I quit Wall Street and decided that it was time to talk more about what was going on inside it, as it had changed. It had become far more sinister and far more dangerous.~ Nomi Prins
For years, many people have suspected that the New York Fed is more or less controlled by the “too big to fail” banks. Well, we now have smoking gun evidence that this is indeed the case…
Alibaba is now the poster child example of how corrupt and controlled by the bankers our entire system is.
Any professional money managers/fund managers who bought this stock for anything more than a quick flip should be strung up from an oak tree by the neck for breach of fiduciary duty.
It is completely inconceivable that the SEC would have approved this stock for issue in the U.S. market 20 years ago.
That the SEC put it’s meaningless “It’s okay to sell this stock to retarded U.S. investors” stamp tells us the degree to which our financial and legal system has become engulfed by the corruption and criminality of Wall Street banks.
BABA is the kind stock market nuclear waste that boiler room penny stock operators like Stratton Oakmont would stuff down the throats of helpless senior citizens and greed-crazed morons. It’s not the kind of garbage that, historically, any large Wall Street investment bank would have touched with a ten-foot pole. Although I can understand JP Morgan and Citi having no qualms about to selling BABA to anyone who picks up the phone call from their broker at those two firms, the fact that Goldman Sachs, Morgan Stanley and Credit Suisse were willing to sell this sewage to the public (historically these 3 firms left the boiler room rot to the sleazy penny stock firms in Long Island, South Florida, Denver and Salt Lake City and focused on real crime) tells us just how unethical and corrupted Wall Street has become.
Fixed Income Global Structured Covered Obligation. Say that three times fast.
According to yesterday’s Wall Street Journal, the bailed out financial criminals at Goldman Sachs are set to launch the latest and greatest toxic derivative product directly into the portfolios of willing muppets the world over.
It all starts this September, so public pension funds may as well just start taking out stacks of hundreds and torching them at Burning Man while they still have a chance.
Yes, it’s called the “Fixed Income Global Structured Covered Obligation,” and no, you will not have a clue what’s in it.
No seriously, you won’t have a clue.
If Banco Espirito goes under, the default could trigger $29 billion in bondholder claims, and $120 billion in credit default claims.
However, it’s not the $120 billion in CDS claims that are visible. The real danger lurks in the “daisy-chain” of hidden counterparty default that could trigger a big meltdown. Remember AIG/Goldman? That melt-down – which triggered the big bailout banks – was likely triggered either by the Bear Stearns or Lehman collapse.
The former happened several months before AIG and Goldman. When Bear collapsed, Bernanke assured us it was isolated and contained. “Shalom Ben!” – how did the statement work out for you?
Will the Argentina default and the coming one of Banco Espirito trigger a credit default swaps meltdown?
- The Squeeze is On! Gold & Silver spike through $1300 & $20- is the next major bull move underway?
- Will the end of the Silver Fix kill the gold fix as well? Alasdair explains why THE FIX IS DEAD!!
- We discuss physical demand in US & Europe, & Alasdair breaks down how 3/4 of all above ground gold is now in Asia!
- Bloomberg admits paper derivatives in silver is a $5 trillion annual market, with gold an $18 trillion annual market- 20 x as much paper silver as gold capping prices?
- With gold & silver bursting out of consolidation patterns this week (& silver breaking out of a 3+ year downtrend) Alasdair informs SD readers that once an uptrend is established (perhaps within a matter of a few weeks): “The prices of gold and silver are going to run very, very quickly“, and that “If we look back on 2014 and saw that was the year gold & silver broke into new high ground, it wouldn’t surprise me-I’m not predicting it, but I would not be terribly surprised because the underlying dynamics are there!“
The SD Weekly Metals & Markets with Guest Host Alasdair Macleod is below:
In an interview with CNBC, Goldman Sachs CEO Lloyd Blankfein advises the CNBC host that at some point, some event will happen that will reset portfolios.
Blankfein states that interest rates will rise, which will be a shock to the market, and states that I have a lot of bad dreams at night, liquidity is one of them.
Lloyd Blankfein’s full interview with CNBC is below:
The recently announced swaps deal between Goldman Sachs and Ecuador involving the exchange of 13 physical tonnes of gold for $585 million in “highly liquid” paper raises the question of why the parties simply didn’t enter into a gold leasing arrangement.
Precious Metals Fund Manager Dave Kranzler cuts through the aromatic cloud hanging over the deal to address this and other key issues affecting the PM markets in the video below.
Ecuador: The Gold, the Bad & the Goldman
Regarding Goldman Sachs’ hypothecation of Ecuador’s 13 tonnes of gold: Ecuador has 26 tonnes in total.
You don’t manipulate the market with 26 tonnes. China withdraws over 30 tonnes per week from the Shanghai Gold Exchange. Then there’s India. Then there’s Russia. Then there’s Viet Nam (Viet Nam is the 5th largest gold importer in the world – that’s a fact). Then there’s all the other gold-buying countries. At least 50 tonnes of gold gets bought every week. This is gold that has to be delivered.
Coincidentally, or not coincidentally, Russia bought 25.5 tonnes in April.
My bet is that Goldman may have needed that gold from Ecuador to deliver to Russia.
This is a great example of how the game works. In a world in which every government on earth needs “liquidity” to survive, and the primary goal of every government is and always has been survival (the retention of arbitrary power at all costs), the provider of liquidity is king. So what is liquidity and who provides it?
…Ecuador agreed to transfer more than half its gold reserves to Goldman Sachs for three years as the government seeks to bolster liquidity. The central bank said it will send 466,000 ounces of gold to Goldman Sachs, worth about $580 million at current prices, and get the same amount back three years from now…“Gold that was not generating any returns in vaults, causing storage costs, now becomes a productive asset that will generate profits,” the central bank said in the statement.
If you want to understand the relationships between the American banking industry and Washington, D.C., look no further than the new book by Nomi Prins: All the Presidents’ Bankers: The Hidden Alliances that Drive American Power.
Prins joined Eric Dubin on Liberty Rising Radio for a lively discussion about the rise of American banking power. Bankers and presidents have traditionally worked together, as allies. Enormous concentration of financial wealth has always assured bankers a seat at the table. At the turn of the last century, the J.P. Morgan empire included control over 70% of the steel industry and over half of the publicly listed companies on the New York Stock Exchange.
Following the 2008 crash, the “too big to fail” banks have only grown larger.
Prins believes another crash is likely the only catalyst that can force change.
Ladies and gentlemen, it is perfectly clear that gold prices are headed south – and in a big way.
For those of you who trust pictures, I have included a graph of gold prices since 1975.
As you can see – it is perfectly clear – repeat – PERFECTLY CLEAR – gold prices have NOWHERE to go but down, down, down.
The distinguished analysts from Goldman Sachs have reiterated their 2014 forecast for gold to hit $1,050 by the end of the year.
Goldman has a serious motivation for throwing the paper price of gold under the bus. You see… Goldman is by far the weakest and most vulnerable bank when it comes to its Assets to Derivatives ratio. Not only does Goldman rank DEAD LAST compared to the other banks in this ratio, it does so with flying colors.
The five biggest banks in the United States in 2008, today those banks are bigger. They have a larger percentage of the assets of the banking system. They have much larger derivatives books and if you apply what I use which is complexity theory, to understand the risk in capital markets, you know that when you increase something in scale, the risk does not go up in a linear fashion. It goes up in an exponential fashion so the risk is – the size of the system is greater than ever before and the risk gets exponentially greater than ever before.
So we have a lousy economy. We have massive risk. We have the whole thing getting propped up like money printing by the Fed. This is naturally going to happen except this time, the next time, it will be worse than 2008 because it will be bigger than the Fed.
The source behind the Twitter handle @GSElevator Gossip, which has over 600,000 followers and chronicles ‘overheard’ elevator conversations at Goldman Sachs revealing bankers’ real attitudes towards money & women, is actually not even an employee.
The Twitter account prompted Goldman Sachs to open an internal inquiry to try and track down the tweet-happy employee, and it turns out that the Twitter author is 34-year-old John Lefevre, a former bond executive who was offered a position as head of debt syndicate at Goldman’s Hong Kong office in 2010, but never actually worked for the firm.
Our favorite member of the European Parliament, Nigel Farage has unleashed another epic rant in Strasbourg on how the Greeks were suckered by Goldman Sachs & big EU bureaucrats:
Greece is now under foreign control. You can’t make any decisions, you’ve been bailed out, and you’ve surrendered democracy, the thing your country invented in the first place. And you can’t admit that joining the euro was a mistake – of course Mr Papandreou did that didn’t he, he even said there should be a referendum in Greece and within 48 hours, the unholy trinity (troika) that now run this European Union had him removed and replaced by a ex-Goldman Sachs employee puppet.
We are run now by big business, big banks and in the shape of Mr Barroso, big bureaucrats.
Farage’s full MUST WATCH rant is below:
Why has Goldman Sachs chosen this moment to publicly declare that stocks are overpriced? Why has Goldman Sachs suddenly decided to warn all of us that the stock market could decline by 10 percent or more in the coming months? Goldman Sachs has to know that when they release a report like this that it will move the market. And that is precisely what happened on Monday. U.S. stocks dropped precipitously.
So is Goldman Sachs just honestly trying to warn their clients that stocks may have become overvalued at this point, or is another agenda at work here?
We consume far more wealth than we produce, and our entire nation is drowning in a massive ocean of red ink that stretches from sea to shining sea.
This is not sustainable, and it is inevitable that the stock market will catch up with economic reality at some point.
It is just a matter of time.
Last week the financial MSM admitted for the first time that the West’s gold is being physically drained to Asia and that London’s gold vaults are “virtually empty“.
Now, allegations that banks are rigging the gold and silver markets continue to gain credence among the mainstream as Bloomberg has published an article by Rosa Abrantes-Metz entitled ‘How to Keep Banks From Rigging Gold Prices’’.
Rosa Abrantes-Metz concludes that gold prices may be manipulated and gives evidence to support her assertion.
Nomi Prins, former Wall Street banker and author, says, “There’s this myth . . . that somehow the Fed’s quantitative easing (money printing) is helping to create jobs. The big six bank stocks are outperforming the rise in the stock market generally by ten times, and that is really not talked about very much, and that’s a big multiple. They are the ones who have received the most benefit, and they are the ones who are still in trouble.”
Can the Fed stop supporting the big banks? According to Prins, “The banks can’t survive without the Fed support, period. . . . The Fed will not discontinue its program of helping these banks because the levels of problems are still the same.” According to Prins, depositors could be in trouble during the next banking calamity. Prins contends, “That is a danger. Depositors could lose money because the FDIC would not be able to contain a mega fallout. . . . They’re creating a facade of stability until it falls apart.”
The Dollar’s fate lies in China’s Hand. Gold is the key to this fate. The Chinese Central bank’s fingerprints are all over the gold manipulation story.
The Chinese play the gold players like fiddles, rigging the price of gold lower to take in as much as they can.
Like Sun Tsu said, If you can win the battle without fighting, that is a good war. They’ve not fired a shot. They’ve used our currency reserves to buy up our gold.
The existence of our world reserve currency status will depend on how and when China shows the world what they hold in gold. That report is due in 2014. Once they show the world they have the gold to back their currency, the entire world will flock to the winner.
The fate of the dollar is almost entirely tied to China, its gold holdings and the value of gold once its real value is set.
$50,000 an ounce could become a real figure.