THE DOT - if this turns orange or red be alert

Monday, November 30, 2009

part 2

3. If I were Abu Dhabi I would play hardball with Dubai and the financing banks. Let them make big haircuts on their loans of 30-50% , the same is true for Dubai who has driven an insane policy of hubris ( history repeats itself all over). My assumption is they will let it slide towards default and save it last second scenario type after banks have made deep discounts on their loans.
The point for the markets is that the risk factor has to be priced in again short term before the final window dressing (year end) and propaganda machinery will roll full speed to make people gloabally to spend for Christmas which is the biggest business of the year plus get the CAPEX rolling again at yearend. I can imagine with last years problems and Mirosoft's 7 at hand banks will do some tech spending. The real economy though the second and third tier can not afford any tech spending as they do not have cash or credit available - plus they have no idea if they will survive. The effect on Q4 will not be that good afterall as consumers are on the retreat path ( deleveraging) which is the crucial factor for the 2010 earnings.

4. Pretty bullish the sentiment - which is not good for bulls

Monday brainstorming

1. The shopping WE did not bring good news for consumers real sentiment as they did not consume more and the whole idea of a GDP of 5% or 80$ profit for the SPX is based on that idiotic idea ( or shall we say propaganda). Its strange anyway where the 23 mio more shoppers come from as America is now on a record 36 mio citizens on food stamps. This happened with deep discounts of even Apple.

Excerpt

Total U.S. retail spending for the four-day Thanksgiving weekend was about $41.2 billion, up just a hair from $41.0 billion a year, according to a survey conducted by the National Retail Federation by BIGresearch. The survey found that 195 million shoppers visited stores and web sites over the the weekend, up from 172 million last year, but that the average spend was $343.31 per person, down from $372.57 a year ago.

2. Firing Bernanke is a good idea in principal but that does not remove the cancer from the financial regulatory system the Rothschild / Rockefeller gang have implemented. He will be replaced with another puppet who is already ready to fill possible void ( many possible starting from Summers). In principal the Senator is perfectly right anyone on a regular job with 5% of the mistakes of Bernanke would have been fired - printing money and putting interest at zero is monkey business anyone could do that.

Excerpt zerohedge

Ben Bernanke's low-road approach of taking the Fed's "noble mission" of bailing out Wall Street at any and all costs directly to the people seems to have come at curiously opportune time, a mere week ahead of his December 3 Senate Banking Committee hearing for his second 4 year term nomination. It also seems to have backfired as some people in high standing seem less than enthused by the oodles of human lactic acid kindness that suddenly overflow from each and every floor (yes, even the 3rd sub-basement which houses the 10 consistently overheating druckmachinen) of the Marriner S. Eccles building.

One such among them is Senator Bernie Sanders who earlier said on ABC's "This Week" that Bernanke will be renominated over his dead body (metaphorically speaking):

"No, I absolutely will not vote for Mr. Bernanke. He is part of the problem. He's the smartest guy in the world, why didn't he do anything to prevent us from sinking into this disaster that Wall Street caused and which he was a part of? No, I will not vote for Bernanke to stay on as chairman."

And even as the dollar moves increasingly underwater and is now even more "collateralized" by worthless and completely unwanted (except by the Fed) MBS and Agency securities, less and less people buy Bernanke's strong dollar Kool Aid: it was not enough for Bernanke to launch the greatest bail out in history using the Mutual Assured Destruction threat as the "end of the world as we know it" event that would occur if Goldman Sachs shareholders were to get wiped out. No, now he has to destroy the US middle class to ensure that Wall Street has one more, maybe two years, of good bonuses, before the main show of commingled feces and precariously balanced cards can collapse with impunity.

As senators consider how much money their Wall Street backers will stuff in their Christmas lobby stockings, we present a modest proposal of 15 or so questions that those in Washington with even half a conscience should ask the Chairman before making sure that nothing ever changes and we are set on a catastrophic bubble collapse of even more epic proportions.

Questions courtesy of The Cunning Realist:

1. The TARP Inspector General recently disclosed that the New York Federal Reserve did not believe that AIG's credit-default swap (CDS) counterparties posed a systemic financial risk. In Congressional testimony and elsewhere, you have stated repeatedly that AIG posed a systemic risk based partly on its CDS obligations [source: Bernanke's testimony to the House Financial Services Committee, 3/24/09]. Explain this apparent contradiction. What was your specific role in the decision to pay AIG's counterparties 100 cents on the dollar?

2. On May 5, 2009, in front of the Joint Economic Committee, you said the following about the unemployment rate: "Currently, we don’t think it will get to 10 percent. Our current number is somewhere in the 9s" [source]. In November it hit 10.2%, and many economists predict it will go even higher. This is happening despite enormous fiscal and monetary stimulus that you previously said would help create jobs. What happened after your JEC testimony in May that caused your prediction to miss the mark?

3. It's now widely accepted that loose monetary policy is at least partly to blame for the credit bubble and subsequent crash. You played an important role in that policy. For eight straight meetings of the FOMC, from June 2003 to May 2004, you voted to keep the Fed funds rate at 1%. But transcripts of recently-released FOMC meetings show you wanted the FOMC to consider cutting rates even further. In the August 12, 2003 meeting, with the Fed already at 1%, you said:

Despite the good news, I think it’s premature to conclude that we should not consider further rate cuts, if not at this meeting then at some time in the near future depending on how the data play out. [source: transcript of FOMC meeting on 8/12/03, page 63]

How much worse would the bubble and subsequent crash have been if you had gotten your way? What do your comments in that meeting imply about your ability to correctly time the reversal of the Fed's current accommodative policy?

4. Forecasts are an important part of the Fed's work. Monetary policy by nature depends on forecasts, making predictive ability an essential part of the job description for any Fed chairman. Yet your record of predictions, including the one about unemployment in (2) above, is questionable at best. Some examples [source]:

March 28, 2007: “The impact on the broader economy and financial markets of the problems in the subprime markets seems likely to be contained.”

May 17, 2007: “We do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system.”

Feb. 28, 2008, on the potential for bank failures: “Among the largest banks, the capital ratios remain good and I don’t expect any serious problems of that sort among the large, internationally active banks that make up a very substantial part of our banking system.”

June 9, 2008: “The risk that the economy has entered a substantial downturn appears to have diminished over the past month or so.”

July 16, 2008: Fannie Mae and Freddie Mac are “adequately capitalized” and “in no danger of failing.”

Explain this pattern of terrible predictions and forecasts. What do they imply about your ability to conduct policy going forward? Is there some fatal flaw in your economic models or forecasting tools? Are you just winging it?

5. Derivatives such as credit-default swaps played an important role in the financial crisis, and they are central to the financial reforms currently being contemplated. During the Senate Banking Committee's hearing in November 2005 to confirm you as Alan Greenspan's successor, you had the following exchange with Senator Paul Sarbanes [source]:

SARBANES: Warren Buffett has warned us that derivatives are time bombs, both for the parties that deal in them and the economic system. The Financial Times has said so far, there has been no explosion, but the risks of this fast growing market remain real. How do you respond to these concerns?

BERNANKE: I am more sanguine about derivatives than the position you have just suggested. I think, generally speaking, they are very valuable. They provide methods by which risks can be shared, sliced, and diced, and given to those most willing to bear them. They add, I believe, to the flexibility of the financial system in many different ways. With respect to their safety, derivatives, for the most part, are traded among very sophisticated financial institutions and individuals who have considerable incentive to understand them and to use them properly. The Federal Reserve’s responsibility is to make sure that the institutions it regulates have good systems and good procedures for ensuring that their derivatives portfolios are well managed and do not create excessive risk in their institutions.

How did you get it so wrong?

6. An important factor in the financial crisis (and a large part of the ultimate cost to taxpayers) was the implicit government guarantee of the GSEs. In part because of decisions you made, there is now an explicit government guarantee of every large firm on Wall Street. Has moral hazard increased or decreased over the past year?

7. Via the FDIC, the American public now explicitly guarantees the bonds of Wall Street firms where bonuses are surging and individual employees can be paid millions of dollars a year. What is your opinion on the morality of this guarantee?

8. The importance you place on the output gap is well known. You have often cited "excess slack" in the economy to justify loose monetary policy, arguing that a large output gap lowers the risk of inflation. But economists such as Allan Meltzer have noted that there are "lots of examples of countries with underutilized resources and high inflation. Brazil in the 1970s and 1980s" [source]. Moreover, in a new paper dated December 2009 and titled "Has the Recent Real Estate Bubble Biased the Output Gap?", researchers at the Federal Reserve Bank of St. Louis state the following:

Because this (predicted) output gap is so large, several analysts have concluded that monetary policy can remain very accommodative without fear of inflationary repercussions. We argue instead that standard output gap measures may be severely biased by the bubble in real estate prices that, according to many, started around 2002 and burst in 2007.

They conclude with a warning that seems directed at you: "We offer a word of caution to policymakers: Policies based on point estimates of the output gap may not rest on solid ground."

Please comment on 1) Allan Meltzer's point and 2) the St. Louis Fed's research paper. Why do you continue to put such a high priority on the output gap?

9. In a scenario in which unemployment remains uncomfortably high, but the dollar continues to fall and commodities including oil and gold continue to rise, what would the Fed do? At what point do market signals take priority over hard-to-measure statistics like the output gap?

10. The Fed has a dual mandate: maximum employment and price stability. But unemployment is at its highest level in decades. And in early and mid-2008, with oil at $150 a barrel and prices of basic staples skyrocketing, opinion polls showed that inflation was the public's highest concern, even more so than jobs or the housing market [source]. Why has the Fed failed so badly in its mandate? Is employment an appropriate objective for monetary policy? Should the Fed have a single mandate of price stability?

11. In February 2009, Janet Yellen, president of the San Francisco Fed, said that the Fed needed to fight back against the argument that its liquidity efforts would eventually lead to higher inflation and higher interest rates, calling the notion "ludicrous" [source]. Since then, the dollar has fallen precipitously, oil has almost doubled in price, and gold has surged to all-time highs. Do you share your colleague's view on inflation?

12. What does the surge in gold mean to you? At what price level would it begin to worry you, if it doesn't already? Does gold have any impact on the Fed's policy deliberations?

13. Why does the Fed insist on waiting five years before it releases transcripts of FOMC meetings to the public? Shouldn't someone tasked with evaluating your performance and voting on your reconfirmation have access to transcripts from late 2008 and early 2009?

14. Has the Fed ever had an internal debate about how monetary policy contributes to geopolitical tensions via the rising oil prices caused by a falling dollar?

15. Before the financial crisis there was a widespread sense, especially on Wall Street trading desks, that the stock market was strangely resilient. This encouraged excessive risk-taking in various types of assets. Do you have direct or indirect knowledge of the Federal Reserve or any government entity or proxy ever intervening to support the stock market (or any individual stock) via futures or in any other way? If yes, who decides the timing of such intervention and with what criteria? How is it funded? Which Wall Street firm handles the orders, and who sees them before they are executed?

Sunday, November 29, 2009

A very interesting chart comparrison

Excerpt from


These two things are not related except in my own mind. Dubai has rattled the global markets with an admission that Dubai World may need a little more time to pay back some of its debt. This may be the spark to get the next leg down in the stock bear market going. What does this have to do with the Panic of 1907? Nothing, really.

However, I like the chart of this old Dow bear market as a crude road map or fractal-type pattern for the current ongoing bear market in U.S. stocks. The exact dimensions and timing are not as interesting to me as the pattern. I don't know why I like this pattern so much, but my hunch is that it's going to play out in a similar manner.

Here's a sliver of the chart of interest from that time (Dow Jones Industrial Average chart, credit given below):



And here's a 4 year weekly linear candlestick chart of the NASDAQ ($COMPQ) thru yesterday's close:



I think the NASDAQ (and other general U.S. stock market indices) is at a similar point in time compared with the 1907 chart pattern shown above. If I'm right, here's what happens next (following and initial Dow chart from thechartstore.com, a great site for historical data):



The stock bear market is not over. An event like Dubai World essentially defaulting on billions of dollars of debt would be just the type of thing to get markets into fear mode again. It seems like a fairly random and scary event, and such events are always used as an "excuse" for why the market went down again. The only people who could have seen something like this coming are those who have remained bearish all along. Bears are no fun to hang around with and they've been wrong for the last several months, but that doesn't mean they're wrong on the longer term "big picture." I am not currently positioned to profit significantly from a downdraft in the stock market, but I remain interested in shorting the stock market if a decent opportunity presents itself (I believe it will soon).

Friday, November 27, 2009

Brainstorming Friday - part 1

1. Interesting is the timing of this Dubai announcement as it was on the brink of Thanksgiving which might be neglectable but just before the start of the biggest islamic holiday which lasts from Friday til Monday - that's a strange timing.
Saturn / Pluto squares are a default pattern and we have 3 sovereigns at the brink at least with Ukraine, Dubai, also quasi sovereigns like California which is a bigger economic factor than those states. With a closer look its actually much more as many Eastern European states are in bad shape - who isn't?.
The full scale will be visible 2010 and will be part of the reason why stock markets will crash around the world in Q1 and Q2. Amazing is again how central bankers downplay the current risks and the corrupt rating agencies as always are behind the curve which makes them absolutely useless.
Bottom line bank balance cheats keep imploding and the ones who made 'profits' phony or real ones will use Q4 to adjust for no tax payments or like in case of Goldman and JPM pay insane bonus amounts.

Excerpt

Building Desert Sand Castles in the Sky

The scramble to identify entities with exposure to Dubai has begun. Almost as desperate as the rush by entities all over the world to reassure markets they have no exposure (or are minimizing it). (Credit Suisse, UniCredit and the Bank of China seem to be leading this race). Bloomberg is citing a JP Morgan report that Royal Bank of Scotland Group was Dubai World's biggest loan arranger over the last two years. Uh oh. We are certain this is totally unrelated news today on Bloomberg:

Royal Bank of Scotland Group Plc said it will issue 25.5 billion pounds of B shares and one dividend access share to the U.K. Treasury and State Aid Commitments.

We love Samsung's attitude (but wish they would have said something earlier):

Samsung C&T Corp., builder of the world’s tallest tower in Dubai, said it stopped work on a $350 million bridge in the city after a unit of Dubai World halted payments. Construction of the half-finished bridge, to the man-made Palm Jebel Ali island, was suspended earlier this month after Nakheel PJSC made no payments for about two months, Cho Keun Ho, a spokesman for the Seoul-based builder, said today.

RANSquawk is reporting that HSBC had $17 billion in loan exposure to UAE at the end of 2008 and foreign banks in general are up to their ears in some $47 billion of UAE debt.

This isn't to mention sovereigns like the Ukraine, Latvia and Greece. (How likely, exactly, is The Hun to loosen the monetary strings for Greece after the Cyprus stink? Zero Hedge says: "Not Very.")


2. The gains of the week have been erased confirming short term the top of last weeeks reversal in the NDX as the weakest link after the Russel. Therefor the weekly upcounts are delayed to the Dec second half rally as the next New Moon around the 15th Dec will be a very positive Astro event short term as it will be in a very positive angle to the Jupiter,Chiron, Neptun conjunction. As I stated earlier the big gathering of daily 13 counts is a topping out pattern and did deliver a short term top. The bigger picture should be a remake of the 2007 top - where we saw a volatile 10% swing double top pattern with slightly new highs. We also should see more intermarket divergence as some indices will underperform and are doing so already. Escpecially in the emerging markets big trouble is ahead which will trigger another wave of credit crunches and huge losses for banks.

3. The Dollar weakness engineered by the US administration brings the world to the edge of a trade war and even more so to a real war. Japan is getting closer to the all time high as the Euro will be in a few weeks - Japan's economy and stock market is already in distress for 2 decades and a high Yen is completely undeserved and will not be tolerated. The only reason the parties on the losing side keep quite is that they do not want to disturb financial markets as that could bring more distress short term and the trade links they have with the biggest consumer the USA. The price is getting now to the pain zone and another downwave in global markets will bring more trouble for all as the market manipulation sponsored by global governments is falling apart slowly with the Japanese market falling already. Its a big illusion the trade peace is founded on as the markets do not reflect fundamentals and have to drop as soon as earnings will show no sustainability going forward. Whatever phony and doctored GDP statistics say the real effect of shrinking demand is visible for the real actors and 11 mio households in USA , who have been left in their homes although they have defaulted and banks have not written down those assets matching numbers of 800 bil. of further losses for banks not accounted yet. The numbers are rising as the jobless situation has not turned and will not any time soon hence the consumption of those 11 mio households not paying rent matches 160 bil. in additional income will vanish at some point and leave America to go through a consumption shock.

Excerpt
http://www.zerohedge.com/article/guest-post-americas-stealth-stimulus-plan-allowing-its-home-owners-be-deadbeats

Let's look at this from a more analytical eye.

1) The number of households in America is approximately 111,000,000 (111 million)

The home ownership rate, after peaking near 70% (the long term trend was 65%ish but we've tried every trick in the book the past decade to get another 5% into the "ownership society), currently it sits under 68%. I will use 67.5%

That means 111M x 67.5% = 75M households in America "own" a home.

2) We saw just last week that more homes in the US were in deliquency or foreclosure, than there are for sale - about 9.6% in delinquency and 4.5% in foreclosure. So 14.1% of home "owners" are living "rent free" - i.e. freeing them from a home payment. Of course some of these people are in dire circumstances so let's not be too flippant about it, but others have chosen to make a calculated decision to walk away from underwater homes and until the banks show up to take the house back they have no housing payment.

So of the 75M households in America owning a home, about 14% are not making a payment.

That means 10.5M households in America are living in a shelter where they either can not, or choose not to make a mortgage payment.

3) Now comes the tricky part, trying to figure out the average note payment. I truly have no idea so let's make an educated guess. The median value of a home in America is roughly $170K, and the average loan to value is about 70%.

About 1/3rd of American homes are owned free and clear of a mortgage meaning the other 2/3rds have notes to pay. Obviously those who are not making payments fall into the 2/3rds category. Hence if we exclude the 1/3rd of Americans who owe nothing on their mortgage, the remaining 2/3rds have a much higher loan to value than 70%. Is it 80%? 90%? No idea... it really makes little difference in our analysis.*

On a $170K home owing 90% means a $153K mortgage, whereas owing 80% means a $136K mortgage. Reasonable people would agree the average owed by the 2/3rds who have not paid off their note would be somewhere in that range.

Next we have to back into some sort of monthly mortgage payment; just looking through some ammortization tables, and realizing some people have bad credit, some average, some good on a $145Kish type of median US mortgage the monthly payment is probably somewhere near $1200-$1300. I am excluding property taxes from this analysis which is another cost that people are avoiding - which is why my numbers are going to be conservative.

So excluding property taxes let's say the average person's mortgage payment is $1250.

Going back to point 2, 10.5M Americans are skipping out on their payments. At a monthly payment of $1250 that is a monthly "stimulus" to the economy due to "not paying a mortgage" of $13.1 Billion.

Annualized that is just under $160 Billion a year of "stimulus" to the US economy via deadbeats; i.e. the Bush 2008 rebate happening quarter after quarter, year after year. Again, I contened the real number is higher than that as property taxes are not included. If I increase the monthly payment "avoided" by $250 (to account for property taxes) we get very close to $200B of extra money flowing through the US economy that should be going to pay for a roof over one's head.


Thursday, November 26, 2009

Wednesday, November 25, 2009

part 2

Finally a trade we all might have missed but a hunch tells me Goldman is behind this as well :)

The price of garlic in China has nearly quadrupled since March

It is a double play of the WHO and Goldman who spread the Swineflu in order to corner the Garlic markets - the real reason might be that the vampires from Wallstreet want to make it harder for the vampire hunters to protect themselves with Garlic.

Excerpt

Garlic Price Rises Surpass Gold, Stocks in China

The price of garlic in China has nearly quadrupled since March, propelled by its very pungency to rank ahead of gold and stocks as the country's best-performing asset this year.

The trigger for the bull run may have been the idea that the potent bulb can ward off H1N1 swine flu, Morgan Stanley economists said.

That chimes with some anecdotal evidence. The China Daily reported last week that a high school in Hangzhou, a prosperous city in eastern China, had bought 200 kg of garlic and forced students to eat it every day for lunch to stay healthy.

"I don't know about H1N1, but it can prevent ordinary colds," Zhang Ping, 74, told Reuters at a vegetable market in Beijing. "Take me. I've not had cold for many years and every year I buy several dozen pounds of garlic."

Others have been looking for darker forces behind the surge.

AP

China Business News said coal mine bosses -- who are often depicted as being both extremely rich and nefarious speculators -- had been playing the garlic market, hoarding bulbs and hauling them between storehouses.

Garlic served as a case study of the asset price appreciation that Morgan Stanley thinks China will have to contend with after a flood of lending by banks to help fight off the global financial crisis.

In some parts of Shandong province, the wholesale price of garlic is up as much as 40-fold.

"Too much liquidity in any market can lead to speculation," analyst Jerry Lou said in a research note this week. "The most recent evidence of asset speculation in China's commodity markets has been for garlic."

But a more mundane factor may lie at the root of it all.

Garlic prices were extremely low last year, convincing many farmers that it was not worth planting the crop again, a wholesale trader was quoted as saying in the Nanfang Daily.

Supply could not keep up with a pick-up in demand from home and abroad, sending prices sky-high, the trader said.

Yi Xianrong, a researcher with the Chinese Academy of Social Sciences, a top government think-tank, said there was no need for panic.

"The garlic market is cyclical. Price rises are short-term and they will fall again before long," Yi told Reuters.

Happy Thanksgiving

Wednesday brainstorming - part 1

1. The pieces are adding up for the big top - one part of a severe top is the bullish option scenario and that's building up. The MA on the ISEE are very good indicators 10 day around 150 and 20 around 140 would be ideal and we are heading there.

Historical

ISEEDate
Previous Trading Day18411/24/2009
10-Day Moving Average14011/11/2009 - 11/24/2009
20-Day Moving Average13310/28/2009 - 11/24/2009
50-Day Moving Average13109/16/2009 - 11/24/2009
52-Week High22003/09/2009
52-Week Low7710/20/2009

2. Half of Banks' Losses May Still Be Hidden: IMF Head

I doubt its only half since Subprime and Alt A are worth 5 tril p
lus various other fields which will add up to it so my old estimate remains rather around 10 tril. - why else would the FED even keep rising their balance sheet heading for 2.5 tril and keep rates at zero although they claim at the same time that the financial markets are stable and recession is over. Why did Japan keep rates at zero for 15 years because it takes plenty of time and government sponsored yield curves to heal the banks. Unfortunately the Japan experience is not to be repeated as the global economy is at the brink this time. As Rosenberg said we are rather in a depression and have just by some extraordionary measures blown the titanic back up but it will sink at the end and the horrifying part is that some forces trying to run this planet want exactly that to happen. The mantra of Freemasonary is order from chaos - so what they do now is to create the chaos.

Must read - Another milestone in the criminal agenda of the Bilderberger-UN / WHO

The plans of the Bilderberger which are an execution arm of the Rothschild/Rockefeller gang is to control global supply of food production but rather the supply for survival hence Health and Food for the world population. Therefor they even create scenario's like in 'wag the dog' movie. The sun erruptions are at an 80 year low and we rather may walk into an icy period than global warming.
They do this with all criminal intends and matters. One of their top frontman for this matter is Al Gore who is a partner with Goldman for this matters.

Excerpt -

Global warming exposed as UN-funded fraud

Global warming exposed as UN-funded fraud

by Project Mayhem

Russian computer hackers have published emails and source code from the UN-affiliated Climate Research Unit showing profound corruption, fraud, and criminal activity. What's really behind the Copenhagen treaty?




Recently, Russian hackers published over 160mb of scientific emails and source code taken from the primary 'climate research unit' -- the University of East Anglia, which is the center of UN/IPCC-promoted global warming alarmism. What the emails and data prove is shocking, and may represent the greatest scandal in the history of science.

In the emails, these UN-funded scientists talk about deleting data under FOIA request, faking data for journals such as Nature, conspiring to keep opposing science out of peer-reviewed journals (which they controlled the editorial boards), using "tricks" to "hide the cooling [period]" etc.


A picture emerges of big science funded to the tune of billions of dollars for the purposes of an underlying international political agenda. The degree of collusion between big media, the UN, and corrupted scientists involved in frank criminal activity is deeply disturbing. As I have detailed before, the purpose here is a political one. Global warming, or now abstractly identified as 'climate change', has been chosen by international banks and think tanks as the method of induction of vast political and social engineering never before seen in the history of the world.

We see based on the activities of criminals representing themselves as 'climate scientists' that the politics came first, and the science came second. They were more than happy to represent the political interests of the UN and international banks -- as long as their lab was well-funded. But there are politics behind this indeed. Here is a small sample of the underlying political agenda: Billions in new taxes, International regulatory control under the UN, Goldman Sachs/CCX carbon trading, Obliteration of national sovereignty, extreme forced austerity and reduction of the standard of living, deindustrialization of the First World countries, and implementation of Orwellian state policies for the purposes of "carbon tracking". The science does not matter -- the politics does.

Let us consider for a moment the cynical political objectives behind 'global warming' before we delve into the mountain of evidence thanks to the leaked emails and source code.


Global Warming and Orwellian State Policy

The Dutch government attempts to introduce GPS tracking units in everyone's cars under the pretext of 'climate change'.


THE HAGUE — The Dutch government said Friday it wants to introduce a "green" road tax by the kilometre from 2012 aimed at cutting carbon dioxide emissions by 10 percent and halving congestion.

"Each vehicle will be equipped with a GPS device that tracks how many kilometres are driven and when and where. This data will be then be sent to a collection agency that will send out the bill," the transport ministry said in a statement.

http://www.google.com/hostednews/afp/article/ALeqM5iYPTOtIepVKcGL_AcCZFe1ht99UQ

Global Warming and New Taxes

One of the primary political aspects of the global warming fraud is the imposition of a massive and bewildering array of new taxes. Obviously it is plain to see how this is in the interest of governments and banks, particularly if such taxes are imposed on an individual level.


Carbon Insurance For Your Car May Be Down The Road [Green Gas Taxes at Pumps] by Terry Tamminen (cnbc.com) - Nov. 13, 2009.

"A carbon insurance premium could easily be included in such a gas pump surcharge so drivers pay the true cost of operating their vehicles in terms of all relevant risks, including their fair share of creating both fender benders and climate change collisions."

http://www.cnbc.com/id/33906802


Carbon ration account for all proposed by Environment Agency by Ben Webster (timesonline.co.uk) - Nov. 9, 2009.


"Everyone should be given an annual carbon ration and face financial penalties if they exceed it, under a proposal by the Environment Agency"

http://www.timesonline.co.uk/tol/news/environment/article6909046.ece

Global Warming and Personal Autonomy

Selling your house? It could be a green crime

Queensland’s flailing government has now made it a crime to sell your house without first doing a big green audit:

QUEENSLANDERS selling their homes will soon have to complete a 56-point questionnaire detailing the property’s environmental credentials

http://blogs.news.com.au/heraldsun/andrewbolt/index.php/heraldsun/comments/selling_your_house_it_could_be_a_green_crime

Global Warming and Forced Austerity

The UN has advocated funding global birth control initiatives [read: 'population security'] in order to 'reduce CO2 emissions'. Of course now we know the connection between CO2 and temperatures is based on fabricated data . . . So where does that leave such UN population initiatives?


UN says Birth control the most effective way of reducing greenhouse gas emissions [UN Wants More Abortions and Sterilizations to cut Co2] by Ben Webster (timesonline.co.uk) - Nov. 19, 2009.
http://www.timesonline.co.uk/tol/news/environment/article6922245.ece

The population control objectives of the global warming fraud do not end there. Andrew Revkin, an NYT correspondent identified in the leaked CRU emails exhibiting a very cozy relationship with the corrupt scientists, advocates restrictions on the number of children couples are permitted to have via the issuance of 'carbon credits'. This is similar to what was advocated by Obama's chief science advisor John Holdren in his book Ecoscience. There is a political agenda behind global warming.



"Should–probably the single-most concrete and substantive thing an American, young American, could do to lower our carbon footprint is not turning off the lights or driving a Prius, it’s having fewer kids, having fewer children,” said Revkin. “So should there be, eventually you get, should you get credit–If we’re going to become carbon-centric–for having a one-child family when you could have had two or three,” said Revkin.

http://www.cnsnews.com/public/content/article.aspx?RsrcID=55667

The above is significant because Revkin is identified in the leaked emails corresponding with the corrupt Climate Research Unit (CRU) and has written many pro-global warming articles for the New York Times.

Global Warming and Systemic Financial Fraud

Where would we be in a Zerohedge article without mention of the fraudsters at Goldman Sachs. No doubt they are present in almost every evil or fraudulent enterprise known to man and global warming is no exception. Certainly these charlatans plan on making billions trading hallucinated carbon credits on Maurice Strong's Chicago Climate Exchange (CCX).

Al Gore's "Carbon Trading" Scam Reeks of Who Else? Goldman

http://www.goldmansachs666.com/2009/05/al-gores-carbon-trading-scam-reeks-of.html


These examples illustrate how the global warming fraud is used to push a far-reaching political agenda -- an agenda born out of the unholy fusion of governments , banks, and corrupt scientists. But let us consider now the content of the leaked emails.


Scientific corruption at the highest levels:

From: Phil Jones
To: ray bradley ,mann@xxxxx.xxx, mhughes@xxxx.xxx
Subject: Diagram for WMO Statement
Date: Tue, 16 Nov 1999 13:31:15 +0000
Cc: k.briffa@xxx.xx.xx,t.osborn@xxxx.xxx

Dear Ray, Mike and Malcolm,
Once Tim’s got a diagram here we’ll send that either later today or first thing tomorrow. I’ve just completed Mike’s Nature trick of adding in the real temps to each series for the last 20 years (ie from 1981 onwards) amd from 1961 for Keith’s to hide the decline. Mike’s series got the annual land and marine values while the other two got April-Sept for NH nd N of 20N. The latter two are real for 1999, while the estimate for 1999
for NH combined is +0.44C wrt 61-90. The Global estimate for 1999 with
data through Oct is +0.35C cf. 0.57 for 1998.


Thanks for the comments, Ray.

Cheers
Phil

Prof. Phil Jones
Climatic Research Unit Telephone +44 (0) xxxxx
School of Environmental Sciences Fax +44 (0) xxxx
University of East Anglia
Norwich Email p.jones@xxxx.xxx
NR4 7TJ
UK

source: http://www.climateaudit.org/?p=7810


Obviously the above email speaks for itself. Despite the glaringly obvious fraud, Phil Jones and his collaborators across the world would have you believe that "trick" and "hiding the decline" are simply normal procedures in any scientific laboratory. The FORTRAN source code tells a different story.


Climate Research Unit FORTRAN code backs up claims of fraud and corruption

Neal from Climate Audit writes:

"People are talking about the emails being smoking guns but I find the remarks in the code and the code more of a smoking gun. The code is so hacked around to give predetermined results that it shows the bias of the coder. In other words make the code ignore inconvenient data to show what I want it to show. The code after a quick scan is quite a mess. Anyone with any pride would be to ashamed of to let it out public viewing. As examples [of] bias take a look at the following remarks from the MANN code files:"


function mkp2correlation,indts,depts,remts,t,filter=filter,refperiod=refperiod,$
datathresh=datathresh
;
; THIS WORKS WITH REMTS BEING A 2D ARRAY (nseries,ntime) OF MULTIPLE TIMESERIES
; WHOSE INFLUENCE IS TO BE REMOVED. UNFORTUNATELY THE IDL5.4 p_correlate
; FAILS WITH >1 SERIES TO HOLD CONSTANT, SO I HAVE TO REMOVE THEIR INFLUENCE
; FROM BOTH INDTS AND DEPTS USING MULTIPLE LINEAR REGRESSION AND THEN USE THE
; USUAL correlate FUNCTION ON THE RESIDUALS.
;
pro maps12,yrstart,doinfill=doinfill
;
; Plots 24 yearly maps of calibrated (PCR-infilled or not) MXD reconstructions
; of growing season temperatures. Uses “corrected” MXD – but shouldn’t usually
; plot past 1960 because these will be artificially adjusted to look closer to
; the real temperatures.

;

"Spin that, spin it to the moon if you want. I’ll believe programmer notes over the word of somebody who stands to gain from suggesting there’s nothing “untowards” about it.

Either the data tells the story of nature or it does not. Data that has been “artificially adjusted to look closer to the real temperatures” is false data, yielding a false result."

-Anthony Watts, Meteorologist

source: http://wattsupwiththat.com/2009/11/22/cru-emails-may-be-open-to-interpretation-but-commented-code-by-the-programmer-tells-the-real-story/

Discussion

The source code above shows that the scientists involved manipulated their data in order to achieve a predetermined outcome. This is fraud, plain and simple. What is worse is these scientists also deliberately deleted the paper trail showing their research was fraudulent when the FOA requests arrived. This is criminal activity at the highest levels, and these people should be investigated and prosecuted. The massive amounts of funding they were provided with was used to lie to the public , in order to achieve the objectives of the UN and its affiliated think tanks, whether these scientists were aware of the implication of their corruption or not. The point is these entire 'climate change' claims need to be thrown in the trash heap and evaluated by competent scientists without financial or political interests in the outcome of their research.

And above all, the UN's Copenhagen treaty for dramatic forced austerity and international political control should be exposed for the vicious and cynical hoax it actually is. Copenhagen is the culmination of these fraudulent policies. National sovereignty will once again be reduced under a treaty conceived and funded by think tanks and international banks. Massive taxes will be imposed. Goldman Sachs and JP Morgan will make billions trading hallucinated carbon credits. Orwellian state policies for tracking individuals and interfering in personal autonomy will become acceptable under the pretext of 'stopping climate change', despite the entire rationale being fraudulent. Monopolistic international finance capital and the billionaire elitists behind it believe they are about to achieve another victory over the unwashed masses with the Copenhagen treaty.

The true political objective behind global warming was proven beyond a doubt in the Club of Rome publication The First Global Revolution. Keep in mind Al Gore is a member of this elitist group of policymakers, and even chaired a full Club of Rome meeting in Washington DC in 1997.


"“The common enemy of humanity is man. In searching for a new enemy to unite us, we came up with the idea that pollution, the threat of global warming, water shortages, famine and the like would fit the bill. All these dangers are caused by human intervention, and it is only through changed attitudes and behavior that they can be overcome. The real enemy then, is humanity itself."


-Club of Rome, The First Global Revolution, 1991.



We should understand that the international political agenda underlying the falsified global warming scandal is, at its core, an ideology of corrupt banks and politicians intent on framing humanity as the enemy , in order to achieve purposes of social control. Thus, it is no surprise that the 'science' behind global warming has been exposed as fraudulent.



For in-depth coverage of this growing scandal, see:

http://wattsupwiththat.com

http://smalldeadanimals.com

http://climateaudit.org


You can download the full copy of the leaked documents and source code here:

http://wikileaks.org/wiki/Climatic_Research_Unit_emails%2C_data%2C_models%2C_1996-2009



4.5
Your rating: None Average: 4.5 (14 votes)



by ZerOhead
on Tue, 11/24/2009 - 16:53
#141071

Mayhem... thanks for the great work and keep the pressure up on these criminals. Yes they are criminals if you merely apply the laws that are aleady on the books...

People tend to forget this since they believe they are merely attempting to save the planet... more like saving the $30 billion in global warming research grants since the early 90's... just sayin'...

by Project Mayhem
on Tue, 11/24/2009 - 17:01
#141075

If these cynical criminals in world policy bodies actually cared about the environment, they would ban Monsanto terminator seeds.

by ZerOhead
on Tue, 11/24/2009 - 17:18
#141103

Mayhem...

I would seed and harvest 4,000 acres a year (wheat, canola, soybean, oats in rotation) with my cousin in Manitoba each year until he sold the farm this spring.

Seed issues loom large with all the local farmers. In an escalating "Yield War" we require planting the highest yielding, drought tolerant, and fastest growing strains of GMO seed around just to survive. Once you do however you must sign contracts to "deliver" the crop back to them at harvest. You don't even own your own crop.

The "terminator seed is the "Holy Grail" of agricultural bioengineering. Forget about all the GMO issues with splicing 'pesticide' and even animal genes into your food crops... with the literal control over the ability of the planet to feed itself there will certainly be dark days ahead for all.

The masses are sleepwalking into uncharted territory here... will they ever wake up before it's too late?

Tuesday, November 24, 2009

A sudden burst of call buyers today - just before the FED minutes

All Securities
TimeCallsPutsTotalISEE
14:30468269242112710381193
14:10453807230160683967197
13:50440921219288660209201
13:30430972212166643138203
13:10416927203030619957205
12:50397285197735595020201
12:30381084180296561380211
12:10363545172157535702211
11:50353003163510516513216
11:30204936152438357374134
11:10178214141097319311126
10:50160858124730285588129
10:30131062103581234643127
10:1010138580816182201125
09:50489264754096466103
All Equities Only
CallsPutsTotalISEE
372669139129511798268
361177134789495966268
351923127992479915275
344147122987467134280
334402115415449817290
320629112094432723286
309248104409413657296
30116499562400726302
29361195246388857308
14801889696237714165
12436083151207511150
11034872631182979152
8998259854149836150
6837247648116020143
373392683464173139
All Indices & ETFs Only
CallsPutsTotalISEE
9557010295419852493
926009534218794297
889689126718023597
868058915117595697
825058758717009294
766368561316224990
718167585914767595
623617256713492886
593726823612760887
569176273911965691
538535794311179693
505095209610260597
41079437248480394
330123316566177100
11586207033228956

Dow update

Even the current top performer The DOW is topping out as we have a massive gathering of 13 counts which is always an indication of a top level. In Dec. we will make even a bit higher high since the weekly count is not finished yet but that is of an neglectable magnitude. We are in a severe topping out process which will be followed by a steep correction in the first half of 2010 and I still stick to the retest of the lows scenario. What we are seeing right now is what I had written about earlier a sector rotation - plus the bluechip rally - to quality as the Dow has become the top performing index. THe Dow runs into strong resistance around the 10400-500. The first wave up in the DOW was around 2400 and the second wave has reached now the same magnitude - Martin Armstrongs cycle is about the 8.6 month length, which gives us a time frame of end Nov. for this rally - lets see how that plays out.

Brainstorming Tuesday

1. If all the trillions could only produce an official 0.7% (annuallized 2.8%) rise in the 3rd quarter with cash for clıunckers as one of the top drivers bad things are ahead. Since the number is a fake anyway and reality much worse the overly optimistic earnings recovery for next year with 80$ on the SPX is a bad joke and a rude awakening will be the result. Remember a big part of this is produced by phony bank balance cheats with the dark side of the moon due to show up soon. As the MD of the IMF said democracy may be at stake as the room and tolerance for errors is zero - and the errors already made. Obama's puppets have not changed any of the crucial area's which caused the problems and still own them. So far America has perfectly repeated the mistakes of Japan of the 90's only the difference is Japan happened while the world was in good shape - this time around all are in bad shape even China despite their propaganda they do not have the power or will to save the rest of the world. Besides we still have even an ignorant and stupid or evil FED - both comes to the same result.

Excerpt

Bernanke Vs. Gold - Getting Hostile

Bruce Krasting's picture



I was struck with Bernanke’s comment last week at the Economics Club regarding bubbles. He said:

”It is not obvious to me that there are any misalignments in the US financial system”.

This comment has already gotten the attention of the media. Two years from now the blogs will be quoting it along with other notable words from the Chairman. Remember the following? Mr. Bernanke regrets having said this.

“We (the Fed) do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system.”

When Mr. Bernanke made those comments back in May of 2007 he was either misrepresenting the facts or he simply could not see the implications of the facts that were in front of him. I don’t think he was fibbing to us then. He called it as he saw it. He simply had no clue what the pieces meant. I am concerned that he is equally out of touch today.

How could Mr. Bernanke not see that zero interest rates are a misalignment?

Mr. Bernanke is a student of economic history. He knows that during the 30’s T Bill rates went negative. I am sure that he remembers the panic of 2008 when again Bill yields fell below zero. But those were panic situations. There is no panic today. But bill rates are at zero.

I am sure that Mr. Bernanke is smiling ear to ear as he sees the evidence that his plans are working. Zero interest rates were his objective. He has succeeded and even exceeded his goals.

What Mr. Bernanke has accomplished is making fiat money useless. It now costs you to own the stuff unless you want to gamble with it. Our whole system is based on the notion that money has value. The Fed has established that it has none.

I assume that Mr. Bernanke is acutely aware of day-to-day market movements. He knows that the comments by St. Louis Fed Governor James Bullard that “Maybe we should extend the Agency POMO buys” quickly resulted in a $20 pop in the gold price. You can’t ask for a better example of the market’s attitude towards America’s monetary stance. It is starting to get downright hostile.

It would be a kick in the pants to the entire financial system if the price of gold started to have a meaningful impact on monetary policy. I think that is exactly what is going to happen. It is just going to take a while. Bernanke continues to believe that nothing is misaligned. We are going to wake up and find out that things are horribly misaligned.

2. With the current jobless rate ( still rising) we can expect slugish Holiday season shopping even Wallstreet hişgh flyer wil be cautious as they do not know if any such year will be possible as the public outcry will carry into midterm elections plus this special FED sponsored earning will not be repeatable.

Excerpt

An Unbiased View Of The Holiday Shopping Season


We present an independent perspective on the 2009 holiday shopping season courtesy of a third-party retail advisor. “The discounters and off-price chains will continue to do well,” Alan Cohen of Abacus Investors says. “People will be shopping this Christmas, but they will be very cost-conscious and trading down. Instead of buying five items, they will buy three. Instead of buying an expensive item, they will go with a moderately priced one.” When all is said and done after the holidays, filing for Chapter 11 bankruptcy protection may be the only option for many chains, Cohen added. Then again, maybe retailers can rely on Cramer's optimism that everyone is massively underestimating the unemployed consumer who has bet the house and the dog on those one hundred shares of Amazon stock.

SLIM PICKINGS AT ONCE-ROBUST OUTLETS OFFER A CLUE TO THE 2009 HOLIDAYS
--A cautionary mood prevails among retailers, lenders and landlords alike,
but ‘this, too, shall pass’ says retailing veteran Alan Cohen of Abacus Advisors


CLOSTER, N.J. (11/xx/09) – The line between outlet stores and mainstream retail is blurring this holiday season as even upscale and luxury chains ratchet back their inventories and slash prices. The success or failure of these value-focused strategies will determine whether some operators manage to stay afloat in 2010, according to Alan Cohen, Chairman of Abacus Advisors, a Closter, N.J.-based turnaround and restructuring firm.

“You can learn a lot simply by walking into stores and observing,” said Cohen, who has more than 30 years of experience working with distressed businesses in all aspects of management and operations. “Throughout the summer and fall, stores at outlet malls like Woodbury Common [in Central Valley, N.Y.] typically are full of great stuff. However, this year inventories appeared to be light at the likes of Neiman Marcus’ Last Call or Saks’ Off 5th. Since these and other better retailers were discounting heavily in their mainline stores, they didn’t have as much excess inventory to send to their outlet locations.”

Deep concern about both the credit crisis and cutbacks in consumer spending has translated into retail strategies marked by caution, Cohen noted. “Manufacturers produced less, and retailers ordered less. In the run-up to the 2009 holiday season, everybody was in a conservative mood.”

In the past, for example, retailers like Nordstrom would bring in holiday merchandise early and reorder the best-selling items. This strategic tool likely will not be available to them this year. “Reorders will be down significantly this year, simply because the merchandise will be unavailable amid these inventory cutbacks,” Cohen explained. “That puts retailers at a strategic disadvantage, and it means shoppers will have a harder time finding certain popular items.”

Naturally, the discount powerhouse Wal-Mart, with its robust grocery sales and aggressive promotions on categories like toys, books and entertainment products, stands to benefit in this cautious environment. “The discounters and off-price chains will continue to do well,” Cohen says. “People will be shopping this Christmas, but they will be very cost-conscious and trading down. Instead of buying five items, they will buy three. Instead of buying an expensive item, they will go with a moderately priced one.”

When all is said and done after the holidays, filing for Chapter 11 bankruptcy protection may be the only option for many chains, Cohen added. “I certainly see more bankruptcies down the road,” he said. “And we will also see vacancies going up at shopping centers and malls across the country. With a limited number of conventional retail, restaurant or entertainment tenants actively looking for space, landlords will be exploring alternative uses like dental or emergency clinics or, in the case of large big-box spaces, flea markets.”



Monday, November 23, 2009

Brainstroming Monday - part 1

1. The Astro effects are already at full force - I rather assumed it might start tomorrow and will last til Thanksgiving. We have a cliffhanger though as the Saturn /Pluto square has an overwhelming negative impact which will play out the weeks and months ahead. SPX and NDX have a slightly different time table of 1 week. As NDX has now again activated week 12 count Combo the DOW and SPX entered week 11. VIX is now on week 13 Sequential ( which means that seat belts have to stay fastened).

Eexcerpt

Venus also rules securities and assets. From Monday through Thursday, Venus will “translate” the forthcoming Jupiter-Neptune conjunction in a square aspect. On Wednesday, Venus will also form a trine aspect to Uranus. Thus these signatures imply the possibility of market reversals this week

2. The IMF is now a permanent Dollar weakening factor as they constantly talk the Dollar down which proves to me that they are part of the market manipulation team. At the lows they were talking 'depression' and they always came up with negative news on the way down to trigger more selling now they do pretty much the opposite on the way up.

Blankfein and his government aids have to be prosecuted

AIG was the single producer for the Goldman earnings and bonus pool not the so called talent as without the outrageuos bailout of AIG which Goldman was by far the single biggest counterpart as the FED and Treasury top guys were ex -Goldman's is obviously a fraud and hence criminal case.
No God's work visible to me but the unbelievable guts to steal taxpayer money at daylight in the 25 billiion dimension.

Excerpt from Zerohedge

Janet Tavakoli Retracts Her Apology To Goldman Sachs, Calls For More Regulation Of The Government Backstopped Hedge Fund


Submitted by Janet Tavakoli of Tavakoli Structured Finance

I Retract My Apology and Call for More Regulation of Goldman Sachs

TSF – Opinion Commentary – November 22, 2009 (see also Apology)

According to SIGTARP1, both the Federal Reserve and Treasury agreed that an AIG failure posed unacceptable risk to the global financial system and the U.S. economy. On March 24, 2009, Fed Chairman Ben Bernanke testified before the House Financial Services Committee [P.9]:

[C]onceivably, its failure could have resulted in a 1930’s-style global financial and economic meltdown, with catastrophic implication[s].

From July 2007, AIG’s financial situation deteriorated while so-called “AAA” collateralized debt obligations (CDOs) dropped in value. AIG sold credit default swaps (CDSs) on these CDOs and had to post more collateral, as the prices plummeted.

Goldman Sachs was AIGFP’s (UK-based AIG Financial Products) largest CDS counterparty with around $22.1 billion, or about one-third of the problematic trades. Goldman underwrote some of the CDOs underlying its own CDSs, and also underwrote a large portion of the CDOs against which French banks SocGen, Calyon, Bank of Montreal, and Wachovia bought CDS protection. Goldman provided pricing on these CDOs to SocGen and Calyon. Goldman was a key contributor to AIG’s liquidity strain and the resulting systemic risk. (See “Goldman’s Undisclosed Role in AIG’s Distress”)

Apocalypse AIG

By mid September 2008, AIG’s long-term credit rating was downgraded, its stock price plummeted, and AIG couldn’t meet its borrowing needs in the short-term credit markets. According to SIGTARP, “without outside intervention, the company faced bankruptcy, as it simply did not have the cash that was required to provide to AIGFP’s counterparties as collateral.” [P.9] The Federal Reserve Board with Treasury’s encouragement authorized a bailout. 2

The Federal Reserve Bank of New York (FRBNY) extended an $85 billion revolving credit facility, so AIG could make its collateral payments to Goldman and some of its CDO buyers. AIG also met other obligations, such as payments under its securities lending programs owed to Goldman and some of its CDO buyers. (See also: “AIG Discloses Counterparties to CDS, GIA, and Securities Lending Transactions.”)

Goldman “Would Have Realized a Loss”

Fed Chairman Bernanke said AIG’s crisis put the world at risk for a global financial meltdown. Goldman purchased little credit default protection3 against an AIG collapse. Even if Goldman escaped a collateral clawback of the billions it held from AIG4, the underlying CDOs posed substantial market value risk (SIGTARP P. 17). As for systemic risk, Goldman CEO Lloyd Blankfein worried about untold billions in losses. (Too Big to Fail, P. 382.)

On September 16, 2008, as the FRBNY arranged AIG’s $85 billion credit line, Goldman CFO David Viniar said whatever the outcome, he would expect the direct impact of credit exposure to be “immaterial to [Goldman’s] results.” The CDOs’ ($22.1 billion) value was down around $10 billion, and AIG still owed Goldman $2.5 billion in collateral (hedged and partly collateralized by CDSs on AIG). SIGTARP shows the CDOs’ value fell another $2.5 billion in two months, and AIG’s new credit line provided more collateral. The CDOs were losing market value. If AIG had collapsed, the value drop would have been swift and brutal with new protection either unavailable or too expensive, if past CDS market mayhem provided any information. As the Wall Street Journal put it, SIGTARP “throws cold water on [Goldman’s] claim.”

Before September 16, 2008, AIG tried to negotiate a settlement for forty cents on the dollar. Other insurers have negotiated even deeper discounts to settle their CDS contracts on CDOs. The SIGTARP report shows that the FRBNY’s decision to pay 100 cents on the dollar to resolve $13.9 billion (part of Goldman’s $22.1 billion) of credit default swaps by purchasing the underlying CDOs in Maiden Lane III was important to Goldman Sachs. “Goldman Sachs…did not agree to concessions, because it would have realized a loss if it had.” [P.16]

Treasury Secretary Timothy Geithner, then President of FRBNY, is revealed in this New York Times article with apparent Stockholm syndrome rivaled only by Patty Hearst. He seems to echo Goldman’s talking points after discussions with Goldman’s CFO. In the fall of 2008, Henry (“Hank”) Paulson was Treasury Secretary. Paulson was formerly CEO of Goldman Sachs and held that role when Goldman executed its trades with AIG. Stephen Friedman, a former Goldman Sachs co-chairman, was Chairman of FRBNY. Friedman owned shares of Goldman Sachs, and was a member of Goldman’s board, while he held his influential Fed position. He resigned the Fed position in May 2009, but not before purchasing 50,000 shares of Goldman Sachs, when the public was still in the dark about the terms of the bailout.

Goldman’s Turn to Apologize

In light of the SIGTARP report, I withdraw my earlier apology to Goldman. Public commitments to AIG are currently around $182 billion. If you wonder what Goldman CEO Lloyd Blankfein meant when he said: “[Goldman Sachs] participated in things that were clearly wrong and we have reason to regret and we apologize for them,” think of Goldman’s role in AIG’s crisis, Goldman’s bailout, and Goldman’s ongoing heavy taxpayer subsidies. That way, one of you will be genuinely sorry about it.

About Me

I am a professional independent trader