History's Biggest Rip Off...........

by Janet Crain
If anyone doubted that the Stock Market Crash in September 2008 which caused so many damaging repercussions, was manipulated, maybe this article will change their mind.

On Tuesday, March 11th, 2008, somebody — nobody knows who — made one of the craziest bets Wall Street has ever seen. The mystery figure spent $1.7 million on a series of options, gambling that shares in the venerable investment bank Bear Stearns would lose more than half their value in nine days or less. It was madness — "like buying 1.7 million lottery tickets," according to one financial analyst.

But what's even crazier is that the bet paid.

At the close of business that afternoon, Bear Stearns was trading at $62.97. At that point, whoever made the gamble owned the right to sell huge bundles of Bear stock, at $30 and $25, on or before March 20th. In order for the bet to pay, Bear would have to fall harder and faster than any Wall Street brokerage in history.

The very next day, March 12th, Bear went into free fall. By the end of the week, the firm had lost virtually all of its cash and was clinging to promises of state aid; by the weekend, it was being knocked to its knees by the Fed and the Treasury, and forced at the barrel of a shotgun to sell itself to JPMorgan Chase (which had been given $29 billion in public money to marry its hunchbacked new bride) at the humiliating price of … $2 a share. Whoever bought those options on March 11th woke up on the morning of March 17th having made 159 times his money, or roughly $270 million. This trader was either the luckiest guy in the world, the smartest son of a bitch ever or…

Or what? That this was a brazen case of insider manipulation was so obvious that even Sen. Chris Dodd, chairman of the pillow-soft-touch Senate Banking Committee, couldn't help but remark on it a few weeks later, when questioning Christopher Cox, the then-chief of the Securities and Exchange Commission. "I would hope that you're looking at this," Dodd said. "This kind of spike must have triggered some sort of bells and whistles at the SEC. This goes beyond rumors."

Cox nodded sternly and promised, yes, he would look into it. What actually happened is another matter. Although the SEC issued more than 50 subpoenas to Wall Street firms, it has yet to identify the mysterious trader who somehow seemed to know in advance that one of the five largest investment banks in America was going to completely tank in a matter of days. "I've seen the SEC send agents overseas in a simple insider-trading case to investigate profits of maybe $2,000," says Brent Baker, a former senior counsel for the commission. "But they did nothing to stop this."

The SEC's halfhearted oversight didn't go unnoticed by the market. Six months after Bear was eaten by predators, virtually the same scenario repeated itself in the case of Lehman Brothers — another top-five investment bank that in September 2008 was vaporized in an obvious case of market manipulation. From there, the financial crisis was on, and the global economy went into full-blown crater mode.

Like all the great merchants of the bubble economy, Bear and Lehman were leveraged to the hilt and vulnerable to collapse. Many of the methods that outsiders used to knock them over were mostly legal: Credit markers were pulled, rumors were spread through the media, and legitimate short-sellers pressured the stock price down. But when Bear and Lehman made their final leap off the cliff of history, both undeniably got a push — especially in the form of a flat-out counterfeiting scheme called naked short-selling.

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What really happened to Bear and Lehman is that an economic drought temporarily left the hyenas without any more middle-class victims — and so they started eating each other, using the exact same schemes they had been using for years to fleece the rest of the country. And in the forensic footprint left by those kills, we can see for the first time exactly how the scam worked — and how completely even the government regulators who are supposed to protect us have given up trying to stop it.

© Janet Crain

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The Obama Deception by Alex Jones

Hat Tip: Don

Hip-hopper Professor Griff of Public Enemy asks, “Where did we get this sense that just because we have a black man as President everything is going to be OK…everything is NOT going to be OK.”



http://www.youtube.com/watch?v=eAaQNACwaLw


http://www.infowars.com/review-the-obama-deception-by-alex-jones/

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Teddy's Good Advice.........

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The Peril Of Financial Linguistics

by Janet Crain
This reminds me of when Nancy Pelosi said "Don't think of it as a bailout, think of it as an opportunity to buy in". That is when I knew she had lost all sense of reality.

Tell you what, go to the bank and try to get a loan with legacy securities as collateral.


THE MONEY CULTURE

Apparently, 'legacy' derives from an ancient root meaning 'it wasn't my fault and I should still get a bonus this year.'

By Daniel Gross | NEWSWEEK

Published Mar 28, 2009

From the magazine issue dated Apr 6, 2009

In his timeless 1946 essay "Politics And the English Language," George Orwell condemned political rhetoric as a tool used "to make lies sound truthful" and "to give an appearance of solidity to pure wind." Were he alive today, Orwell might well be moved to pen a companion piece on the use of financial lingo. Remember those toxic assets? The poorly performing mortgages and collateralized debt obligations festering on the books of banks that made truly execrable lending decisions? In the latest federal bank-rescue plan, they've been transformed into "legacy loans" and "legacy securities" —safe for professional investors to purchase, provided, of course, they get lots of cheap government credit. It's as if some thoughtful person had amassed, through decades of careful husbandry, a valuable collection that's now being left as a blessing for posterity.

The legacy gambit is necessary, in part, because the prior nomenclature used to describe the stuff in question was so corrosive. " 'Toxic' is one of those words that is so negative that it's just hyperbole," says Jesse Sheidlower, editor-at-large of the Oxford English Dictionary. The phrase "toxic assets," used widely in 2008, was either a sign of admirable reality, or an attempt to scare people into action. A middle ground of sorts was reached last fall when then–Treasury Secretary Henry Paulson rolled out the Troubled Asset Relief Program (TARP). Of course, calling some of those mortgage assets troubled was a little like calling Charles Manson a troubled person.

In this new paradigm, a legacy, usually a gift, is a burden. A potential loss is spun as a potential gain. War is peace. See what I mean by Orwellian?

http://www.newsweek.com/id/191397

© Janet Crain

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Why Can't Tarp Money be Returned?

Obama Wants to Control the Banks

There's a reason he refuses to accept repayment of TARP money.

By STUART VARNEY

I must be naive. I really thought the administration would welcome the return of bank bailout money. Some $340 million in TARP cash flowed back this week from four small banks in Louisiana, New York, Indiana and California. This isn't much when we routinely talk in trillions, but clearly that money has not been wasted or otherwise sunk down Wall Street's black hole. So why no cheering as the cash comes back?

My answer: The government wants to control the banks, just as it now controls GM and Chrysler, and will surely control the health industry in the not-too-distant future. Keeping them TARP-stuffed is the key to control. And for this intensely political president, mere influence is not enough. The White House wants to tell 'em what to do. Control. Direct. Command.

It is not for nothing that rage has been turned on those wicked financiers. The banks are at the core of the administration's thrust: By managing the money, government can steer the whole economy even more firmly down the left fork in the road.

If the banks are forced to keep TARP cash -- which was often forced on them in the first place -- the Obama team can work its will on the financial system to unprecedented degree. That's what's happening right now.

Here's a true story first reported by my Fox News colleague Andrew Napolitano (with the names and some details obscured to prevent retaliation). Under the Bush team a prominent and profitable bank, under threat of a damaging public audit, was forced to accept less than $1 billion of TARP money. The government insisted on buying a new class of preferred stock which gave it a tiny, minority position. The money flowed to the bank. Arguably, back then, the Bush administration was acting for purely economic reasons. It wanted to recapitalize the banks to halt a financial panic.

Cont. here:
http://online.wsj.com/article/SB123879833094588163.html


© Janet Crain

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A New Species Evolves

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The sound of cracking ice..........

You know that instantly sick to your stomach feeling you get from a near automobile crash? That is the feeling many are getting now from the sound of cracking ice..........



Traditionally, punditry in Washington has been a cozy business. To get the inside scoop, big-time columnists sometimes befriend top policymakers and offer informal advice over lunch or drinks. Naturally, lines can blur. The most noted pundit of mid-20th-century Washington, Walter Lippmann, was known to help a president write a speech—and then to write a newspaper column praising the speech.

Paul Krugman has all the credentials of a ranking member of the East Coast liberal establishment: a column in The New York Times, a professorship at Princeton, a Nobel Prize in economics. He is the type you might expect to find holding forth at a Georgetown cocktail party or chumming around in the White House Mess of a Democratic administration. But in his published opinions, and perhaps in his very being, he is anti-establishment. Though he was a scourge of the Bush administration, he has been critical, if not hostile, to the Obama White House.

In his twice-a-week column and his blog, Conscience of a Liberal, he criticizes the Obamaites for trying to prop up a financial system that he regards as essentially a dead man walking. In conversation, he portrays Treasury Secretary Tim Geithner and other top officials as, in effect, tools of Wall Street (a ridiculous charge, say Geithner defenders). These men and women have "no venality," Krugman hastened to say in an interview with NEWSWEEK. But they are suffering from "osmosis," from simply spending too much time around investment bankers and the like. In his Times column the day Geithner announced the details of the administration's bank-rescue plan, Krugman described his "despair" that Obama "has apparently settled on a financial plan that, in essence, assumes that banks are fundamentally sound and that bankers know what they're doing. It's as if the president were determined to confirm the growing perception that he and his economic team are out of touch, that their economic vision is clouded by excessively close ties to Wall Street."

If you are of the establishment persuasion (and I am), reading Krugman makes you uneasy. You hope he's wrong, and you sense he's being a little harsh (especially about Geithner), but you have a creeping feeling that he knows something that others cannot, or will not, see. By definition, establishments believe in propping up the existing order. Members of the ruling class have a vested interest in keeping things pretty much the way they are. Safeguarding the status quo, protecting traditional institutions, can be healthy and useful, stabilizing and reassuring. But sometimes, beneath the pleasant murmur and tinkle of cocktails, the old guard cannot hear the sound of ice cracking.



http://www.newsweek.com/id/191393


© Janet Crain

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Why GE???

by David Sirota

So here's the question: Can anyone explain the differing treatment of auto companies and Wall Street firms? Is it just that there are far more Wall Street worshipers like Tim Geithner and Larry Summers in the Obama administration than auto industry representatives? Or is it something else?

The Associated Press reports that "General Motors Corp. Chairman and CEO Rick Wagoner will step down immediately at the request of the White House, U.S. administration officials said Sunday." I'm not sure that's a good or bad thing, but I am curious about why the White House would make such a bold demand of a car company the federal government is lending to, but not a similar demand of the banks the federal government partially owns?

What I mean is - how is it that the White House is requesting the resignation of GM's CEO while not doing the same of, say, Bank of America's CEO? In fact, not only is the president not demanding the resignation of bank CEOs, he's actually hosting them for photo ops at the White House. Sure, I know some bank CEOs resigned a few months ago under shareholder pressure, but the Obama administration has never publicly demanded such resignations of the current management that is making the problems worse, nor the resignation of management at the biggest firms (Goldman Sachs, BofA, etc.) that are still in place.

http://open.salon.com/blog/david_sirota/2009/03/30/why_not_bank_ceos

Working Class Democrat comments:

I'm beginning to concede that Obama is worrisome. While it is too early to judge him on his actions, it is not too early to begin to see a pattern. There is a part of me that fears a Manchurian Candidate. There has been precious little for the working man up to this point and Obama may be looking to Kent Conrad to get him out of his campaign promise to bring us a National Health Care program. It's worrisome.

---

Obama doesn't care anything about working class Americans. Remember how he and Biden turned up their noses and snarled through clenched teeth; "He's a plumber". As if there were nothing worse than plumbers. When in truth, any honest work is to be admired. I daresay none of the elites in DC can fix a toilet or anything else, these days. Janet Crain


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Sarah Palin is Right About Drilling in the ANWR

by Janet Crain

How much longer are we going to keep shooting ourselves in the foot? In both feet? In the midst of the worst economic crisis in decades with no promise of relief in sight, our leaders are imposing severe hardships by cap and trade legislation, new automobile emissions and fuel standards, higher taxes on coal production and refusal to tap into the richest resource available.

I consider this an emergency and in an emergency ou do whatever it takes to survive. If you want to win a race you don't encumber yourself with shackles and weights and restrict fluids or deny them all together. Because if you were so insane as to do this, you would not only lose the race, you would most likely die.

Read what George Will has to say on this insanity:

Iowa's caucuses, a source of so much turbulence, might even have helped cause the recent demonstration by 10,000 Indonesians in Jakarta. Savor the multiplying irrationalities of the government-driven mania for ethanol and other biofuels, and energy policy generally.

Indonesians, like most Asians, love soybeans, the world price of which has risen 50 percent in a month and 125 percent in a year, partly because of increasing world population and incomes, but also because many farmers have switched land from soybeans to crops that can be turned into biofuels. In 2005, America used 15 percent of its corn crop to supplant less than 2 percent of its gasoline use. In 2007, the government-contrived U.S. demand for ethanol was more than half the global increase in demand. The political importance of corn-growing, ethanol-making Iowa is one reason that biofuel mandates flow from Washington the way oil would flow from the Arctic National Wildlife Refuge if it had nominating caucuses.

ANWR's 10.4 billion barrels of oil have become hostage to the planet's saviors (e.g., John McCain, Hillary Clinton, Barack Obama), who block drilling in even a tiny patch of ANWR. You could fit Massachusetts, New Jersey, Rhode Island, Connecticut and Delaware into ANWR's frozen desolation; the "footprint" of the drilling operation would be one sixth the size of Washington's Dulles airport.

Clinton has an alternative to drilling: Oil should be released from the Strategic Petroleum Reserve—which exists to protect the nation against major interruptions of supply—as "a signal to the market." A signal of what? Readiness to release more? All 698 million barrels? Then what?

Americans can still drill for … water. Water rights (T. Boone Pickens has bought 400,000 acres of them in the Texas Panhandle) are becoming more valuable as ethanol production, which is extremely water-intensive, puts pressure on supplies.

To avoid drilling for oil in ANWR's moonscape, the planet savers evidently prefer destroying forests, even though they absorb greenhouse gases. Will ethanol prevent more carbon-dioxide emissions than would have been absorbed by the trees cut down to clear land for the production of crops for ethanol? Be that as it may, governments mandating the use of biofuels are one reason for the global rise in food prices, which is driving demand for more arable land. That demand is driving the destruction of forests—and animal habitats. In Indonesia alone, 44 million acres have been razed to make way for production of palm oil.

Cont. here:

http://www.newsweek.com/id/107575

© Janet Crain

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Don't let the trillion dollar no-stimulus bill pass the Senate too

Take a stand against the Pelosi-Reid-Obama big-government pork-barrel spending bill by signing our online petition TODAY!

Last week, the trillion dollar, unprecedented explosion in federal spending misleading called a "stimulus" package passed a vote in theHouse, but all the House Republicans and 11 House Democrats stood up toNancy Pelosi and voted 'no' to bigger government, more debt, and more wasteful programs. The bill needs 60 voted to pass in the Senate, and with enough grassroots pressure it will be defeated.

Sign the petition:

http://www.nostimulus.com/

© Janet Crain

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Obama Has a Great Idea!!!!!

© Janet Crain

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Bonfire of the Vanities

Comment

By William Greider

This article appeared in the December 15, 2008 edition of The Nation.

November 25, 2008

A monstrous crisis is bearing down on the president-elect, but it is not just about the sinking economy and Barack Obama's plans to launch a massive economic stimulus. The house that's on fire is the financial system and the government's failing efforts to save Wall Street's largest banks. Bloomberg News reports this explosive fact: the Fed and Treasury have so far obligated taxpayers to cover a staggering $7.7 trillion in potential losses. That is roughly equal to half the nation's annual economic activity, yet Washington officials continue to treat those bankers like their privileged clients.

Some of the Fed's efforts are no doubt worthy, but the largest deals to rescue Wall Street firms, like the monster bailout for Citigroup, have already taken on a stench of self-dealing--protecting club members from their self-inflicted wounds and demanding little in return for the public. Bloomberg and others have sued the Fed, demanding that it identify the recipients of its lending and the rotten assets the Fed has taken on its balance sheet as collateral. Fed chair Ben Bernanke imperiously replied that such transparency would be "counterproductive."

He's right to worry. Public wrath will swell when people learn the particulars of the extremely generous deal-making with Wall Street. If he's not careful, Obama will be on the receiving end of the blame. He should seriously consider withdrawing his nomination of Timothy Geithner, president of the New York Federal Reserve Bank, to be Treasury secretary. Geithner is the badly soiled negotiator who worked out some of the most dubious deals. His easy terms protected shareholders and executives but demanded almost nothing from the failing banks for the public. Worst of all, the deals did not work. They have failed to stabilize much of anything and are still putting Wall Street preservation ahead of the national interest. Where is the evidence that we can expect a different approach if Geithner is in charge? Or even that he understands the true dimensions of this crisis? Obama had better get answers up front, or else he might wind up as history's fall guy.

http://www.thenation.com/doc/20081215/greider

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Obama's Cure: A Little Hair of the Dog that Bit Ya.........

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Paulson Pardons the Wall Street Turkeys

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Obama's Fireside Video Chats

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The Foxes are in Charge of Guarding the Hen House Now!!!

by Janet Crain

I remember my parents telling me about the Depression. They always said; "But that will never happen again. Regulations were put in place to prevent the stockmarket from ever falling again." And it just makes me furious that these so called brilliant geniuses removed those regulations.

The Times editorial writers deftly avoid criticising Barack “Mr Change” Obama, slamming Larry Summers while not missing a parting shot at the Bush administration and giving the Clinton administration a deregulatory pass.

Mr. Obama’s Economic Advisers

As treasury secretary in 2000, Mr. Summers championed the law that deregulated derivatives, the financial instruments — a k a toxic assets — that have spread the financial losses from reckless lending around the globe. He refused to heed the critics who warned of dangers to come.

That law, still on the books, reinforced the false belief that markets would self-regulate. And it gave the Bush administration cover to ignore the ever-spiraling risks posed by derivatives and inadequate supervision. Read More

Imus speaking with Lou Dobbs had this to say..

When Larry Summers was Treasury Secretary he was the guy for deregulating derivatives and wouldn’t take any advice from anybody. A bunch of people were jumping up and down saying this would be a nightmare bundling up all these mortgages and selling ‘em to each other.

To which Lou Dobbs responded..

The New York Times is funny as heck editorializing against deregulation while supporting the Clinton administration all the way through.

Of course we are talking about Lawrence Summers former Harvard University President, who hypothesised innate differences between men and women might be one reason fewer women succeed in science and math careers. Which from the NYT’s PC point of view makes him expendable or at least criticisable.

Imus with Lou Dobbs

Click|Here

http://www.nytimes.com/2008/11/25/opinion/25tue1.html?_r=1&ref=opinion

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Obama: Don't expect much anytime soon....

Nov 21, 2008 5:39 am US/Central

Obama Advisers To Public: Temper Expectations

Reporting
Mike Flannery

CHICAGO (CBS) ― President-elect Barack Obama and his inner circle fear that some voters expect him to turn around the economy, wind down the war in Iraq and, perhaps, cure cancer -- all by the Fourth of July.

They know they must manage and lower those expectations, CBS 2 Political Editor Mike Flannery reports.

A top economic advisor to Obama had a glum warning for the rest of us Thursday morning: Neither the job market nor the stock market will be turning around any time soon.

"This might be a long haul," said Robert Reich, who was President Bill Clinton's secretary of labor. "2009 is going to be a very hard year. Some economists say we won't be out of this for two years, others are saying it may be three, or four, maybe five years."

Now on Obama's transition team, Reich worries about what happens after the new president is sworn in Jan. 20.

"We all have to be very careful about the expectations that we are putting on this man, our president-elect," Reich said. "If we all assume it's going to be the first 100 days, we're going to be disappointed."

http://cbs2chicago.com/local/Obama.advisers.expecations.2.869896.html

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