Racketeering 101: bailed out Banks threaten systemic collapse if Fed discloses information

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Racketeering 101: bailed out Banks threaten systemic collapse if Fed discloses information

http://www.zerohedge.com/article/racketeering-101-bailed-out-banks-threa...

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Re: Racketeering 101: bailed out Banks threaten systemic ...

zo  -

Very interesting article - great find.

Which leads to the question of so what?  If the banking system is doomed anyway, why not get it over with now?  I would like to see a "systemic collapse" because then something would have to be done.

This is great information - the banks need to be careful how loudly they protest.  As more and more people begin to understand the depth of the problem they are going to realize that "systemic changes" are needed.  The louder the banking industry protests about transparency into their way of doing business, the more they are drawing attention to the incompetent good ole boy network.  It will (I hope) collapse under its own weight.

What better time to implement systemic changes than after systemic collapse?

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Re: Racketeering 101: bailed out Banks threaten systemic ...

I agree with Dogs. The eventual and inevitable crisis is only getting worse with the time we waste. Best to deal with things now. Unfortunately, our political system doesn't really encourage prudence or longer term goals, so I'm not quite sure we're going to deal with the systemic issues until things really collapse. It has been a year since Lehman failed, what new regulations, etc. have we actually meaningfully implemented since then? I see a regulatory system that is virtually indistinguishable from 2 years ago.

This sort of protesting reminds me of Goldman Sachs' argument regarding the stolen high frequency trading code. It literally stated in court that a third party could "use the code to unfairly manipulate the markets." Somehow, the public (and Congress) must have missed the question begging to be asked of Goldman at that time. While some individuals can read all the writing on the wall regarding the banks, groups of people have collectively stuck their heads in the sand. To be frank, it seems America feels disempowered, discouraged, and unconfident in themselves to allow this daylight robbery to continue.

Another fact I would point out regarding the banks is the almost shockingly high degree to which executive and legislative members of our government are invested in that sector. See here: http://www.opensecrets.org/pfds/overview.php?type=S&year=2007
The latest information on this is only from 2007, but I believe that is good enough to gauge the relative levels of investment in each sector. Further, since the decline began in 2007, there would clearly be an interest on at least some of the leaders to regain what was lost. Draw your own conclusions, but 2+2 still = 4.

The greatest trick the devil ever pulled was convincing the world he didn't exist.

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Kill the People, Save the Insiders!

The degree of backwards thinking on display by these banks is simply astounding.

The position they are taking is the equivalent of a major food producer, found to have deadly contaminated food, requesting that the FDA hold it's identity secret for fear that consumers might dump its food and put the corporation in severe danger. 

Kill the people, save the insiders! 

Such is the motto that best describes the current state of this putrid oligarchy.

 

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Re: Racketeering 101: bailed out Banks threaten systemic ...

Kick the can down the road...

Ok, it's a year later, now what?

More kicking...

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Re: Racketeering 101: bailed out Banks threaten systemic ...

I think the Fed and the clearing houses have a point.............and whilst we're at it, lets get rid of credit rating agencies, criminal records databases, insurance access to medical records etc etc etc.  Afterall, we would want other people or organisations to make rational decisions based on any kind of meaningful data and information that might negatively affect us personally.  If its good for them, then its good for us, right!!Wink

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Re: Racketeering 101: bailed out Banks threaten systemic ...

Great dig investorzzo, this is a threat that we should take quite seriously and it should anger all Americans.

The "Clearing House" that issued this warning are the same banks that received the bail-out money - Bank Of America, The Bank Of New York, Deutsche Bank, HSBC, JP Morgan Chase, US Bank and Wells Fargo.  Why are they so fearful of Bloomberg's FOIA suit and a possible audit of the non-Federal Reserve bank?  

One reason is that many of these banks also own the non-Federal Reserve and they know that if people ever get a whiff of what they are brewing it would spell the end of the greatest scam in history.  Like the vampires they are, they know that if the light of truth ever shines on them they will wither and die in prison.

Statement from the Clearing House criminals:

The Clearing House submits this declaration because the Court's Order threatens to impair the ability of our members to access emergency funds through the New York Fed's Discount Window without suffering the severe competitive harm that public disclosure of their identity will cause.

Our members have accessed the New York Fed's Discount Window with the understanding that the Fed will not publicly disclose information about their borrowing, especially their identity. Industry experience, including very recent and searing experience, has shown that negative rumors about a bank's financial condition - even completely unfounded rumors - have caused competitive harm, including bank runs and failures. 

If the names of our member banks who borrow emergency funds are publicly disclosed, the likelihood that a borrowing bank's customers, counterparties and other market participants will draw a negative inference is great. Public speculation that a financial institution is experiencing liquidity shortfalls - which would be a natural inference from having tapped emergency funds - has caused bank customers to withdraw deposits, counterparties to make collateral calls and lenders to accelerate loan repayment or refuse to make new loans. When an institution's customers flee and its credit dries up the institution may suffer severe capital and liquidity strains leaving it in a weakened competitive position.

In sum, our experience differs from the factual conclusions the Court appears to have reached about the nature of competition in the banking industry:

The competitive harm to institutions that are publicized as needing emergency funding is not "speculative," but demonstrated by the recent multiple failures of financial institutions whenever information about their funding difficulty has been disclosed.

My Comment:

Yes, that's exactly why we need disclosure, we need to know which banks are teetering on the edge of insolvency.  Disclosure is not a public relations event, it is to establish a factual basis of a banks ability to perform.  The banks will only be "embarrassed" if weakness and fraud are found.

  • The disclosure would not merely "stigmatize [ ]"the institution or make it "look [ ] weak," but goes to its very viability.

My Comment:

That is why we need disclosure, to determine which banks are insolvent and which are viable.

  • The disclosure of accessing emergency funding is not an "inherent risk" of market participation, but an extraordinary risk in extraordinary circumstances.
  • Competitors can use the disclosure to advertise or publicize that they are financial stronger because they don't need emergency funding.

My Comment:

The text in the first bulleted item must have been written by Alan Greenspan.  The second bullet is really a great idea, why not list banking viability/solvency reports so consumers can better decide where to place their money.

 

The disclosure does not involve mere "embarassing publicity" but information that could result in the immediate demise of an institution.

My Comment:

If the institution is insolvent or guilty of fraud then it should meet it's "demise" through bankruptcy and possible criminal proceedings.

 

Dogs_In_A_Pile said:

Which leads to the question of so what?  If the banking system is doomed anyway, why not get it over with now?  I would like to see a "systemic collapse" because then something would have to be done.

Dogs, I see it a different way.  The system has already collapsed.  For example, we are now monetizing our own debt (see Martenson Report The Shell Game - How the Federal Reserve is Monetizing Debt).

We are moving towards something far worse - national bankruptcy.  It is seldom talked about but during the great depression of the 1930s, the United States went bankrupt.  This official act wiped out much of the nations private and public wealth and it forever changed the way our government works while taking rights away from citizens.

For example, the currency was devalued by over 40%, the gold held in our national vaults was seized by the Federal Reserve, the gold held by private citizens was seized at around half of the market value, the President seized emergency powers that wiped out much of the power delegated to congress - we are still operating under presidential emergency powers 75 years later.

The last bankruptcy took us from being a constitutional republic to becoming a democracy under an imperial president.  Like the first bankruptcy, this one is part of a plan and it  will take us from the imperial president and democracy to a new world order of international  fascism.

Larry

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Re: Racketeering 101: bailed out Banks threaten systemic ...

Sorry to rain on your parade Larry, but the American people are going to wake up from this and WE are going to take this country back.  It is going to be painful.

It will be a very tough challenge but your new world whatever is not going to happen.  The structure of their "system" will no longer support the weight of it's own greed and incompetence.  I suspect (and truly hope) that in time you will get over the disappointment of that not happening, but trust me, we the people will prevail.

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Re: Racketeering 101: bailed out Banks threaten systemic ...
Dogs_In_A_Pile wrote:

the American people are going to wake up from this and WE are going to take this country back.  It is going to be painful.

I can speak for myself: regardless of the desires and intentions of international bankers, elitists, and NWO mongers, I, for one, shall not participate in such a system and I will do everything in my power to educate those around me as to the nature of our problems.

This nation does not need everyone to be 100% on board. It only needs the "critical mass" that Chris frequently speaks of. A relatively small group of highly motivated individuals can overcome the inertia baked into this system. It has been done before and the NWO is not a given.

I've read that psychological studies indicate that human emotions and confidence are far more influenced by losing something than by gaining it. Fear of loss or failure apparently outweigh the greed of attainment to make a generalization. The People of this country have far more to lose than the corrupt controlling interests have to gain. In that sense, the odds are absolutely on our side. Hard work never hurt, either.

Just guess who's responsible for this one:

"I'm a great believer in luck, and I find the harder I work, the more I have of it"

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Re: Racketeering 101: bailed out Banks threaten systemic ...
DrKrbyLuv wrote:

For example, the currency was devalued by over 40%, the gold held in our national vaults was seized by the Federal Reserve, the gold held by private citizens was seized at around half of the market value, 

Larry, 

I'm not trying to nit-pick here, but by my calculations, the currency was devalued by 75%. Can you check my assumptions and math on this?

The USD was backed by gold at the time.

1 oz of gold=$20 before the devaluation.

1 oz of gold=$35 after the devaluation.

35-20=15 and 20/15 =.75

So it took 75% more dollars to purchase the same amount of gold after the devaluation. 

How am I mistaken in this calculation? Thanks in advanced.

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Re: Racketeering 101: bailed out Banks threaten systemic ...

"The debasement of the dollar is the most pernicious, universal and regressive tax that can be imposed. It is also invisible. Hence, it is highly favored by the political and social elites. It harms the most vulnerable and least skilled Americans the most. These people, lulled into believing they are being cared for because they pay no income taxes and receive welfare, are the very Americans who have the least personal pricing power to offset inflation because they have the least value added abilities and make the most substitutible and fungible contributions to society. The bottom 50% of Americans, over a period of decades, suffer more cruelly from this tax via inflation than the top half.
The top 5% actually benefit because they have the personal pricing power (differentiated skill set), poiltical control ( hence resource allocation power) and investment/asset mix to expand real income and wealth. Hence income, wealth and power continue to flow up (the Rising Sap effect?) from 95% of Americans to the corrupt governing elites.
For these elites, your chart is affirmative evidence of how well their strategies for accumulating money, power and status have succeeded over the decades. The power to debase is the power to tax is the power to rule."

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Re: Racketeering 101: bailed out Banks threaten systemic ...

Xray -

Great chart - and great essay.

Can you imagine what is going to happen when 10-15% of the 95% get sick and tired of all of this?  This ends when we say it does.

Getcha popcorn ready

 

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Re: Racketeering 101: bailed out Banks threaten systemic ...
DrKrbyLuv wrote:

<snip>

The last bankruptcy took us from being a constitutional republic to becoming a democracy under an imperial president.  Like the first bankruptcy, this one is part of a plan and it  will take us from the imperial president and democracy to a new world order of international  fascism.

Larry

Larry, There certainly is plenty of pressure to head down the path to a NWO and fascism but I would argue the point that we are factually operating as a democracy with an imperial president. I'd say we are actually operating more closely as a fascist state now given the corporate control of government and the lack of choice in electing officials.

Webster New World defines fascism as "a system of government characterized by rigid one-part dictatorship, forcible suppression of opposition, private economic enterprise under centralized governmental control, belligerent nationalism, racism, and militarism,etc."

It is only an apparency that we have a choice as regards our elections. We can choose between a Democrat or Republican candidate but the others are not even allowed to debate. Private banking interests probably are in control of government rather than the reverse. We certainly are acting rather militaristic by carrying on wars with two countries.  

As regards the NWO, I suspect that it is largely  complete as regards private banking interests manipulating international finance to maintain control of populations.

But I do not subscribe to the notion that we will not have our day. I don't think these power brokers really see the power of the exponential function as it relates to money. They likely understand shrinking resources and will make a grab for as much of it as possible and they have plenty of cash to have their way. But we have the power to get the word out about the truth of the matter and we will do that. There will likely be plenty of folks who consider they have nothing left to lose and that is a formidible position of strength agains a small minority who have taken advantage. You can run but you cannot hide .........forever.

So I'm with Dogs and Mike. We will not go quietly in the night and we don't have to take this S*%$ any more!  Nothing here is to be construed to mean this will be easy or maybe unmessy!

Coop

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Re: Racketeering 101: bailed out Banks threaten systemic ...

Dogs, you sound quite excited at what's coming. That's good. I like it. My popcorn (among other items) is ready. My eyes, wide open. I just wish I had more time to write a diary. This website's blogs might some day prove to be excellent first hand accounts of history as it was made. Wait, they already are.

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Re: Racketeering 101: bailed out Banks threaten systemic ...

JAG said:

I based my approximation by my calculations, the currency was devalued by 75%. Can you check my assumptions and math on this?

The USD was backed by gold at the time,1 oz of gold=$20 before the devaluation, 1 oz of gold=$35 after the devaluation.

35-20=15 and 20/15 =.75

Hi Jeff,

I didn't calculate the number I provided (40%), I based it on a number of articles and books, e.g. - Ellen Brown, Web of Debt suggests 41%.  Your math looks good, so why the difference?

I think there are two things that occurred to change the math:

  • The money supply was contracted for several years leading up to the bankruptcy; less money for the same amount of gold reserves.
  • The government and fed was, and is lying about the amount of gold the U.S. actually holds in reserves.  The reserves were never 100%, even back in 1900 when the U.S. first went on the gold standard.  Even if we had enough gold on day one, fractional reserve lending and interest debt would make it impossible to maintain backing without constantly buying large quantities of gold.  The books were cooked so to speak, even through bankruptcy.

The gold standard, when applied through private banking debt, is actually a scam for banks to steal all of a nations gold.  It has happened everywhere it was applied.  No one has able to remain on the gold standard because eventually, the banks take all the gold through the mathematics of debt interest and fractional banking.

Dogs_In_A_Pile said:

It will be a very tough challenge but your new world whatever is not going to happen.  The structure of their "system" will no longer support the weight of it's own greed and incompetence.

Dogs, can you provide anything more than your assurance that the "new world whatever is not going to happen"?  The international banking cartel will BENEFIT from our bankruptcy.  The will again take our private and public assets held in collateral.  And, again bankruptcy will put us in their receivership - just as it did in 1933.  

They are more rich than ever, having looted the public coffers of trillions, and now they can buy the remaining assets at pennies on the dollar.  The people will be greatly hurt, many will go bankrupt too and all will see a rapid destruction of all that they have saved.

Mike Pilat said:

This nation does not need everyone to be 100% on board. It only needs the "critical mass"

Hello Mike, good to see you, where ya been?

I agree it does not require 100% to put a stop on the NWO scam/scum.

Larry

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Re: Racketeering 101: bailed out Banks threaten systemic ...
DrKrbyLuv wrote:

Dogs, can you provide anything more than your assurance that the "new world whatever is not going to happen"?  The international banking cartel will BENEFIT from our bankruptcy.  The will again take our private and public assets held in collateral.  And, again bankruptcy will put us in their receivership - just as it did in 1933.  

They are more rich than ever, having looted the public coffers of trillions, and now they can buy the remaining assets at pennies on the dollar.  The people will be greatly hurt, many will go bankrupt too and all will see a rapid destruction of all that they have saved.

Nope.  No more than you can provide any assurance that it will.  Otherwise you would be able to tell me the exact date and time it is going to happen because objective, measurable and observable proof can stand up to that kind of academic rigor right?

In fact, you did a great job of answering that very question with your exchange with Mike quoted below. 

Quote:

 

Mike Pilat said:

This nation does not need everyone to be 100% on board. It only needs the "critical mass"

Hello Mike, good to see you, where ya been?

I agree it does not require 100% to put a stop on the NWO scam/scum.

Larry

The other assurance I offer, and I truly am not intending this as a smart ass answer, is because I said so.  I, like Mike and Coop and many others here refuse to allow this to happen. 

And so I toil here on the threads, pulling information I can share with co-workers and friends and family to educate them one by one.  The base of informed people is growing. 

The base of really, REALLY pissed off people is growing and soon enough we will yank back control of our country from the idiot politicians and the corrupt and incompetent ans smug, arrogant and overconfident bankers and business captains they rub elbows with. 

Their beast is too big and it is going to fail.  But not before it hurts a lot of people - and it is that hurt, that systemic failure shock and awe that is going to galvanize people into action.

Trust me.

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Re: Racketeering 101: bailed out Banks threaten systemic ...
JAG wrote:
DrKrbyLuv wrote:

For example, the currency was devalued by over 40%, the gold held in our national vaults was seized by the Federal Reserve, the gold held by private citizens was seized at around half of the market value, 

Larry, 

I'm not trying to nit-pick here, but by my calculations, the currency was devalued by 75%. Can you check my assumptions and math on this?

The USD was backed by gold at the time.

1 oz of gold=$20 before the devaluation.

1 oz of gold=$35 after the devaluation.

35-20=15 and 20/15 =.75

So it took 75% more dollars to purchase the same amount of gold after the devaluation. 

How am I mistaken in this calculation? Thanks in advanced.

It's a question of which direction you perform the percentage calculation. Gold went from $20.67 to $35.00 an ounce. Now take reciprocals: previously one dollar was equal to (1 / 20.67) = .04838 ounce of gold. After Roosevelt's devaluation, one dollar bought ( 1 / 35.00 ) = .0286 ounce of gold, which is only 59% of the previous amount of gold one dollar would buy. Therefore, it's usually said that the dollar was devalued 41% in terms of gold, although the gold price increased by 69% (35.00 / 20.67).

The mathematical paradox here is that negative percentages don't equal positive percentages. For instance, to recover from a 50% loss, you need a 100% gain. To avoid this paradox, natural logarithms can be used, so that negative and positive changes are additively equal.

p.s. Under fascist math, a dollar isn't equal to any amount of gold -- it's unredeemable, even for the securities which allegedly 'back' it.

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Re: Racketeering 101: bailed out Banks threaten systemic ...

xraymike79 said:

The top 5% actually benefit because they have the personal pricing power (differentiated skill set), poiltical control ( hence resource allocation power) and investment/asset mix to expand real income and wealth. Hence income, wealth and power continue to flow up (the Rising Sap effect?) from 95% of Americans to the corrupt governing elites.

For these elites, your chart is affirmative evidence of how well their strategies for accumulating money, power and status have succeeded over the decades. The power to debase is the power to tax is the power to rule."

x-mike - thanks for helping to establish that there are winners and losers through this financial crisis.  The losers are almost everyone, the winners are an elite few who already have more than they could ever spend.

ckessel said:

Larry, There certainly is plenty of pressure to head down the path to a NWO and fascism but I would argue the point that we are factually operating as a democracy with an imperial president. I'd say we are actually operating more closely as a fascist state now given the corporate control of government and the lack of choice in electing officials.

Coop, I yeild to your better point.  Fascism is already destroying the last remnants of our constitutional republic.  Maybe it is more accurate to say that totalitarianism is coming our way with the next bankruptcy.

ckessel said:

But I do not subscribe to the notion that we will not have our day. I don't think these power brokers really see the power of the exponential function as it relates to money. They likely understand shrinking resources and will make a grab for as much of it as possible and they have plenty of cash to have their way. But we have the power to get the word out about the truth of the matter and we will do that....So I'm with Dogs and Mike. We will not go quietly in the night and we don't have to take this S*%$ any more!

You have misread me - I know that there are solutions and I am optimistic it can be done as long as people wake up to the fact that our monetary system is a scam run by the international banking cartel.

We have the power to stop the financial crisis by ending the cartel, at least in the United States.  As Lord Anton said over 100 years ago..."The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks."

The solution is very easy and quick to implement, the hard part is getting people to understand the problem.

Dog_in_a_pile said:

The other assurance I offer, and I truly am not intending this as a smart ass answer, is because I said so.  I, like Mike and Coop and many others here refuse to allow this to happen.

Dogs, I don't think that you and a few others have the power to stop the massive financial change that is upon us.  I've offered many historical references to back up my points - I haven't seen you dispute or discard their merits; instead it seems you prefer to dismiss what I say as being a CT. 

strabes said:

It's a question of which direction you perform the percentage calculation. Gold went from $20.67 to $35.00 an ounce. Now take reciprocals: previously one dollar was equal to (1 / 20.67) = .04838 ounce of gold. After Roosevelt's devaluation, one dollar bought ( 1 / 35.00 ) = .0286 ounce of gold, which is only 59% of the previous amount of gold one dollar would buy. Therefore, it's usually said that the dollar was devalued 41% in terms of gold, although the gold price increased by 69% (35.00 / 20.67).

The mathematical paradox here is that negative percentages don't equal positive percentages. For instance, to recover from a 50% loss, you need a 100% gain. To avoid this paradox, natural logarithms can be used, so that negative and positive changes are additively equal.

You da man!

Larry

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