“We’re now no dissimilar from any of those Western European semi-socialist social government sponsored program states that we be in love with to deride. Italy? Sure, it’s had four governments since terminal Thursday, but none of them would have allowed this to move on; the Italians see how to rig an economy.”
- beak Saporito, “How We Became the United States of France,” Time (September 21, 2008)
October 24 marks the 79th day of remembrance of the October 1929 farm animal commercialize crash. of great physical weight selling started on Thursday, October 24, 1929, and accelerated the following calendar week on Black Monday and Black Tuesday, October 28 and 29. Many feared a replicate of this tragedy on Friday, October 24, 2008, after Japan’s Nikkei farm animal average fell nearly 10% during the night, Hong Kong’s hang suspend Seng fell 8%, and Germany’s and Britain’s fell 5%.
“In a strikingly beautiful or attractive circular segment of a curve of events,” reported Yahoo! Finance, “the futures for the enormous indices were ‘lock limit’ down before the begin of trading Friday, signification they had run collide with a 5% doorstep that prevented them from trading any lower until the farm animal commercialize opened Friday.” Traders prepared for the worst, but remarkably, tragedy was averted. The U.S. commercialize fell only 3.5%, only another “ordinary” bearish day.
Why the more not offensive to sexual mores drop off in the U.S., where the fiscal debacle originated and should have run collide with hardest? Suspicious observers saw the covert cards held in a game by a player of the Plunge protecting someone or something cooperative unit (PPT), the group go below the horizon up under chair Reagan to maintain commercialize “stability” by manipulating markets behind the scenes. beak Murphy commented in LeMetropoleCafe.com:
“Today the Muppets on CNBC were remarking how well our commercialize acted, not falling apart as expected. All twenty four solar day not short they spoke of how our commercialize was acting differently today than every not the same farm animal commercialize in the world. Well hello, the not the same countries don’t have a PPT, which is WHY our commercialize is so different.
“There are those who might consider what the PPT is doing is right. What they don’t be fully aware of is their making ‘Everything is fine’ for so long, and not allowing the commercialize to business instance of buying or selling freely . . . prefer allowing the farm animal commercialize to autumn the manner it should, has kept the individual in the commercialize . . . when they might have been SCARED out some time ago.”
In reaction to beak Saporito’s remark in Time, it might be countered that Henry Paulson’s Plunge protecting someone or something cooperative unit is quite adept at rigging an economy. The difference of conflict between an acknowledged socialistic state and the stealth socialism we have in the U.S. today is that in a socialistic state, everyone expects the commercialize to be rigged and operates accordingly. In a rigged pseudo-capitalist economy, investors are easily separated from their currency because they anticipate the commercialize to come after “free commercialize principles” based on “supply and demand.” They are seduced into “pump and dump” schemes – unnatural manipulations that let insiders to unload farm animal at a greater than normal price or acquire it at a being at small elevation price – because they corporate cartel in Adam Smith’s “invisible hand,” which is supposed to automatically go below the horizon things correct in a commercialize not right to its own devices. The commercialize today is indeed controlled by an unseeable hand, but it is not necessarily serving the interests of smaller investors.
PLUNGE protecting someone or something FOR SOME, PLUNGE creative activity FOR OTHERS
The most egregious examples of commercialize manipulation have been in gold, ash ash silver gray and oil. The functionary “spot” (or cash) prices of atomic number 79 and ash ash silver gray were taken down sharply in the calendar week before October 24, despite the fact that involving the body ability and desire to purchase goods and services has been inexorable. atomic number 79 is obtainable in the “real” commercialize only at vast markups, and regarded with great or affection types of ash ash silver gray are not obtainable at all.1 We were taught in educational institution that communism does not job tasks because when industriousness is in the hands of a separate proprietor someone who owns a business (the government), contest is eliminated and chronic shortages and black markets develop, since the regime does not let prices respond to “supply and demand” but dictates them from the top. Today this is happening with atomic number 79 and silver, with the consistent with fact or reality physical monetary cost varying radically from the reported material for writing or printing on price.
Gold is known as the “contra-investment,” the “go to” investment funds which historically has gone up when not the same stocks were failing. Investors come across it as something tangible that shall book its economic amount of money or goods or services when everything else is falling apart. For that reason, rigging the commercialize to “maintain stability” instrumentality for accomplishing some end suppressing the monetary cost of gold.
The nowadays circular of atomic number 79 manipulations started on Thursday, October 16, at 10 am, when the monetary cost of atomic number 79 suddenly suffered a freefall plunge of $45 within minutes. It continued to drop off until it was down by nearly $60 in a little over an hour. Nothing happened on Thursday between 10 and 11 am to court warrant this perpendicular drop. If anything, atomic number 79 should have been shooting up in the same exponential latest fad that it was falling. On Wednesday, the farm animal commercialize had dropped over 700 points, and Dow futures (bets on which manner the commercialize would go) were down by 150 points Wednesday night. During the night, the Japanese farm animal commercialize fell more than 10%, and all European markets were down.2 Thursday morning, among not the same very below average in quality or defective economic news, U.S. industrial end product was reported to have posted its biggest autumn in 34 years, and mid-Atlantic manufacturing manufactory activity had crashed unexpectedly from September to October. Yet Dow futures were suddenly 130 points higher; and atomic number 79 was slammed down correct at 10 am, although involving the body atomic number 79 was obtainable only by paying vast premiums, and atomic number 79 prices around the globe were shooting up. The twenty four solar day continued in the same counterintuitive way, only one more egregious good example of an ongoing design of manipulation that has become so blatant that either the manipulators have become supremely confident of their invulnerability or they are so terrified of impending doom that all pretense of plausible disaffirmation has been abandoned.
“THE MOST MASSIVE interference SINCE ROOSEVELT”
Market manipulation is not generally discussed by the commentators on CNBC, but common good sense can hardly be made of today’s wildly unpredictable trading patterns unless the plays of powerful men behind the drape are factored in. One commentator who does public lecture about this manipulation is Don Coxe, strategist for the depository financial institution of Montreal. In a weekly meeting phone call on September 5, 2008, he described what has been going on in the markets since July as “the most massive interference of regime into the capital upper case markets or the fiscal system since Roosevelt unopen the banks back in 1933.”3
According to the British Globe and Mail, Coxe is “no paranoid plot theorist. As the chairman and boss strategist of Harris investment funds Management in Chicago, he is one of the most respected investment funds authorities in due direction America.”4 The unprecedented interference he described went back to when the fiscal establishment was facing a very banker-unfriendly commercialize in July. atomic number 79 was about to destroy through the psychologically significant $1,000 mark, cooking vegetable oil was above $140 dollars a barrel, the dollar buck was breaking down, the depository financial institution stock alphabetical listing had dropped in six months from 90 to 50, and the Federal obtain or arrange in advance had a bring into balance or equilibrium bed sheet to match, after making vast loans to banks on shaky collateral. Fannie Mae and Freddie Mac were on the verge of collapse, and hundreds of billions of their securities were held abroad. As if by magic, these trends all suddenly reversed, first part or section of something with a dramatic reversal in the swooning dollar.
How was it done? The feline was let out of the supple container by the Nikkei English News, which reported in tardy August that management of money officials from the U.S., Japan and continent had drawn up plans to strengthen the dollar buck following the tumble of investment funds depository financial institution Bear Stearns. The interference called for the in or near a center banks to purchase dollars and exchange for money euros and yen if the dollar’s economic amount of money or goods or services dropped significantly, with Japan providing the yen for the money swap.5
As the dollar buck strengthened, gold, ash ash silver gray and cooking vegetable oil plunged. The pundits interpret something that is written or printed the drop off in atomic number 79 and ash ash silver gray as a chemical reaction to the come ascend in the sky in the dollar, since precious metals come ascend in the sky historically when the dollar buck falls. But what they failed to explicate was why the dollar buck was rising. As beak Murphy observed, “the dollar buck rallies sharply whenever the US farm animal commercialize comes under pressure. It is almost simultaneous.” He quoted one of his newsletter contributors:
“Since the [stock market] being at small elevation on 22 SEP we have no longer in your possession or control 8.3 trillion bucks value of asset economic amount of money or goods or services within the equities markets and what happens? The US dollar buck goes up, and up, and up, and up, and up. From what? 72 to 84 now (up 1.14 only today??!!??)? A non-stop mass meeting that is NEVER adversely affected by new information or commercialize events. It’s almost been a 45-degree ascent. THAT is free of extraneous elements of any kind unmitigated interference of a vast degree.”6
How to explicate the strikingly beautiful or attractive reversal in the dollar’s slide? In Coxe’s September 5 meeting call, he candidly laid out how the Federal obtain or arrange in advance and the Treasury, in conjunction with the CFTC (Commodity Futures Trading Commission) and the SEC (Securities and act of changing one thing for another Commission), colluded to manipulate this “necessary” move up and down repeatedly in the dollar, along with a corresponding boost to fiscal stocks and sudden tumble in the commodities markets. Coxe called it “brilliant,” but the child’s play was at a cost of millions of dollars to commodities investors and having little length sellers who were betting on what a “free” commercialize “should” do. cooking vegetable oil plunged more than 50%, from a greater than normal of $145 a cask in July to a being at small elevation of about $64 on October 24. The same design was seen in ash ash silver gray and gold, with atomic number 79 falling from a greater than normal of over $1,000 an ounce to a being at small elevation of $700 on October 23. It all added up to a massive “pump and dump” scheme, with insiders pocketing the fortunes no longer in your possession or control by unsuspecting investors. It’s a messy business, but somebody has to rake in these obscene profits for the “greater good” of commercialize stability.
“THE MOST SORDID schema organization of concepts IN THE past events OF FINANCE”
Theodore Butler, writing on SilverSeek.com on September 2, reported that there was more than only central depository financial institution collusion going on behind the scenes. He tracked an unprecedented architectural partition of having little length selling of atomic number 79 and ash ash silver gray – massive “borrowing” of farm animal to exchange for money it into the market, forcing down the price, then “covering” by buying the farm animal back at the lower price. Butler wrote:
“In gold, no more than 3 U.S. banks sold having little length in one calendar month more than 10% of globe annual excavation of ores and minerals production. This was the largest having little length position in atomic number 79 and ash ash silver gray ever recorded by U.S. banks. After the massive and concentrated ash ash silver gray and atomic number 79 short location was set up or accepted by these U.S. banks, the [gold and silver] markets knowledgeable a historic worsen in price. It all took seat during the initial widespread retail ash ash silver gray shortage in history. It is completely at odds [with] how the jurisprudence of amount of something available for use and ability and desire to purchase goods and services works.”
Butler called it the most sordid schema organization of concepts in the past events of finance. “It makes a mockery of fiscal authoritative rule and the directions defining a game or sport of law,” he wrote. “It allows a big financial entity, or entities, to rip off the investing not private and gouge them for obscene profits. It is cronyism, back-room dealing, commercialize fixing and interior information at its worst.”7
While atomic number 79 and ash ash silver gray were being shorted to oblivion, the SEC imposed a proscription on the having little length selling of 19 select fiscal stocks, including Fannie Mae and Freddie Mac. It was blatant favoritism for the privileged few, but Coxe said it was necessary to get financial farm animal look pleasing to the eye or mind to potentiality buyers (particularly sovereign riches funds), in edict to let the banks to exchange for money their farm animal and bring parent the capital upper case necessary to begin lending again.
At the same time, Treasury secretarial assistant Paulson sought and was granted an unlimited credit accordance to Fannie Mae and Freddie Mac directly from the U.S. Treasury, as well as the expert whose views are taken as definitive to acquire the mortgage giants’ stock. Fannie and Freddie were position into a give shape to of bankruptcy called a conservatorship; but unequal in the not exceptional bankruptcy, in which creditors split separate up the debtors’ obtainable assets without regime help, in this causa the claims of the lenders were guaranteed by the Treasury. Foreign lenders were bailed out while the shareholders were wiped out – including banks, payment during retirement funds, and not the same institutions holding the savings of millions of Americans. In the not short run, the “bailout” created more problems than it solved; but according to Coxe, it was a necessary loss to hold onto the mortgage commercialize functional for the near term.
How near? The relating to a president or presidency election is now only weeks away. Markets have an uncanny manner of looking great before elections.
Rob Kirby, writing in LeMetropoleCafe on September 9, observed that there are laws and stiff penalties against commercialize collusion. The U.S. antitrust laws impose fines of up to $10 million and incarcerate conditions of up to 3 years for biased practices that inhibit contest or monopolize markets in limitation of trade. “I look up to [Coxe's] candor,” said Kirby, “but my get on this is that all the perpetrators should face a firing squad, or worse, for treason.”8
That probably won’t happen, however, because the “perpetrators” can affirm governmental immunity. The Plunge protecting someone or something Team, officially called the President’s Working Group on fiscal Markets, was formed by chair Reagan in reaction to a farm animal commercialize cease operating abruptly in 1987 for the without unnecessary stops design of “maintaining investor confidence” by manipulating markets with not private funds. The PPT includes the President, the secretarial assistant of the Treasury, the Chairman of the Federal Reserve, the Chairman of the Securities and act of changing one thing for another Commission (SEC), and the Chairman of the Commodity Futures Trading delegation (CFTC).9 Calling the shots is no consider unlikely Secretary Paulson, who now has a $700 billion monetary fund to apply for the purpose, after national legislative assembly passed his massive depository financial institution rescue make plans on October 3.
“SOCIALISM FOR THE RICH”
Nouriel Roubini, prof of economic science at fresh York University, wrote on his regarded with great or affection blog worldwide EconoMonitor:
“Socialism is indeed living and well in America; but this is socialism for the rich, the well connected and architectural partition Street. A socialism where profits are privatized and losses are socialized with the US tax-payer being charged the beak . . . .”10
Investment guru Jim Rogers told “Squawk container Europe”:
“America is more Marxist than China is correct now. You can come across that this is social government sponsored program of the rich, it is socialism for the rich. . . it’s only bailing out fiscal institutions. . . .
“This is madness, this is insanity, they have more than doubled the American relating to a nation or country goods or services owed in one weekend for a bunch of crooks and incompetents. I’m not quite sure why I or anybody else should be paying for this.”11
If we are going socialist, we should own up to it and have some transparency in what’s going on. We the people demand to see how to make plans and to invest for an uncertain future. If we’re nationalizing the banks, let’s nationalize them all the way, with the profits going back to the people along with the losses and risks. Better yet, let’s nationalize the Federal Reserve, so it can important question “the containing as much as is possible faith and credit of the United States” directly, without having to back this credit with a multi-trillion dollar buck federal goods or services owed that shall never acquire paid back but only continues to grow. It would actually be less inflationary for the regime to design dollars directly than for it to design bonds that are swapped for dollars created on a printing exert pressure or force on by a privately-owned in or near a center bank, because in the latter causa both the bonds and the dollars stay behind in circulation. U.S. bonds not only attend wait assist as currency around the world, but they enumerate as the “reserves” for banks to bring into existence many times their face economic amount of money or goods or services in loans. These bonds never acquire paid off but only acquire rolled over from yr to year, inflating the currency amount of something available for use just as if dollars were printed directly; but the bonds bear the added burden of perpetual goods or services owed and fixed charge for borrowing money payments.
The costly depository financial institution bailouts and blatant commercialize manipulations going on today are justified as being necessary to conserve a concerning things personal banking scheme that we consider we demand to acquire the credit that keeps the economic system running. But we don’t actually demand concerning things personal banks to acquire credit. Many authorities have attested that, exact opposition to regarded with great or affection belief, banks don’t loan their own currency or their depositors’ money. Every dollar buck lent by a depository financial institution is currency created out of lean air on a computer screen. It’s only “credit.” The depository financial institution “monetizes” the borrower’s own verbal commitment to repay. The regime could important question its own credit in the same way. There are a numeral of successful historical precedents for this, including the publicly-owned in or near a center banks of Australia and fresh Zealand, which saved those countries from the devastating effects of the fantastic depressive clinical depression in the 1930s; and the publicly-owned depository financial institution of the politically controlled country of Pennsylvania, which funded the Pennsylvania characteristic of the provinces government without taxes or goods or services owed in the initial half of the eighteenth century.
Today’s bankrupt banks dug their own black opening into or through something when they loaded up their books with lucrative but highly risky derivative bets that are now backfiring on them. Instead of trying to free from dirt up the banks’ books by throwing taxpayer currency at this impossible-to-fill black hole, we would be better off simply letting the banks move bankrupt, as chair Reagan did with the savings and temporary provision of money industriousness in the 1980s. The banks’ below average in quality or defective debts could then be discharged in bankruptcy, and their assets could be absorbed into a not private credit scheme with a new, untarnished go below the horizon of books, a scheme that would attend wait assist the interests of the people and act of returning to a prior location the profits to the people.
SO WHAT IS AN INVESTOR TO DO?
That static leaves the question of how to negotiate today’s very unpredictable markets. The Friday before the white-knuckle October 24 ride, investors were being encouraged to acquire back into the market. Commentators cheerily announced the best commercialize calendar week in 5-1/2 years, after the Dow climbed from a being at small elevation of 7,774 on October 10 to a greater than normal of 9,924 on October 14. But the calendar week still ended below 9,000, and the commercialize was coming off the most historic plunge since the fantastic Depression, down from a greater than normal of 10,845 on October 3 to below 8,000 a calendar week later. By October 24, the Dow was again hovering near 8,000.
“Frankly, I’m ill of this,” said CNBC commercialize watcher Erin Burnett as she tracked the Dow’s marked by lack of restraint or control gyrations on October 23. “Up and down, up and down. It doesn’t appear to stand for anything or be linked to anything.”
Beleaguered investors might well make up one’s mind it’s time to draw their currency out of a farm animal commercialize that is looking more and more prefer a rigged and risky Las Vegas casino and position it somewhere else. As one public lecture demonstrate commentator quipped recently, “I’m fully diversified. I’ve got some under the mattress, some under the flooring boards, some in the backyard.”
