Dec 16

Flashback:

- Gold is a Crap Investment – Unless …

- Inflation, Hyperinflation and Real Estate (Price Collaps)


revolver
What the Fed is looking at.

- What If There’s A Recession in 2014? (Gonzalo Lira, Dec 16, 2013):

If policymakers were gunfighters, they’d be out of bullets: They have run out of effective policy tools to improve the economy.

So the question is simple: If there is a recession in 2014, and policymakers are out of bullets, how will it play out across the American economy?

Recently, Deutsche Bank’s Jim Reid very astutely pointed out that the current “expansion” of the U.S. economy is on its fifth year—the seventh longest in history.

We are due for a recession.

Continue reading »

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Nov 20

- Tim Geithner in January 2013: “Extremely Unlikely Will Take a Job in the World of Finance” (Liberty Blitzkrieg, Nov 18, 2013):

So over the weekend, the world learned that Tiny Turbo Tax Timmy Geither had accepted a job with private equity giant firm Warburg Pincus. The news was about as much of a surprise as a lie popping out of Barack Obama’s mouth every time he opens it. Nevertheless, the move is particularly hilarious in light of a profile article of Geithner in New York magazine from January of this year, in which the king of cronyism tried to distance himself from Wall Street.

Here’s the money-shot paragraph from the piece:

Another fiction that has plagued Geithner is the idea that he is a creature of Wall Street, specifically that he worked for Goldman Sachs. He isn’t sure where it came from—probably just confusion with his predecessor, Hank Paulson, who was the former CEO—but “once it hardened, it was very hard to overcome.” Indeed, he has not really overcome it at all. I can write, right here, in all caps, TIM GEITHNER HAS NEVER WORKED ON WALL STREET, and still someone will comment on our website that he is a bankster who should just go back to Goldman Sachs. Geithner says it’s “extremely unlikely” he will take a job in the world of finance, but the idea that he is somehow, secretly, working hand in hand with that community persists, and every once in a while someone pulls out records of his phone calls and meetings with CEOs as evidence. Geithner is not really sure what to say about that. “I’m the secretary of the Treasury.” He laughs. “How am I supposed to run a financial rescue if I don’t take phone calls from people?”

At least he is making up for lost time. Those conspiracy theorists making stuff up again…

Continue reading »

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Nov 16

- Timothy Geithner heads to private equity firm Warburg Pincus (Politico, Nov 16, 2013):

Former Treasury Secretary Timothy Geithner, a trusted lieutenant to President Barack Obama who played a leading role in the government’s response to the financial crisis, will join private-equity firm Warburg Pincus LLC in March.

On Saturday, the firm, which is headquartered in New York, announced Geithner will hold the titles of president and managing director.

Continue reading »

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May 11

- IRS Conservative Witchhunt Started In 2011 With High-Level Officials Involved (ZeroHedge, May 11, 2013)

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Feb 10

- Geithner Admits: “I Never Had A Real Job” (The Daily Bail, Feb 8, 2013):

UPDATEGeithner Joins CFR As Distinguished Fellow (CFR Press Release)

For once, Turbo told the truth on a weekend talk show.  Sort of.  We could add that Geithner never paid taxes like a real taxpayer either.  Geithner’s ongoing attempt to distance himself from Wall Street’s decade of fraud is laughable.  As President of the New York Fed, Geithner was criminally negligent in his role as Wall Street’s chief regulator.

Timmaaayy tells the truth.

“I find that the charge that — the myth that I worked in Wall Street all my life, somewhat amusing.  But it is part of a narrative that hardened.  People came to view the judgments we were making through the prism of a myth … it’s actually very damaging.  It’s completely false, of course, and it, you know, should have been corrected a long time ago.  What I say is that I never had a real job.”

Flashback – Geithner with Fareed Zakaria - WSJ

This is worth watching:

Max Keiser on Geithner’s AIG Crime

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Feb 06

- Tim Geithner Joins CFR As “Tireless And Creative Practitioner And Thinker” (ZeroHedge, Feb 6, 2013):

Well that didn’t take long. It appears spending time with the family is over-rated (or perhaps they couldn’t stand him either) as Turbo Timmy has landed his first post-Treasury gig (Citi next?). The Council of Foreign Relations has graciously brought this “tireless and creative” thinker on board as a Distinguished Fellow. His role… “to strengthen their capacity to produce thoughtful analysis of issues at the intersection of economic, political, and strategic developments.” We assume this is his gracious ‘giving back’ phase before six-months down the line slithering over to the big bucks at a bank when he suspects no one will be looking…The mutual adoration society continues..

Continue reading »

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Jan 27

- Geithner’s Legacy: The “0.2%” Hold $7.8 Trillion, Or 69% Of All Assets; And $212 Trillion Of Derivative Liabilities (ZeroHedge, Jan 26, 2013):

As of this morning Tim Geithner is no longer Treasury Secretary. And while Tim Geithner’s reign of clueless pandering to the banks has left the US will absolutely disastrous consequences, an outcome that will become clear in time, the most ruinous of his policies is making the banks which were too big to fail to begin with, so big they can neither fail nor be sued, as the recent fiasco surrounding the exit of Assistant attorney general Lanny Breuer showed. Just how big are these banks? Dallas Fed’s Disk Fisher explains.

It is important to have an accurate view of the landscape of banking today in order to understand the impact of this proposal.

As of third quarter 2012, there were approximately 5,600 commercial banking organizations in the U.S. The bulk of these—roughly 5,500—were community banks with assets of less than $10 billion. These community-focused organizations accounted for 98.6 percent of all banks but only 12 percent of total industry assets. Another group numbering nearly 70 banking organizations—with assets of between $10 billion and $250 billion—accounted for 1.2 percent of banks, while controlling 19 percent of industry assets. The remaining group, the megabanks—with assets of between $250 billion and $2.3 trillion—was made up of a mere 12 institutions. These dozen behemoths accounted for roughly 0.2 percent of all banks, but they held 69 percent of industry assets.

What does this mean numerically? Continue reading »

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Jan 25

- Tim Geithner’s Annotated Exit Interview: “F— The Banks” And Other Pearls (ZeroHedge, Jan 25, 2013)

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Jan 19

- Did Tim Geithner Leak Every Fed Announcement To The Banks? (ZeroHedge, Jan 18, 2013):

On August 17, 2007, the Fed’s Board of Governors announced a key change to primary credit lending terms, whereby the discount rate was cut by 50 bp — to 5.75% from 6.25% — and the term of loans was extended from overnight to up to thirty days. This reduced the spread of the primary credit rate over the fed funds rate from 100 basis points to 50 basis points. News of the emergency measure was supposed to be kept secret from market participants as it was substantially market moving. It wasn’t. And just when we thought our opinion of the outgoing Treasury Secretary and former NY Fed head Tim Geithner, whose TurboTax incompetence is now legendary, couldn’t get lower, it got lower. Much lower. From the August 16, 2007 transcript (page 13 of 37) of the conference call preceding this announcement.

MR. LACKER. If I could just follow up on that, Mr. Chairman.

CHAIRMAN BERNANKE. Yes, go ahead.

MR. LACKER. Vice Chairman Geithner, did you say that [the banks] are unaware of what we’re considering or what we might be doing with the discount rate?

VICE CHAIRMAN GEITHNER. Yes.

MR. LACKER. Vice Chairman Geithner, I spoke with Ken Lewis, President and CEO of Bank of America, this afternoon, and he said that he appreciated what Tim Geithner was arranging by way of changes in the discount facility. So my information is different from that.

CHAIRMAN BERNANKE. Okay. Thank you. Go ahead, Vice Chairman Geithner.

VICE CHAIRMAN GEITHNER. Well, I cannot speak for Ken Lewis, but I think they have sought to see whether they could understand a little more clearly the scope of their rights and our current policy with respect to the window. The only thing I’ve done is to try to help them understand—and I’m sure that’s been true across the System—what the scope of that is because these people generally don’t use the window and they don’t really understand in some sense what it’s about.

At least we now know who the bankers’ mole on the FOMC was before, as gratitude for his services, he was promoted to Treasury Secretary of the US. Because if he leaked one, he leaked them all.

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Jan 13

Watch Taibbi and Black discuss Geithner’s legacy and the issues behind the government’s Wall Street bailout, originally aired on January 11, 2013:

- Taibbi: Geithner is ‘the architect of too big to fail’ (The Raw Story, Jan 12, 2013):

The legacy of outgoing U.S. Treasury Secretary Tim Geithner will be simple, said Rolling Stone contributing editor Matt Taibbi on Friday — and unflattering.

“He’s the architect of “too big to fail,” Taibbi told Democracy Now hosts Amy Goodman and Juan Gonzalez. ” When this all blows up — and it’s going to blow up, for sure, because things can’t continue the way they are right now — people are going to look back in history, and they’re going to say, “Who was to blame for this?” And Timothy Geithner is going to be the guy who designed this entire system.”

Continue reading »

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Jan 10

- Secrets and Lies of the Bailout (Rolling Stone, Jan 4, 2013):

It has been four long winters since the federal government, in the hulking, shaven-skulled, Alien Nation-esque form of then-Treasury Secretary Hank Paulson, committed $700 billion in taxpayer money to rescue Wall Street from its own chicanery and greed. To listen to the bankers and their allies in Washington tell it, you’d think the bailout was the best thing to hit the American economy since the invention of the assembly line. Not only did it prevent another Great Depression, we’ve been told, but the money has all been paid back, and the government even made a profit. No harm, no foul – right?

Wrong.

It was all a lie – one of the biggest and most elaborate falsehoods ever sold to the American people. We were told that the taxpayer was stepping in – only temporarily, mind you – to prop up the economy and save the world from financial catastrophe. What we actually ended up doing was the exact opposite: committing American taxpayers to permanent, blind support of an ungovernable, unregulatable, hyperconcentrated new financial system that exacerbates the greed and inequality that caused the crash, and forces Wall Street banks like Goldman Sachs and Citigroup to increase risk rather than reduce it. The result is one of those deals where one wrong decision early on blossoms into a lush nightmare of unintended consequences. We thought we were just letting a friend crash at the house for a few days; we ended up with a family of hillbillies who moved in forever, sleeping nine to a bed and building a meth lab on the front lawn.

Continue reading »

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Dec 27

- Santelli Channels Cramer: “The Fed Doesn’t Have A Clue” (ZeroHedge, Dec 27, 2012):

Comparisons of the failure of the TARP vote and the fiscal cliff were summarily dismissed early in this clip – though CNBC’s Rick Santelli does note, as we have vociferously stated that a market correction is the only impetus to get something done in Washington. Having abandoned his channel’s “Rise Above” meme in the face of this “childish nonsense”, Santelli agrees that politicians “can show incompetence at very critical moments.” Then, sparked by the anchor’s comment that “the markets would know if [the cliff] was going be a horrific thing”, Santelli goes ‘off-script’ with an epic take-down of all things CNBC: “the stock market is an immediate gratification for investors to make money;” and asks the key question “Why do we look to the Dow Jones Industrial Average to handicap if this country is going to go down the sewer in a couple of years? It doesn’t give us a glimpse into the future.” He adds that the market is not discounting $100 trillion of unfunded liabilities in our future and then slams the door shut with what will likely become the new meme: “The Fed doesn’t have a clue, neither does the President, neither does Congress.”

Forward to 4:30 for the epic rant (or enjoy the whole thing as Rick summarily dismisses the much hoped for “Rise Above” theme)


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Dec 27

- Geithner – US To Hit Debt Ceiling On December 31 (ZeroHedge, Dec 27, 2012):

Just because the Fiscal Cliff was not enough…

  • GEITHNER SAYS U.S. WILL REACH STATUTORY DEBT LIMIT ON DEC. 31
  • GEITHNER: WILL USE `EXTRAORDINARY MEASURES’ TO AVOID DEBT LIMIT
  • TREASURY: SPECIAL MEASURES TO MAKE $200 BLN  ROOM UNDER LIMIT
  • GEITHNER: $200 BLN TO LAST TWO MONTHS IN `NORMAL CIRCUMSTANCES’
  • GEITHNER: TAX, SPENDING `UNCERTAINTY’ MAKES DURATION NOT CLEAR
  • GEITHNER SAYS ALL MEASURES HAVE BEEN USED IN PRIOR IMPASSES
  • GEITHNER OUTLINES PLANS IN LETTER TO SENATE MAJORITY LEADER

So since America’s dysfunctional congress failed to “rise above” the Fiscal Cliff, it at least succeeded to “rise above” the debt ceiling. One out of two is not too bad…

To summarize: debt ceiling hit December 31, just in time for the no deal on the Fiscal Cliff, and then the Treasury will proceed to defund various Government retirement accounts for the next two and a half months, when sometime in March the true deadline to getting a joint solution on both the Cliff and the Debt Ceiling will becoming unextendable as the alternative is truly unthinkable: living within its means!
Continue reading »

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Dec 12

- U.S. Rakes Up Nearly $300 Billion Deficit In First Two Months Of Fiscal 2013 (ZeroHedge, Dec 12, 2012):

To paraphrase Tim Geinter: “Risk of the Fed ever ending its monetization? No risk of that.” Why? Because as the FMS just reported, the February budget deficit was $172 billion, up $52 billion from a month ago, and $35 billion from a year ago. In brief: in the first two months of Fiscal 2013, the US accumulated a $292 billion budget deficit (compared to $236 billion a year ago), a number which is simply scary when annualized. What does this mean? That as long as the Treasury runs $1+ trillion budget deficit, the Fed will never, ever be allowed to stop monetizing, especially with China and the other legacy foreign borrowers just saying nein. Which in turn means that it will now be in the Fed’s favor to paint the economy with uglier colors (recall that the Fed now needs unemployment deterioration to have infinite free monetization reign). Does this mean that going over the Cliff is now an absolute certainty.

Source

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Dec 03

- Geithner: Raise U.S. debt limit to infinity (Natural News, Dec 1, 2012):

The elaborate Ponzi scheme officially known as the U.S. financial system is set to completely transform into a Monopoly-style fantasy economy where money and debt are both meaningless and limitless. U.S. Treasury Secretary Timothy Geithner has actually come out with a proposal that the American debt ceiling be completely eliminated, allowing the crooks that run the federal government to print as much phony debt currency as their hearts desire, and spend away into oblivion.

During a recent interview on Bloomberg TV, Geithner told Political Capital‘s Al Hunt that the Congressionally-established debt ceiling, which was specifically designed to establish reasonable limits on the amount of money the federal government can borrow, should be completely abolished. Even though Congress is the only entity that can make such a decision, Geithner expressed his belief that the limit be scrapped to avoid its being used as “a tool for political advantage.”

“It would have been time a long time ago to eliminate it,” said a nervous Geithner to Hunt, after being asked when he believed the debt ceiling should be eliminated. “The sooner the better.”

Continue reading »

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Dec 01

“I wish it were possible to obtain a single amendment to our Constitution — taking from the federal government their power of borrowing. “
- Thomas Jefferson

“If the American people ever allow private banks to control the issue of their money, first by inflation and then by deflation, the banks and corporations that will grow up around them (around the banks), will deprive the people of their property until their children will wake up homeless on the continent their fathers conquered.”
- Thomas Jefferson

See also:

- Since Obama Has Been President The National Debt Has Increased $49,432.73 Per Household (CNS News)


- Obama Wants Dictatorial Power To Increase Debt (PressTv, Nov 30, 2012):

The former president of the Federal Reserve Bank of New York and current Treasury boss Timothy Geithner has informed Republicans that Obama wants absolute authority to increase the national debt.

Geithner’s proposal was met with derision and laughter by Republicans.

“Well, it’s outrageous,” Sen. John Cornyn (R-Texas) told Fox News when asked about Obama’s plan to personally dictate the finances of the United States. “It’s profoundly irresponsible. So that’s a crazy idea and I’m amazed that Secretary Geithner had the courage to float that yesterday.”

The idea floated by Geithner would give the president sole power to unilaterally raise the debt ceiling at any time. Congress could pass a resolution to stop the increase, but it would require a two-thirds vote of both chambers to pass and could still be vetoed by the president.

As it now stands, the so-called debt ceiling can only be increased following a vote by Congress.

Continue reading »

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Dec 01

Don’t miss:

- Since Obama Has Been President The National Debt Has Increased $49,432.73 Per Household (CNS News)


- Cornyn: Obama ‘crazy’ to claim unilateral debt ceiling power (The Hill, Nov 30, 2012):

Sen. John Cornyn (R-Texas), who will soon be the second-ranking Republican in the Senate, on Friday panned a proposal by the White House that would allow President Obama to raise the debt ceiling without congressional approval.

Cornyn was referring to a plan Treasury Secretary Tim Geithner presented to Speaker John Boehner (R-Ohio) on Thursday that was meant to avoid the “fiscal cliff” of tax increases and spending cuts.

The plan, which sparked strong Republican criticism, included a provision allowing the White House to raise the debt ceiling without the consent of Congress.

“Well, it’s outrageous,” Cornyn said on Fox News.

“It’s like saying we maxed out our credit card so I’m going to get a new credit card with no limit so I can keep spending. There needs to be some accountability here and, so far, we’re spending 42 cents out of every dollar in Washington and that’s borrowed money. And that’s money that our kids and grandkids are gonna have to pay back.”The provision is meant to avoid the standoff that occurred in the summer of 2011 when Obama struggled to win congressional Republicans’ consent to raise the debt ceiling.

Cornyn went on to say that the proposal was “irresponsible.”

“It’s profoundly irresponsible,” Cornyn said. “So that’s a crazy idea and I’m amazed that Secretary Geithner had the courage to float that yesterday.”

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Nov 21

- Is The Largest Weekly Inflow Into Bank Savings Accounts On Record, A Flashing Red Alarm? (ZeroHedge, Nov 20, 2012)

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Nov 05


Timothy Geithner at CFR

- Tim Geithner: Next Steps (ZeroHedge, Nov 5, 2012):

Tim Geithner’s public “servant” tenure has not been without its blemishes: from his deplorable run as the (figure)head of the New York Fed (from 2003 until 2009), when the entire financial system literally imploded under his watch, to his epic failing up as Hank Paulson’s replacement as treasury Secretary of the United States, despite his legendary inability to navigate the Minotaurian labyrinth that is the TurboTax income tax flowchart, the Dartmouth alum has had his share of run ins with adversity (and adversity won). Of course, Geithner’s tenure in charge of the Treasury in the past 4 years has been somewhat mollified by the fact that here too here was merely a figurehead, and the true entity that runs the US printing presses is none other than the JPM and Goldman Sachs co-chaired Treasury Borrowing Advisory Committee (for more on the TBAC read here and especially here as pertains to the former LTCM trader and current head of JPM’s CIO group), meaning that the US Treasury, just like the Fed, are merely branches of the one true power in US governance: Wall Street. Geithnerian figureheadedness aside, the one undeniable fact is that Tim Geithner’s days as head of the Treasury are now numbered: he has made it quite clear that he will not accompany Obama (should the incumbent be reelected) into his second term. So what is a career “public servant” to do once the public no longer has any interest in retaining his services? Bloomberg’s Deborah Solomon has some suggestions…First, it may come as a surprise to some, that just like virtually every other central planner currently in charge of deciding the fate of billions of people in US and around the world, Geithner has never really had much interaction with real life:

Despite the fact that much of the public — not to mention some lawmakers on Capitol Hill — assume Geithner worked on Wall Street, he never has. Instead, he has spent most of his career in public service. Before taking the Treasury post in 2009, Geithner headed the Federal Reserve Bank of New York for six years and worked at the International Monetary Fund. His main private-sector job was at Kissinger Associates Inc.

The years in public service — particularly engaging in diplomacy with domestic and foreign partners — left a deep impression on Geithner, infusing him with a sense of purpose that he might find lacking on Wall Street (see: “Why I Left Goldman Sachs” by Greg Smith).

Continue reading »

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Oct 27

- Major Banks, Governmental Officials and Their Comrade Capitalists Targets of Spire Law Group, LLP’s Racketeering and Money Laundering Lawsuit Seeking Return of $43 Trillion to the United States Treasury (PR Newswire, Oct 25, 2012):

NEW YORK, Oct. 25, 2012 /PRNewswire/ — Spire Law Group, LLP’s national home owners’ lawsuit, pending in the venue where the “Banksters” control their $43 trillion racketeering scheme (New York) – known as the largest money laundering and racketeering lawsuit in United States History and identifying $43 trillion ($43,000,000,000,000.00) of laundered money by the “Banksters” and their U.S. racketeering partners and joint venturers – now pinpoints the identities of the key racketeering partners of the “Banksters” located in the highest offices of government and acting for their own self-interests.

In connection with the federal lawsuit now impending in the United States District Court in Brooklyn, New York (Case No. 12-cv-04269-JBW-RML) – involving, among other things, a request that the District Court enjoin all mortgage foreclosures by the Banksters nationwide, unless and until the entire $43 trillion is repaid to a court-appointed receiver – Plaintiffs  now establish the location of the $43 trillion ($43,000,000,000,000.00) of laundered money in a racketeering enterprise participated in by the following individuals (without limitation):  Attorney General Holder acting in his individual capacity, Assistant Attorney General Tony West, the brother in law of Defendant California Attorney General Kamala Harris (both acting in their individual capacities), Jon Corzine (former New Jersey Governor), Robert Rubin (former Treasury Secretary and Bankster), Timothy Geitner, Treasury Secretary (acting in his individual capacity), Vikram Pandit (recently resigned and disgraced Chairman of the Board of Citigroup), Valerie Jarrett (a Senior White House Advisor), Anita Dunn (a former “communications director” for the Obama Administration), Robert Bauer (husband of Anita Dunn and Chief Legal Counsel for the Obama Re-election Campaign), as well as the “Banksters” themselves, and their affiliates and conduits.  The lawsuit alleges serial violations of the United States Patriot Act, the Policy of Embargo Against Iran and Countries Hostile to the Foreign Policy of the United States, and the Racketeer Influenced and Corrupt Organizations Act (commonly known as the RICO statute) and other State and Federal laws. Continue reading »

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Oct 25

- Iconic NY Steakhouse “Gallagher’s”, Which Survived The Great Depression, Is Closing (ZeroHedge, Oct 25, 2012):

The Department of Labor’s WARN (Worker Adjustment and Retraining Notification) website may have been exempt from layoff notices related to the fiscal cliff, but it still provides a sufficiently (bleak) complete picture about the real nature of layoffs and business cycle in general in America’s busiest city. Which is why it was precisely using the WARN website that we learned that one of New York’s most historic steakhouses, “NY’s Prime Steakhouse since 1927″ Gallagher’s, located on 52nd street, and which survive the great depression, is shutting down on January 16. Surely neither the surging price of meat, nor the ability of patrons to spend charge $46.95 for an 18 ounce sirloin, has had any impact on the decision to close this iconic restuarant which survived the Great Depression, but failed to survive Tim Geithner’s “recovery“.

From WARN:

Date of Notice: 10/23/2012 Continue reading »

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Aug 18

- US Treasury Admits It Conducted A Circular Ponzi Scheme For Years (ZeroHedge, Aug 17, 2012):

While one may wonder about the implications of the just announced “accelerated windown” of the GSEs, predicated in no small part by the surge in animosity between Tim Geithner and the FHFA’s Ed DeMarco, there is one aspect of the announcement that is completely and utterly unambigious: as part of its justification to demand faster liquidation of Fannie and Freddie’s “investment portfolio” Tim Geithner gave the following argument:

This will help achieve several important objectives, including… Ending the circular practice of the Treasury advancing funds to the GSEs simply to pay dividends back to Treasury

In other words not some fringe blog, not some “partisan” media outlet, not some morally conflicted whistleblowing former employee seeking immunity, but the US Trasury itself just admitted it had been engaged in circular check kiting scheme, which essentially has all the components of a Ponzi scheme in it, ever since the nationalization (about which there is no now doubt and which means the GSE’s $6 trillion in debt is now fully on the Treasury’s balance sheet) of Fannie and Freddie in 2008.

Transfer one more conspiracy theory into the conspiracy fact bin.

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Aug 09

- Treasury’s Secretive $2.4 Trillion Fund Guarantee (CNBC, Aug 9, 2012):

Details about a secretive government program to bail out money-market mutual funds are finally coming to light.

Acting without any explicit Congressional authority, the U.S. Treasury guaranteed in excess of $2.4 trillion of money market funds after the giant Reserve Primary Fund “broke the buck” following the bankruptcy of Lehman Brothers. The program, which ended on Sept. 18, 2009, seems to have successfully prevented a panicked run by money-market fund investors.

But until now the Treasury has kept the identities of the funds that received government backing and the amounts guaranteed secret. It was not clear how many funds obtained backing or for how much taxpayers were on the hook during the program’s duration.

Continue reading »

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Aug 07


YouTube

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Aug 05


YouTube Added: 29.07.2012

Description:

The rest of the story: Continue reading »

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Aug 05

Not just one generation will be thrown into poverty.


To prop up the euro – whose survival is vital only for the banks’ balance sheets – a generation is thrown into poverty


In Athens, Angela Merkel is seen handcuffed on the cover of the magazine Crash. The headline demands that European leaders be ‘tried for genocide of the Greeks’. Photograph: Thanassis Stavrakis/AP

- Eurozone crisis: the bankers are happy to play Nero as Europe burns (Guardian, July 31, 2012):

While Rome burned, Nero put on fancy dress, stood on a tower and played his lyre. He sang of the Sack of Ilium and roasted Christians at the stake to light up his party. The people were taxed to pay for his extravagance, but he appeased them with games of ever increasing spectacle and sadism. He clad slaves in deerskins and had lions eat them. It was immensely popular. When Nero duly fell from grace and committed suicide, he cried: “What an artist dies in me.”

I like the Olympics now that athletes have taken over from fatcats on centre stage, but the media coverage is disproportionate, idiotic and Orwellian. Never has the BBC in particular purveyed such nationalistic opium to the people. Is it really necessary to ignore all news of the city burning for the duration?

Last weekend a small island off the coast of Schleswig-Holstein saw the American treasury secretary, Tim Geithner, and the German finance minister, Wolfgang Schäuble, attempt a feat as yet unknown to the Olympics. It is called “save the euro”. This marathon is being played simultaneously and in real time by bankers and politicians in all Europe’s capitals, while a claque shouts “two weeks to save the euro” over and over again.

Continue reading »

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Aug 03

- The Fed’s Gold Is Being Audited… By The US Treasury (ZeroHedge, Aug 2, 2012):

When we started reading the LA Times article reporting that “the federal government has quietly been completing an audit of U.S. gold stored at the New York Fed” we couldn’t help but wonder when the gotcha moment would appear. It was about 15 paragraphs in that we stumbled upon what we were waiting for: “The process involved about half a dozen employees of the Mint, the Treasury inspector general’s office and the New York Fed. It was monitored by employees of the Government Accountability Office, Congress’ investigative arm.” In other words the Fed’s gold is being audited… by the Treasury. Now our history may be a little rusty, but as far as we can remember, the last time the Fed was actually independent of the Treasury then-president Harry Truman fired not one but two Fed Chairmen including both Thomas McCabe as well as the man after whom the Fed’s current residence is named: Marriner Eccles, culminating with the Fed-Treasury “Accord” of March 3, 1951 which effectively fused the two entities into one – a quasi independent branch of the US government, which would do the bidding of its “political”, who in turn has always been merely a proxy for wherever the money came from (historically, and primarily, from Wall Street), which can pretend it is a “private bank” yet which is entirely subjugated to the crony interests funding US politicians (more on that below). But in a nutshell, the irony of the Treasury auditing the fed is like asking Libor Trade A to confirm that Libor Trader B was not only “fixing” the Libor rate correctly and accurately, but that there is no champagne involved for anyone who could misrepresent it the best within the cabal of manipulation in which the Nash Equilibrium was for everyone to commit fraud.

Far more importantly, for all those financial novices who fail to grasp the simplest relationship between assets and liabilities, the allegation expounded by the “conspiracy theorists”, as the LA Times calls them, has never been that the gold at the NY Fed is not there. It is by all means there: after all what safer place to keep it than 80 feet below the Federal Reserve itself, the same Fed which has exclusive access to the 1000+ strong Federeal Reserve Police whose “primary duty is to provide force protection to Federal Reserve facilities. Secondary responsibilities, depending on the particular location, may include liaison work with other law enforcement agencies and/or investigative work related to administrative matters.”

And not only the gold belonging to the US: it is well known that the bulk of Europe’s sovereign gold is also contained deep under downtown Manhattan: we wish them all the best when they attempt to repatriate the physical when they need it, such as the day after the EUR finally collapses.

No – what the “conspiracy theorists” allege is that claims existing in paper format on the physical gold held under Liberty 33 are orders of magnitude greater than the actual physical gold these claims supposedly have recourse to. Indeed, this too was a conspiracy theory until the failure of MF Global proved it to be a conspiracy “fact” and the entire asset-liability rehypothecation daisy-chain threatened to begin unwinding in November of 2011, at which point forced delivery of hard assets would expose the entire facade of the modern financial system to be a hollow sham.

So unless the Treasury will also conduct a full “audit” of every single paper trail and every physical bar is mapped to all of its existing obligors, then the entire operation is absolutely meaningless and simply a waste of taxpayer money. Because the physical gold may well be there (and furthermore it is the gold at Ft. Knox that was questionable; never the gold held by the Fed, but who cares about details). The problem is if the paper claims on this gold are far greater than the actual deliverable physical gold for that moment when the latest attempt to kick the can down the rehypothecated road finally fails.

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Jul 31

- GREECE EXCLUSIVE: Geithner envoy ‘assured Athens of US support on return to drachma’ – sources (The Slog, July 29, 2012):

Meanwhile, the EFSF robs Petros to pay Pavlos

The US Treasury’s Assistant Secretary for International Finance Charles Collyns had a meeting with Greek Finance Minister Yiannis Stournaras in Athens on Wednesday morning. The official Greek media version was that Collyns ‘expressed the support of US-Finance Secretary Tomothy Geithner to Greece and his confidence in Greek efforts. Yinannis Stournas briefed Collyns on the situation of the Greek fiscal condition, and the key challenges of the Greek economy’.

In fact, Washington sources told The Slog last night BST that Collyns – a confidante of both Geithner and Stournas – was on a specific mission to impress on Greek Finance bosses the US Treasury’s sincerity in offering Greece “almost unqualified support in the event of a return to the drachma”. The White House is betting on the strong likelihood of Greece becoming formally insolvent before any more bailout monies are available from Berlin-am-Brussels.

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Jul 27

- Barofsky On Geithner: “We Should See People In Handcuffs” (ZeroHedge, July 26, 2012):

There is no point in recapping the ongoing vendetta between former SIGTARP Neil Barofsky and former head of the NY Fed, and current Treasury secretary and resident TurboTax expert Tim Geithner. One need but follow the former on Twitter for a quick and concise sampling of the sentiments harbored vis-a-vis the latter. However, in the following interview Barfosky does touch on some points which in the context of the recent Liborgate, should be brought front and center, especially since the increasingly apathetic US audience seems to not care about one bit (as opposed to their distant cousins across the Atlantic for whom Lieborgate has become a daily distraction). Namely, what Barofsky says is that Geithner and other regulators who allowed Lieborgate to proceed should not only lose their job but we should see [Geithner] in handcuffs.”  Sadly that will never happen as it would actually be a deterrent to future crime among the highest echelons of America: something which is just not allowed to happen in a system whose very survival is increasingly reliant on rampant criminality.

To wit:

While Geithner pushed for broader reforms of LIBOR, he did not explicitly warn of possible rate manipulations and neglected to notify U.S. regulators at the Department of Justice, the Commodity Futures Trading Commission and Securities and Exchange Commission to the wrongdoing, notes Barofsky.

It was a “message to the banks ‘if we commit fraud, we break the rules, don’t worry, we’re too big — they’ll never bring the appropriate steps against us,’” Barofsky says in an interview with The Daily Ticker. “And that is why we’ve had scandal after scandal after scandal.”

This was a “global conspiracy to fix one of the most important interest rates in the world,” Barofsky continues. “[Geithner] heard this information and looked the other way. Geithner and other regulators should be held accountable, they should be fired across the board. If they knew about an ongoing fraud, and they didn’t do anything about it, they don’t deserve to have their jobs. I hope we see people in handcuffs.”

Full clip:

There is no point in recapping the ongoing vendetta between former SIGTARP Neil Barofsky and former head of the NY Fed, and current Treasury secretary and resident TurboTax expert Tim Geithner. One need but follow the former on Twitter for a quick and concise sampling of the sentiments harbored vis-a-vis the latter. However, in the following interview Barfosky does touch on some points which in the context of the recent Liborgate, should be brought front and center, especially since the increasingly apathetic US audience seems to not care about one bit (as opposed to their distant cousins across the Atlantic for whom Lieborgate has become a daily distraction). Namely, what Barofsky says is that Geithner and other regulators who allowed Lieborgate to proceed should not only lose their job but we should see [Geithner] in handcuffs.”  Sadly that will never happen as it would actually be a deterrent to future crime among the highest echelons of America: something which is just not allowed to happen in a system whose very survival is increasingly reliant on rampant criminality.

To wit:

While Geithner pushed for broader reforms of LIBOR, he did not explicitly warn of possible rate manipulations and neglected to notify U.S. regulators at the Department of Justice, the Commodity Futures Trading Commission and Securities and Exchange Commission to the wrongdoing, notes Barofsky.

It was a “message to the banks ‘if we commit fraud, we break the rules, don’t worry, we’re too big — they’ll never bring the appropriate steps against us,’” Barofsky says in an interview with The Daily Ticker. “And that is why we’ve had scandal after scandal after scandal.”

This was a “global conspiracy to fix one of the most important interest rates in the world,” Barofsky continues. “[Geithner] heard this information and looked the other way. Geithner and other regulators should be held accountable, they should be fired across the board. If they knew about an ongoing fraud, and they didn’t do anything about it, they don’t deserve to have their jobs. I hope we see people in handcuffs.”

Full clip:

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Jul 19

- This Is The Government: Your Legal Right To Redeem Your Money Market Account Has Been Denied – The Sequel (ZeroHedge, July 19, 2012):

Two years ago, in January 2010, Zero Hedge wrote “This Is The Government: Your Legal Right To Redeem Your Money Market Account Has Been Denied” which became one of our most read stories of the year. The reason? Perhaps something to do with an implicit attempt at capital controls by the government on one of the primary forms of cash aggregation available: $2.7 trillion in US money market funds. The proximal catalyst back then were new proposed regulations seeking to pull one of these three core pillars (these being no volatility, instantaneous liquidity, and redeemability) from the foundation of the entire money market industry, by changing the primary assumptions of the key Money Market Rule 2a-7. A key proposal would give money market fund managers the option to “suspend redemptions to allow for the orderly liquidation of fund assets.” In other words: an attempt to prevent money market runs (the same thing that crushed Lehman when the Reserve Fund broke the buck). This idea, which previously had been implicitly backed by the all important Group of 30 which is basically the shadow central planners of the world (don’t believe us? check out the roster of current members), did not get too far, and was quickly forgotten. Until today, when the New York Fed decided to bring it back from the dead by publishing “The Minimum Balance At Risk: A Proposal to Mitigate the Systemic Risks Posed by Money Market FUnds“. Now it is well known that any attempt to prevent a bank runs achieves nothing but merely accelerating just that (as Europe recently learned). But this coming from central planners – who never can accurately predict a rational response – is not surprising. What is surprising is that this proposal is reincarnated now. The question becomes: why now? What does the Fed know about market liquidity conditions that it does not want to share, and more importantly, is the Fed seeing a rapid deterioration in liquidity conditions in the future, that may and/or will prompt retail investors to pull their money in another Lehman-like bank run repeat?

Here is how the Fed frames the problem in the abstract: Continue reading »

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