Bloomberg: Vampire Squids Are My Peeps - Defending The Squid My First Priority

independent |  Michael Bloomberg called Goldman Sachs bankers his ‘peeps’ and promised to defend them, leaked tape reveals. Presidential candidate Michael Bloomberg is being criticised for telling bankers he would have defended them as president in a leaked audio from a private Goldman Sachs event in 2016.

At the event, Mr Bloomberg first described the audience as his “peeps”, and said that had he run for president that year, his “first campaign platform” would have been “to defend the banks.”

But, he added, “you know how well that’s gonna go down in this country”.

Mr Bloomberg then defended the banks more seriously: “Somebody's gotta stand up and do what we need. A healthy banking system that's going to take risks because that's what creates the jobs for everybody. And nobody's willing to say that.”

The audio was uploaded to hosting platform Soundcloud and sent to CNN and several journalists. The sender used the email address and username “CancelGoldman”, and claimed to have worked at Goldman Sachs for 14 years.

The Bloomberg campaign has confirmed that the audio is real. In an email to CNN, spokesperson Stu Loeser said that much of what Mr Bloomberg said was in jest, and that his remarks were of an analytical standard almost unheard of in current politics.

Han Elite Rule Epitomizes The Full Neoliberal And Surveillance Capitalist Agenda

strategic-culture |  For decades, we were led to believe that the world-system put in place after WWII provided the U.S. with unrivalled structural power. Now, all that’s left is structural fragility, grotesque inequalities, unpayable Himalayas of debt, and a rolling crisis.

No one is fooled anymore by the Fed’s magic quantitative easing powers, or the acronym salad – TALF, ESF, SPV – built into the Fed/U.S. Treasury exclusive obsession with big banks, corporations and the Goddess of the Market, to the detriment of the average American.

It was only a few months ago that a serious discussion evolved around the $2.5 quadrillion derivatives market imploding and collapsing the global economy, based on the price of oil skyrocketing, in case the Strait of Hormuz – for whatever reason – was shut down.

Now it’s about Great Depression 2.0: the whole system crashing as a result of the shutdown of the global economy. The questions are absolutely legitimate: is the political and social cataclysm of the global economic crisis arguably a larger catastrophe than Covid-19 itself?  And will it provide an opportunity to end neoliberalism and usher in a more equitable system, or something even worse?

 

Wall Street, of course, lives in an alternative universe. In a nutshell, Wall Street turned the Fed into a hedge fund. The Fed is going to own at least two thirds of all U.S. Treasury bills in the market before the end of 2020.

The U.S. Treasury will be buying every security and loan in sight while the Fed will be the banker – financing the whole scheme.

So essentially this is a Fed/Treasury merger. A behemoth dispensing loads of helicopter money.

And the winner is BlackRock—the biggest money manager on the planet, with tentacles everywhere, managing the assets of over 170 pension funds, banks, foundations, insurance companies, in fact a great deal of the money in private equity and hedge funds. BlackRock — promising to be fully  “transparent” — will buy these securities and manage those dodgy SPVs on behalf of the Treasury.

BlackRock, founded in 1988 by Larry Fink, may not be as big as Vanguard, but it’s the top investor in Goldman Sachs, along with Vanguard and State Street, and with $6.5 trillion in assets, bigger than Goldman Sachs, JP Morgan and Deutsche Bank combined.

Now, BlackRock is the new operating system (OS) of the Fed and the Treasury. The world’s biggest shadow bank – and no, it’s not Chinese.

Compared to this high-stakes game, mini-scandals such as the one around Georgia Senator Kelly Loffler are peanuts. Loffler allegedly profited from inside information on Covid-19 by the CDC to make a stock market killing. Loffler is married to Jeffrey Sprecher – who happens to be the chairman of the NYSE, installed by Goldman Sachs.

While corporate media followed this story like headless chickens, post-Covid-19 plans, in Pentagon parlance, “move forward” by stealth.

The price? A meager $1,200 check per person for a month. Anyone knows that, based on median salary income, a typical American family would need $12,000 to survive for two months. Treasury Secretary Steven Mnuchin, in an act of supreme effrontry, allows them a mere 10 percent of that. So American taxpayers will be left with a tsunami of debt while selected Wall Street players grab the whole loot, part of an unparalleled transfer of wealth upwards, complete with bankruptcies en masse of small and medium businesses.

Fink’s letter to his shareholders almost gives the game away: “I believe we are on the edge of a fundamental reshaping of finance.”

And right on cue, he forecasted that, “in the near future – and sooner than most anticipate – there will be a significant reallocation of capital.”

monetary fascism - the rise of the financial industrial congressional complex

counterpunch | Challenging Monetary Fascism is much more dangerous for political leaders representing countries outside the G-20.  Populist leaders who put forward Nationalist policies are automatically in violation of one or more international ‘free trade’ agreements.  Non-conformity with these agreements ultimately results in trade sanctions, IMF or World Bank imposed austerity, or worse…

Friedman’s ideology is global and his rules of ‘free trade’ are deeply integrated into the laws of international trade.  All of our Nation’s international treaties on trade and banking are a series of interlocking agreements that force all nations to subvert their sovereignty and conform to Monetary Fascism.  It is a global pandemic built on a world-wide transmission system with universal powers of enforcement.  Sovereign Nations comply or they lose their credit rating.  Considering the world wide mass escalation of debt to GDP for most western nations, a small increase in the cost of borrowing would easily result in default and bankruptcy.

Today, Nation States face nothing less than financial Armageddon – the Sampson Option, if they do not comply with the demands of the global banking industry.  And it is with this weapon that the Financial Class has come to dominate the State.

Forget Al Qaeda, the only legitimate threat to U.S. and international security is the financial class.  They have created Weapons of Mass Financial Destruction (Financial WMDs) and they stand ready to take down the world economy.  They are more dangerous than any ‘terrorist group’, or even all of the ‘terrorist groups combined.

Exaggeration – consider what Friedman’s ‘free market’ banking system has done to Iceland, Ireland, Spain, Greece, Estonia, etc.  How many western nations has Islam overthrown?  Not one, and by comparison that should scare you.

Money has become the state and the traditional state is forced to serve money’s interests.  Everywhere the Financial Class is openly lording over sovereign nations.  Ireland, Greece and Spain are subject to ultimatums and remember Hank Paulson’s $700 billion extortion from the U.S. Congress.  The $700 billion was just the wedge.  Thanks to unlimited access to the Discount Window, Quantitative Easing and other taxpayer funded debt-swap bailouts the total transfers to the financial industry exceeded $16 trillion as of July 2010 according to a Federal Reserve Audit.  All of this was dumped on the taxpayer and it is still growing.

Why must the people of Ireland or Iceland accept the losses of the private banking sector as a public obligation?  Why must Greece accept austerity because its politician’s entered into a series of deals structured by Goldman Sachs specifically designed to deceive its EU partners?  If Goldman Sachs authored documents with the intent of fraud then Goldman Sachs is required to bear the losses and prosecution.  The taxpayer had no hand in this.

It is breathtaking.  Within the last 40 years ‘money’ has gained total control of each and every one of us.  Generations to come will enter this world burdened with the debts of their fathers.  It is inescapable and ubiquitous.  More than just a spider’s web, or a money-sucking vampire squid, it is a global pandemic that infects our very DNA.  It is the Original Sin of money – subject to compound interest, converted into a derivative, hypothecated and rolled into a CMO and then leveraged through CDSs.

The uber-wealthy will continue to aggregate wealth.  The banking system will continue to make ‘risk free bets,’ booking gains and shifting the losses to the public.  As these losses accumulate on the public balance sheet the state will be forced to seek austerity measures from the public. As austerity and debt levels increase the global economy will continue ‘circling of the bowl’ with increasing speed until we suddenly plunge into the vortex.

Without Wikileaks How Would We Know the U.S. Koreas/China Policy?

downwithtyrrany |  [Update: It's been suggested in comments (initially here) that Clinton's "we" in her answer to Blankfein's question was a reference to China's policy, not our own. I'm doubtful that's true, but it's an interpretation worth considering. Even so, the U.S. and Chinese policies toward the two Koreas are certainly aligned, and, as Clinton says, "for the obvious economic and political reasons." (That argument was also expressed in comments here.)  I therefore think the thrust of the piece below is valid under either interpretation of Clinton's use of "we." –GP]

"We don't want a unified Korean peninsula ... We [also] don't want the North Koreans to cause more trouble than the system can absorb."

—Hillary Clinton, 2013, speech to Goldman Sachs

Our policy toward North Korea is not what most people think it is. We don't want the North Koreans to go away. In fact, we like them doing what they're doing; we just want less of it than they've been doing lately. If this sounds confusing, it's because this policy is unlike what the public has been led to assume. Thanks to something uncovered by WikiLeaks, the American public has a chance to be unconfused about what's really going on with respect to our policies in Korea.

This piece isn't intended to criticize that policy; it may be an excellent one. I just want to help us understand it better. 

Our source for the U.S. government's actual Korean policy — going back decades really — is former Secretary of State Hillary Clinton. She resigned that position in February 2013, and on June 4, 2013 she gave a speech at Goldman Sachs with Lloyd Blankfein present (perhaps on stage with her) in which she discussed in what sounds like a very frank manner, among many other things, the U.S. policy toward the two Korea and the relationship of that policy to China.

That speech and two others were sent by Tony Carrk of the Clinton campaign to a number of others in the campaign, including John Podesta. WikiLeaks subsequently released that email as part of its release of other Podesta emails (source email with attachments here). In that speech, Clinton spoke confidentially and, I believe, honestly. What she said in that speech, I take her as meaning truthfully. There's certainly no reason for her to lie to her peers, and in some cases her betters, at Goldman Sachs. The entire speech reads like elites talking with elites in a space reserved just for them.

goldman sachs earnings easily surpass expectations

Washington Post | Goldman Sachs yesterday reported the largest quarterly profit in its history as a public company, $3.44 billion between April and June, as the decimation of its Wall Street rivals allowed the investment bank to romp across the financial landscape, buying low and selling high.

The New York firm is only months removed from a federal rescue that included emergency approval to become a bank holding company, $10 billion in direct federal aid and help to borrow billions more to finance its operations. But Goldman's earnings of $4.93 a share, up from $4.58 during the comparable period last year, made clear that the company has emerged stronger than other survivors, allowing it to seize opportunities in the aftermath of the crisis.

The results may cheer investors, offering further evidence that the strongest financial companies can once again be trusted to generate massive profit. Goldman's stock closed basically flat yesterday at $149.66, but its share price has climbed 77 percent this year.

Goldman's success also risks a political backlash, as the company is now on track to pay record bonuses in the midst of a recession that many Americans -- including President Obama -- have blamed in part on Wall Street's lavish pay practices. Goldman said yesterday that it set aside 48 percent of its total revenue, or $6.65 billion, to reward employees for the company's performance. That share is the same as Goldman set aside in 2007, before the crisis.

goldman's golden goose grab...,

NYTimes | “A geek who writes code — those guys are now the valuable guys,” Mr. Donefer said.

The spate of lawsuits reflects the highly competitive nature of ultrafast trading, which is evolving quickly, largely because of broader changes in stock trading, securities industry experts say.

Until the late 1990s, big investors bought and sold large blocks of shares through securities firms like Morgan Stanley. But in the last decade, the profits from making big trades have vanished, so investment banks have become reluctant to take such risks.

Today, big investors divide large orders into smaller trades and parcel them to many exchanges, where traders compete to make a penny or two a share on each order. Ultrafast trading is an outgrowth of that strategy.

As Mr. Aleynikov and other programmers have discovered, investment banks do not take kindly to their leaving, especially if the banks believe that the programmers are taking code — the engine that drives trading — on their way out.

This spring, Mr. Aleynikov quit Goldman to join Teza Technologies, a new trading firm, tripling his salary to about $1.2 million, according to the complaint. He left Goldman on June 5. In the days before he left, he transferred code to a server in Germany that offers free data hosting.

At Mr. Aleynikov’s bail hearing, Joseph Facciponti, the assistant United States attorney prosecuting the case, said that Goldman discovered the transfer in late June. On July 1, the company told the government about the suspected theft. Two days later, agents arrested Mr. Aleynikov at Newark.

After his arrest, Mr. Aleynikov was taken for interrogation to F.B.I. offices in Manhattan. Mr. Aleynikov waived his rights against self-incrimination, and agreed to allow agents to search his house.

He said that he had inadvertently downloaded a portion of Goldman’s proprietary code while trying to take files of open source software — programs that are not proprietary and can be used freely by anyone. He said he had not used the Goldman code at his new job or distributed it to anyone else, and the criminal complaint offers no evidence that he has.

Why he downloaded the open source software from Goldman, rather than getting it elsewhere, and how he could at the same time have inadvertently downloaded some of the firm’s most confidential software, is not yet clear.

At Mr. Aleynikov’s bail hearing, Mr. Facciponti said that simply by sending the code to the German server, he had badly damaged Goldman.
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The MSM has finally gotten around to narratizing the frontrunning fraud perpetrated by Goldman Sachs. This summer has already shown the issue to complex to be digested by the public at large. So justice, as with political leadership, is reduced to a lowest common denominator in which the people will get precisely what their effort and attention spans lead them to deserve.

frontrunning and now the "trading huddle"

BusinessInsider | We find it hard to believe that the top hedge funds in the world get a lot of value out of Buy/Sell ideas from analysts, unless they're blatantly telegraphing market-moving reports, in which case that could be trouble.

Still, this timeline looks pretty damning:

Susanne Craig at WSJ takes a deep dive into the practices of Goldman Sachs (GS) stock analysts, and notes that preferred clients get, well, preferred access to ideas and advice.

Here's the nut of it:

Goldman Sachs Group Inc. research analyst Marc Irizarry's published rating on mutual-fund manager Janus Capital Group Inc. was a lackluster "neutral" in early April 2008. But at an internal meeting that month, the analyst told dozens of Goldman's traders the stock was likely to head higher, company documents show.

The next day, research-department employees at Goldman called about 50 favored clients of the big securities firm with the same tip, including hedge-fund companies Citadel Investment Group and SAC Capital Advisors, the documents indicate. Readers of Mr. Irizarry's research didn't find out he was bullish until his written report was issued six days later, after Janus shares had jumped 5.8%.

Every week, Goldman analysts offer stock tips at a gathering the firm calls a "trading huddle." But few of the thousands of clients who receive Goldman's written research reports ever hear about the recommendations.

This story will bring fresh, unwanted attention to the bank, which is reeling from a string of undesirable media stories.

chess, not checkers (continued)......,

Video - Bill Black on Goldman Sachs derivatives fraud.

WaPo | Even before the Securities and Exchange Commission sued Goldman last week, accusing it of creating a complex financial product designed to fail and selling it to unknowing investors, the firm had become a frequent target of investigators. In courts and in Congress, Goldman has been accused of a range of misdeeds, including manipulating oil prices and using taxpayer money for handsome bonuses.

The company has maintained that it did nothing improper in any of those cases. In the Massachusetts settlement, it admitted to no wrongdoing, and a spokesman said Goldman was never a leading issuer or underwriter of residential mortgage-backed securities. Yet, to many Goldman critics, the SEC lawsuit underscores their worst image of the firm as a cold bank that places its profit before anything else -- client interests, customer needs and its obligation to society as a leading American corporation.

Although Goldman quickly agreed to settle the Massachusetts case, it is gearing up for a court battle with the SEC. The case, analysts said, challenges the heart of Goldman's motto -- "Our clients' interests always come first" -- and could set off a new wave of lawsuits against the firm.

"Anyone who's ever done any investment through Goldman who's lost a significant amount of money all the sudden starts to say, 'Gee, I wonder if there was something else out there that they were doing, which they didn't tell me about, which would have made me not want to invest?' " said Richard L. Scheff, chairman of the law firm Montgomery, McCracken, Walker & Rhoads. "If I'm a person who's lost money, why would I think it's limited to this? You're talking about someone's duty to their clients. That's the principle at issue here."

foxes and chicken coops

HuffPo | There have been a few financial insiders who've raised an eyebrow over Storch's hire. Zero Hedge pointed to a big flaw in Storch's background "...at least the SEC could have hired someone with actual market/broker experience. Based on his record, Mr. Storch is not even a licensed (Series 7/63) broker."

The Atlantic points to some real concerns about his level of experience: "I'm not sure what's scarier, that this guy worked at an investment bank that many believe has questionable ethics and too cozy a Washington connection, or that he's just 29. His 'great deal of background' must be those seven long years since college ended."

For those who've lamented the various links between Goldman Sachs and the financial regulatory system, this certainly isn't good news.

Bloomberg reports that the Securities Exchange Commission has named Adam Storch, a former Goldman exec, as its enforcement division's first chief operating officer. Storch is actually just 29 years old and previously worked in Goldman's business intelligence unit.

Here's Bloomberg:

"The COO, who started Oct. 13, has "a great deal of background" in technology and managing processes and the pace of work, Robert Khuzami, head of enforcement, said yesterday in Washington. Storch, who worked since 2004 in a unit at Goldman Sachs that reviewed contracts and transactions for signs of fraud, will be charged with making the unit more efficient. Storch, reached by telephone at the SEC, declined to comment."

According to what appears to be his LinkedIn profile, Storch spent his undergraduate years at the State University Of New York At Buffalo, and earned an MBA from New York University's Stern School Of Business. Other experience -- besides Goldman -- includes working as a Senior Analyst at Deloitte and Touche.

geithner and summers should mcchrystal

truthout | What we need is for the president's economic hotshots, Timothy Geithner and Lawrence Summers, to grant damaging interviews to Rolling Stone, as Gen. Stanley McChrystal recently did in self-destructing. Perhaps then President Obama would have the gumption to fire the misleaders of his economic team.

It was always bizarre that those two, who did so much to wreck the economy, were put in charge of the effort to salvage it. Their previous records should have provided ample warning that their economic outlook begins and ends with the demands of Wall Street.

It was Geithner who, as head of the New York Fed, presided over the $180 billion bailout of AIG, which, as revealed by the 500-page documented record of that travesty released last week by the Financial Crisis Inquiry Commission, was a scam to pass taxpayer money to Goldman Sachs and the other large banks that had created the problem.

And it was Summers who, as President Bill Clinton's treasury secretary, pushed through the Commodity Futures Modernization Act, which guaranteed "legal certainty" for the toxic derivatives packages that Goldman and the others sold. At the time, Summers assured Congress that "the parties to these kinds of contracts are largely sophisticated financial institutions that would appear to be eminently capable of protecting themselves from fraud and counterparty insolvencies."

For such not-so-prescient but very convenient insight, Goldman Sachs rewarded Summers with $200,000 for two speeches he gave to its executives while he was an adviser to candidate Obama. Not surprisingly, the new financial regulations proposed by this administration and soon to be signed into law let Goldman and the others so much at fault off the hook.

There is enormous and justifiable populist outrage out there over the antics of a runaway Wall Street that is not being held accountable. Obama could tap into that outrage by taking his cues from a true populist, Democratic Sen. Russ Feingold of Wisconsin. One of only eight senators to vote against the Clinton-backed 1999 repeal of the Glass-Steagall Act, which had done so much to protect the economy, Feingold voted against the Bush bailout, too, and is now breaking with Obama on his so-called financial reform:

"The bill does not eliminate the risk to our economy posed by 'too big to fail' financial firms, nor does it restore the proven safeguards established after the Great Depression, which separated Main Street banks from big Wall Street firms and are essential to preventing another economic meltdown. The recent financial crisis triggered the nation's worst recession since the Great Depression. The bill should have included reforms to prevent another such crisis. Regrettably, it did not."

The president's record on the economy is even worse than his performance in Afghanistan, and a reversal of course is much in order. If he doesn't get the message now, the voters will give it to him loud and clear come the November midterm elections.

softening you up for the goldman frontrunning fiasco

NYTimes | Traders Profit With Computers Set at High Speed - It is the hot new thing on Wall Street, a way for a handful of traders to master the stock market, peek at investors’ orders and, critics say, even subtly manipulate share prices.

It is called high-frequency trading — and it is suddenly one of the most talked-about and mysterious forces in the markets.

Powerful computers, some housed right next to the machines that drive marketplaces like the New York Stock Exchange, enable high-frequency traders to transmit millions of orders at lightning speed and, their detractors contend, reap billions at everyone else’s expense.

These systems are so fast they can outsmart or outrun other investors, humans and computers alike. And after growing in the shadows for years, they are generating lots of talk.

Nearly everyone on Wall Street is wondering how hedge funds and large banks like Goldman Sachs are making so much money so soon after the financial system nearly collapsed. High-frequency trading is one answer.

And when a former Goldman Sachs programmer was accused this month of stealing secret computer codes — software that a federal prosecutor said could “manipulate markets in unfair ways” — it only added to the mystery. Goldman acknowledges that it profits from high-frequency trading, but disputes that it has an unfair advantage.

Yet high-frequency specialists clearly have an edge over typical traders, let alone ordinary investors. The Securities and Exchange Commission says it is examining certain aspects of the strategy.

“This is where all the money is getting made,” said William H. Donaldson, former chairman and chief executive of the New York Stock Exchange and today an adviser to a big hedge fund. “If an individual investor doesn’t have the means to keep up, they’re at a huge disadvantage.”

Taibbi Redux: an attempt at war with the vampire squid

rollingstone |  Congress looked serious about finance reform – until America's biggest banks unleashed an army of 2,000 paid lobbyists. It's early May in Washington, and something very weird is in the air. As Chris Dodd, Harry Reid and the rest of the compulsive dealmakers in the Senate barrel toward the finish line of the Restoring American Financial Stability Act – the massive, year-in-the-making effort to clean up the Wall Street crime swamp – word starts to spread on Capitol Hill that somebody forgot to kill the important reforms in the bill. As of the first week in May, the legislation still contains aggressive measures that could cost once- indomitable behemoths like Goldman Sachs and JP Morgan Chase tens of billions of dollars. Somehow, the bill has escaped the usual Senate-whorehouse orgy of mutual back-scratching, fine-print compromises and freeway-wide loopholes that screw any chance of meaningful change.

The Great American Bubble Machine

The real shocker is a thing known among Senate insiders as "716." This section of an amendment would force America's banking giants to either forgo their access to the public teat they receive through the Federal Reserve's discount window, or give up the insanely risky, casino-style bets they've been making on derivatives. That means no more pawning off predatory interest-rate swaps on suckers in Greece, no more gathering balls of subprime shit into incomprehensible debt deals, no more getting idiot bookies like AIG to wrap the crappy mortgages in phony insurance. In short, 716 would take a chain saw to one of Wall Street's most lucrative profit centers: Five of America's biggest banks (Goldman, JP Morgan, Bank of America, Morgan Stanley and Citigroup) raked in some $30 billion in over-the-counter derivatives last year. By some estimates, more than half of JP Morgan's trading revenue between 2006 and 2008 came from such derivatives. If 716 goes through, it would be a veritable Hiroshima to the era of greed.

"When I first heard about 716, I thought, 'This is never gonna fly,'" says Adam White, a derivatives expert who has been among the most vocal advocates for reform. When I speak to him early in May, he sounds slightly befuddled, like he can't believe his good fortune. "It's funny," he says. "We keep waiting for the watering-down to take place – but we keep getting to the next hurdle, and it's still staying strong."

In the weeks leading up to the vote on the reform bill, I hear one variation or another on this same theme from Senate insiders: that the usual process of chipping away at key legislation is not taking place with its customary dispatch, despite a full-court press by Wall Street. The financial-services industry has reportedly flooded the Capitol with more than 2,000 paid lobbyists; even veteran members are stunned by the intensity of the blitz. "They're trying everything," says Sen. Sherrod Brown, a Democrat from Ohio. Wall Street's army is especially imposing given that the main (really, the only) progressive coalition working the other side of the aisle, Americans for Financial Reform, has been in existence less than a year – and has just 60 unpaid "volunteer" lobbyists working the Senate halls.

Why Isn't Wall Street in Jail?

The companies with the most at stake are particularly well-connected. The lobbying campaign for Goldman Sachs, for instance, is being headed up by a former top staffer for Rep. Barney Frank, Michael Paese, who is coordinating some 14 different lobbying firms to fight on Goldman's behalf. The bank is also represented by Capitol Hill heavyweights like former House majority leader Dick Gephardt and former Reagan chief of staff Ken Duberstein. All told, there are at least 40 ex-staffers of the Senate Banking Committee – and even one former senator, Trent Lott – lobbying on behalf of Wall Street. Until the final weeks of the reform debate, however, it seemed that all these insiders were facing the prospect of a rare defeat – and they weren't pleased. One lobbyist even complained to The Washington Post that the bill was being debated out in the open, on the Senate floor, instead of in a smoky backroom. "They've got to get this thing off the floor and into a reasonable, behind-the-scenes" discussion, he groused. "Let's have a few wise fathers sit around the table in some quiet room" to work it out.

As it neared the finish line, the Restoring American Financial Stability Act was almost unprecedentedly broad in scope, in some ways surpassing even the health care bill in size and societal impact. It would rein in $600 trillion in derivatives, create a giant new federal agency to protect financial consumers, open up the books of the Federal Reserve for the first time in history and perhaps even break up the so-called "Too Big to Fail" giants on Wall Street. The recent history of the U.S. Congress suggests that it was almost a given that they would fuck up this one real shot at slaying the dragon of corruption that has been slowly devouring not just our economy but our whole way of life over the past 20 years. Yet with just weeks left in the nearly year-long process at hammering out this huge new law, the bad guys were still on the run. Even the senators themselves seemed surprised at what assholes they weren't being. This new baby of theirs, finance reform, was going to be that one rare kid who made it out of the filth and the crime of the hood for everybody to be proud of.

Then reality set in.

Picture the Restoring American Financial Stability Act as a vast conflict being fought on multiple fronts, with the tiny but enormously influential Wall Street lobby on one side and pretty much everyone else on the planet on the other. To be precise, think World War II – with some battles won by long marches and brutal campaigns of attrition, others by blitzkrieg attacks, still more decided by espionage and clandestine movements. Time after time, at the last moment, the Wall Street axis has turned seemingly lost positions into surprise victories or, at worst, bitterly fought stalemates. The only way to accurately convey the scale of Wall Street's ingenious comeback is to sketch out all the crazy, last-minute shifts on each of the war's four major fronts.

not a single iota of testicular fortitude between the two-of-em...,

RollingStone | I’ve been on deadline in the past week or so, so I haven't had a chance to weigh in on Eric Holder’s predictable decision to not pursue criminal charges against Goldman, Sachs for any of the activities in the report prepared by Senators Carl Levin and Tom Coburn two years ago.

Last year I spent a lot of time and energy jabbering and gesticulating in public about what seemed to me the most obviously prosecutable offenses detailed in the report – the seemingly blatant perjury before congress of Lloyd Blankfein and other Goldman executives, and the almost comically long list of frauds committed by the company in its desperate effort to unload its crappy “cats and dogs” mortgage-backed inventory.

In the notorious Hudson transaction, for instance, Goldman claimed, in writing, that it was fully "aligned" with the interests of its client, Morgan Stanley, because it owned a $6 million slice of the deal. What Goldman left out is that it had a $2 billion short position against the same deal.

If that isn’t fraud, Mr. Holder, just what exactly is fraud?

Still, it wasn’t surprising that Holder didn’t pursue criminal charges against Goldman. And that’s not just because Holder has repeatedly proven himself to be a spineless bureaucrat and obsequious political creature masquerading as a cop, and not just because rumors continue to circulate that the Obama administration – supposedly in the interests of staving off market panic – made a conscious decision sometime in early 2009 to give all of Wall Street a pass on pre-crisis offenses.

No, the real reason this wasn’t surprising is that Holder’s decision followed a general pattern that has been coming into focus for years in American law enforcement. Our prosecutors and regulators have basically admitted now that they only go after the most obvious and easily prosecutable cases.

If the offense committed doesn’t fit the exact description in the relevant section of the criminal code, they pass. The only white-collar cases they will bring are absolute slam-dunk situations where some arrogant rogue commits a blatant crime for individual profit in a manner thoroughly familiar to even the non-expert portion of the jury pool/citizenry.

goldman sachs stealing?!?!?!

Market-Ticker | Something really ugly popped up on Daily Kos yesterday late in the afternoon.....

...GS, through access to the system as a result of their special gov't perks, was/is able to read the data on trades before it's committed, and place their own buys or sells accordingly in that brief moment, thus allowing them to essentially steal buttloads of money every day from the rest of the punters world.

Two things come out of this:

1. If true, this should be highly illegal, and would, in any sane country result in something like what happened to Arthur Andersen...

(2. ... is way off point....)

God help Goldman if this is true and the government goes after them. This would constitute massive unlawful activity. Indeed, the allegation is that Goldman alone was given this access!

God help our capital markets if this is true and is ignored by our government and regulatory agencies, or generates nothing more than a "handslap." Nobody in their right mind would ever trade on our markets again if this occurred and does not result in severe criminal and civil penalties.

This is precisely the sort of thing that a Unix machine, sitting on a network cable where it can "see" traffic potentially not intended for it, could have an interface put into what is called "promiscuous mode" and SILENTLY sniff that traffic!

ASSUMING THE TRAFFIC IS PASSING BY THE MACHINE ON THE WIRE THIS IS TRIVIALLY EASY FOR ANY NETWORK PROGRAMMER OF REASONABLE SKILL TO DO. IF THAT TRAFFIC IS EITHER UNENCRYPTED OR IT IS EASY TO BREAK THE ENCRYPTION.....

Folks, I have no way to know what the code in question does, but if there's anything to this - anything at all - there is a major, as in biggest scam of the century - scandal here - something much, much bigger than Madoff or Stanford.

What would this mean, if it was all to prove up?

It would mean that Goldman was able to "see" transaction order flow - bid, offer, and execute messages - before they were committed in the transaction stream. Such a "SNIFF" would be COMPLETELY UNDETECTABLE by the sender or recipient of the message.

The implication of this would be that they would be able to front-run any transaction where the data was visible to them, thereby effectively "stealing pennies" from each transaction they were able to front-run.

Again: I have absolutely nothing on the content of the allegedly-stolen code nor can I validate the claim made that Goldman had "special network access." Nothing. All I have to go on with regards to "market manipulation" (which such a program would be, writ large!) is the statement of the US Attorney that I cited in my earlier Ticker.

Lehman and the Collapse of the Shadow Banking System

It is now clear that we are again – as we were in mid- March at the time of the Bear Stearns collapse – an epsilon away from a generalized run on most of the shadow banking system, especially the other major independent broker dealers (Lehman, Merrill Lynch, Morgan Stanley, Goldman Sachs). If Lehman does not find a buyer over the weekend and the counterparties of Lehman withdraw their credit lines on Monday (as they all will in the absence of a deal) you will have not only a collapse of Lehman but also the beginning of a run on the other independent broker dealers (Merrill Lynch first but also in sequence Goldman Sachs and Morgan Stanley and possibly even those broker dealers that are part of a larger commercial bank, I.e. JP Morgan and Citigroup). Then this run would lead to a massive systemic meltdown of the financial system. That is the reason why the Fed has convened in emergency meetings the heads of all major Wall Street firms on Friday and again today to convince them not to pull the plug on Lehman and maintain their exposure to this distressed broker dealer.

Nouriel Roubini - let me elaborate in much detail on these issues…

eight families to rule them all - is this true?

GlobalResearch | The Four Horsemen of Banking (Bank of America, JP Morgan Chase, Citigroup and Wells Fargo) own the Four Horsemen of Oil (Exxon Mobil, Royal Dutch/Shell, BP and Chevron Texaco); in tandem with Deutsche Bank, BNP, Barclays and other European old money behemoths. But their monopoly over the global economy does not end at the edge of the oil patch.

According to company 10K filings to the SEC, the Four Horsemen of Banking are among the top ten stock holders of virtually every Fortune 5http://www.blogger.com/img/blank.gif00 corporation.[1]

So who then are the stockholders in these money center banks?

This information is guarded much more closely. My queries to bank regulatory agencies regarding stock ownership in the top 25 US bank holding companies were given Freedom of Information Act status, before being denied on “national security” grounds. This is rather ironic, since many of the bank’s stockholders reside in Europe.

One important repository for the wealth of the global oligarchy that owns these bank holding companies is US Trust Corporation - founded in 1853 and now owned by Bank of America. A recent US Trust Corporate Director and Honorary Trustee was Walter Rothschild. Other directors included Daniel Davison of JP Morgan Chase, Richard Tucker of Exxon Mobil, Daniel Roberts of Citigroup and Marshall Schwartz of Morgan Stanley. [2]

J. W. McCallister, an oil industry insider with House of Saud connections, wrote in The Grim Reaper that information he acquired from Saudi bankers cited 80% ownership of the New York Federal Reserve Bank- by far the most powerful Fed branch- by just eight families, four of which reside in the US. They are the Goldman Sachs, Rockefellers, Lehmans and Kuhn Loebs of New York; the Rothschilds of Paris and London; the Warburgs of Hamburg; the Lazards of Paris; and the Israel Moses Seifs of Rome.

CPA Thomas D. Schauf corroborates McCallister’s claims, adding that ten banks control all twelve Federal Reserve Bank branches. He names N.M. Rothschild of London, Rothschild Bank of Berlin, Warburg Bank of Hamburg, Warburg Bank of Amsterdam, Lehman Brothers of New York, Lazard Brothers of Paris, Kuhn Loeb Bank of New York, Israel Moses Seif Bank of Italy, Goldman Sachs of New York and JP Morgan Chase Bank of New York. Schauf lists William Rockefeller, Paul Warburg, Jacob Schiff and James Stillman as individuals who own large shares of the Fed. [3] The Schiffs are insiders at Kuhn Loeb. The Stillmans are Citigroup insiders, who married into the Rockefeller clan at the turn of the century.

Eustace Mullins came to the same conclusions in his book The Secrets of the Federal Reserve, in which he displays charts connecting the Fed and its member banks to the families of Rothschild, Warburg, Rockefeller and the others. [4]

The control that these banking families exert over the global economy cannot be overstated and is quite intentionally shrouded in secrecy. Their corporate media arm is quick to discredit any information exposing this private central banking cartel as “conspiracy theory”. Yet the facts remain.

Granny's such an outrageous liar, you expect her pantsuit to catch on fire...,

thefederalist |  During the Democratic town hall that aired on CNN Wednesday night, Hillary Clinton completely fell apart onstage when Anderson Cooper asked her about $675,000 she received for delivering three speeches at Goldman Sachs.

Throughout the campaign, her opponent Bernie Sanders has criticized Clinton’s ability to deliver on her promises to crack down on Wall Street after taking more than $600,000 in speaking fees from Goldman Sachs in a year.

“Was that a mistake? Was that a bad error in judgement?” Anderson asked.

“Well, I dunno,” Clinton said. “That’s what they offered. Every secretary of State that I know has done that.”

Clinton’s remarks during the televised town hall may have given off the impression that she wasn’t very involved when negotiating speaking deals, but the truth is, she is actually a heavy-handed negotiator.

The Washington Post reported that when Clinton agreed to deliver a speech at the University of California Los Angeles in 2014, she charged the publicly-funded school $300,000. When school administrators asked for a discounted rate, Clinton’s handlers informed UCLA that $300,000 was the special, discounted rate for public universities.

to serve man...,

Reuters | Stephen Friedman, chairman of the New York Federal Reserve Bank's board of directors, resigned on Thursday amid questions about his purchases of stock in his former firm, Goldman Sachs (GS.N).

Friedman, a retired chairman of Goldman Sachs who has led the New York Fed's board since January 2008, said he quit to prevent criticism about his stock buying from becoming a distraction as the Fed battles a severe U.S. recession.

"Although I have been in compliance with the rules, my public service motivated continuation on the Reserve Bank Board is being mischaracterized as improper," he said in a letter of resignation to New York Fed President William Dudley.

"The Federal Reserve System has important work to do and does not need this distraction," Friedman said.

The U.S. central bank is comprised of a seven-member Board of Governors in Washington, and 12 regional Fed banks.

They Won't Cure You

arstechnica |  One-shot cures for diseases are not great for business—more specifically, they’re bad for longterm profits—Goldman Sachs analysts noted in an April 10 report for biotech clients, first reported by CNBC.

The investment banks’ report, titled “The Genome Revolution,” asks clients the touchy question: “Is curing patients a sustainable business model?” The answer may be “no,” according to follow-up information provided.

Analyst Salveen Richter and colleagues laid it out:

The potential to deliver “one shot cures” is one of the most attractive aspects of gene therapy, genetically engineered cell therapy, and gene editing. However, such treatments offer a very different outlook with regard to recurring revenue versus chronic therapies... While this proposition carries tremendous value for patients and society, it could represent a challenge for genome medicine developers looking for sustained cash flow.

For a real-world example, they pointed to Gilead Sciences, which markets treatments for hepatitis C that have cure rates exceeding 90 percent. In 2015, the company’s hepatitis C treatment sales peaked at $12.5 billion. But as more people were cured and there were fewer infected individuals to spread the disease, sales began to languish. Goldman Sachs analysts estimate that the treatments will bring in less than $4 billion this year.

“[Gilead]’s rapid rise and fall of its hepatitis C franchise highlights one of the dynamics of an effective drug that permanently cures a disease, resulting in a gradual exhaustion of the prevalent pool of patients,” the analysts wrote. The report noted that diseases such as common cancers—where the “incident pool remains stable”—are less risky for business.

To get around the sustainability issue overall, the report suggests that biotech companies focus on diseases or conditions that seem to be becoming more common and/or are already high-incidence. It also suggests that companies be innovative and constantly expanding their portfolio of treatments. This can “offset the declining revenue trajectory of prior assets." Lastly, it hints that, as such cures come to fruition, they could open up more investment opportunities in treatments for “disease of aging.”  Fist tap Dale

sec trys to ban goldman-sachs preferred mode of stealing

Reuters | U.S. securities regulators proposed on Thursday a ban on flash orders that stock exchanges send to a select group of traders, fractions of a second before revealing them publicly.

The Securities and Exchange Commission is seeking to end the practice criticized for giving an unfair advantage to some market participants who have lightning-fast computer trading software.

Nasdaq OMX's (NDAQ.O) Nasdaq Stock Market and privately-held BATS Exchange recently canceled their flash services that disclosed buy and sell orders to specific trading firms before sending them to the wider market.

NYSE Euronext's (NYX.N) New York Stock Exchange did not adopt the flashes under scrutiny but major alternative venue Direct Edge still offers flashes.

The SEC will put its proposal out for public comment for 60 days, and will later schedule a meeting to decide whether to adopt the proposal.

The agency said it will seek feedback on on the cost and benefits of the proposed ban, and whether the use of flash orders in options markets should be evaluated differently from those in equity markets.

Don't you wish you were Goldman-Sachs and could just get away with naked hacking and pillaging? But wait, instead of having all your crew get snatched off of Wall Street for a 6:00PM televised perp walk, all that happens to you is that the SEC simply attempts to ban one of your core criminal enterprises after you've clocked $100 Million/Day profits for months, and months, and months?