Posts Tagged ‘Fraud’
Foreclosure fraud

A long but fascinating audio on fraud in the foreclosures. Hat tip to the Market Ticker, who comments:

It’s two hours… In particular, listen to the couple of minutes starting at 12:30 in. Then listen to 6:30, and 42:30, right around 50:00 and then again at 70:00 and finally, at 78:00 in.

Pay attention to what’s being said here.

First: The assertion is made that the lenders and holders of the notes were paid in full. That is, they have no economic damage from the default (!) due to the way they structured the deals.

Second: The assertion is made that there was fraud in the inducement in all of these loans, in that there is an implied duty of dealing in good faith in all contracts that was violated by the banks that made knowingly bad loans – which we now have sworn testimony on. While this is not settled by any means, there is currently pending litigation on this point, and if this approach wins, well, then you go – those contracts are voidable.

Third: The allegation is made that the banks were not stupid – they knew the mathematics (as we all do now) and intentionally crashed the market. That just compounds the second point.

He aslo has charts on the growth of US money supply and debt here

 
Massive Market Manipulation

We have posted on the possibility of USD 15 trillion money laundering, a rogue US agency or an attempt to extort at least 50 billion. It seems so farfetched, surely it can’t be true. But is it any more unbelievable than the manipulation of the gold and silver market or that of AAA rated securities?

Gold and silver markets are manipulated in what was termed the biggest fraud in the history of the world. Gold is the biggest commodity market in the world. USD 5.4 trillion a year is traded through the LBMA and no end of derivatives hang off it. The leverage level is 100 to 1. In other words there are 100 ounces of paper gold for every ounce of physical gold. Every ounce of gold that leaves the LBMA causes leverage rates to rise. At some point the market is going to blow.

Listen to King World News Interview with Andrew Maguire & Adrian Douglas. Andrew told the CFC exactly what was going to happen to the gold price when it followed the pattern caused by the manipulation. It then moved exactly as he said it would. He even gave the CFC live commentary explaining what was happening.

The email exchange between Andrew Maguire and the CFTC is linked to at the King World News site. It includes the following:

A final e-mail to confirm that the silver manipulation was a great success and played out EXACTLY to plan as predicted yesterday. How would this be possible if the silver market was not in the full control of the parties we discussed in our phone interview? I have honored my commitment not to publicize our discussions.

I hope you took note of how and who added the short sales (I certainly have a copy) and I am certain you will find it is the same concentrated shorts who have been in full control since JPM took over the Bear Stearns position.

It is common knowledge here in London among the metals traders that it is JPM’s intent to flush out and cover as many shorts as possible prior to any discussion in March about position limits. I feel sorry for all those not in this loop. A serious amount of money was made and lost today and in my opinion as a result of the CFTC’s allowing by your own definition an illegal concentrated and manipulative position to continue.

The Wikipedia entry on Maguire states:

He went public in April 2010 with assertions of market manipulation by JPMorgan Chase and HSBC of the gold and silver markets. Maguire said “JPMorgan acts as an agent for the Federal Reserve; they act to halt the rise of gold and silver against the US dollar. JPMorgan is insulated from potential losses (on their short positions) by the Fed and/or the U.S. taxpayer.” “No one at JPMorgan is familiar with Andrew Maguire,” said Brian Marchiony, a JPMorgan spokesman. HSBC declined to comment….

Maguire and his wife were injured in London in a hit-and-run accident on March 26, 2010, the day after Maguire’s name came to light during a CFTC hearing on limiting gold and silver positions held by large market participants in order to prevent manipulation. Maguire believes the accident was an attempt on his life. The driver of the other vehicle was apprehended after a police chase, both on the ground and from the air in helicopters, but his name has not been released.

Think about the implications of the biggest commodity market in the world being manipulated. Of banks being even more leveraged in this than other securities. At the moment much of the manipulation may be designed to stop gold from appearing as a viable alternative to fiat currencies. But it also flags the potential manipulation in the event of a move back to the gold standard. A debate that has raged before. The Secret of Oz is a great documentary. Well worth watching for its outline of the debate between a gold standard and one which uses silver coinage as well.

We have commentated repeatedly on fraud in assorted securities market. I expect this book will detail more. If central bank manipulation of interest rates, the very price of money was not bad enough, we have the banks at it as well. Money is so central to everything that if it is too badly distorted the economy can’t fail but to destroy value, rather than create it.

It’s time to face facts, there is something rotten in the State of Denmark. Not to mention the other States of the formerly developed world. Formerly developed world is an awkward term. The “regressing world” seems a better term for describing our reality.

What is happening has nothing to do with classical models of capitalism. We now have a new form in the US, UK and perhaps other “Anglo” style economies. It can be thought of as connected capitalism. Not because the net connects us all, but because wealth accrues on the basis of connections. Not merit, not luck, but that now rather quaint concept …. corruption. Corruption on this scale will undermine the legitimacy of our system. This would be an unmitigated disaster.

Innovation represents the only hope for a beneficial black swan that will enable western governments to meet their promises. That will enable developed country citizens to have anything like the life style they are expecting. It must not be sabotage in a march to neo-luddite or pseudo-socialist alternatives. Neither they nor gangsta capitalism or its related connected capitalism will enable sufficient innovation. It really is a case of go forward fast or experience a collapse of Western civilization and much of the existing world order.

There is an interesting video here on the failure of our societies to continue to get big things done. It makes an unstated but nevertheless devastating attack on the precautionary principle. It also touches on the loss of the BS detector that Westerners used to have. We need to turn our culture around, fast.

Graphic courtesy of The Market Oracle

 
Free: The New Robber Barons

I’ve not read the book yet, but Janet was all over the issue of MBS related fraud. It is hard to believe it will be anything other than excellent:

Free Kindle Edition of The New Robber Barons By Janet Tavakoli

For today and on Tuesday (not on Monday) the $9.99 Kindle edition of The New Robber Barons by Janet Tavoli is free.

You must own a kindle, or have installed the kindle app for PC or mac, to download it. You can find it at Amazon US here, at Amazon UK here, or Amazon France here.

This e-book is a collection of her writings from various sources.

The NEW ROBBER BARONS continues financial expert Janet Tavakoli’s on-going chronicle of the global financial crisis captured in her articles from the September 2008 meltdown through February 2012. Picking up where her previous book, Dear Mr. Buffett, ended, she exposes the criminogenic environment that enabled international oligarchs to solidify power.

In January 2009, Warren Buffett, CEO of Berkshire Hathaway, told Tom Brokaw: “the idea that people that move money around are some favored class…strikes me as getting pretty far away from where we should be.” Two years later he publicly excused apparent insider trading by one of his successor candidates, David Sokol.

Berkshire Hathaway officer Charlie Munger admonished law students that Americans shouldn’t be “bitching about a little bailout.”

Shortly before Congress confronted him with Goldman Sachs’s profiteering during the financial crisis, Goldman CEO Lloyd Blankfein quipped he was doing “God’s work.”

CEO Jamie Dimon told shareholders that he didn’t think JPMorgan made a mistake when it came to potential foreclosure fraud: “maybe we’ll have to pay penalties eventually to some of the attorneys general but we really think we should just continue.” Meanwhile the bank scoured 115,000 mortgage affidavits and reserved $1.3 billion for legal costs.

After MF Global’s October 31, 2011, bankruptcy a U.S. Congressman told former CEO Jon Corzine: “You’ve got thousands of hard working people around this country that feel cheated.”

Tavakoli serves up example after stunning international example of no-strings-attached socialization of losses and privatization of gains. In the words of Congresswoman Marcy Kaptur: “I believe most of us would call that theft.”

Jesse’s Café Américain has long been one of my favorite sights. But in bringing this to my attention it has excelled itself.

The timing of the book is so apt given I am currently concocting a post on massive market manipulation.