The Commerce Department said today that retail sales fell by 1.2 percent in May. Although this was a surprise to many economists it has been no surprise to the millions of Americans who are looking for a job, or those that have already thrown in the towel and given up, or for the millions still facing foreclosure.
The US economy has been brought to its knees by the inevitable failure of any meaningful and insightful judgment coming from the Obama administration. Both the president and congress have thrown money in the wrong direction, wasting resources that may cause the US government to find itself in the same place as Greece within the next few years. Yes the banks were saved but at the expense of the US population.
Now after throwing trillions at the banks and a small token at the people, the Federal Reserve under Bernanke is completely lost in its own quagmire of confusion; the system is so completely over run by the bank elite that there is no place in this administration for common sense.
Five banks that set this collapse in motion each KNEW Obama would bring taxpayer aid to their survival. Those banks were Goldman Sachs Group Inc., Deutsche Bank AG, Bear Stearns Cos, Citigroup Inc., and JP Morgan Chase & Co., traders from these banks actually met and devised the instruments to bet against the subprime securities they were themselves promoting, and by playing both sides of the table they couldn’t lose. It was a Las Vegas style Gamble and they took out insurance, literally, taking down AIG and a host of other smaller insurance companies.
Why then did they need a government bailout? Primarily because they actually bankrupted AIG which caused Timothy Geithner from the New York Fed to coerce AIG to pay the banks in full for their second party CDS’s, thus allowing these same banks to be made whole with the exception of Bear Stearns. Why was Bear allowed to fall when the others were not?
Former Bear Stearns chief executive James Cayne, the chairman and CEO said the firm became the first major victim of the financial crisis due to “unfounded rumors”, not because of risky exposures to mortgage-related products with free-falling values.
Bear Stearns in March 2008 experienced essentially a run on the bank as creditors and the markets lost confidence in the institution. Regulators scrambled to find a buyer for the collapsing firm, resulting in a sale to none other than JPMorgan Chase & Co for $10 a share.
Maybe it’s just a coincidence that Bear Stearns was brought to its knees by rumors and ended up in the hands of JP Morgan. In 1907 JP Morgan began a series of rumors that the New York Banks were insolvent causing a similar run which essentially gave Morgan control, and what was accomplished was that which Morgan sought the beginning of the Federal Reserve System where Wall Street actually took control of the US Government.
The belief is that J.P. Morgan actually wanted Bear Stearns. So they arranged it by rumors and a sale, just as they did with Washington Mutual.
On April 17, 2010 the former head of the chief banking regulatory agency that oversaw failed Washington Mutual told lawmakers that the giant savings and loan collapsed because of a run on the bank, not failures by him or other regulators.
Who started the rumors that cause a run on Washington Mutual? Another coincidence Washington Mutual was taken over by non other that JP Morgan Chase who bought it for $2 billion.
Phil Angelides (Crisis Commission) in January accused Goldman Sachs CEO Lloyd Blankfein of treating clients unfairly for creating -- and then betting against -- subprime mortgage-backed securities. And this is essentially what each of these banks did.
Could the US economy have been saved?
Absolutely if that were the real intent of the Obama Administration! But Obama and Congress were to focused on their financial backers to see the forest for the trees, they threw money at the banks, and AIG with the latter allowing the foreclosures to continue, thus giving the banks a twofold profit, the bail out money allowing them to loan it back to the government and the foreclosure where they were paid by AIG and the other institutions that were foolish enough to guarantee these insane investments.
Obama and Congress could have used the same money to bailout both the Banks and the Borrowers, they could have provided the money to the banks per each loan that was modified to reduce the principal and interest. Thereby stopping the onslaught of foreclosures and maintaining a jobs market because there would not have been the financial impact on the economy.
The US Government because they have been substantially absorbed by Wall Street, is now tinkering on the brink of financial collapse. And this collapse is what should have allowed of Wall Street.
Showing posts with label wall street. Show all posts
Showing posts with label wall street. Show all posts
Friday, June 11, 2010
Wednesday, June 9, 2010
Moving out of a recession and into a recovery?
If you love a good story you’ll love the latest novelette published by the FED. It’s full of hope and optimism, and dreams and imaginings and its heart wrenching. If only it were true!
According to the latest vision of the FED who now claims to have conducted a poll, the FED found that we are moving out of a recession and into a recovery. What a great story and I only wish it was true, but as I am not an ostrich I don’t buy it.
Just like GM paid off their obligation to the US government was supposed to make us believe that GM had turned around, those who read my articles know I called the shot on what really occurred. GM paid back the government with the money it borrowed from the government.
Now the real polls taken in the past couple of days show a much different story, and it’s one that is much more pessimistic. Only 29% of Adults now believe the economy is getting better. That’s down from 34% before the jobs report last week. But these are the 10% at the top; a remarkable 71% of the population isn’t buying into the propaganda.
And it’s the same among investors, 36% believe the economy is getting better while 42% say it’s getting worse. Before Friday’s report, investors were more evenly divided with 41% thinking that the economy is getting better and 39% offering the more realistic and sadly pessimistic view.
On the night that Lehman Brothers collapsed to begin the financial industry meltdown, 43% of Americans rated their own personal finances as good or excellent. Just 31% of Americans are now that upbeat about their own financial situation.
Today, only 24% believe their personal finances are getting better while 46% say they are getting worse with 30% remaining constant fairly equal to those who currently believe the economy is improving. And the FED acknowledged, economic growth won't be strong enough to bring speedy relief to millions of out-of-work Americans. Growth in the early stages of economic recoveries is usually much stronger. That's not happening this time because consumers and businesses haven't shown signs that they are inclined to go on spending sprees. There continues to be one important element that remains elusive, it’s called JOBS!
Without them there can’t be a real and meaningful recovery, what the FED fails to mention in its work of fiction is that what economy there is has been created by what his Wall Street friends have characterized as “Strategic Defaulters” home mortgage borrowers who have intentionally made a decision to stop making their mortgage payments and are instead spending the money.
According to the latest vision of the FED who now claims to have conducted a poll, the FED found that we are moving out of a recession and into a recovery. What a great story and I only wish it was true, but as I am not an ostrich I don’t buy it.
Just like GM paid off their obligation to the US government was supposed to make us believe that GM had turned around, those who read my articles know I called the shot on what really occurred. GM paid back the government with the money it borrowed from the government.
Now the real polls taken in the past couple of days show a much different story, and it’s one that is much more pessimistic. Only 29% of Adults now believe the economy is getting better. That’s down from 34% before the jobs report last week. But these are the 10% at the top; a remarkable 71% of the population isn’t buying into the propaganda.
And it’s the same among investors, 36% believe the economy is getting better while 42% say it’s getting worse. Before Friday’s report, investors were more evenly divided with 41% thinking that the economy is getting better and 39% offering the more realistic and sadly pessimistic view.
On the night that Lehman Brothers collapsed to begin the financial industry meltdown, 43% of Americans rated their own personal finances as good or excellent. Just 31% of Americans are now that upbeat about their own financial situation.
Today, only 24% believe their personal finances are getting better while 46% say they are getting worse with 30% remaining constant fairly equal to those who currently believe the economy is improving. And the FED acknowledged, economic growth won't be strong enough to bring speedy relief to millions of out-of-work Americans. Growth in the early stages of economic recoveries is usually much stronger. That's not happening this time because consumers and businesses haven't shown signs that they are inclined to go on spending sprees. There continues to be one important element that remains elusive, it’s called JOBS!
Without them there can’t be a real and meaningful recovery, what the FED fails to mention in its work of fiction is that what economy there is has been created by what his Wall Street friends have characterized as “Strategic Defaulters” home mortgage borrowers who have intentionally made a decision to stop making their mortgage payments and are instead spending the money.
Sunday, May 16, 2010
Is High Frequency Trading “Insider Trading?”
Looking through the secret profit center behind Wall Street is like looking at wonderland through the eyes of Alice . It’s an amazing picture few ever get to see and fewer will ever understand. There are mega bucks floating everywhere. That is except into the pockets of those of us on Main Street who could use a little green coloring.
These HFT’s have been around since the 1990’s, ever fine tuning their computer software, searching for deals where the investors have not yet realized a stock is about to rise or fall, or where an exchange hasn’t provided consumers notice of a recent stock trade.
While billions of dollars are churned in mega seconds sometimes a million dollars and more in a fraction of a millisecond and on only a fraction of a penny profit. The stock market has become a fools paradise, left to the big hedge funds and their inside investors.
How do they work?
One way these traders make money is by exploiting the fact that stock indexes sometimes don't immediately reflect falling or rising prices of their component stocks. If GM shares for example rise 5 percent but an index fund that includes it such as the SPDR S&P 500 lags by a fraction of second to adjust, these HFT computers pick up the lag and buy or sell the stock in fractions of a second reaping large profits. HFT computers will “automatically” buy shares of SPDR S&P 500 at the lower price and then sell them again when they are fully valued, in other words, when the information is released to the general public.
Is this really Insider Trading, we believe it is because the information has not yet been released to the public!
This reminds me of the old days and Ben Siegel, who charged fees from bookmakers for a wire service that transmitted horse racing results. Often allowing bookmakers to lay off bets from a direct source after the race had been concluded.
It appears to be time that the SEC took a real hard look at these high frequency traders to determine if in fact they are trading on information that has not yet been made public.
Since Goldman Sachs is a part of this trading mechanism we need to take a hard look at its legitimacy.
These HFT’s have been around since the 1990’s, ever fine tuning their computer software, searching for deals where the investors have not yet realized a stock is about to rise or fall, or where an exchange hasn’t provided consumers notice of a recent stock trade.
While billions of dollars are churned in mega seconds sometimes a million dollars and more in a fraction of a millisecond and on only a fraction of a penny profit. The stock market has become a fools paradise, left to the big hedge funds and their inside investors.
How do they work?
One way these traders make money is by exploiting the fact that stock indexes sometimes don't immediately reflect falling or rising prices of their component stocks. If GM shares for example rise 5 percent but an index fund that includes it such as the SPDR S&P 500 lags by a fraction of second to adjust, these HFT computers pick up the lag and buy or sell the stock in fractions of a second reaping large profits. HFT computers will “automatically” buy shares of SPDR S&P 500 at the lower price and then sell them again when they are fully valued, in other words, when the information is released to the general public.
Is this really Insider Trading, we believe it is because the information has not yet been released to the public!
This reminds me of the old days and Ben Siegel, who charged fees from bookmakers for a wire service that transmitted horse racing results. Often allowing bookmakers to lay off bets from a direct source after the race had been concluded.
It appears to be time that the SEC took a real hard look at these high frequency traders to determine if in fact they are trading on information that has not yet been made public.
Since Goldman Sachs is a part of this trading mechanism we need to take a hard look at its legitimacy.
Sunday, May 9, 2010
Bank control of congress and the White House, pays off big time for Wall Street
The US Senate has more interest in the big pools of money the banks funnel for campaigns through their lobbyists, than for the people who elect them to office.
This was exemplified last night (May 7) when the Senate rejected the single most important element of Wall Street reform, being able to break up the “too big to fail banks” the Senate rejected this provision by a vote of 33 to 61; 27 Democrats joined all but three Republicans to vote against breaking up the banks.
The 61 votes against the measure are votes in favor of Wall Street's continuing stranglehold over our economy. But more importantly it allows business as usual on Wall Street, and without fear of government reprisal. It also guarantees future bail outs when they become necessary. (And they will)
At the same time, the Senate also voted down a $50 billion Wall Street tax that would have been used to fund the cost of shutting down a major failing bank, assuring future taxpayer funding when a “too big to fail” bank again finds itself in trouble.
By rejecting both the break-up bill and the bank tax, Wall Street has emerged as a clear winner and shown what clout and control they have over the US political system and particularly over congress, and the president.
President Obama who strongly opposed both the tax and the break-up measures, hosted J.P. Morgan Chase CEO Jamie Dimon for dinner at the White House on Monday. J.P. Morgan is the largest U.S. bank, and spent more money on lobbying in 2009 than any other bank. House Minority Leader John Boehner (R-OH) has aggressively courted Dimon for campaign cash, as has Obama
It seems that money is more important to congress and the president, that the interests of the nation!
The failure of congress to address the banking problems in the US and to protect the interest of the American people over their benefactors, have assured further reckless behavior from these mega financial institutions.
By allowing the megabanks to remain super-sized, Congress has insulated them from the fallout associated with the Fed disclosures, and given them a tool to fight other reforms. Our giant financial institutions are not only too-big-to-fail they are now too-big-to-regulate!
No matter what else Congress may “ultimately” enact, in the name of Bank reform, Congress has decided that it will not confront the single greatest problem and threat to the U.S. economy: the “Too Big To Fail banks”.
If any meaningful legislation is passed it will be a total surprise.
Perhaps the issue of “too big to fail” will ultimately be address by a different forum, the American People themselves who after all have the last word.
Following is a list of Senators, who voted to protect the banks against the interest of the American people, its time to retire each and ever one of them.
Akaka (D-HI);
Alexander (R-TN);
Barrasso (R-WY)
Baucus (D-MT);
Bayh (D-IN);
Bennet (D-CO);
Bond (R-MO);
Brown (R-MA);
Brownback (R-KS);
Burr (R-NC);
Carper (D-DE);
Chambliss (R-GA);
Cochran (R-MS);
Collins (R-ME);
Conrad (D-ND);
Corker (R-TN)
Cornyn (R-TX);
Crapo (R-ID);
Dodd (D-CT);
Enzi (R-WY);
Feinstein (D-CA);
Gillibrand (D-NY);
Graham (R-SC);
Grassley (R-IA);
Gregg (R-NH);
Hagan (D-NC)
Hatch (R-UT);
Hutchison (R-TX);
Inhofe (R-OK);
Inouye (D-HI);
Isakson (R-GA);
Johanns (R-NE)
Johnson (D-SD);
Kerry (D-MA);
Klobuchar (D-MN)
Kohl (D-WI);
Kyl (R-AZ);
Landrieu (D-LA)
Lautenberg (D-NJ);
LeMieux (R-FL);
Lieberman (ID-CT);
McCain (R-AZ);
McCaskill (D-MO);
McConnell (R-KY);
Menendez (D-NJ);
Murkowski (R-AK)
Nelson (D-FL);
Nelson (D-NE);
Reed (D-RI);
Risch (R-ID);
Roberts (R-KS);
Schumer (D-NY);
Sessions (R-AL);
Shaheen (D-NH);
Snowe (R-ME);
Tester (D-MT);
Thune (R-SD);
Udall (D-CO);
Voinovich (R-OH)
Warner (D-VA);
Wicker (R-MS)
But equally important remember that Obama as well is financially beholden to the mega bank interests.
This was exemplified last night (May 7) when the Senate rejected the single most important element of Wall Street reform, being able to break up the “too big to fail banks” the Senate rejected this provision by a vote of 33 to 61; 27 Democrats joined all but three Republicans to vote against breaking up the banks.
The 61 votes against the measure are votes in favor of Wall Street's continuing stranglehold over our economy. But more importantly it allows business as usual on Wall Street, and without fear of government reprisal. It also guarantees future bail outs when they become necessary. (And they will)
At the same time, the Senate also voted down a $50 billion Wall Street tax that would have been used to fund the cost of shutting down a major failing bank, assuring future taxpayer funding when a “too big to fail” bank again finds itself in trouble.
By rejecting both the break-up bill and the bank tax, Wall Street has emerged as a clear winner and shown what clout and control they have over the US political system and particularly over congress, and the president.
President Obama who strongly opposed both the tax and the break-up measures, hosted J.P. Morgan Chase CEO Jamie Dimon for dinner at the White House on Monday. J.P. Morgan is the largest U.S. bank, and spent more money on lobbying in 2009 than any other bank. House Minority Leader John Boehner (R-OH) has aggressively courted Dimon for campaign cash, as has Obama
It seems that money is more important to congress and the president, that the interests of the nation!
The failure of congress to address the banking problems in the US and to protect the interest of the American people over their benefactors, have assured further reckless behavior from these mega financial institutions.
By allowing the megabanks to remain super-sized, Congress has insulated them from the fallout associated with the Fed disclosures, and given them a tool to fight other reforms. Our giant financial institutions are not only too-big-to-fail they are now too-big-to-regulate!
No matter what else Congress may “ultimately” enact, in the name of Bank reform, Congress has decided that it will not confront the single greatest problem and threat to the U.S. economy: the “Too Big To Fail banks”.
If any meaningful legislation is passed it will be a total surprise.
Perhaps the issue of “too big to fail” will ultimately be address by a different forum, the American People themselves who after all have the last word.
Following is a list of Senators, who voted to protect the banks against the interest of the American people, its time to retire each and ever one of them.
Akaka (D-HI);
Alexander (R-TN);
Barrasso (R-WY)
Baucus (D-MT);
Bayh (D-IN);
Bennet (D-CO);
Bond (R-MO);
Brown (R-MA);
Brownback (R-KS);
Burr (R-NC);
Carper (D-DE);
Chambliss (R-GA);
Cochran (R-MS);
Collins (R-ME);
Conrad (D-ND);
Corker (R-TN)
Cornyn (R-TX);
Crapo (R-ID);
Dodd (D-CT);
Enzi (R-WY);
Feinstein (D-CA);
Gillibrand (D-NY);
Graham (R-SC);
Grassley (R-IA);
Gregg (R-NH);
Hagan (D-NC)
Hatch (R-UT);
Hutchison (R-TX);
Inhofe (R-OK);
Inouye (D-HI);
Isakson (R-GA);
Johanns (R-NE)
Johnson (D-SD);
Kerry (D-MA);
Klobuchar (D-MN)
Kohl (D-WI);
Kyl (R-AZ);
Landrieu (D-LA)
Lautenberg (D-NJ);
LeMieux (R-FL);
Lieberman (ID-CT);
McCain (R-AZ);
McCaskill (D-MO);
McConnell (R-KY);
Menendez (D-NJ);
Murkowski (R-AK)
Nelson (D-FL);
Nelson (D-NE);
Reed (D-RI);
Risch (R-ID);
Roberts (R-KS);
Schumer (D-NY);
Sessions (R-AL);
Shaheen (D-NH);
Snowe (R-ME);
Tester (D-MT);
Thune (R-SD);
Udall (D-CO);
Voinovich (R-OH)
Warner (D-VA);
Wicker (R-MS)
But equally important remember that Obama as well is financially beholden to the mega bank interests.
Friday, April 30, 2010
Financial Reform
Hundreds of lobbyists for banks and Wall Street, working with Republicans, have been working to block the reform bill currently winding its way through congress.
If ever bank reform is needed it’s now!
But Wall Street has not come to grips with the possibility that if a bill could pass in its current form, Wall Street will be restrained form gambling with our money! So far the banks that were provided Taxpayer assistance to prevent their filing bankruptcy have accumulatively invested more than $9 million to “bribe” congress to fight this bill.
A recent Fox report says, "About 25 Wall Street executives, many of them hedge fund managers, sat down for a private meeting with two of the most powerful Republican lawmakers in Congress: Senate minority leader Mitch McConnell of Kentucky, and John Cornyn, the senior senator from Texas who runs the National Republican Senatorial Committee, one of the primary fundraising arms of the Republican Party." (View the broadcast) http://www.foxbusiness.com/story/markets/industries/government/street-execs-pols-earful-financial-reform/
The Banks and their lobbyists are aligning themselves with the republican constituent in congress. Believing they are their best hope of watering down a bill that seeks to place them under control.
Under attack appears to be several important areas of concern that the Republicans, under the Banks influence will fight to their death. Those areas are (i) a 50 Billion dollar fund to break up “too big to fail banks” (ii) visibility for the lucrative derivatives market, and (iii) on how to protect consumers and (iv) how to set limits on previously unregulated exotic instruments such as derivatives.
Lobbying spending to block the bill by some of the biggest firms:
JP Morgan Chase & Co.; First quarter, 2010: $1,510,000 First quarter, 2009: $1,310,000 Citigroup: First quarter, 2010: $1,310,000, First quarter, 2009: $1,250,000;
Credit Suisse. First quarter, 2010: $1,190,000, First quarter, 2009: $470,000;
Goldman Sachs First quarter, 2010: $1,150,000, First quarter, 2009: $670,000
Wells Fargo; First quarter, 2010: $1,020,000, First quarter, 2009: $700,000;
Bank of America, First quarter, 2010: $940,000, First quarter, 2009: $820,000,
Morgan Stanley, First quarter, 2010: $810,000, First quarter, 2009: $540,000;
State Street First quarter, 2010: $380,000, First quarter, 2009: $210,000
CNN during a recent panel discussion described the lobbying process on Capitol Hill as the "Blob." Congressional staffers and lobbyists are the ones hashing out the final details of the financial reform bill. These same Congressional staffers and their bosses are indebted to the lobbyists, having accepted tens of millions in campaign contributions. There is absolutely no adversarial relationship on capital hill - everybody is on the same side of the page - and rarely is anybody at the table even an elected official.
Think about this, if the banks and those beholden to them in congress don’t want this bill passed, we do!!!
If ever bank reform is needed it’s now!
But Wall Street has not come to grips with the possibility that if a bill could pass in its current form, Wall Street will be restrained form gambling with our money! So far the banks that were provided Taxpayer assistance to prevent their filing bankruptcy have accumulatively invested more than $9 million to “bribe” congress to fight this bill.
A recent Fox report says, "About 25 Wall Street executives, many of them hedge fund managers, sat down for a private meeting with two of the most powerful Republican lawmakers in Congress: Senate minority leader Mitch McConnell of Kentucky, and John Cornyn, the senior senator from Texas who runs the National Republican Senatorial Committee, one of the primary fundraising arms of the Republican Party." (View the broadcast) http://www.foxbusiness.com/story/markets/industries/government/street-execs-pols-earful-financial-reform/
The Banks and their lobbyists are aligning themselves with the republican constituent in congress. Believing they are their best hope of watering down a bill that seeks to place them under control.
Under attack appears to be several important areas of concern that the Republicans, under the Banks influence will fight to their death. Those areas are (i) a 50 Billion dollar fund to break up “too big to fail banks” (ii) visibility for the lucrative derivatives market, and (iii) on how to protect consumers and (iv) how to set limits on previously unregulated exotic instruments such as derivatives.
Lobbying spending to block the bill by some of the biggest firms:
JP Morgan Chase & Co.; First quarter, 2010: $1,510,000 First quarter, 2009: $1,310,000 Citigroup: First quarter, 2010: $1,310,000, First quarter, 2009: $1,250,000;
Credit Suisse. First quarter, 2010: $1,190,000, First quarter, 2009: $470,000;
Goldman Sachs First quarter, 2010: $1,150,000, First quarter, 2009: $670,000
Wells Fargo; First quarter, 2010: $1,020,000, First quarter, 2009: $700,000;
Bank of America, First quarter, 2010: $940,000, First quarter, 2009: $820,000,
Morgan Stanley, First quarter, 2010: $810,000, First quarter, 2009: $540,000;
State Street First quarter, 2010: $380,000, First quarter, 2009: $210,000
CNN during a recent panel discussion described the lobbying process on Capitol Hill as the "Blob." Congressional staffers and lobbyists are the ones hashing out the final details of the financial reform bill. These same Congressional staffers and their bosses are indebted to the lobbyists, having accepted tens of millions in campaign contributions. There is absolutely no adversarial relationship on capital hill - everybody is on the same side of the page - and rarely is anybody at the table even an elected official.
Think about this, if the banks and those beholden to them in congress don’t want this bill passed, we do!!!
Saturday, April 24, 2010
Wall Street’s culture of Deception (Part 1)
The unwary investor is made to believe - by a press owned by the very people who are part of the Wall Street scam that they can make a killing in the stock market if they get lucky. Over the years’ “outsiders”, small-time investors have lost billions of dollars to the “insiders” who control and manipulate the stock market.
The small time investor believes that the stock market goes up and down according to what he or she reads in the Wall Street Journal or hears about on their evening NEWS program: interest rates, inflation rates, wholesale prices, gross national product, public fears about foreign and domestic events, and the ranting of the head of the "Federal" Reserve Board.
This is all a game, a con to make the hapless investor believe that the rise and fall in stock prices is not being manipulated by the specialists. The fact is that specialists, working at the largest firms and hedge funds are creating the ups and downs of the market to bring them profits at the expense of the rest of us. In reality it’s the bankers and investment houses against the working class of America, and Congress and the While House allow this SCAM to continue.
This is how the Stock SCAM works
The insider buys stocks at the lowest possible price, using one of the magic tricks of the market called short selling (selling stocks you don't yet own in the hopes that the price will drop, so that you can purchase it back at a lower price; the difference between what you sold it for and what you purchased it back at is your profit): This parable was made famous by John D Rockefeller
That $20 million has to come from somewhere – and it does, it comes from the small investors who didn't have a clue about what was going on.
As an example, the Panamanian-registered Pilgrim Investment Trust, controlled by the Bush family, in April 2000 was about 78% long. By the end of 2000, they were 78% short, and, by the end of 2001, that trust was 98% short. In essentially the same short position was the Houston Energy Trust, another deep offshore Republican trust whose investors include Henry Kissinger, Paul Bremer, James Baker, and George Schultz.
Get the picture.
The small time investor believes that the stock market goes up and down according to what he or she reads in the Wall Street Journal or hears about on their evening NEWS program: interest rates, inflation rates, wholesale prices, gross national product, public fears about foreign and domestic events, and the ranting of the head of the "Federal" Reserve Board.
This is all a game, a con to make the hapless investor believe that the rise and fall in stock prices is not being manipulated by the specialists. The fact is that specialists, working at the largest firms and hedge funds are creating the ups and downs of the market to bring them profits at the expense of the rest of us. In reality it’s the bankers and investment houses against the working class of America, and Congress and the While House allow this SCAM to continue.
This is how the Stock SCAM works
The insider buys stocks at the lowest possible price, using one of the magic tricks of the market called short selling (selling stocks you don't yet own in the hopes that the price will drop, so that you can purchase it back at a lower price; the difference between what you sold it for and what you purchased it back at is your profit): This parable was made famous by John D Rockefeller
- Since they control the stock prices, they simply begin lowering the prices
- They "borrow" the stock from their or another brokerage firm's pool, with the understanding that at a later date they will return the shares
- The Wall Street Con Game News will announce that stock prices dropped sharply on light trading, which is a cover for the insiders' actual manipulation of the decrease in stock prices. The Insiders don't want heavy trading and straight-line lowering of stock prices, else they might have to buy a lot of stock at a higher price than desired. So they usually lower prices through a series of ups and downs of the market, dealing with small investors' shares as they go.
- The SEC rules prohibit NYSE members from "demoralizing the market by effecting short sales at or below a price lower than that of the last sale." But insiders have an “insider loophole” allowing them to sell short on downticks (drops in stock prices) without having to report these transactions as short sales. Those same SEC rules force the unsuspecting, small-time investor to sell short only on upticks - when stock prices are higher than the last preceding price. This is a very neat scam, and small time investors aren’t even aware that they have been had.
- They will wait until the stock prices reach a top price where they can realize windfall profits - let's say the stock reaches the price of $40 a share.
- At this point the insiders sell their million shares at $40 a share and receive $40,000,000. A profit of $20 million is easy if the con game is fixed in your favor.
That $20 million has to come from somewhere – and it does, it comes from the small investors who didn't have a clue about what was going on.
As an example, the Panamanian-registered Pilgrim Investment Trust, controlled by the Bush family, in April 2000 was about 78% long. By the end of 2000, they were 78% short, and, by the end of 2001, that trust was 98% short. In essentially the same short position was the Houston Energy Trust, another deep offshore Republican trust whose investors include Henry Kissinger, Paul Bremer, James Baker, and George Schultz.
Get the picture.
Wall Street’s culture of Deception (Part 2)
Bank Stock Value Manipulation:
We are now aware of Lehman Bros SCAM, where they would hide billions of dollars of bad debts by selling them prior to a required reporting period and buy them back directly after the report was filed. This is known now as end-of-quarter balance sheet manipulation, the purpose was to trick investors into thinking the Bank or investment house was less leveraged than it was.
This was a form of stock value manipulation, which is illegal! It also constitutes FRAUD on the investors, who would have sold their stock had they known the truth. It is concealing the true nature and value of the company and of its stock value.
Now as it turns out, almost of all of Wall Street is based on this same phony perception, having been caught using this same Ploy, Bank of America now claims there is nothing wrong with concealing in this manner its bad assets. We respectfully disagree!
Comparing Bank of America's "average quarterly assets" and "end of quarter assets" found that, in each quarter, billions of dollars of assets conveniently disappeared briefly at the end of the quarter, only to return again at the start of the next one.
Like Lehman, Bank of America found some legal loophole in some country somewhere that allowed them to momentarily hide tens of billions of dollars of assets somewhere where Wall Street wouldn't see them. And, naturally, Bank of America thinks it's perfectly acceptable: We believe this has been a common practice on Wall Street for sometime
For those that don’t know Repo 105, Lehman Bros asset disappearance program, it was a sale and repurchase agreement by which Lehman parked about 50 billion in assets (presumably assets they did not want to discuss) overnight via a repo transaction so they would not appear on the balance sheet. Who the counter party was has still not been disclosed.
But unfortunately the Lehman executives do have one point. Repo 105 type balance sheet faking was “an old trick” and well known to anyone who cared to read balance sheets (very) carefully.
With BoA they did the very same thing, the end period assets were always lower than the average assets. Moreover it was not obvious unless you really looked because the quarterly earnings releases did not include average assets (but you could work it out because they stated return on average assets.
Bank of America was parking its assets off balance sheet at the end of every quarter for some time and had been obscuring the fact.
There must be a Counterparty
If Bank of America wanted to shove the assets off balance sheet someone (credit worthy) needed to be found to house the assets overnight. There are not that many parties credit worthy for $50 billion or more of overnight repos.
Well BoA found such a willing participant the counterparty was MUFJ. If you look you can see – the same way that MUFJ had end period assets higher than average assets and that the differences and timing roughly match. Someone had to assist BofA in its financial manipulation and that was MUFJ. MUFJ stands for (Mitsubishi UFJ Financial Group)
About MUFJ
Mitsubishi UFJ Financial Group, Inc. (MUFJ), incorporated on April 2, 2001, they are a holding company for The Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU), Mitsubishi UFJ Trust and Banking Corporation (MUTB), Mitsubishi UFJ Securities Co., Ltd. (MUS), Mitsubishi UFJ NICOS Co., Ltd. (Mitsubishi UFJ NICOS), and other subsidiaries.
Through its subsidiaries and affiliated companies, MUFG engages in a range of financial operations, including commercial banking, investment banking, trust banking and asset management services, securities businesses, and credit card businesses, and provides related services to individual and corporate customers. In July 2008, BTMU acquired 49.375% interest in JALCARD, Inc., a wholly owned subsidiary of Japan Airlines International Co., Ltd. In November 2008, BTMU completed the acquisition of all the interest in UnionBanCal Corporation (UNBC), and as a result, UNBC became a wholly owned indirect subsidiary of MUFG.
The Company manages the underwriting of debt and equity instruments for large corporations. It also provides arrangement services relating to private placements primarily for medium-sized enterprise issuers and institutional investors. The Company advises on financing methods to meet various financing needs, including loans with derivatives, corporate bonds, commercial paper, asset-backed securities, securitization programs and syndicated loans. It also offers a range of products to meet fund management needs, such as deposits with derivatives, government bonds, debenture notes and investment funds. It also offers swaps, options and other risk-hedge programs to customers.
Well this is just the second Scam uncovered in the series, stay tuned.
We are now aware of Lehman Bros SCAM, where they would hide billions of dollars of bad debts by selling them prior to a required reporting period and buy them back directly after the report was filed. This is known now as end-of-quarter balance sheet manipulation, the purpose was to trick investors into thinking the Bank or investment house was less leveraged than it was.
This was a form of stock value manipulation, which is illegal! It also constitutes FRAUD on the investors, who would have sold their stock had they known the truth. It is concealing the true nature and value of the company and of its stock value.
Now as it turns out, almost of all of Wall Street is based on this same phony perception, having been caught using this same Ploy, Bank of America now claims there is nothing wrong with concealing in this manner its bad assets. We respectfully disagree!
Comparing Bank of America's "average quarterly assets" and "end of quarter assets" found that, in each quarter, billions of dollars of assets conveniently disappeared briefly at the end of the quarter, only to return again at the start of the next one.
Like Lehman, Bank of America found some legal loophole in some country somewhere that allowed them to momentarily hide tens of billions of dollars of assets somewhere where Wall Street wouldn't see them. And, naturally, Bank of America thinks it's perfectly acceptable: We believe this has been a common practice on Wall Street for sometime
For those that don’t know Repo 105, Lehman Bros asset disappearance program, it was a sale and repurchase agreement by which Lehman parked about 50 billion in assets (presumably assets they did not want to discuss) overnight via a repo transaction so they would not appear on the balance sheet. Who the counter party was has still not been disclosed.
But unfortunately the Lehman executives do have one point. Repo 105 type balance sheet faking was “an old trick” and well known to anyone who cared to read balance sheets (very) carefully.
With BoA they did the very same thing, the end period assets were always lower than the average assets. Moreover it was not obvious unless you really looked because the quarterly earnings releases did not include average assets (but you could work it out because they stated return on average assets.
Bank of America was parking its assets off balance sheet at the end of every quarter for some time and had been obscuring the fact.
There must be a Counterparty
If Bank of America wanted to shove the assets off balance sheet someone (credit worthy) needed to be found to house the assets overnight. There are not that many parties credit worthy for $50 billion or more of overnight repos.
Well BoA found such a willing participant the counterparty was MUFJ. If you look you can see – the same way that MUFJ had end period assets higher than average assets and that the differences and timing roughly match. Someone had to assist BofA in its financial manipulation and that was MUFJ. MUFJ stands for (Mitsubishi UFJ Financial Group)
About MUFJ
Mitsubishi UFJ Financial Group, Inc. (MUFJ), incorporated on April 2, 2001, they are a holding company for The Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU), Mitsubishi UFJ Trust and Banking Corporation (MUTB), Mitsubishi UFJ Securities Co., Ltd. (MUS), Mitsubishi UFJ NICOS Co., Ltd. (Mitsubishi UFJ NICOS), and other subsidiaries.
Through its subsidiaries and affiliated companies, MUFG engages in a range of financial operations, including commercial banking, investment banking, trust banking and asset management services, securities businesses, and credit card businesses, and provides related services to individual and corporate customers. In July 2008, BTMU acquired 49.375% interest in JALCARD, Inc., a wholly owned subsidiary of Japan Airlines International Co., Ltd. In November 2008, BTMU completed the acquisition of all the interest in UnionBanCal Corporation (UNBC), and as a result, UNBC became a wholly owned indirect subsidiary of MUFG.
The Company manages the underwriting of debt and equity instruments for large corporations. It also provides arrangement services relating to private placements primarily for medium-sized enterprise issuers and institutional investors. The Company advises on financing methods to meet various financing needs, including loans with derivatives, corporate bonds, commercial paper, asset-backed securities, securitization programs and syndicated loans. It also offers a range of products to meet fund management needs, such as deposits with derivatives, government bonds, debenture notes and investment funds. It also offers swaps, options and other risk-hedge programs to customers.
Well this is just the second Scam uncovered in the series, stay tuned.
Tuesday, April 6, 2010
How do we get America moving again?
17.3 million Americans need jobs.
Vacant storefronts abandoned and often shuttered homes and schools tell the story of the economy in real life 3rd dimension.
Wherever we go from one coast to another, this is the reality for many towns and cities across America , a nation no longer reminiscent of its better days, a nation of shrinking tax rolls and migration.
For many and for generations yet to come, there will be a different face peering out from the murky windows, staring as in a translucent state of amnesia
We as a nation have been in a decline since the 1980’s but is was so gradual a decline that we didn’t notice until the fan turned brown from our splattered remnants.
And now that we see the picture that has so assiduously unfolded, how do we as a people get out from under this elegantly conceived effrontery to not only us, but to a lifestyle that made us a great people?
Yes America was forced to transition, to pick up roots planted while the nation appeared to be on a forward momentum, but that roll wasn’t a boom and prosper roll, at least not for us.
We were used, we had become, somehow in the darkness and shadows, the mere pawns of those who consider themselves the elite of our society, and we as a people now at the hands of a government that has joined in league with them, have found ourselves without recourse to recover the government we had believed was ours.
Instead we find ourselves at the mercy of a street in New York , where the enterprises of capitalism have abandoned American principles and churned from democracies ashes a new form of governance, and it is not one with our assent.
However, there is something that remains more pressing to our society; can we yet emerge from this creative captivity unscathed?
In common parlance, what America needs is jobs, and there is one concept that may work, a return to a form of isolationism, but in trade only.
It is suggested that for America to recover, drastic measures are required, and are offered for consideration in this article:
First; no imports would be allowed unless we as a society require them, as such oil would be allowed, while all manufactured items would not. Whether it would be autos or clothing or appliances, they would be disallowed.
Second; our large corporations will be required to open plants in America and to hire Americans or their products would be denied sales in the US .
Third; these multinational corporations would be taxed 90 percent on all goods manufactured and sold abroad, giving them incentive to reverse the trend begun under the Reagan/Bush administration which promoted the exit of jobs and businesses in America in favor of a service oriented society.
And finally: there will be no additional bailouts for the financial sector, if they lose our money again they will like any other criminal be dealt with in a similar fashion.
Vacant storefronts abandoned and often shuttered homes and schools tell the story of the economy in real life 3rd dimension.
Wherever we go from one coast to another, this is the reality for many towns and cities across America , a nation no longer reminiscent of its better days, a nation of shrinking tax rolls and migration.
For many and for generations yet to come, there will be a different face peering out from the murky windows, staring as in a translucent state of amnesia
We as a nation have been in a decline since the 1980’s but is was so gradual a decline that we didn’t notice until the fan turned brown from our splattered remnants.
And now that we see the picture that has so assiduously unfolded, how do we as a people get out from under this elegantly conceived effrontery to not only us, but to a lifestyle that made us a great people?
Yes America was forced to transition, to pick up roots planted while the nation appeared to be on a forward momentum, but that roll wasn’t a boom and prosper roll, at least not for us.
We were used, we had become, somehow in the darkness and shadows, the mere pawns of those who consider themselves the elite of our society, and we as a people now at the hands of a government that has joined in league with them, have found ourselves without recourse to recover the government we had believed was ours.
Instead we find ourselves at the mercy of a street in New York , where the enterprises of capitalism have abandoned American principles and churned from democracies ashes a new form of governance, and it is not one with our assent.
However, there is something that remains more pressing to our society; can we yet emerge from this creative captivity unscathed?
In common parlance, what America needs is jobs, and there is one concept that may work, a return to a form of isolationism, but in trade only.
It is suggested that for America to recover, drastic measures are required, and are offered for consideration in this article:
First; no imports would be allowed unless we as a society require them, as such oil would be allowed, while all manufactured items would not. Whether it would be autos or clothing or appliances, they would be disallowed.
Second; our large corporations will be required to open plants in America and to hire Americans or their products would be denied sales in the US .
Third; these multinational corporations would be taxed 90 percent on all goods manufactured and sold abroad, giving them incentive to reverse the trend begun under the Reagan/Bush administration which promoted the exit of jobs and businesses in America in favor of a service oriented society.
And finally: there will be no additional bailouts for the financial sector, if they lose our money again they will like any other criminal be dealt with in a similar fashion.
Saturday, March 13, 2010
We are a disposable people and a disposable workforce!
We built a great nation only to watch it collapse under the weight of corporate greed:
There was a joke that was told many years ago about the Lone Ranger and his sidekick Tonto, Tonto was an Indian, or now more correctly stated “a Native American” the story went like this: Both the Lone Ranger and Tonto were surrounded by hundreds of Indians and as the Lone Ranger ran out of ammunition he turned to Tonto and said, ” looks like we’re done Tonto”, Tonto turned back to the Lone Ranger and replied “what do you mean “we” white man”
And so it goes with Wall Street
Yes there is a recovery going on, but it’s not for middle class America, it’s for the big boys whom the government favors. Like our big global companies, Wall Street, and high-income Americans who hold their savings in financial instruments and in bonds and stocks, they are clearly doing better.
But take a drive down main street or look at any commercial center in any of the 50 states and we see empty stores that once contained mom and pop businesses, even franchises are folding. If there is as the government says a recovery, then why are businesses still closing?
Because Americans are not spending as the government claims, in fact Americans generally don’t have the money to spend. Indeed they don’t have the means to even pay their current debts. In fact since the first business day of January 2010, Americans are filing bankruptcies at the rate of 6,000 per day. That’s an annual filing rate of just over 1.5 million
The reason the Government puts out exaggerated figures is their belief the economy runs on optimism and that if the average consumer believes the economy is getting better, they'll spend more readily and- the economy will get better.
Only a pseudo intellect in today’s sad state of affairs could muster this reasoning
The government fails to understand that regardless of how people feel, they won't spend if they don't have the money, and Main Street doesn’t have the money! The 9 million unemployed along with 30 million underemployed and the growing number of College Graduates entering the workforce has crippled the economy and it is felt most by small business, the neighborhood business. Each unemployed and underemployed individual affects 5 others in the economy. This 39 million people who are earning less are spending less and they are affecting nearly 200,000,000 people. It is axiomatic that the economy will not improve for the average American until we begin to employ our own, and to regenerate and reinvigorate American Small business.
The government tells us that the US economy grew at a 5.9 percent annual rate in the fourth quarter of 2009. That sounds good at first blush, until you realize GDP figures are badly distorted by structural changes in the economy. For example, part of the increase is due to rising health care costs, when WellPoint ratchets up premiums it enlarges the GDP. A separate part of the perceived growth in GDP is due to rising government expenditures, and the costs or gas at the pump.
Who is really doing better in America?
The people and private-sector institutions at the top!
Many of America's biggest companies are sitting on huge amounts of cash, but that says nothing about the health of the U.S. economy. Companies in the Standard & Poor 500 stock index had sales of $2.18 trillion in the fourth quarter, up from $2.02 trillion last year, and their earnings tripled. Why? Because they're global and selling into fast-growing markets in places like India, China, and Brazil!
America's biggest companies are also showing fat profits and productivity gains because they continue to slash payrolls and cut expenditures. Alcoa, for example, had $1.5 billion in cash at the end of last year, double what it had on hand at the end of 2008. Sounds terrific until you realize how it did it. By cutting 28,000 jobs - 32 percent of its workforce - and slashed capital expenditures 43 percent. Who suffered, middle class America, while those who owned Alcoa Stock benefited and so did Alcoa’s executives.
We have become a use then throw away work force!
Yes firms in S&P 500 are holding $932 billion in cash and short-term investments. And they can borrow money cheaply, corporate bond sales, that is buying into Corporate debt, so far in 2010, has topped $195.2 billion, excluding government-guaranteed bonds.
Does this spell a recovery? No, why? Because they're doing two things that don't help at all!
First, they're buying other companies. Walgreen last month spent $618 million for New York drugstore chain Duane Reade; Bank of New York Mellon, $2.3 billion for PNC Financial Services; Monster, $225 million for jobs.com; Diamond Foods, $615 million for Kettle Foods.
This buying doesn't create new jobs. In fact it creates a net loss of duplicate ones. One of the first things companies do when they buy other companies is fire people who are considered "redundant."
The second thing large companies are doing with all their cash is buying back their own stock, in order to boost their share prices. There were 62 such share buy-backs in February, valued at $40.1 billion. We're witnessing the biggest share buyback spree since Sept 2008. The major beneficiaries are current shareholders, including top executives, whose pay is linked to share prices. The buy-backs do absolutely nothing for most Americans.
The picture on Main Street is quite different. Small businesses aren't selling much because they have to rely on American consumers - rather than foreign consumers. And Americans still aren't buying much because they don’t have the financial resources.
Small businesses are also finding it difficult to get credit. Most of the 8000 American banks don’t have money to loan because of the large number of bad debts on their books. And some 700 banks are set to fail this year. Since small businesses are where the jobs are created in any recovery and we are losing small businesses, this recession will continue for a decade or longer. We won’t see a recovery until we have an administration with the foresight to care about us rather than Wall Street.
The traditional mom and pop business is closing at the rate of 40% (2 out of 5) during this recession if this continues we may lose most of our 28,000,000 small businesses that we had in 2007 during its peak.
Don’t believe the Government reports
The Federal Reserve recently reported that American consumers are shedding their debts. Total US household debt, the FED claims, “including mortgages and credit card balances, fell 1.7 percent last year”. Supposedly this was the first drop since the government began recording consumer debt in 1945.
What is the truth?
Much of the debt-shedding has been through default - consumers are simply not repaying their debts and walking away from homes and big-ticket purchases, cars and credit card balances.
End of story!
Rupert Murdoch’s Wall Street Journal has its own take on the defaults: "the defaults are leaving many people with more cash to spend and save, jump-starting the financial rehabilitation of the economy”
Let’s get real: American consumers account for 70 percent of the total demand for goods and services if they don’t have the financial resources or the jobs, or are concerned about their retirement, who if not them will sustain the economy?
Let’s face the facts: This American economy was in trouble since the end of 2000, it took the real estate balloon (developing Bubble) to stimulate the economy, but there were NO real job growth even then, consumers were borrowing the equity from their homes merely to make the payments. The Banks knew it, the FED knew it, and they knew the bubble had to burst! That was one of the reasons the Credit Default Swaps were created, guaranteeing Mortgage loans that the Banks knew were worthless!
The daunting question must be considered? The US Economy has been imperiled through incompetent administrations, who have favored outsourcing American jobs, and it started with Ronald Reagan and George HW Bush. Now how will Main Street come back? How will we create jobs? Certainly not from big businesses that are outsourcing! Certainly not from Wall Street who considers itself above main street and has no concerned for what they consider a disposable work force. And certainly not from government who is so tied to the apron strings of Wall Street they appear to be tied at the hip!
Until there's an answer, an economic "recovery" for anyone other than big corporations, Wall Street, and the wealthy is an illusion, and more Americans will yet find themselves falling into dismay
There was a joke that was told many years ago about the Lone Ranger and his sidekick Tonto, Tonto was an Indian, or now more correctly stated “a Native American” the story went like this: Both the Lone Ranger and Tonto were surrounded by hundreds of Indians and as the Lone Ranger ran out of ammunition he turned to Tonto and said, ” looks like we’re done Tonto”, Tonto turned back to the Lone Ranger and replied “what do you mean “we” white man”
And so it goes with Wall Street
Yes there is a recovery going on, but it’s not for middle class America, it’s for the big boys whom the government favors. Like our big global companies, Wall Street, and high-income Americans who hold their savings in financial instruments and in bonds and stocks, they are clearly doing better.
But take a drive down main street or look at any commercial center in any of the 50 states and we see empty stores that once contained mom and pop businesses, even franchises are folding. If there is as the government says a recovery, then why are businesses still closing?
Because Americans are not spending as the government claims, in fact Americans generally don’t have the money to spend. Indeed they don’t have the means to even pay their current debts. In fact since the first business day of January 2010, Americans are filing bankruptcies at the rate of 6,000 per day. That’s an annual filing rate of just over 1.5 million
The reason the Government puts out exaggerated figures is their belief the economy runs on optimism and that if the average consumer believes the economy is getting better, they'll spend more readily and- the economy will get better.
Only a pseudo intellect in today’s sad state of affairs could muster this reasoning
The government fails to understand that regardless of how people feel, they won't spend if they don't have the money, and Main Street doesn’t have the money! The 9 million unemployed along with 30 million underemployed and the growing number of College Graduates entering the workforce has crippled the economy and it is felt most by small business, the neighborhood business. Each unemployed and underemployed individual affects 5 others in the economy. This 39 million people who are earning less are spending less and they are affecting nearly 200,000,000 people. It is axiomatic that the economy will not improve for the average American until we begin to employ our own, and to regenerate and reinvigorate American Small business.
The government tells us that the US economy grew at a 5.9 percent annual rate in the fourth quarter of 2009. That sounds good at first blush, until you realize GDP figures are badly distorted by structural changes in the economy. For example, part of the increase is due to rising health care costs, when WellPoint ratchets up premiums it enlarges the GDP. A separate part of the perceived growth in GDP is due to rising government expenditures, and the costs or gas at the pump.
Who is really doing better in America?
The people and private-sector institutions at the top!
Many of America's biggest companies are sitting on huge amounts of cash, but that says nothing about the health of the U.S. economy. Companies in the Standard & Poor 500 stock index had sales of $2.18 trillion in the fourth quarter, up from $2.02 trillion last year, and their earnings tripled. Why? Because they're global and selling into fast-growing markets in places like India, China, and Brazil!
America's biggest companies are also showing fat profits and productivity gains because they continue to slash payrolls and cut expenditures. Alcoa, for example, had $1.5 billion in cash at the end of last year, double what it had on hand at the end of 2008. Sounds terrific until you realize how it did it. By cutting 28,000 jobs - 32 percent of its workforce - and slashed capital expenditures 43 percent. Who suffered, middle class America, while those who owned Alcoa Stock benefited and so did Alcoa’s executives.
We have become a use then throw away work force!
Yes firms in S&P 500 are holding $932 billion in cash and short-term investments. And they can borrow money cheaply, corporate bond sales, that is buying into Corporate debt, so far in 2010, has topped $195.2 billion, excluding government-guaranteed bonds.
Does this spell a recovery? No, why? Because they're doing two things that don't help at all!
First, they're buying other companies. Walgreen last month spent $618 million for New York drugstore chain Duane Reade; Bank of New York Mellon, $2.3 billion for PNC Financial Services; Monster, $225 million for jobs.com; Diamond Foods, $615 million for Kettle Foods.
This buying doesn't create new jobs. In fact it creates a net loss of duplicate ones. One of the first things companies do when they buy other companies is fire people who are considered "redundant."
The second thing large companies are doing with all their cash is buying back their own stock, in order to boost their share prices. There were 62 such share buy-backs in February, valued at $40.1 billion. We're witnessing the biggest share buyback spree since Sept 2008. The major beneficiaries are current shareholders, including top executives, whose pay is linked to share prices. The buy-backs do absolutely nothing for most Americans.
The picture on Main Street is quite different. Small businesses aren't selling much because they have to rely on American consumers - rather than foreign consumers. And Americans still aren't buying much because they don’t have the financial resources.
Small businesses are also finding it difficult to get credit. Most of the 8000 American banks don’t have money to loan because of the large number of bad debts on their books. And some 700 banks are set to fail this year. Since small businesses are where the jobs are created in any recovery and we are losing small businesses, this recession will continue for a decade or longer. We won’t see a recovery until we have an administration with the foresight to care about us rather than Wall Street.
The traditional mom and pop business is closing at the rate of 40% (2 out of 5) during this recession if this continues we may lose most of our 28,000,000 small businesses that we had in 2007 during its peak.
Don’t believe the Government reports
The Federal Reserve recently reported that American consumers are shedding their debts. Total US household debt, the FED claims, “including mortgages and credit card balances, fell 1.7 percent last year”. Supposedly this was the first drop since the government began recording consumer debt in 1945.
What is the truth?
Much of the debt-shedding has been through default - consumers are simply not repaying their debts and walking away from homes and big-ticket purchases, cars and credit card balances.
End of story!
Rupert Murdoch’s Wall Street Journal has its own take on the defaults: "the defaults are leaving many people with more cash to spend and save, jump-starting the financial rehabilitation of the economy”
Let’s get real: American consumers account for 70 percent of the total demand for goods and services if they don’t have the financial resources or the jobs, or are concerned about their retirement, who if not them will sustain the economy?
Let’s face the facts: This American economy was in trouble since the end of 2000, it took the real estate balloon (developing Bubble) to stimulate the economy, but there were NO real job growth even then, consumers were borrowing the equity from their homes merely to make the payments. The Banks knew it, the FED knew it, and they knew the bubble had to burst! That was one of the reasons the Credit Default Swaps were created, guaranteeing Mortgage loans that the Banks knew were worthless!
The daunting question must be considered? The US Economy has been imperiled through incompetent administrations, who have favored outsourcing American jobs, and it started with Ronald Reagan and George HW Bush. Now how will Main Street come back? How will we create jobs? Certainly not from big businesses that are outsourcing! Certainly not from Wall Street who considers itself above main street and has no concerned for what they consider a disposable work force. And certainly not from government who is so tied to the apron strings of Wall Street they appear to be tied at the hip!
Until there's an answer, an economic "recovery" for anyone other than big corporations, Wall Street, and the wealthy is an illusion, and more Americans will yet find themselves falling into dismay
Friday, February 12, 2010
Obama tied to FDIC, Wall Street Scam
It all started in June 2008, when the FDIC took control of Indymac Bank, that of itself wasn’t strange as many large banks would collapse over the type of loans and the creative insurance programs these banks invested in.
But what occurred in March 2009 will make your hair stand on edge. It displays the open corruption between the White House, The Banks, and those so well connected to the current administration and Washington insiders.
In March 2009 Indymac Bank was sold to One West Bank, the sale was for 70% of the face value of the mortgages and the HELOC’S at 58%
But the government guaranteed 80% to 95% of the original loan amount, for a short sale or a foreclosure.
Example:
Loan Amount $ 478,000
Add six months interest for failed payments
$ 485,000
One West Bank paid FDIC $ 334,600
Short sale amount $ 241,000
FDIC Guarantee $ 388,000
FDIC paid One West Bank $ 147,000
One West Bank received for the short sale a total of:
$ 241,000
$ 147,000
__________
$ 388,000 a $53,400 windfall plus
The Bank on a short sale took a note from the seller for the shortfall in the amount of $90,000 for a profit of= $143,400
One West Bank made a hefty profit from the taxpayers on this one transaction and it worked the same way on a foreclosure
Now we can see why it benefits the banks to Foreclose or complete a short sale. But wait!
The owners of One West Bank are none other than:
1. George Soros - Obama’s main contributor whom he has already paid back with a 2bn dollar Grant to one of his corporations for off shore oil drilling, and the US has no benefit in the oil:
2. John Paulson - A relative of Treasury Secretary Hank Paulson former Chairman and Chief Executive Officer of Goldman Sachs.
And a former Goldman Sachs VP
Obama Takes good care of his financial supporters and often it’s with our money!
But what occurred in March 2009 will make your hair stand on edge. It displays the open corruption between the White House, The Banks, and those so well connected to the current administration and Washington insiders.
In March 2009 Indymac Bank was sold to One West Bank, the sale was for 70% of the face value of the mortgages and the HELOC’S at 58%
But the government guaranteed 80% to 95% of the original loan amount, for a short sale or a foreclosure.
Example:
Loan Amount $ 478,000
Add six months interest for failed payments
$ 485,000
One West Bank paid FDIC $ 334,600
Short sale amount $ 241,000
FDIC Guarantee $ 388,000
FDIC paid One West Bank $ 147,000
One West Bank received for the short sale a total of:
$ 241,000
$ 147,000
__________
$ 388,000 a $53,400 windfall plus
The Bank on a short sale took a note from the seller for the shortfall in the amount of $90,000 for a profit of= $143,400
One West Bank made a hefty profit from the taxpayers on this one transaction and it worked the same way on a foreclosure
Now we can see why it benefits the banks to Foreclose or complete a short sale. But wait!
The owners of One West Bank are none other than:
1. George Soros - Obama’s main contributor whom he has already paid back with a 2bn dollar Grant to one of his corporations for off shore oil drilling, and the US has no benefit in the oil:
2. John Paulson - A relative of Treasury Secretary Hank Paulson former Chairman and Chief Executive Officer of Goldman Sachs.
And a former Goldman Sachs VP
Obama Takes good care of his financial supporters and often it’s with our money!
Saturday, November 7, 2009
Let’s Call It What It Is - It’s Reagan’s Fault!
The government, both state and federal, is on a feeding frenzy to save the banks, the real reason is that the banks are the feeding ground for our politicians, in fact any office seeker is beholden to the banks for their financial support. As such there will never be any meaningful control over these institutions.
There are now 140 fewer banks then there was last year, and the too big to fail have gotten even larger, and now have much less competition, as such those too big to fail institutions profits have soared.
Real reform in America will not occur, the system has already transitioned and the constitution has been rendered a nullity. What does this mean for the masses of the population?
We have Geitner’s Bankers view: “Geithner’s “Claim” -the Economy is Rebounding!” "Right now we're focused on getting growth back on track," says Geithner. "And we're not at the point yet where we have to decide exactly what it's going to take."
Ok, so, the economy is rebounding, says Geitner, the government is focused on getting growth back on track, but hasn’t the slightest idea how to do just that!
Leaving the rhetorical question, with most American jobs outsourced, will the economy ever rebound?
It’s time we got real!
People are still losing jobs and at an alarming rate, while those in government are focused on helping the banks, that same irresponsible element that is still doing the same thing that got them in trouble in the first instance. The Banks are still bundling loans and creating derivatives (CDS’S). Although it is at a much lower pace as they are making fewer loans.
Perhaps the process of thinking for the executives of these major banks may be demented, as it appears that they simply don’t care. So far when they fail the government has forced us to come to their rescue, and as the government believes these banks are too big to fail the bankers “know” they won’t be allowed to fail!
So it’s business as usual on Wall Street.
This unemployment cycle had to occur and it was expected by Greenspan, Geitner and Bernanke. The housing bubble was an artificial bubble created by the Bush administration to help take us out of the recession we had entered in 2000. We were already into a recession when the incident of 9/11 occurred, we never came out of that recession until the banks loosened credit and had us take the equity out of our homes. It wasn’t jobs or income that marshaled the economy; it was the easy access to our home equity.
The Banks didn’t care that the housing market was a bubble and the numbers weren’t realistic, or that the consumers would be able long term to cover their mortgages, as they made a lot of money creating these loans and inflating the economy, which caused the housing bubble in the first place. They also created these insurance derivatives to protect themselves when the bubble collapsed, as they knew it would.
The US economy has been in a sad state since the Reagan Bush administration, Reagan was a puppet of the banks, and as the banks controlled Reagan they also controlled each of the fortune 500 companies, they sought more profits. Reagan gave them what they wanted by promoting American businesses to relocate off shore and with them American jobs, and an abundance of cheap labor. It was Reagan that transitioned this economy to a service economy! Reagan the idol of the Republican Party elite was himself a puppet of the Banking interests. Reagan is the culprit that has caused the waste of American jobs.
Now we are simply reaping what Reagan and Bush had sown, followed by Clinton and Nafta and Gatt. Each taking American jobs further disrupting our economy.
The unemployed, those who have filed claims for assistance during 2009 number in excess of 24,003,936. More than 24 million American workers displaced in 2009 Alone. The government acknowledges that 35.6% or 8,545,40 people are hard core unemployed, this does not take into account however (i) those whose benefits have expired and they are simply out of luck, or (ii) those that have accepted part time work as better than nothing, or (iii) those who have taken a cut in pay to work in a less desirable industry.
The jobless rate has now been acknowledged at 10.2 percent of the workforce however this number is very misleading, when we take into account those on aid, on Social Security, those no longer collecting unemployment benefits, and the unemployed we have a tremendous difference, there appears to be more people collecting benefits than there are actually working.
The unemployment rate doesn't include people without jobs who have stopped looking, or those who have settled for part-time jobs. Counting those people, the unemployment rate would be 17.5 percent or higher, the highest since at least 1994, and the worst record for Americans since Ronald Reagan was in office. An alternative gauge of unemployment, which includes discouraged workers and those forced to work part-time, actually rose to 17.5%, the highest on record dating to 1994.
The underemployed - Total hours worked in the economy fell 0.2%. The average workweek was steady at a record-low 33 hours meaning that of those who were employed were working fewer hours and making less money!
Very simply and plainly, high unemployment is going to be around for some time to come ... there is little reason for businesses to hire and we can expect this holiday season to be the worst on record!
There is no need to highlight the terrible predicament the American economy has been placed in by the banks, big business and inadequate administrations. The bank control of Ronald Reagan and the following administrations bear evidence to the tragic state our economy now finds itself.
The Banks because of their greed, and big business seeking to make larger profits for their investors, have disrupted the American economy. Only the reversal of this plan to equalize the citizens of the world and to bring back American jobs will make any meaningful difference. But this will never happen our system of governance has fully transitioned to a corporate form of governance.
Consumer products manufactured overseas means jobs are overseas. We still have access to any product we want because they’re imported, whether or not we’ll be able to afford them is another question and one that will depend on whether we have an income or job. It may also depend on our relationship with those in power!
Eventually there isn't going to be enough income spread among enough of the population to continue the economy even at this reduced standard. The cycle of more productivity from fewer workers will ultimately hit a floor and then unemployment would crash even further.
We need to end the crony capitalism that still thrives under Obama, no more bailouts, no more bonuses, no more mega-players like Goldman Sachs, no more off-shoring American jobs and manufacturing. We need jobs now! And we need a plan that does not contain the banking interest above our own!
There are now 140 fewer banks then there was last year, and the too big to fail have gotten even larger, and now have much less competition, as such those too big to fail institutions profits have soared.
Real reform in America will not occur, the system has already transitioned and the constitution has been rendered a nullity. What does this mean for the masses of the population?
We have Geitner’s Bankers view: “Geithner’s “Claim” -the Economy is Rebounding!” "Right now we're focused on getting growth back on track," says Geithner. "And we're not at the point yet where we have to decide exactly what it's going to take."
Ok, so, the economy is rebounding, says Geitner, the government is focused on getting growth back on track, but hasn’t the slightest idea how to do just that!
Leaving the rhetorical question, with most American jobs outsourced, will the economy ever rebound?
It’s time we got real!
People are still losing jobs and at an alarming rate, while those in government are focused on helping the banks, that same irresponsible element that is still doing the same thing that got them in trouble in the first instance. The Banks are still bundling loans and creating derivatives (CDS’S). Although it is at a much lower pace as they are making fewer loans.
Perhaps the process of thinking for the executives of these major banks may be demented, as it appears that they simply don’t care. So far when they fail the government has forced us to come to their rescue, and as the government believes these banks are too big to fail the bankers “know” they won’t be allowed to fail!
So it’s business as usual on Wall Street.
This unemployment cycle had to occur and it was expected by Greenspan, Geitner and Bernanke. The housing bubble was an artificial bubble created by the Bush administration to help take us out of the recession we had entered in 2000. We were already into a recession when the incident of 9/11 occurred, we never came out of that recession until the banks loosened credit and had us take the equity out of our homes. It wasn’t jobs or income that marshaled the economy; it was the easy access to our home equity.
The Banks didn’t care that the housing market was a bubble and the numbers weren’t realistic, or that the consumers would be able long term to cover their mortgages, as they made a lot of money creating these loans and inflating the economy, which caused the housing bubble in the first place. They also created these insurance derivatives to protect themselves when the bubble collapsed, as they knew it would.
The US economy has been in a sad state since the Reagan Bush administration, Reagan was a puppet of the banks, and as the banks controlled Reagan they also controlled each of the fortune 500 companies, they sought more profits. Reagan gave them what they wanted by promoting American businesses to relocate off shore and with them American jobs, and an abundance of cheap labor. It was Reagan that transitioned this economy to a service economy! Reagan the idol of the Republican Party elite was himself a puppet of the Banking interests. Reagan is the culprit that has caused the waste of American jobs.
Now we are simply reaping what Reagan and Bush had sown, followed by Clinton and Nafta and Gatt. Each taking American jobs further disrupting our economy.
The unemployed, those who have filed claims for assistance during 2009 number in excess of 24,003,936. More than 24 million American workers displaced in 2009 Alone. The government acknowledges that 35.6% or 8,545,40 people are hard core unemployed, this does not take into account however (i) those whose benefits have expired and they are simply out of luck, or (ii) those that have accepted part time work as better than nothing, or (iii) those who have taken a cut in pay to work in a less desirable industry.
The jobless rate has now been acknowledged at 10.2 percent of the workforce however this number is very misleading, when we take into account those on aid, on Social Security, those no longer collecting unemployment benefits, and the unemployed we have a tremendous difference, there appears to be more people collecting benefits than there are actually working.
The unemployment rate doesn't include people without jobs who have stopped looking, or those who have settled for part-time jobs. Counting those people, the unemployment rate would be 17.5 percent or higher, the highest since at least 1994, and the worst record for Americans since Ronald Reagan was in office. An alternative gauge of unemployment, which includes discouraged workers and those forced to work part-time, actually rose to 17.5%, the highest on record dating to 1994.
The underemployed - Total hours worked in the economy fell 0.2%. The average workweek was steady at a record-low 33 hours meaning that of those who were employed were working fewer hours and making less money!
Very simply and plainly, high unemployment is going to be around for some time to come ... there is little reason for businesses to hire and we can expect this holiday season to be the worst on record!
There is no need to highlight the terrible predicament the American economy has been placed in by the banks, big business and inadequate administrations. The bank control of Ronald Reagan and the following administrations bear evidence to the tragic state our economy now finds itself.
The Banks because of their greed, and big business seeking to make larger profits for their investors, have disrupted the American economy. Only the reversal of this plan to equalize the citizens of the world and to bring back American jobs will make any meaningful difference. But this will never happen our system of governance has fully transitioned to a corporate form of governance.
Consumer products manufactured overseas means jobs are overseas. We still have access to any product we want because they’re imported, whether or not we’ll be able to afford them is another question and one that will depend on whether we have an income or job. It may also depend on our relationship with those in power!
Eventually there isn't going to be enough income spread among enough of the population to continue the economy even at this reduced standard. The cycle of more productivity from fewer workers will ultimately hit a floor and then unemployment would crash even further.
We need to end the crony capitalism that still thrives under Obama, no more bailouts, no more bonuses, no more mega-players like Goldman Sachs, no more off-shoring American jobs and manufacturing. We need jobs now! And we need a plan that does not contain the banking interest above our own!
Friday, September 25, 2009
The Dow Jones Stock Bubble
Today is September 25, 2009, and as this essay is written the Stock market is moving in the direction of 10,000, but one has to wonder what is driving it?
Certainly, it is not consumer spending, the reality is consumers, who make up 70 percent of the economy, have had to cut “way” back on buying because they have no money to spend, no savings left, and their Jobs continue to disappear.
Statistics show that one out of every six Americans, almost 17% of the workforce, is either unemployed or underemployed. This does not take into account those that are no longer collecting unemployment or other financial aid. Home values have fallen close to 50% of their 2007 high, and can no longer maintain the economy through refinancing. Indeed they are being foreclosed at record rates still.
Even more curious, how can the Dow be so far up when the government is crushing the economy with its huge deficits, and businesses are closing also at alarming record rates?
The explanation is simple. The Government, aided by Wall Street, is creating a stock market bubble through its debt financing, which is helping the bottom line of big business, including Health Care, Oil, and of course the Banks, part of the bubble is being created by black ops funding, CIA and Intelligence community investments.
The problem is however, this expanded government, isn't doing anything for the average working American, who continues to lose their job at record rates, whose belts continue to tighten, and who are getting almost nothing out of the rising Dow because they own few if any stock at all.
The reader is reminded that while consumer spending is down, government spending is up, but what is government spending but forced taxation? In this case, the government is taking money from us, money that we don’t have, and using our “future income” to support them the Banks, and big business. In real terms the government is taking from the citizens, our private property, and transferring this, private property, our wealth to big business. A substantial violation of the notion the framers of the constitution intended to guard against.
In the Federal constitution, Amendment 5 and 14, the relevant part “nor shall private property be taken for public use, without just compensation” where is our just compensation? What is the benefit to us by saving the Banks, only to allow them to continue foreclosing on our homes? What is the benefit to the government’s using our assets to salvage Wall Street, and to allow these investment houses to lavish in their large bonus structures, while the population succumbs to poverty created by these very same bankers?
We the consumer are not reaping any benefit or advantage from this forced taxation, this transfer of our wealth, our jobs are declining, our homes are being foreclosed, outsourcing has become the American big business staple, and these executives are lavishing in large salaries and big bonuses. Where is our benefit in all of this?
Yes, Wall Street is making money and the stock market is booming, and it's all funded by government, taxpayer supported debt. No one is really producing anything of value, just shuffling paper while Wall Street takes its trade fee.
It’s only the global Bankers, the Entrenched Media, and the Military Establishments linked around the world, and the International Traders that are reaping the benefits of this forced extraction. The investor will be used, and discarded as the money flows upward into the hands of those entrenched in the system, that (1) percent at the top. It is not that the Dow is up because government is "helping out" the Mega Corp. It is that the Mega Corp is Plundering the public treasury. In other words, in addition to plundering us as individuals, these same predators are plundering all of us collectively. They will continue to succeed until the American people have enough and stand tall, demanding their rights, and requiring the government to return to our constitutional form.
Wall Street is in charge, of this and their lobbyists there is no question, but there is a question to be answered, why is this a secret, why it is that Wall Street is quietly in charge, much less very quietly so? Why not just come out and say so?
I will leave you with this daunting question, how are we solving the problem of “too big to fail” by encouraging firms allegedly “too big to fail” to get bigger.
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