers. And Wall Street can’t fix Washington because Washington is already doing what Wall Street wants. As long as the left supports Washington and the right supports Wall Street, absolutely nothing with long-term positive economic effect can be accomplished.

Which, of course, is why I have been saying for years that there will be no solution until the eventual and inevitable system failure takes place.

Zerohedge has the details on the Federal Reserve’s plans to spy on the economically astute:

Two weeks ago, the media’s heart went aflutter when it learned that the president had borrowed a page right out of ole’ Joe McCarthy’s communist witch hunt book with the launch of Attack Watch. The response by everyone, even fans of Obama, was immediate and brutal. Yet where Obama took about 24 hours to crash and burn, someone else has stepped in with a far stealthier method of ferreting out the traitors amongst us: none other than our old friends, the Federal Reserve Bank of the United States, which in a Request for Proposals filed to companies that are Fed vendors, is requesting the creation of a “Social Listening Platform” whose function is to “gather data from various social media outlets and news sources.” It will “monitor billions of conversations and generate text analytics based on predefined criteria.” The Fed’s desired product should be able to “determine the sentiment [ED:LOL] of a speaker or writer with respect to some topic or document”… “The solution must be able to gather data from the primary social media platforms – Facebook, Twitter, Blogs, Forums and YouTube. It should also be able to aggregate data from various media outlets such as: CNN, WSJ, Factiva etc.” Most importantly, the “Listening Platform” should be able to “Handle crisis situations, Continuously monitor conversations, and Identify and reach out to key bloggers and influencers.” Said otherwise, the Fed has just entered the counterespionage era and will be monitoring everything written about it anywhere in the world.

I could save them the trouble and expense of spying on the world with a simple summary: Everyone who understands the U.S. central banking system despises the Fed and understands that it is an organization that was created to inflate the money supply and funnel money to the banks. And while investors once feared its influence over the financial markets, no one fears it anymore because Chairman Bernanke’s predictions are uniformly wrong, his policies have uniformly failed, and the shortcomings of the its debt currency are becoming obvious even to non-economists.

On the other hand, perhaps Helicopter Ben is simply looking for hot investment tips. Obviously his investment strategy hasn’t been working out so well.

Faced with a clear and open violation of the German Constitution, the German Supreme Court unsurprisingly caved rather than risk undermining the supports that are propping up the banks of the European Union:

In a widely followed ruling on Wednesday, Germany’s Constitutional Court upheld the legality of Berlin’s rescue packages for debt-stricken euro zone countries, but said any future bailouts must be approved by a parliamentary panel…. The court rejected three appeals against the legality of earlier bailouts, which have stirred a furious political debate among Germans. The suits had been brought by a coalition of German lawmakers, economists and business executives who argued that Germany’s participation in loans and support funds for Greece undermined Parliament and infringed constitutional provisions underpinning the country’s democracy.

In other words, there is no longer any more law in Germany than there is in the United States. That should work out well. All this worldwide government kowtowing to the banks in a futile and desperate attempt to keep them from going under has done is to make it perfectly clear to all and sundry that there is no law. The law is now a transparent fiction. All of the words written down on paper are entirely meaningless. Read the English translation, it is a masterpiece of legal weaselry.

The world is rapidly entering into a literally Satanic state where do what thou wilt truly is the whole of the law.

And clearly, going to mark-to-fantasy should fix the whole thing. After all, it has worked so well in the USA. “My gnome, high above the Alps is hearing that the EU is considering suspension of bank mark to market acctg.”

Germany is indicating a potential disinclination to play the Fed game:

“I regard the huge buy-up of bonds of individual states by the ECB as legally and politically questionable. Article 123 of the Treaty on the EU’s workings prohibits the ECB from directly purchasing debt instruments, in order to safeguard the central bank’s independence,” [German President Christian Wulff] said….

The blistering attack follows equally harsh words by the Bundesbank in its monthly report. The bank slammed the ECB’s bond purchases and also warned that the EU’s broader bail-out machinery violates EU treaties and lacks “democratic legitimacy”.

The combined attacks come just two weeks before the German constitutional court rules on the legality of the various bailout policies. The verdict is expected on September 7.

It’s hard to imagine that the German court won’t just rubber stamp the blatantly unconstitutional, overtly illegal actions of the EU and ECB in the same way that the U.S. Supreme Court has seen no evil in the illegal actions of the U.S. Congress and the Federal Reserve.

However, the Germans aren’t always predictable, they do tend to be sticklers for the letter of the law, and there is no question that if the letter of the law is respected, the bailouts will be pronounced illegal. The possibility the court will do so may explain this recent market development:

Insurance on the debt of several major European banks has now hit historic levels, higher even than those recorded during financial crisis caused by the US financial group’s implosion nearly three years ago. Credit default swaps on the bonds of Royal Bank of Scotland, BNP Paribas, Deutsche Bank and Intesa Sanpaolo, among others, flashed warning signals on Wednesday.

Interesting times, interesting times….

S&P readies a belated upgrade to U.S. debt:

The ratings agency Standard & Poor’s said late on Monday that its president, Deven Sharma, who has become the public face of the firm in the wake of its historic downgrade on the United States’ long-term debt rating, will step down and leave the company by the end of the year. The decision by Mr. Sharma to resign comes as the ratings agency is under pressure from several fronts, including an inquiry by the Justice Department into its ratings of subprime mortgage securities and a push by activist investors to break up its parent company, McGraw-Hill….

His replacement, Mr. Peterson, 53, is currently the chief operating officer of Citibank, the banking unit of Citigroup.

I note that the one thing the New York Times does not assure us was that the management change was not the result of the recent downgrade of U.S. debt. No doubt Mr. Citibank already understands that an review of that decision and eventual restoration of AAA status is in the best interest of his continued employment.

Unless, of course, it is decided the time is right to debut the new, super-safe, guaranteed AAAA rating.

Karl Denninger puts his finger on why the bankers and their public servants are desperately pushing for inflation:

These policies are not born out of ignorance, they’re intentional frauds.

We keep hearing that we can’t have “deflation” as that’s “terrible”, but exactly who is it terrible for? It certainly isn’t terrible for the prudent saver – the Senior Citizen who has been systemically and serially financially raped by those very same “captains of finance!” Yes, it’s terrible if you took on debt you can’t afford but exactly why should you be protected from your own stupidity whether you’re that borrower or lender – and using debt to pull future earnings capacity from the future or speculate is factually stupid!

Further, is it really “deflation” when you simply reverse the inflation of the last ten years, say much the last 30? Why is it perfectly ok to steal half or more of someone’s saved money, but when they might get that stored value back it’s suddenly a national calamity to be avoided at all costs?

The answer is perfectly clear. Because those responsible for the theft are in charge and they don’t want to give up their ill-gotten gains.

I have to admit, Rick Perry’s “mistake” is the first thing he’s done that makes me want to think he might not be a complete disaster as president. (Of course, this posturing is merely for the Tea Party, in private he’s kowtowing before the Fed like all the other candidates not named Ron Paul.) But the neocons and neoclassicals were quick to leap to the defense of Ben Shalom:

On Monday, 24 hours before the Rasmussen poll would show him up 13 points on Mitt Romney after only three days in the GOP presidential race, Rick Perry made a mistake. He answered a question in an Iowa field about the Federal Reserve with a waspish threat to Ben Bernanke — something about how in Texas the Fed chairman would be “treated ugly” if he printed more money.

“Horrifying,” shrieked Binyamin Appelbaum, The New York Times’ chief Washington correspondent. The economist Nouriel Roubini raged that Perry belonged in a mental institution — after he compared the Texas governor to the Norwegian mass murderer…. Yesterday, in refusing to apologize for what he said, Perry didn’t even suggest he’d been speaking lightly. He said instead that this — Fed policy, presumably — was something about which he’s passionate.

Actually, Perry’s comment about Bernanke’s near-treason is a little careless. The man’s policies aren’t “almost” treasonous as they have without question been to the severe material detriment of the USA and given his expert PhD credentials, there can be little question that his decision to enact those policies was intentional. He has done far more harm to America and Americans than 100 bin Ladens could have ever done, and worse, he telegraphed his intention to do so before he was appointed to his present office.

The mortgage banks are doing their best to escape liability for their large-scale mortgage fraud:

They’ve trotted out Kathryn Wylde, the President of the Partnership for New York City, to attack Eric Schneiderman for his intervention in the Bank of America settlement with investors over mortgage backed securities. Wylde is going to bat for BofA as well as the Bank of New York Mellon, the trustee for the MBS in the settlement. And she is actually arguing that Schneiderman, by defending the rights of investors and seeking the truth on out and out securitization fraud, is threatening the existence of the financial sector in New York City. No, really.

Tanks in the streets and cats living with dogs if the state governments don’t look the other way when the banks commit fraud. That’s certainly a new one. Interesting to see that they’re having to pull it out on a regular basis, isn’t it?