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Tag: goldman sachs

Goldman Sachs’ Global Coup D’etat

“Goldman made similar deals here in the United States, masking the true value of investments, then selling those worthless investments to customers while placing bets that those same investments would eventually fail.”

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Tuesday, 27 November 2012 16:07
By Thom Hartmann and Sam Sacks

When the people of Greece saw their democratically elected Prime Minister George Papandreou forced out of office in November of 2011 and replaced by an unelected Conservative technocrat, Lucas Papademos, most were unaware of the bigger picture of what was happening all around them.

Similarly, most of us in the United States were equally as ignorant when, in 2008, despite the switchboards at the US Capitol collapsing under the volume of phone calls from constituents urging a “no” vote, our elected representatives voted “yes” at the behest of Bush’s Treasury Secretary Henry Paulsen and jammed through the biggest bailout of Wall Street in our nation’s history.

But now, as the Bank of England, a key player in the ongoing Eurozone crisis, announces that former investment banker Mark Carney will be its new chief, we can’t afford to ignore what’s happening around the world.

Steadily – and stealthily – Goldman Sachs is carrying out a global coup d’etat.

Greek Prime Minister Lucas Papademos in his office at the Presidential Palace in Athens, Greece, January 16, 2012. (Photo: Eirini Vourloumis / The New York Times)

There’s one tie that binds Lucas Papademos in Greece, Henry Paulsen in the United States, and Mark Carney in the U.K., and that’s Goldman Sachs. All were former bankers and executives at the Wall Street giant, all assumed prominent positions of power, and all played a hand after the global financial meltdown of 2007-08, thus making sure Goldman Sachs weathered the storm and made significant profits in the process.

But that’s just scratching the surface.

As Europe descends into an austerity-induced economic crisis, Goldman Sachs’s people are managing the demise of the continent. As the British newspaper The Independent reported earlier this year, the Conservative technocrats currently steering or who have steered post-crash fiscal policy in Greece, Germany, Italy, Belgium, France, and now the UK, all hail from Goldman Sachs. In fact, the head of the European Central Bank itself, Mario Draghi, was the former managing director of Goldman Sachs International.

And here in the United States, after Treasury Secretary and former Goldman CEO Henry Paulsen did his job in 2008 securing Goldman’s multi-billion dollar bailout, he was replaced in the new Obama administration with Tim Geithner who worked very closely with Goldman Sachs as head of the New York Fed and made sure Goldman received more than $14 billion from the bailout of failed insurance giant AIG.

What’s happening here goes back more than a decade.

In 2001, Goldman Sachs secretly helped Greece hide billions of dollars through the use of complex financial instruments like credit default swaps. This allowed Greece to meet the baseline requirements to enter the Eurozone in the first place. But it also created a debt bubble that would later explode and bring about the current economic crisis that’s drowning the entire continent. But, always looking ahead, Goldman protected itself from this debt bubble by betting against Greek bonds, expecting that they would eventually fail.

Ironically, the man who headed up the Central Bank of Greece while this deal was being arranged with Goldman was – drumroll please – Lucas Papademos.

Goldman made similar deals here in the United States, masking the true value of investments, then selling those worthless investments to customers while placing bets that those same investments would eventually fail. The most notorious example was the “Timberwolf” deal, which brought down an Australian hedge fund, and which Goldman Sachs banksters emailed each other about, bragging, “Boy, that Timberwolf was one shitty deal.”

This sort of behavior by Goldman helped inflate, and then eventually pop, the housing bubble in the United States. The shockwave then ran across the Atlantic, hitting Europe and turning Goldman’s debt-masking deal with Greece years earlier sour, thus deepening the crisis.

All of these antics should have brought about the demise of Goldman as well, but with their alumni in key policy positions on both sides of the Atlantic, Goldman not only survived, it flourished.

As the DailyKos sums up, “The normal scenario usually involves helping a nation hide a problem and sell its debt until the problem blows up into a bubble that bursts in a spectacular way…Goldman Sachs then puts their ‘man’ into a position of power to direct the bailouts so that Goldman gets all its money back and more, while the nation’s economy gets gutted.”

For years, tinfoil hat crazies who’ve bookmarked Glenn Beck’s websites and often appear as “experts” on Fox so-called News have warned us about a one-world government (here, here, and here). The latest threat, according to them, is Agenda 21 and the creation of a Soviet-style world authority that will confiscate private party everywhere, redistribute wealth to developing nations, and force us all to live by new global laws that sacrifice our national sovereignty. It’s totalitarian governments and not transnational corporations that we should be afraid of, they warn.

But when the tinfoil hat is removed, you can see that a sort of one-world government has already been established in a far more subtle form, through the rise of Goldman Sachs and their colleagues in the Wall Street elite.

A million questions arise when looking at what’s happening around the world. But many of these questions can be answered, once it’s acknowledged that Goldman Sachs alumni have executed a global coup d’etat.

Why are the working people of Greece, Portugal, Spain, and Italy suffering under austerity and being asked to sacrifice their pensions, their wages, and their jobs when, after five years, it’s clear these policies are only making these nations’ debts even harder to pay off?

It’s because Goldman Sachs is sucking the last remaining wealth out of those nations to recoup whatever failed investments they made before the Crash.

Why have thousands of homeowners in the United States turned to suicide, domestic violence, and even mass murder when faced with home foreclosure, when a simple solution like re-writing mortgages, which FDR did successfully during the Great Depression, could put an end to the bloodshed and misery?

It’s because re-writing mortgages would force banks like Goldman Sachs to take a hit. And thanks to the game they’ve created, they actually make more money when a home they own is foreclosed on.

Why, despite mountains of evidence, have banksters at Goldman Sachs and other Wall Street institutions not been thrown in jail for defrauding customers, manipulating LIBOR interest rates, and throwing thousands of Americans out of their homes illegally in a massive robo-signing scandal?

It’s because we have a two-tiered justice system in which those in power, like Goldman Sachs executives, get a slap on the wrist when they steal $50 billion, but people like you and me go to jail for stealing a 7-11 Slurpee.

Now does it make sense why Wall Street was bailed out and Main Street was sold out?

In this post-crash world, where agents of Goldman Sachs have infiltrated key positions of power all around the world, we must all fundamentally re-understand how we view the global economy and just how much effect our democratic institutions have on this economy.

We no longer have an economy geared to benefit working people around the world; we have an economy that’s geared to exploit working people for Goldman Sachs’ profits. Trader Alessio Rastani told the BBC in September before Goldman’s Lucas Papademos was installed as Greece’s Prime Minister, “We don’t really care about having a fixed economy, having a fixed situation, our job is to make money from it…Personally, I’ve been dreaming of this moment for three years. I go to bed every night and I dream of another recession.” Rastani continued, “When the market crashes… if you know what to do, if you have the right plan set up, you can make a lot of money from this.”

And as we’ve seen over the last decade, Goldman Sachs knows exactly what to do. They’ve had the right plan set-up, and it’s nothing short of a global coup d’etat.

As Rastani bluntly told the BBC, “This is not a time right now for wishful thinking that governments are going to sort things out. The governments don’t rule the world, Goldman Sachs rules the world.”

 

SOURCE:
http://truth-out.org/opinion/item/12996-goldman-sachs-global-coup-de-tat.html#13547977288201&action=collapse_widget&id=3478441

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Our Broken World: The Toxic Nexus of Power and Money

“In our global society, only money gives a few people access to power which in return allows the very same people the possibility to accumulate even more wealth.”

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By Gilbert Mercier
NEWS JUNKIE POST
Jan 19, 2012 at 8:41 pm

A Crisis of Ontology

The deadly disease of our global capitalist system is rather easy to understand from a philosophical standpoint. The crisis is ontological, a profound existential turmoil. Human beings are currently defined and valued by what they have, not by what they are. The quantitative aspect of our lives is in the forefront of all human interactions-either between groups or individuals within a group-while the qualitative aspect has been pushed aside, not even on the back burner of our collective consciousness, but literally into the trash of our social interactions. Usually, people are gauged by their assets, incomes, and cars they drive not by evaluating what contributions they make to the common good. We live in a world where a person is defined by quantity not quality, and it is probably our biggest systemic problem.

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This is reflected by countless examples in the popular culture with expressions such as “show me the money”, “money talks” or the famous line in Brian De Palma’s “Scarface”: “First you get the money, than you get the power”. Poor kids, dreaming of a better future, are constantly bombarded by the spectacle of the “bling, the cool cribs, the fancy rides and the sexy babes” which are the trademarks of most Hip Hop music videos. Money is always center stage in this out of reach universe of “players” which regardless of any tangible cultural meaning serve as heroes and role models for the disenfranchised. It is the deadly equation of money= success + happiness + self respect =power. The same toxic component motivates some of the brightest and best educated young people in the United States to opt for a career on Wall Street instead of becoming doctors, engineers or scientists.

In our global society, only money gives a few people access to power which in return allows the very same people the possibility to accumulate even more wealth. A typical example of this vicious cycle is the constant revolving door between investment banks, such as Goldman Sachs and the highest jobs at the US Treasury Department. Top finance executives with a taste for power- such as Hank Paulson or Larry Summers- under the premises of an interest in “public service”, work for governmental branches for a few years, then go back to their extremely lucrative jobs in finance, and so on.

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Anxiety Rising: Occupy Versus Fear and Paradigm Paralysis

Some people are still living under the pretense that “things” in our broken global system will eventually fix themselves up spontaneously by some kind of miracle. Of course it will not happen, and this model is, by essence, the definition of magical thinking. Recently, a Haitian woman, interviewed for the occasion of the second anniversary of the earthquake, said that she was “putting her trust in god not in people” to rebuild Haiti from the horrific disaster. With a rising uncertainty and global anxiety building up like a pressure cooker, most people are scared and either try to escape reality by putting their heads in the sand or are convinced that the global system can be salvaged by making changes from within.

But, what they refuse to see is that following this model of a “business as usual” mentality impair their judgments and lock them into the box of paradigm paralysis. Even so most people feel that we have already entered an extraordinary period of global paradigm shift, the fear of the unknown makes them want to hang on to a system in advance state of decay. More people worldwide are getting aware of the fact that it is not a question of if the system will collapse but rather when.

The global Occupy movement has two functions in this process: firstly, to be the main catalyst for systemic change, secondly, as one of the architects setting up the foundations for a new global system where quality not quantity shall finally prevail in human relationships. Turning what seems to be Utopian into a reality is the challenge, and it is what this brave new world is all about. It is only a question of reaching a certain critical mass, and of developing the psychological ability to welcome the unknown, without fear, and to enter into uncharted territories.

Editor’s Note: All photographs by Magalie L’Abbe.

SOURCE:
http://newsjunkiepost.com/2012/01/19/our-broken-world-the-toxic-nexus-of-power-and-money/

Swiss Study Shows 147 Technocratic “Super Entities” Rule the World

Swiss Study Shows 147 Technocratic “Super Entities” Rule the World
October 10, 2012

By Susanne Posel – Occupy Corporatism
(click images to see their sourcepages – ’tis disturbing)

The Swiss Federal Institute (SFI) in Zurich released a study entitled “The Network of Global Corporate Control” that proves a small consortiums of corporations – mainly banks – run the world. A mere 147 corporations which form a “super entity” have control 40% of the world’s wealth; which is the real economy. These mega-corporations are at the center of the global economy. The banks found to be most influential include:

• Barclays
• Goldman Sachs
• JPMorgan Chase & Co
• Vanguard Group
• UBS
• Deutsche Bank
• Bank of New York Melon Corp
• Morgan Stanley
• Bank of America Corp
• Société Générale

9 Biggest Banks’ Derivative Exposure – $228.72 Trillion
Note the little man standing in front of white house. The little worm next to lastfootball field is a truck with $2 billion dollars.
There is no government in the world that has this kind of money. This is roughly 3 times the entire world economy. The unregulated market presents a massive financial risk. The corruption and immorality of the banks makes the situation worse.
If you don’t want to bank with these banks, but want to have access to free ATM’s anywhere– most Credit Unions in USA are in the CO-OP ATM network, where all ATM’s are free to any COOP CU member and most support depositing checks. The Credit Unions are like banks, but invest all their profits to give members lower rates and better service. They don’t have shareholders to worry about or have derivatives to purchase and sell.
Keep an eye out in the news for “derivative crisis”, as the crisis is inevitable with current falling value of most real assets.
Derivative Data Source: ZeroHedge

However as the connections to the controlling groups are networked throughout the world, they become the catalyst for global financial collapse.

James Glattfelder, complex systems theorist at the SFI explains: “In effect, less than one per cent of the companies were able to control 40 per cent of the entire network.”

Using mathematic models normally applied to natural systems, the researchers analyzed the world’s economy. Their data was taken from Orbis 2007, a database which lists 37 million corporations and investors. The evidence showed that the world’s largest corporations are interconnected to all other companies and their professional decisions affect all markets across the globe.

George Sudihara, complex systems expert for SFI claims that this phenomenon is a common structure that could be found in nature. Comparing the manufactured reality of the financial markets to the ecosystems of the planet, Sudihara says that although the 147 corporations that rule the world through influence and interconnectedness are no more harmful than the natural cycles of our weather or animal kingdoms.

€828.6 Billion – Amount 2x large banks loaned to people of bankrupt countries
€828,600,000,000 – Intesa SanPaolo & Banco Santander lent a total of €828.6 billion to GIIPS in loans to institutions, corporations, retail business, mortgages, commercial real estate, etc, also called private debt. Intesa SanPaolo’s convoy is 3.8 kilometers long and Banco Santander’s is 3.5 kilometers long.
In technical terms this is called “Credit risk exposures (EAD – exposure at default)”.
The info is sourced from European Banking Authority’s website – 2011 Bank Stress Tests.

 

Yet because of the facts presented in the study, the financial crash of 2008 can be traced back to these tightly-knit networks. Future disasters can also be projected based on this analysis because of the “connectedness” of these influential entities which are only 147 corporations.

It is suggested the global capitalism could be a useful tool to make the markets more stable by simply acquiescing to control by the technocrats. The world’s transitional corporations (TNCs) guide the flow of all economies through influence and manipulation which created a structure of economic power. Most corporations are guided by the shareholders who use the companies to wield incredible power over the shift of economic consciousness. And the behavior of the system reflects the direction taken by those who fund the super entities.

Assumed by many that there was a complex architecture to the global economic power that caused financial systems to ebb and flow or crash and burn is not a scientific fact as evidenced in this study.

As the banking cartels force countries in the EuroZone into sovereign debt, there is a weakening of the many multi-national corporations around the world. Wells Fargo and JPMorgan Chase have financially gained while stocks are being unloaded in other markets.

This sovereign land-grab by the central banking cartels across Europe is mirrored in a recent Goldman Sachs report: “The more the Spanish administration indulges domestic political interests … the more explicit conditionality is likely to be demanded.” In other words the technocrats working for the Zionists are acquiring each country in the EuroZone.

The European Central Bankers agreed to give any nation in the Euro-Zone a bailout if they agreed to hand over the country to them under the guise of “new rules and conditions when applying for assistance.”

The Army of Debt
€360 Billion Euro Army of Debt heading towards Greece to infest itself on the government.
“Democracy is when the indigent, and not the men of property, are the rulers.” – Aristotle

As America drifts downstream toward economic implosion, the Federal Reserve headed by Ben Bernanke has chosen a different approach. They unveiled QE3 last week as a pump and dump scheme to prop up the US dollar by printing cash that is backed by nothing, while purchasing the mortgage-backed securities from the same banks that created the scandal and acquiring land in a massive land-grab; the likes of which have never been seen in the US.

Simultaneously, the BRICs nations (Brazil, Russia, India and China) are buying gold to back their fiat currencies to avoid being caught up in the destruction of the technocrats as they march toward one world currency. BRICs have become the anti-thesis to the banking cartels of the Zionist regime.

As these nations pair with Middle Eastern countries like Iran to trade gold for petrol instead of the US dollar as the global reserve currency, the Obama administration has begun a propaganda campaign against China involving a manufactured cyber-threat.

In Iran, the terrorist factions that do the bidding of the Zionists to topple governments by inciting fake revolutions have been deployed to Iran to stir-up trouble and blame the failing Ra-il which is being strategically destroyed by sanctions placed on the nation by the US. The American Israeli Public Affairs Committee (AIPAC) coerced the US Congress to pass HR 1905 which further tighten the economic noose around Iran for the benefit of the Zionist-controlled Israeli government.

In April of this year, the BRICs nations met to agree upon a strategy that would liberate the countries of the world from the grip of the technocrats. The BRICs countries are pushing for peace, but not through force and occupation of other countries to obtain this goal.

Vladimir Putin, President of Russia had this to say about the United Nations and their obvious attempts at global governance through usurpation of powers over countries. “One of the priorities of BRICs for the years to come should be the strengthening and key role of the UN’s Security Council in maintaining international peace and security. And also ensuring that the UN is not used as a cover for regime change and unilateral actions to resolve conflict situations.”

A joint BRICs bank was discussed with vigor. It would serve as an alternative to central banks that abuse their power at the expense of nations worldwide. They hope to replace the International Monetary Fund (IMF) and the World Bank. The IMF and World Bank are alarmed by this move and highly disapprove of it.

This is not shocking, considering that the central banks play a game of printing fiat that has no precious metals backing the paper.

Over 180 countries have signed onto the BRICs agreement as evidenced in their declaration. While the global Elite still hold power over the G5 countries, the rest of the world is standing up, severing their ties and making plans for a new world without them.

 

SOURCE: Blacklisted News
http://www.blacklistednews.com/Swiss_Study_Shows_147_Technocratic_“Super_Entities”_Rule_the_World_/21945/0/0/0/Y/M.html?morestories=obinsite

 

MORE SOURCES:

PDF: Swiss Study “The Network of Global Corporate Control”
http://arxiv.org/PS_cache/arxiv/pdf/1107/1107.5728v2.pdf

Huffington Post: ‘Super-Entity’ Of 147 Companies At center of World’s Economy, Study Claims
http://www.huffingtonpost.ca/2011/10/24/super-entity-147-global-economy-swiss-researchers_n_1028690.html

Reuters: Wall Street drops as investors wary of weak earnings
http://www.reuters.com/article/2012/10/08/us-markets-stocks-idUSBRE89708R20121008

Forbes: Wells Fargo And The Case Of The Falling Financials
http://www.forbes.com/sites/greatspeculations/2012/10/08/wells-fargo-and-the-case-of-the-falling-financials/

CNBC: Bank Bailout May Be Insufficient for Spain: Goldman Sachs
http://www.cnbc.com/id/48173416/Bank_Bailout_May_Be_Insufficient_for_Spain_Goldman_Sachs

WN: Euro crisis: Europe clears key obstacle; political risks remain in Greece, Spain, Italy (NOTE: the original source DELETED the original article. India’s sources do this more often than ye think)
http://article.wn.com/view/2012/09/12/Euro_crisis_Europe_clears_key_obstacle_political_risks_remai/

Occupy Corporatism: Bernanke’s Stimulus Simply Following Global Elite’s Directives to Implode the US Dollar
http://occupycorporatism.com/bernankes-stimulus-simply-following-global-elites-directives-to-implode-the-us-dollar/

Occupy Corporatism: The Fed’s US Land-Grab Hidden Within Purchase of Mortgage-Backed Securities
http://occupycorporatism.com/the-feds-us-land-grab-hidden-within-purchase-of-mortgage-backed-securities/

Occupy Corporatism: China buys gold before Bernanke implodes the US Dollar
http://occupycorporatism.com/china-buys-gold-before-bernanke-implodes-the-us-dollar/

Occupy Corporatism: The Connection Between White House Cyber Attacks and Global Reserve Currency
http://occupycorporatism.com/the-connection-between-white-house-cyber-attacks-and-global-reserve-currency/

Occupy Corporatism: Manufactured Arab Spring Implemented in Iran Amid Stricter US Sanctions
http://occupycorporatism.com/manufactured-arab-spring-implemented-in-iran-amid-stricter-us-sanctions/

Occupy Corporatism: HR 1905: AIPAC Pressures Congress for Stricter Sanctions Against Iran
http://occupycorporatism.com/hr-1905-aipac-pressures-congress-for-stricter-sanctions-against-iran/

BRICS: http://www.bricsindia.in/

VIDEO: Bye bye Dollar, it was fun – USA dollar NO LONGER world reserve currency

Now we know the truth. The financial meltdown wasn’t a mistake – it was a con

Hiding behind the complexities of our financial system, banks and other institutions are being accused of fraud and deception, with Goldman Sachs just the latest in the spotlight. This has become the most pressing election issue of all

Goldman Sachs was in the spotlight last November when demonstrators protested outside its Washington offices against executive bonuses. Photograph: Andrew Harrer/Bloomberg via Getty Images (click images for their sourcepages)

Will Hutton
The Observer, Sunday 18 April 2010

The global financial crisis, it is now clear, was caused not just by the bankers’ colossal mismanagement. No, it was due also to the new financial complexity offering up the opportunity for widespread, systemic fraud. Friday’s announcement that the world’s most famous investment bank, Goldman Sachs, is to face civil charges for fraud brought by the American regulator is but the latest of a series of investigations that have been launched, arrests made and charges made against financial institutions around the world. Big Finance in the 21st century turns out to have been Big Fraud. Yet Britain, centre of the world financial system, has not yet levelled charges against any bank; all that we’ve seen is the allegation of a high-level insider dealing ring which, embarrassingly, involves a banker advising the government. We have to live with the fiction that our banks and bankers are whiter than white, and any attempt to investigate them and their institutions will lead to a mass exodus to the mountains of Switzerland. The politicians of the Labour and Tory party alike are Bambis amid the wolves.

Just consider the roll call beyond Goldman Sachs. In Ireland Sean FitzPatrick, the ex-chair of the Anglo Irish bank was arrested last month and questioned over alleged fraud. In Iceland last week a dossier assembled by its parliament on the Icelandic banks – huge lenders in Britain – was handed to its public prosecution service. A court-appointed examiner found that collapsed investment bank Lehman knowingly manipulated its balance sheet to make it look stronger than it was – accounts originally audited by the British firm Ernst and Young and given the legal green light by the British firm Linklaters. In Switzerland UBS has been defending itself from the US’s Internal Revenue Service for allegedly running 17,000 offshore accounts to evade tax. Be sure there are more revelations to come – except in saintly Britain.

The shape of CDOs to come (Cayman Financial Review)

Beneath the complexity, the charges are all rooted in the same phenomenon – deception. Somebody, somewhere, was knowingly fooled by banks and bankers – sometimes governments over tax, sometimes regulators and investors over the probity of balance sheets and profits and sometimes, as the Securities and Exchange Commission (SEC) says in Goldman’s case, by creating a scheme to enrich one favoured investor at the expense of others – including, via RBS, the British taxpayer. Along the way there is a long list of so-called “entrepreneurs” and “innovators” who were offered loans that should never have been made. Lloyd Blankfein, Goldman’s CEO, remarked only semi-ironically that his bank was doing God’s work. He must wake up every day bitterly regretting the words ever emerged from his mouth.

For the Goldmans case is in some ways the most damaging. The Icelandic banks, Anglo Irish bank and Lehman were all involved in opaque deals and rank bad lending decisions – but Goldman allegedly went one step further, according to the SEC actively creating a financial instrument that transferred wealth to one favoured client from others less favoured. If the Securities and Exchange Commission’s case is proved – and it is aggressively rebutted by Goldman – the charge is that Goldman’s vice-president Fabrice Tourre created a dud financial instrument packed with valueless sub- prime mortgages at the instruction of hedge fund client Paulson, sold it to investors knowing it was valueless, and then allowed Paulson to profit from the dud financial instrument. Goldman says the buyers were “among the most sophisticated mortgage investors” in the world. But this is a used car salesman flogging a broken car he’s got from some wide-boy pal to some driver who can’t get access to the log-book. Except it was lionised as financial innovation.

Banks in talks to end bond probe (Wallstreet Journal)

The investors who bought the collateralised debt obligation (CDO) were not complete innocents. They had asked for the bond to be validated by an independent expert into residential mortgage-backed securities – a company called ACA management. ACA gave the bond the thumbs-up on the understanding from Fabrice Tourre that the hedge fund Paulson were investing in it. But the SEC says Tourre misled them, a pivotal claim that Goldman denies. The reality was that Paulson was frantically buying credit default swaps in the CDO that would go up in price the more valueless it became – a trade that would make more than $1 billion. Worse, Paulson had identified some of the dud sub-prime mortgages that he wanted Tourre to put into the CDO. If the SEC case is true, this was a scam – nothing more, nothing less.

Tourre could see what was coming. In one email in January 2007 he wrote: “More and more leverage in the system. The whole building is about to collapse anytime now… only potential survivor, the fabulous Fab[rice Tourre] .. standing in the middle of all these complex highly leveraged exotic trades he created without necessarily understanding all of the implications of those monstrosities”. Fabulous Fab, like his boss, will not be feeling very fab today.

Hedging their bets — about exactly WHO owns your Mortgage? (Daily KOS)

The cases not only have a lot in common – using financial complexity allegedly to deceive and then using so-called independent experts to validate the deception (lawyers, accountants, credit rating agencies, “portfolio selection agents,” etc etc ) – but they also show how interconnected the financial system is. In Iceland Citigroup and Deutsche Bank covered the margin calls of distressed Icelandic business borrowers, deepening the crisis. Lehman uses the lightly regulated London markets and two independent British experts to validate that their “Repo 105s” were “genuine” trades and not their own in-house liability. The American authorities pursued a Swiss bank over aiding and abetting US nationals to evade tax.

Hedging their bets — about exactly WHO owns your Mortgage? (Daily KOS)

Bankers will complain these cases all involve one or two misguided individuals, but that most banking is above board and was just the victim of irrational exuberance, misguided belief in free market economics and faulty risk management techniques. Obviously that is true – but, sadly, there is much more to the crisis. Andrew Haldane, executive director of the Bank of England, highlights the remarkable reduction in the risk weighting of bank assets between 1997 and 2007. Put simply, Europe’s and the US’s large banks exploited the weak international agreement on bank capital requirements in the so-called Basel agreement in 2004 to reclassify the risk of their loans and trading instruments. They did not just reduce the risk by 5 or 10%. Breathtakingly, they claimed their new risk management techniques were so wonderful that the riskiness of their assets was up to half of what it had been – despite property and share prices cresting to new all-time highs.

Brutally, the banks knowingly gamed the system to grow their balance sheets ever faster and with even less capital underpinning them in the full knowledge that everything rested on the bogus claim that their lending was now much less risky. That was not all they were doing. As Michael Lewis describes in The Big Short, credit default swaps had been deliberately created as an asset class by the big investment banks to allow hedge funds to speculate against collateralised debt obligations. The banks were gaming the regulators and investors alike – and they knew full well what they were doing. Simon Johnson’s 13 Bankers shows how the major American banks deployed vast political lobbying power and money to create the relaxed regulatory environment in which all this could take place. In Britain no money changed hands. Gordon Brown offered light-touch regulation for free – egged on by the Tories, who wanted to go further.

CDOs for Dummies (The Big Picture)

This was the context in which Goldman’s Fabulous Fab created the disputed CDOs, Sean FitzPatrick allegedly moved loans between banks and Lehman created its Repo 105s along with the entire “debt mule” structure revealed this weekend of inter-related companies to shuffle debt around its empire. London and New York had become the centre of an international financial system in which the purpose of banking became making money from money – and where the complexity of the “innovations” allowed extensive fraud and deception.

Now it has all collapsed, to be bailed out by western taxpayers. The banks are resisting reform – and want to cling on to the business practices and business model that has so appallingly failed. It is obvious why: it makes them very rich. The politicians tread carefully, only proposing what the bankers say is congruent with their definition of what banking should be. Labour and Tories alike are united in opposing improved EU regulation of hedge funds, buying the propaganda those operations had nothing to do with the crisis. Perhaps Paulson’s trades at Goldman, and the hedge funds’ appetite for speculating in credit default swaps, may disabuse them.

Goldman Sachs has a derivative exposure of $44.192 Trillion dollars.
The $1 Trillion pillars towers are double-stacked @ 930 feet (248 m).
The White House is standing next to the Statue of Liberty.
Goldman Sachs has advantage over other banks because it has awesome
connections in US Government. A lot of former Goldman employees hold high-level
US Government positions (chart).
Mitt Romney’s top donor is Goldman Sachs, and one of Obama’s best donors.
Ex-CEO of Goldman Sachs, Hank Paulson became the Secretary of Treasury under Bush and
during the 2008 financial crisis authored the TARP bill demanding $700 billion bail-out.
In UK, Goldman Sachs escaped £10 million bill on a failed tax avoidance scheme with help of good connections.
The bank is the largest player in the food commodities market, earned $955m from food speculation in 2009″ – That’s your $$$.
Goldman Sachs employees are arming themselves with guns in case there is a populist uprising against the bank.
Goldman Sachs calls their investors “muppets”. and use clients to make money for themselves, disregarding the clients.
The bank was fined $22 million for sharing valuable nonpublic information with top clients (Think insider trading with best clients).
Goldman Sachs was part-owner America’s leading website for prostitution ads until the ownership stake was exposed.
Goldman Sachs helped Greece conceal its debt with secret loans, while simultaneously taking advantage of Greece.
Goldman Sachs got a $814 billion SECRET bailout from the Federal Reserve during the 2008 crisis.
Goldman Sachs got $10 billion of the 2008 TARP bailout, and in the same year paid $10.9 billion in employee compensation and “benefits”, while paying a tax rate of 1%. That means an average of $327,000 to each Goldman Sach’s employee.

It is time to reframe the question. Banks and financial institutions should do what economy and society want them to do – support enterprise, direct credit to where it is needed and be part of the system that generates investment and innovation. Andrew Haldane – and the governor of the Bank of England – are right. We need to break up our banks, limit their capacity to speculate and bring them back to earth. Britain should also launch an official investigation into what went wrong – and hand the findings to the Serious Fraud Office. This needs to become this election campaign’s number one issue – not one which either a compromised Labour party or a temporising Conservative party will relish. The Lib Dems, the fiercest critics of the banks, have begun to get very lucky.

SOURCE: The Guardian
http://www.guardian.co.uk/business/2010/apr/18/goldman-sachs-regulators-civil-charges?fb=optOut