How Paulson Gave Hedge Funds Advance Word of Fannie Rescue

Bloomberg article: http://news.businessweek.com/article.asp?documentKey=1376-LVDZC507SXKX01-53FDT6STR4PRVU9B7CRTDL62J0

November 29, 2011 5:46 PM

Treasury Secretary Henry Paulson stepped off the elevator into the Third Avenue offices of hedge fund Eton Park Capital Management LP in Manhattan. It was July 21, 2008, and market fears were mounting. Four months earlier, Bear Stearns Cos. had sold itself for just $10 a share to JPMorgan Chase & Co.

Now, amid tumbling home prices and near-record foreclosures, attention was focused on a new source of contagion: Fannie Mae and Freddie Mac, which together had more than $5 trillion in mortgage-backed securities and other debt outstanding, Bloomberg Markets reports in its January issue.

Paulson had been pushing a plan in Congress to open lines of credit to the two struggling firms and to grant authority for the Treasury Department to buy equity in them. Yet he had told reporters on July 13 that the firms must remain shareholder owned and had testified at a Senate hearing two days later that giving the government new power to intervene made actual intervention improbable.

“If you have a bazooka, and people know you have it, you're not likely to take it out,” he said.

On the morning of July 21, before the Eton Park meeting, Paulson had spoken to New York Times reporters and editors, according to his Treasury Department schedule. A Times article the next day said the Federal Reserve and the Office of the Comptroller of the Currency were inspecting Fannie and Freddie's books and cited Paulson as saying he expected their examination would give a signal of confidence to the markets.

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From Zero Hedge: http://www.zerohedge.com/news/hank-paulson-tipped-goldman-led-plunge-protection-team-about-fannie-bankruptcy-7-weeks-advance

Today, BusinessWeek's Michael Serrill and Jonathan Neumann have released a blockbuster report based on a FOIA response by the Treasury, which proves that in America rules are only for little people, that this country has been a banana republic for years, that Animal Farm was spot on, and gives excruciating detail of how Hank Paulson tipped off a select group of Goldman diaspora hedge fund managers about the eventual failure of Fannie and Freddie 7 weeks ahead of this information becoming public knowledge.

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... Goldman Sachs

Goldman Sachs Has Taken Over, Bankers Have Seized Europe

The European Union, just like everything else, is merely another scheme to concentrate wealth in a few hands at the expense of European citizens, who are destined, like Americans, to be the serfs of the 21st century.

Analysis from mutlpie sources, which can be boiled down to the tax payer is continuing to be screwed, now in astronomical proportions. Also, the banks continue to make a profit.

From Washington's Blog: http://www.washingtonsblog.com/2011/10/the-federal-reserve-and-bank-of-america-initiate-a-coup-to-dump-hundreds-of-billions-of-dollars-of-losses-on-the-american-taxpayer.html

The Federal Reserve and Bank of America Initiate a Coup to Dump Billions of Dollars of Losses on the American Taxpayer

Bloomberg reports that Bank of America is dumping derivatives onto a subsidiary which is insured by the government – i.e. taxpayers.

Yves Smith notes:

If you have any doubt that Bank of America is going down, this development should settle it …. Both [professor of economics and law, and former head S&L prosecutor] Bill Black (who I interviewed just now) and I see this as a desperate move by Bank of America’s management, a de facto admission that they know the bank is in serious trouble.

http://www.bloomberg.com/news/2011-10-18/bofa-said-to-split-regulators-over-moving-merrill-derivatives-to-bank-unit.html

BofA Said to Split Regulators Over Moving Merrill Derivatives to Bank Unit

By Bob Ivry, Hugh Son and Christine Harper Oct 18, 2011 10:56 AM PT

Bank of America, which got a $45 billion bailout during the financial crisis, had $1.04 trillion in deposits as of midyear, ranking it second among U.S. firms. Photographer: Scott Eells/Bloomberg

Bank of America Corp. (BAC, hit by a credit downgrade last month, has moved derivatives from its Merrill Lynch unit to a subsidiary flush with insured deposits, according to people with direct knowledge of the situation.

The Federal Reserve and Federal Deposit Insurance Corp. disagree over the transfers, which are being requested by counterparties, said the people, who asked to remain anonymous because they weren’t authorized to speak publicly. The Fed has signaled that it favors moving the derivatives to give relief to the bank holding company, while the FDIC, which would have to pay off depositors in the event of a bank failure, is objecting, said the people. The bank doesn’t believe regulatory approval is needed, said people with knowledge of its position.

From Truthout http://www.truth-out.org/77-trillion-wall-street-anything-keep-banksters-happy/1322841741

... Technocrats aren't interested in democracy - it takes too long, and often the interests of the majority of voters don't quite line up with the interests of the minority of bankers and foreign investors. Or - to put it in today's terms - the interests of the 99 percent rarely line up with the interests of the 1 percent. That's why - back in 2008 - the technocrats at the Fed weren't interested in waiting for Congress - with all of its open debate and constituent services - to bail out the banks - they just went ahead and did it themselves. According to documents obtained by Bloomberg News - in 2009 - the Fed dished out $7.7 trillion in no-strings-attached, super-low interest loans to Wall Street's biggest players.

That's $7.7 trillion!

That's more than half of the total value of EVERYTHING - every single thing produced in America - that same year. $7.7 TRILLION out the door - with no one bothering to inform the electorate about it until now.

Read the full article here: http://occupyeverywhere.ca/2011/11/19/why-iceland-should-be-in-the-news-but-is-not/

By Deena Stryker

An Italian radio program’s story about Iceland’s on-going revolution is a stunning example of how little our media tells us about the rest of the world. Americans may remember that at the start of the 2008 financial crisis, Iceland literally went bankrupt. The reasons were mentioned only in passing, and since then, this little-known member of the European Union fell back into oblivion.

[See also Lesley Riddoch on the High North here - or Mike Small on Scotland in Europe here]

* Both editor and author are aware of mistakes n this piece which are due to mistranslation from Italian – apologies

As one European country after another fails or risks failing, imperiling the Euro, with repercussions for the entire world, the last thing the powers that be want is for Iceland to become an example. Here’s why:

Five years of a pure neo-liberal regime had made Iceland, (population 320 thousand, no army), one of the richest countries in the world. In 2003 all the country’s banks were privatized, and in an effort to attract foreign investors, they offered on-line banking whose minimal costs allowed them to offer relatively high rates of return. The accounts, called IceSave, attracted many English and Dutch small investors. But as investments grew, so did the banks’ foreign debt. In 2003 Iceland’s debt was equal to 200 times its GNP, but in 2007, it was 900 percent. The 2008 world financial crisis was the coup de grace. The three main Icelandic banks, Landbanki, Kapthing and Glitnir, went belly up and were nationalized, while the Kroner lost 85% of its value with respect to the Euro. At the end of the year Iceland declared bankruptcy.

Contrary to what could be expected, the crisis resulted in Icelanders recovering their sovereign rights, through a process of direct participatory democracy that eventually led to a new Constitution. But only after much pain.

Brave New Foundation wants to know.

http://whoarethe1percent.com/

Who’s using their wealth to exploit the 99%? You tell us. Start voting by rating any of the nominees below on a scale of “ho-hum” to “pure evil.” Then you’ll be taken through the list of nominees, person by person, to rate each one. Our job will be to make a series of videos exposing the ones you rate as the worst. So go ahead. Take your democracy back.

New Scientist Magazine article on a recent study:

Revealed – the capitalist network that runs the world

Excerpt:

The idea that a few bankers control a large chunk of the global economy might not seem like news to New York's Occupy Wall Street movement and protesters elsewhere (see photo). But the study, by a trio of complex systems theorists at the Swiss Federal Institute of Technology in Zurich, is the first to go beyond ideology to empirically identify such a network of power. It combines the mathematics long used to model natural systems with comprehensive corporate data to map ownership among the world's transnational corporations (TNCs).

The 1318 transnational corporations that form the core of the economy. Superconnected companies are red, very connected companies are yellow. The size of the dot represents revenue

The site is brand new and under development. Content suggestions are welcome and encouraged! Please reply to this post or email editor@guillotinerevival.com. Thank you!

Original Article: Charts: Here's What The Wall Street Protesters Are So Angry About...

41 Charts on economic inequality.

Original Article: http://www.adbusters.org/blogs/adbusters-blog/occupywallstreet.html

#OCCUPYWALLSTREET A shift in revolutionary tactics.

Alright you 90,000 redeemers, rebels and radicals out there, a worldwide shift in revolutionary tactics is underway right now that bodes well for the future. The spirit of this fresh tactic, a fusion of Tahrir with the acampadas of Spain, is captured in this quote:

"The antiglobalization movement was the first step on the road. Back then our model was to attack the system like a pack of wolves. There was an alpha male, a wolf who led the pack, and those who followed behind. Now the model has evolved. Today we are one big swarm of people."

— Raimundo Viejo, Pompeu Fabra University
Barcelona, Spain