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August 30th, 2014

8/30/2014

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As the article stated yesterday---costs for PIP are not going up----there is simply more fraud and corruption lifting the costs as with Medicare and Medicaid.  We are reforming Medicare and Medicaid because the health industry fraud sucked the Trusts dry.  That is what is happening with PIP.  The insurance and health industries are inflation costs by fraud with soaring profits and then claiming PIP needs to be dismantled because it is too costly.....same as Medicare.  So, rather than having the costs of your health care covered with this auto insurance that is required by law---you are now going to be pushed into Medicaid which now mostly covers only preventative health care.  This eliminates yet another outlet for health coverage for the working and middle-class while insurance and health industry profits soar.

Notice the Maryland Assembly is about to end PIP and push Maryland citizens into the most private and profit-driven health system in the nation---Medicaid and preventative care.
  The No Fault auto premiums are no small payment---as many times as people use it the total premium amounts paid often covered costs.

Think that at the same time, your rates go higher and higher for simply being in an accident no matter it wasn't your fault.  That is what deregulating the insurance industry looks like.  It gives them the ability to charge anything they want as laws are on the books requiring you to have some kind of insurance.  Deregulating while making insurance mandatory----watch that disposable income disappear with rate hikes.

Tort-based auto insurance means the ambulance-personal injury lawyers that you see on TV will be the only recourse for paying medical bills and we all know these lawyers pocket most of the money won in the lawsuit with the plaintiff often receiving pennies on the dollar.  So, this will cost health care more and that money will go to lawyers and it will come from taxpayer Medicaid.
So, now the insurance, the health care, and lawyers are getting a cut money that always went to actual care for the patient who will be bankrupt and/or left with little access to care.

THESE ARE NEO-LIBERAL AND NEO-CON POLICIES MOVING ALL MONEY TO CORPORATE PROFIT ON THE BACKS OF THE AMERICAN PEOPLE.


All Maryland pols are neo-liberal and neo-cons doing all of the above.

'Rates did go down initially'---before the fraud and corruption sent them soaring.

PIP and No-Fault Auto Insurance Reform


More and more states are abandoning the PIP/No-Fault form of auto insurance in favor of a tort-based set of laws. PIP/No Fault originated in the 1930s as an alternative to the often slow and expensive process of litigating claims. The intent was to speed up the process by shifting the dispute resolution from the courts to the insurance companies. In theory, this was supposed to reduce insurance rates—and rates did go down initially.

By the mid-70s, almost 20 states had some form of no-fault insurance laws. However, over time, rates again rose until "No-Fault" states had higher rates than tort-based states. Beginning in 1980, states started repealing their no-fault laws, and now only nine states (Florida, Hawaii, Kansas, Massachusetts, Missouri, Minnesota, New York, North Dakota and Utah) have mandatory no-fault laws. Eleven states plus the District of Columbia have hybrid laws (Arkansas, Delaware, Kentucky, Maryland, New Jersey, Oregon, South Carolina, South Dakota, Texas and Virginia), which are a combination of no-fault and tort systems.

The pendulum seems to be swinging back to tort-based auto insurance. What does this mean for you as a policyholder?

The Good News

Tort-based systems, in theory, give you more choices for medical payments and could save you substantial amounts of money. As an example, depending on the insurance company and coverages selected, those with Colorado car insurance (the most recent state to revert to a tort-based system) could see savings of 10 percent to 30 percent, according to several recent Denver Post articles.

The Choices

PIP, or Personal Injury Protection, is still available (in most cases), should you wish (or need) to pay for it. If you choose to drop this coverage, or if you are already under a tort-based system and don't have this coverage, you can still purchase it with most policies to cover medical expenses. However, coverage will be limited, with a general ceiling of $50,000. This additional coverage, if purchased, will pay expenses incurred by you and your immediate family for injuries resulting from an at-fault auto accident.

Since many drivers are uninsured or underinsured, it is essential that you understand the ramifications of this and make an informed decision about the "Uninsured/Underinsured Motorists" coverage option.

What if?

What happens if you are at fault? Your auto policy should pay the other person's claims. Companies normally negotiate this with each other. If you have insufficient coverage, you may have to go to court—thus displaying the tort aspect of the law. Either you or your health insurance company will pay medical expenses for you and your family once those expenses exceed your auto policy coverages.

What if you are injured by another driver who is at fault? Generally, the two auto insurance companies will work together to determine fault and pay benefits accordingly. This resolves the problem in most cases. If not, or if the amounts paid are insufficient, it may be necessary to resort back to the court system to recover damages.

What if the other driver is at-fault and has no (or inadequate) insurance? Your insurance company normally covers your medical expenses. This protection is provided under the uninsured/underinsured motorist coverage. If you do not have this coverage, your health insurance usually pays the bills, or you can sue the other party.

Consider the "Deductible Gap"

Generally, under a tort system, medical payments from your own policy are limited. However, in most cases you can choose "additional medical payments" and "Uninsured/Underinsured Motorists" coverage as part of your auto insurance policy.

After years of rising rates, many people may choose to forgo any additional coverages. Adding these coverages creates financial strain if you have high-deductible health insurance, or no health insurance at all. However, there is a potentially huge gap between the amount paid under a tort-based policy and your health insurance deductible. If you have no insurance, the out-of-pocket costs could be staggering. If you are not at fault in the accident, the tort-based system allows you to go to court to receive compensation for these costs, as well as for pain and suffering. But you must do so within a specified time period, and a lot of out-of-pocket expenses may be involved.

What does this mean for health insurance?

As more costs are shifted to the health insurance system, your insurance costs are likely to rise. This also means more people will be without health insurance.

So, what is next?

This is a good time to look at your health insurance to make sure you will have adequate coverage if you drop your PIP/No-Fault coverage. Don't wait until you're in an unpleasant situation to find out if you need more insurance. Be prepared!

_______________________________________________

This is when PIP was working in the interest of citizens and government coffers.  Insurance corporations were earning profits in the millions while the Uninsured auto insurance pool was bursting at the seams with revenue. 

NOW, HOW CAN WE DIVERT THE MONEY PAID INTO THIS FUND FOR HEALTH CARE INTO PROJECTS THAT BENEFIT DEVELOPMENT CORPORATIONS.

This is when a good program was targeted for fraud and corruption just as with the other Federal programs Medicare and Federal Housing Authority.  Working well for citizens, leaving government coffers flush to handle future events, allowing millions in profits to be earned---BUT THAT WAS NOT ENOUGH.  You see the article below was written in 1993----HERE COMES NEO-LIBERAL CLINTON TO DEREGULATE ALL THAT HE CAN SEE......this is the deregulation that sent all of this surplus in the Maryland Automobile Insurance Fund to development corporations like Johns Hopkins in Baltimore.  There's Donald Schaefer funneling money from Transporation Trusts and now MAIF to balance the budget with the public's designated money.  Baltimore Development paraded all kinds of working class and poor out to praise Schaefer who was behind creating Baltimore Development Corporations to funnel all the city's revenue from where it was to go----to where they wanted to send it.

You see the insurance corporations were able to move more and more people into MAIF clearing its rolls of all but the best of drivers.  It went from helping low-income people to subsidizing the costs of these auto insurance corporations.  It was gutted of its funds for
pet projects.  I know Ravens fans love their stadium----but most of the fans are the ones no longer affording auto insurance because of the subsidy.  Note that the Uninsured Motorist insurance had high premiums and should have paid all health care costs when needed.

Remember, this was done through fraud and corruption because this money was not to be fungible.  It needs to come back to this government coffer.



I KNOW---LET'S SEND THIS PIP MONEY TO BUILD THE NEW FOOTBALL FIELD.----M AND T STADIUM AND BALANCE THE BUDGET WITH IT.


MAIF's embarrassment of riches

March 04, 1993|
By Frank A. DeFilippo  Baltimore Sun

THE Maryland Automobile Insurance Fund has a big-time problem. It's rich. So rich, in fact, that other state agencies are itching to get their hot little hands on MAIF's $118 million surplus.

MAIF's been approached about financing a new football stadium in Baltimore. Sen. George W. Della Jr. of Baltimore has sponsored a bill that would shift $50 million of MAIF's money to the general fund. And the Schaefer administration is pilfering $5.4 million from MAIF to help balance the budget.

MAIF is Maryland's state-run insurer of last resort. Any Maryland motorist who's turned down by at least two commercial insurers is automatically MAIFed.

MAIF's rates aren't cheap.
Depending on how bad a motorist's record is, the driver's age and ZIP code, bare-bones coverage can range from $2,559 to a stick-it-to-'em high of $8,677 a year.

That MAIF should be suffering such an embarrassment of riches during a time of budget cuts and deficits is an embarrassment itself. MAIF's $118 million surplus is larger than the $100 million budget shortfall that's being plugged with keno proceeds and other money.

In theory, at least, MAIF is supposed to be non-profit. It was created in 1973 as an antidote to the no-fault insurance craze at the time, kind of an everybody's-fault approach. It's run by a board of trustees and receives no state funds, nor are its assets part of the state treasury. To settle claims, MAIF has the power to attach salaries and seize property.

Over the years, the commercial insurance companies in Maryland have pumped $137 million into MAIF. In effect, good drivers subsidize the insurance of bad drivers. In 1980, MAIF had 30,000 policies. Today it has 135,000.

Much of MAIF's excess is due to changes in the way it does business as well as some shrewd investments. At the same time MAIF has reduced rates over the past three years, it's also lowered awards. MAIF is also now doing all of its work in-house instead of farming it out to free-lance adjusters and collectors.

So it should come as no surprise that the Schaefer administration's pie-slicers approached MAIF about lending the Maryland Stadium Authority $100 million to help finance a new football stadium if Baltimore wins one of two NFL expansion franchises.

There are serious legal questions about whether the Stadium Authority has a funding mechanism for another stadium if the city is awarded a team. Because of a change in the tax code, the use of tax-free bonds to finance stadiums expired at the end of 1990.


The authority argues, though, that it's confident that it can float tax-free bonds because there have been a number of test cases around the country that might allow it.

Moreover, the authority has a bonding limit of $220 million, of which it has already used $170 million to build the new baseball stadium. The authority will pocket another $30 million over three years from lottery proceeds -- on top of the $50 million in bond money left over from the ballyard -- a total of $74 million. But a new topless football stadium will cost about $130 million. Put a lid on it, and it'll cost millions more.

So here's the catch: If the authority can't float tax-free bonds, it will have to go to market with bonds at a much higher interest rate. But before it can go to market with bonds, the authority will need the General Assembly's approval to increase its bonding capacity. This could hoist the total bond package over the spending affordability limit. Allowing this is action the legislature is reluctant to take.

It's for this reason that Gov. William Donald Schaefer is bypassing the spending affordability limit and proposing the use of transportation bonds to finance improvements to Baltimore's Convention Center. Now he's trying to scoot around the spending limit again just in case there's a football team in the city's future.

So drive carefully. Get MAIFed, and the premiums you pay could wind up helping to finance some government geegaw.

Frank A. DeFilippo writes every other Thursday on Maryland politics.

_______________________________________

Here we are just a handful of years later and what the first article stated was in fact true in Maryland----it was the hybrid model Maryland adopted that sent auto insurance money to lawyers and doctors.

Now, they are working to end hybrid and make it all tort. 
People not being able to afford strong health coverage will be preyed upon -----80% of the American people.

Again, another public program that worked fine for the people gutted and dismantled by neo-liberals and neo-cons.  Profit over people every time

Again, we are at the height of Reagan/Clinton's deregulation frenzy.
I wonder if those voters wanting small government wanted to be pushed out of driving because they can no longer afford car insurance? 

Your Public Trusts are being gutted by small government and deregulation.


Why car insurance is so high Law suits: System encourages excessive litigation, raises premiums $130 to $150 a year

.
December 23, 1996  Baltimore Sun

WANT TO LOWER your car-insurance premiums? It could happen -- if legislators in Annapolis stop catering to powerful special interests. More than 60 percent of your premium covers liability. Of that amount, 19 percent could be saved if excessive litigation and fraudulent claims were eliminated.Sadly, state legislators yawned at the problem when a gubernatorial commission sought reforms this year. Too many of them want to please trial lawyers and doctors who vigorously fight for the status quo. These special interests know that lower insurance premiums would come out of their pockets.



_________________________________________



I have talked about AIG spinoff HighStar and its connection with the Ivy League schools like Johns Hopkins.  The subprime mortgage fraudulent loans were insured here with the idea that HighStar would break from AIG with the equity and leave taxpayers to pay 100% on the dollar for the fraudulent Credit Default Swaps.   This article does a good job doing this.  Geithner was the NY FED chief that watched as trillions of dollars of fraud ran through the mortgage industry and did nothing about it----he aided and abetted the massive fraud.  What many people may  not know AIG was more a Life Insurance agency with this HighStar hedge fund sucking all its profits into their bank accounts.  Indeed, the taxpayer bailout of AIG saved the shareholders and those insured by CDS-----but it left an AIG still in business and limping along saying it is healthy when indeed it is not.  AIG Life Insurance advertises on Free TV---you know , where you get life insurance with no checkup.  Like you get a house without having a job. 

SAME THING.  THIS IS THE SUBPRIMING OF LIFE INSURANCE.


They are simply selling as many policies as they can and gaining those monthly payments knowing the coming economic collapse will bankrupt them again.

You are guaranteed to get back what you put into this Life Insurance plan-----OH REALLY????  They will spin that Life Insurance money off as they did with HighStar----probably to HighStar just as the economy is ready to crash.  THEN WE WILL HEAR----WE CAN'T PAY YOUR PREMIUMS BACK!


They will keep doing this with every business sector until you and I get rid of the neo-liberals and neo-cons that have allowed this corporate system to be deregulated with no oversight and accountability.

AIG's Collapse: The Part Nobody Likes to Talk About


Hester Peirce JUN 16, 2014 12:00pm ET

  Earlier this month, American International Group announced the departure of Robert Benmosche, the CEO who led the company through most of its recovery from the financial crisis. Now that the company’s postcrisis chapter is underway, it is worth taking a fresh look at AIG’s downfall and rescue and the implications for reform.

The standard AIG story lays all the blame for the company’s problems on AIG Financial Products—an allegedly unregulated, irresponsible, derivatives dealer hiding within an otherwise solid insurance company.

Former Treasury Secretary Timothy Geithner repeats this traditional line in his recent book, where he recounts how an aggressive “hedge fund-like subsidiary called AIG Financial Products” brought the otherwise healthy insurance company to its knees and ultimately drove it into the Fed’s welcoming arms. Former Federal Reserve chairman Ben Bernanke made a similar claim when he told Congress how angry he was about AIG’s Financial Products unit—“a hedge fund attached [to] a large and stable insurance company.” And former Commodity Futures Trading Commission Chairman Gary Gensler, with typical dramatic flair, explained that AIG’s “subsidiary, AIG Financial Products, operating out of London, brought down the company and nearly toppled the U.S. economy.”

This widely repeated narrative ignores or downplays a critical aspect of AIG’s downfall--the insurer’s securities lending program run for the benefit of its regulated life insurance subsidiaries.

An endnote in Geithner’s tome explains that securities lending was one of “AIG’s major liquidity needs” at the time of its rescue. As I describe in a recent working paper, the company got itself into hot water by lending securities from its life insurance companies’ portfolios. AIG took the cash collateral it received for these short-term loans and—in a departure from insurance industry practice—invested much of it in longer term, illiquid residential mortgage-backed securities.

The securities lending program grew from about $10 billion at the end of 2001 to over $80 billion by the end of 2007. When borrowers stopped renewing the loans, returned their securities, and asking for their cash back, AIG was in a bind—the borrowers’ cash was tied up in reinvestments. 

To meet borrowers’ demands, AIG lent more securities and used the cash collateral from new borrowers to return to existing borrowers. This solution only aggravated the problem. When CEO Robert Willumstad took the reins of AIG in June 2008, the cash drain from securities lending worried him more than AIG Financial Products’ liquidity needs.

Losses from the securities lending program threatened the viability of a number of AIG’s regulated life insurance subsidiaries. To save them from falling below minimum capital requirements, AIG pumped billions of dollars into these units.

Government rescue money was critical to this recapitalization effort. Taxpayer funds were also critical in meeting securities borrowers’ demands for cash. Securities lending counterparties received $43.8 billion in the last quarter of 2008, comparable to $49.6 billion in collateral postings and payments to AIG’s derivatives counterparties.

As consequential as it was to AIG in a time of crisis, nobody likes to tell the securities lending part of the story. First, it doesn’t feed as nicely into the vilification of derivatives that laced crisis narratives and fueled calls for an intense derivatives regulatory regime. Second, the fact that heavily regulated insurance companies got into trouble does not support the call for greater reliance on government regulators. Finally, the rescue of a deeply troubled company is less defensible than the rescue of a healthy insurance company with a troubled derivatives subsidiary.

The Fed’s contention that its loan was adequately secured rested on the supposition that apart from the derivatives unit, AIG was sound. The banks that went in to AIG in September 2008 to assess whether it was worth rescuing concluded that it was not.

As one of the private bankers subsequently explained, “The value of the company in its entirety was not necessarily sufficient to cover the liquidity need that the company had.”


Geithner recounts in his book that—looking for confirmation that a loan to AIG would comply with the legal requirement that “the Fed can only lend against reasonably solid collateral”—he asked Warren Buffett “what he thought about the earning power of AIG’s traditional insurance subsidiaries.” Buffett “was pretty positive about their underlying value, which made [Geithner] more confident that [the Fed] could meet the legal test of being secured to [its] satisfaction.” Buffett’s words of assurance to Geithner weren’t matched by a willingness to put his own money on the line; he refused AIG’s overtures to invest during 2008.

AIG was on the verge of filing for bankruptcy when the Fed stepped in with a better deal for shareholders and creditors. The government subsequently re-rescued the company by devoting additional taxpayer funds to it and softening the lending terms.
 At any of these re-rescue points, the government could instead have let the company go through bankruptcy.

By continuing to prop up AIG, the government shielded the company from the toughest regulator of all—the markets. AIG’s problems were not confined to one unregulated corner; problems also arose in full view of insurance regulators. Rather than assuming the Fed will be better than AIG’s other regulators, we ought to allow the truly superior regulator—the market—to do its job.







_____________________________________________

I spoke yesterday about Life Insurance corporations being the most leveraged and ready to collapse of the insurance industry but guess what is the next in line of threatened insurance corporations-----

THAT'S RIGHT----WORKMAN'S COMP.

They have been allowed to create the same over-leveraged financial status that will have them bankrupt with this coming economic collapse.  No more worker's compensation----

THAT'S HOW YOU GET RID OF THE NEW DEAL SAY NEO-LIBERALS AND NEO-CONS!  BLOW THEM UP AS WE DID THE HOUSING MARKET WITH FRAUD AND CORRUPTION!


Coming after more public wealth and no public justice in place to protect or give us recourse....that is what neo-liberals and neo-cons have been building these few decades-----Clinton and Obama taking the people's party and handing it to Wall Street.  Run and vote for labor and justice in all Democratic Primaries!  WE CAN REVERSE THIS!


Rapidly writing new contracts for worker's comp that they could not afford----sound familiar?


IMPLODING ALL OF THE NEW DEAL PROGRAMS TO PROTECT THE AMERICAN PEOPLE DURING HARD TIMES.


After Tower Group collapse, lingering concerns about industry’s reserve adequacy

By Adam Cancryn and Saurabh Nair, SNL Financial Posted: May 6, 2014

...................................................

Most of the concern centers on long-tailed commercial lines, particularly workers’ compensation. Claims behavior takes longer to develop than in other sectors, making it more difficult to tell how much money should be set aside even years after a policy is written. Misjudging those reserving needs can be disastrous. SeaBright Holdings Inc. sold in 2013 after reserve charges pressured its operations, and Meadowbrook’s stock dropped nearly 35% from 2012 through 2013 amid several quarters of reserve charges. Tower Group served as the highest-profile example of reserving gone wrong, with its shares losing more than 80% in the six months before it hastily agreed to a sale.

Those companies ran into problems with business written during a softer market between 2007 and 2011, when they grew their books rapidly just as the rates being charged for coverage were at their most inadequate. When claim costs far outstripped the rates they originally charged, the insurers had to quickly build up their loss reserves. Analysts now consider the 2010 accident year one of the worst performers of the cycle, attributing the troubles to low prices and more expensive claims driven by high unemployment.

“The troubles they have now is on stuff they wrote years ago,” Keefe Bruyette & Woods analyst Robert Farnam told SNL.


The 10 workers’ comp insurers with the greatest adverse development in 2013 reported an aggregate $702.6 million in charges. SeaBright and Meadowbrook did not make that list. Tower Group was also absent, as it has not yet submitted all of its filings, but it said in February that its U.S.-taxed subsidiaries recorded $269.2 million of 2013 reserve charges.

Despite the issues, the sector continues to steadily release reserves.
Companies argue that Meadowbrook and Tower Group in particular are isolated situations, driven just as much by reckless growth as the broader industry conditions.
The rest of the industry, they contend, was more prudent in writing business during the soft market, leaving it with less risk and the ability to make up for a few unfavorable accident years with better results from other parts of their books of business. The insurers themselves are also working with much more detailed data than analysts and outside actuaries, they say, allowing them to most accurately evaluate their reserves.

“We look at it on a much more granular basis, and we think we have certainly better information,” W. R. Berkley Corp. Vice President of External Financial Communications Karen Horvath told SNL. Analysts have singled out W.R. Berkley’s reserving position as one of the more concerning in the industry, predicting that its quarterly releases would soon slow. But the company in the first quarter released about $25 million, extending a string of favorable reserve development that dates back to 2007.

Even so, skeptics are not quite willing to accept insurers’ assurances as fact. They worry that companies are already drawing down their reserves for the 2012 and 2013 accident years to supplement earnings or balance out problems in earlier years, without enough data to be sure about how those most recent years will ultimately perform.


“There is just no way a company would know or have the type of certainty under which they would be able to release reserves from some of the most recent business,” said Standard & Poor’s credit analyst Siddhartha Ghosh, who warned that the workers’ comp sector will eventually have to strengthen reserves significantly. “We don’t think that’s a prudent way of addressing reserves.”

He pointed to the previous market cycle, when workers’ comp companies released $12.4 billion of reserves between 1994 and 2000 and then had to scramble to add back $10.6 billion from 2001 to 2005 to make up for their overconfidence.

The sector’s fortunes over the next several years will depend heavily on whether insurers can keep raising prices, analysts said.
The workers’ comp business is still not reliably profitable despite recent pricing actions, and low interest rates continue to pressure investment income. If companies can continue to move their prices considerably and consistently higher over the next couple years, the new premium should be enough to cover costs. If the rate hikes falter and claims from recent policies start piling up, though, the reserving actions that insurers used to buoy earnings for so long could stick them with a deficit that will take years to fill.

“It’s a simple equation,” Ghosh said. “The premium coming in has to be higher than the losses going out.”


________________________________________________
This is a pretty good analysis of the coming bond market crash.  Notice it states that the insurance market will be taken out----Life Insurance the first to go.  See why you are seeing all those Life Insurance ads requiring no medical checkup or anything-----

THEY ARE SIMPLY GOING TO POCKET THOSE MONTHLY PREMIUMS.


This was written in 2013 acting as if the crash would come in 2014 but Bernanke allowed the QE bond bubble machine to continue another year and Yellen is now having to address it as the FED is leveraged out.  The crash will come soon......the FED is simply manipulating the inevitable.

'The most vulnerable are those who can least afford to suffer losses: Seniors who are approaching or in retirement, who have shifted large amounts of their money into fixed income investments.

Your tax-free municipal bonds could tank.

Your annuities and other insurance policies could turn to dust.

Your money invested in bank and insurance company stocks could vanish right before your very eyes'.


All of this is pretty important----yet, we do not hear a thing about it from media, labor or justice, our pols---and all of these national leaders know it is coming.  Their policies created this mess and labor and justice leaders are constantly backing neo-liberals.
  It is important to have Governors and Mayors that will work through this in the people's interest and not corporate interest.

This article is not
hyperbole---it will happen.
I did edit out his marketing ---

The Next Great Bubble about to Collapse

Martin D. Weiss, Ph.D. | Saturday, January 19, 2013 at 7:30 am

130 Senator Orrin Hatch warns that the bubble has the power to “destroy the retirement savings of millions of Americans.”

Famed economist Leonard E. Burman of Syracuse University is warning the U.S. Senate of “disastrous consequences for ourselves and the rest of the world.”

Goldman Sachs … Bank of America … Morgan Stanley … Royal Bank of Scotland … JPMorgan … and Oppenheimer Funds are all warning that it could bankrupt millions of investors.

Congressman Ron Paul says, simply, “this country will be ruined.”

These and many other authorities are talking about the greatest financial bubble in human history:

A bubble that is now more than EIGHT times larger than all the stock exchanges in the United States combined.

A bubble so massive, it is four times larger than the dot-com bubble of the 1990s and the housing bubble of the 2000s combined.

Now that bubble has begun to burst.

As it implodes, it will launch interest rates into the stratosphere … crush the feeble U.S. economy … destroy major U.S. banks and insurance companies … drive your cost of living through the roof, threaten your standard of living and financial security … and push the U.S. government to the very brink of financial collapse.

But the best defense is a strong offense -- and this crisis will also create windfall profit opportunities for a select group of investors who make the right moves now.

Just a few days ago, Weiss Research analyst Tom Essaye hosted a special online summit meeting to explain exactly how, and I’ll give you a transcript of the meeting in a moment.

In our online summit, he was joined by Safe Money editor Mike Larson and Real Wealth editor Larry Edelson. Here’s the transcript…

The Next Great Bubble about to Collapse
with Tom Essaye, Mike Larson and Larry Edelson — abridged transcript

Tom Essaye: If there’s anyone who knows how to capitalize on bursting bubbles, it’s our firm, Weiss Research.



For nearly a year now, I’ve been sounding the alarm again; NOT for the bursting of a bubble in the tech sector or housing sector … but in a market that is many times larger than all the stock exchanges in the United States COMBINED.


Debt is created in the bond market. That’s where the government goes to borrow money. So do states and local governments. Companies, too.

Borrowers sell bonds — or notes and bills — that guarantee investors a certain rate of interest or “yield” over time.

Since the turn of the century, the U.S. bond market has simply exploded in size — adding $20.7 trillion in new debt.


But now, despite massive new initiatives by the U.S. Federal Reserve, the meteoric rise in prices that characterized the debt market since the turn of the century has sputtered, stalled and is now dead in its tracks.

Millions of investors all over the world — including many of the world’s richest central banks — have started to stampede for the bond market’s exit.

And now, we’re beginning to see the first cracks appearing in this massive bubble.


This chart of the PIMCO Total Return Bond Fund is a perfect picture of the bubble in the bond market — and also the beginning of the crash.

On the left side of the chart, you can see the bubble in the bond market being inflated.

On the right-hand side, you can see how prices just plunged well below their support levels.

And just look at this chart of the iShares Municipal Bond ETF: It just fell off the proverbial cliff, giving back every penny it gained since last July!

But this crash has barely begun. The last few Treasury auctions showed that bidding from foreign central banks is plunging to the lowest level in years.

In addition, U.S. investors are starting to turn bearish on Treasuries. A recent report from a top industry watchdog showed that nearly 20% of all Treasury investors have started to cut back their holdings.

Even Fitch — the normally conservative ratings firm — is warning that a massive bubble has been created in the bond market.

This is huge. Bubbles are like an enormous Ponzi scheme: They collapse when the money stops flowing in.

The moment that happens, it’s over. And it’s beginning to happen right now!

As this bubble — the greatest bubble mankind has ever seen — implodes, the consequences will be devastating for millions of unprepared investors, just like the tech bubble was and just like the housing bubble was.


The most vulnerable are those who can least afford to suffer losses: Seniors who are approaching or in retirement, who have shifted large amounts of their money into fixed income investments.

Your tax-free municipal bonds could tank.

Your annuities and other insurance policies could turn to dust.

Your money invested in bank and insurance company stocks could vanish right before your very eyes.






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July 28th, 2014

7/28/2014

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THERE GOES ANOTHER PUBLIC ASSET-----PUBLIC PARKING.  RATHER THAN SERVE THE PUBLIC WITH AFFORDABLE PRICES BALTIMORE HANDS PARKING TO PREDATORY CORPORATIONS SO THEY CAN SOAK THE CITIZENS.



I was listening to people speak of how much money Johns Hopkins has and I ask myself-----does Hopkins really have that money or does most of it belong to the taxpayer and public?  The answer of course is that Hopkins is a publicly-owned entity with a small private college attached.  The reason Hopkins has the appearance of money is all of the fraud and corruption the last few decades that in the Baltimore and Maryland region moved to Baltimore Development and Johns Hopkins.  They are the local Visigoths who raided the US Treasury and US citizen's pockets.  Simply reinstating Rule of Law moves much of that money back.  Remember, the Ivy League schools and Wall Street did to the US what Gorbachev and Yelsin did to Russians-----PERESTROIKA moved all of the Russian people's wealth to connected families then called the Oligarchs.  All of those decades of hard work and investment by the Russian people was simply auctioned off and privatized.  This is what Wall Street and the Ivy League schools are doing in the US and it is why they have endowments in the billions of dollars with off-shore investments all over the world.  They are not universities----they are corporations that fleeced government coffers and people's pockets.  Baltimore City Hall has become so predatory on behalf of Johns Hopkins that they are sending out inflated water bills and passing laws to allow secure of people's homes simply because they owe a few hundred dollars in taxes and their cars for simply owing a few parking tickets.  Preying on the working class to take every last home owned is the goal.  These policies are now expanding to the middle-class who are struggling with this deliberate stagnation and high unemployment.

WHEN NEO-LIBERALS AND NEO-CONS ALLOW POLICY THAT HAS ALL PUBLIC REVENUE GO TO CORPORATE TAX BREAKS AND SUBSIDY AND ALLOW MASSIVE CORPORATE FRAUD AND CORRUPTION----THEY ARE TAKING YOU TO A THIRD WORLD STATUS.  THIS IS MARYLAND TODAY.

The latest move towards PERESTOIKA comes with Baltimore City Parking.  The city agency was handed to global corporations in a public private partnership a few decades ago and is now ranked as one of the agencies with the most fraud and corruption.  THE BALTIMORE PARKING AUTHORITY is simply a corporation that pays no taxes and allows the taxpayers to pay all operations and maintenance as with all public private partnerships. There is not one community in city center that is not metered or permitted so if you want to do business in these areas you have to park in one of these city lots which as privatized have become increasingly expensive.  Around the Inner Harbor and Enterprise Zone areas you can pay $25 to $40 a day to come and enjoy the waterfront.  When parking facilities are public-----the idea is to give people a convenient and affordable place to park that brings the city revenue to fill its coffers.  See the difference?


MAYOR RAWLINGS BLAKE PLANS TO SELL 4 PARKING DECKS IN DOWNTOWN FOR $40 MILLION SAY THE HEADLINES.

There is almost no publicly owned space in downtown Baltimore and these properties are in high value development zones so $40 million is a steal.  So, instead of that money coming into our government coffers it will now go to private global corporate profit and you can bet that $8-10 a day parking will soar.  Less affordable parking in downtown Baltimore.  At the same time the downtown area businesses are getting no consumer traffic and are struggling to stay in business----don't worry, City Hall will give more public money to keep you in business.  It couldn't be that no one wants to pay so much to come down town and the threats of parking employees standing at the wait to ticket you the minute that meter expires?

PEOPLE ARE NOT COMING DOWNTOWN BECAUSE THE ENTIRE ENVIRONMENT IS PREDATORY.

Oh, it's those roaming bands of youth they say.  NO, IT'S THE PREDATORY PUBLIC POLICY THAT FINES, FEES, AND TAXES THE PUBLIC TO DEATH BECAUSE ALL PUBLIC REVENUE IS BEING redirected to global corporations.



Mayor Rawlings-Blake Wants To Sell Garages For Revenue


July 27, 2014 8:04 AM BALTIMORE (AP) — Baltimore Mayor Stephanie Rawlings-Blake plans to announce a proposal to sell four city-owned parking garages to generate cash for urgent priorities and infrastructure.

The mayor’s office says Rawlings-Blake will announce her plans Monday to introduce new legislation to sell the parking garages to generate $40 million to $60 million. The proceeds would be used for urgent priorities, such as eliminating blight, without adding to the city’s debt.

Also on Monday, Rawlings-Blake and members of the City Council will help open the city’s first new recreation center built in 10 years. The Morrell Park Community Center features a gymnasium, fitness room and outdoor green space.

It’s the first recreation center to be built from the ground since a 2010 taskforce recommended a transformation of the city’s aging recreation centers.

(Copyright 2013 by The Associated Press. All Rights Reserved.)


___________________________________________


Now, for what will $40 million pay?  Well, it would take $40 million to partially pay for the $100 million in Exelon Corporation tax break that was given for no reason at all------a pay-to-play.  Then, there is the few hundred million each year of taxpayer money subsidizing the Hilton that was never needed and will never turn a profit especially since we are heading towards a bond market crash and recession for years.  So, Rawlings-Blake is handing public assets for dirt cheap to pay for bad policy and fraud and corruption.  It's revenue  neutral to empty government coffers with corporate tax breaks and subsidy while handing all that is public to these same entities.  Let's look at the history of the Baltimore Parking Authority:

Meet the Parking Authority------BOOTED FOR FAILING TO PAY 3 PARKING TICKETS----FORGET YOU ARE HAVING TO GO TO COURT TO CONTEST MANY OF THOSE TICKETS OR SIMPLY GETTING THEM TOO FAST TO PAY.


Neo-liberals will try hard to make it sound as if these partnerships are with a local or regional corporation but as you see below all of the ones tied to Baltimore Parking Authority are national and global corporations.  Why do we want our local economy tied with corporations that take the profits out of the city and state?  This is why our government coffers are starved and it is deliberate global market policy.  If a French corporation comes to the US ---then a US corporation goes to France----both undermining labor and justice.  Partnered with the city they pay no taxes.


LAZ Parking’s success was founded on childhood friendships that grew into a nationwide customer oriented parking service.

Republic Parking System is a privately owned professional parking management company based in Chattanooga, Tennessee.

The company operates over 690 parking facilities in 87 US cities.[1]


PMS
PMS - Parking Management Services SA Votre spécialiste dans la conception, réalisation et gestion de parkings !
  • Markets Served Atlanta • Charlotte • Chattanooga • Dallas/Fort Worth • Ft. Lauderdale/Hollywood • Houston Indianapolis • Jacksonville • Kansas City • Miami New Orleans • New York • Orlando/Walt Disney World • Richmond • Scottsdale • Tampa

Inside City Hall: Parking garage operators get no-bid extensions A range of management fees charged to the Parking Authority.

Mark Reutter June 29, 2012 at 4:12 pm

In a little-noticed item approved without comment on Wednesday, the Board of Estimates signed off on no-bid extensions of management contracts to run some of the city’s main parking garages.

The deal, requested by the Parking Authority for Baltimore City, obliges the quasi-public agency to pay $3.57 million in management fees to four operators, led by the ubiquitous PMS Parking group headed by Amsale Geletu, a certified woman-owned business.

PMS, Landmark Parking, LAZ Parking Mid-Atlantic and Republic Parking Systems were awarded the management contracts some 15 months ago.

The contracts were set to expire tomorrow (June 30), but the parking agency blew the deadline for writing up new agreements. Hence, the old contracts will stay in effect until December 31, 2013.

The Penn Station Garage boasts the highest management fee per space under a contract approved by the Board of Estimates. (Photo by Mark Reutter)

All this was explained in the unique nomenclature of the Board of Estimates agenda: “. . . efforts [to write the new agreements] have been delayed due to the Parking Authority experiencing significant disruption in the personnel charged with oversight and administration of this and other management agreements, and the procurement of new management agreements.”

As a result, “This amendment to the original agreement provides additional funding to pay for anticipated operating expenses and compensates the organization during the extended term upon the original compensation structure.”

Costs Vary Among Garages


The breakdowns of the individual parking contracts provide some interesting reading. Take the cost of security over the 18-month extension period.

Republic Parking will be paid $211,000 for providing security at the Lexington Market parking garage. (Photo by Mark Reutter)

It ranges from a low of $4,000 for the Fleet and Eden Garage in Fells Point to a high of $211,000 for the Market Center Garage serving Lexington Market.

The charges for maintenance also vary widely.

PMS will maintain and repair the 376-space Franklin Street Garage for $275,888 under the extended agreement.

Landmark, on the other hand, is authorized to bill the city 2½ times that amount ($670,000) for the somewhat larger (525 space) Penn Station Garage.

Even with its high security costs, Market Center is not the costliest municipal garage under private management.

That honor goes to the Penn Station Garage used chiefly by Amtrak and MARC customers. The management fee over the next 18 months amounts to $1,533 per parking space.

Quasi-Public

The Parking Authority is one of those quasi-public governmental entities – others include the Baltimore Development Corp. and Baltimore Hotel Corp., owner of Hilton Baltimore – whose stated mission is “to enhance Baltimore City’s position in planning, development, management and operations of its parking institution.”

Its budget is not part of the annual city budget approved by the City Council. Its five-member board consists of four people appointed by the mayor and one by the City Council president. The direct link to the mayor is through Director of Finance Harry E. Black, who sits on the board.

In addition to administering 17 municipal garages and 23 surface lots, the Parking Authority operates the residential parking permit program.
_______________________________

Here is a breakdown of the fees to be charged for the extended contracts:

Caroline St. Garage, 325 spaces, operator PMS, management fee: $350,027, or $1,077 per space.

Little Italy Garage, 399 spaces, operator PMS, management fee: $387,363, or $971 per space.

St. Paul Place Garage, 500 spaces, operator PMS and LAZ Parking Mid-Atlantic, management fee: $533,668, or $1,067 per space.

Franklin St. Garage, 376 spaces, operators PMS and LAZ Parking Mid-Atlantic, management fee: $331,888, or $883 per space.

Market Center Garage, 606 spaces, operator Republic Parking Systems, management fee: $651,791, or $1,076 per space.

Penn Station Garage, 525 spaces, operator Landmark Parking,  management fee: $804,933, or $1,533 per space.

Fleet and Eden Garage, 815 spaces, operator, Landmark Parking, management fee: $507,273, or $622 per space.

___________________________________________


contesting baltimore city parking tickets?

09/17/07 at 1:36pm   after leaving my apartment this morning i found a $52 dollar parking ticket on my car, for apparently "parking in an unmarked crosswalk".  this is totally bullshit, imo, as there is no signage, crosswalk, or handicap accessible curb where my car was parked.  i'm planning to write a letter to contest the ticket, and was wondering if anyone out there has done this ... and to what effect.  did it get your ticket dropped?  did you still have to go to court to contest the ticket after submitting the letter?

There was an article a few years ago that had the City of Baltimore doing national searches to find people owing the city parking tickets.  As you see below, a $25 fine can become thousands of dollars in fees and your car can be impounded and sold.  Now, people should simply pay a parking ticket but to have a system in place that creates such a financial burden on citizens for minor offenses is predatory.  Towing fees of $400 on cars booted for 3 outstanding parking tickets has the City Impound flush with cars and they are making profits from working class citizens not able to pay.  Meanwhile, a corporation leaves Baltimore owing millions of dollars in water bills......probably never paid.

Combine the high parking meter fees, the ever higher parking garage fees, and the parking employees being right there when your meter time ends-----and you have a reason for not going downtown in Baltimore.


Four parking tickets on state vehicles cost taxpayers $2,263 Tickets go unpaid, and penalties grow


By Scott Calvert, The Baltimore Sun 9:33 a.m. EDT, June 8, 2012

Five years ago, a Ford Windstar assigned to the state Department of Juvenile Services got a $42 parking ticket in downtown Baltimore. The ticket was not paid on time. And in the weeks, months and years that followed, the penalties grew and grew and grew.

A week after The Baltimore Sun inquired to state budget officials on April 20, the agency finally ponied up. The tab: $970.

It was one of four unpaid Baltimore City parking citations the agency belatedly paid. Due to the delays, tickets amounting to $178 wound up costing state taxpayers a cool $2,263.



___________________________________________

Baltimore City is so starved of money from all of the corporate tax breaks, tax evasion, and fraud that it simply must take away free parking for the disabled.  Dismantling the public sector support for the disabled and creating tiered funding with special needs at the lowest level-----  can you imagine denying the disabled the pleasure of being soaked with parking fines, fees, and taxes to support corporate profit!  We are doing it to stop the theft of placards they say-----can the police not run a license check to see if a car is registered for disability?  Easy Peasy.  People are being pushed to use these tactics because it is too expense for many people to park.  If your business is with City Hall ----you will be there for hours; phone resolutions are deliberately hard to get.-----no, Baltimore and Johns Hopkins uses public policy to push the disabled out of Baltimore.  DEMOCRATS DO NOT DO THAT----NEO-CONS DO!  Why are Baltimore pols running as Democrats when they are neo-conservatives?

Take public transit you say-----sorry, it has been so defunded and funds diverted from public transit that the quality equals that of Central American bus service.  If you are not downtown-----it takes you hours to travel the shortest distance.  Can you imagine being disabled trying to wait for a dysfunctional public transit.


DISABILITY ACT AND EQUAL OPPORTUNITY------NOT IN MARYLAND THEY SAY!  WE ARE NEO-LIBERALS AND NEO-CONS WORKING TO SEND ALL MONEY TO THE RICH AFTER ALL!



Mayor Rawlings-Blake Announces Changes to City Parking to Address Misuse of Disability


Tags Wednesday Jul 9th, 2014

Stephanie Rawlings-Blake

Mayor,

Baltimore City

250 City Hall - Baltimore Maryland 21202

(410) 396-3835 - Fax: (410) 576-9425

Better Schools. Safer Streets. Stronger Neighborhoods.

FOR IMMEDIATE RELEASE

CONTACT

Caron A. Brace

(443) 853-0957

caron.brace@baltimorecity.gov

Project SPACE Improves Access for Drivers with Disabilities; Aims to Increase Available Parking, Stop Theft, Abuse of Disability Placards BALTIMORE, Md. (July 9, 2014)—Today, Mayor Stephanie Rawlings-Blake was joined by the Parking Authority of Baltimore City, the Mayor's Commission on Disabilities, the Downtown Partnership, and members of the disability community to announce Project SPACE, an initiative that aims to eliminate the abuse of disability placards, create more accessible parking for people with disabilities, and increase the general availability of on-street parking Downtown.

Project SPACE will require all drivers who utilize on-street parking in the downtown business district to pay the parking meter—even if a disability placard or tag is displayed. The cost and time limitations for on-street parking will be the same regardless of whether the driver is displaying a disability placard/tags.

"As we near the 24th anniversary of the Americans with Disabilities (ADA) Act, we want to offer greater freedom of access for those with disabilities and their families," said Mayor Stephanie Rawlings-Blake. "Baltimore should be accessible for everyone who wishes to enjoy the many attractions that are part of what makes our city a great place to live, work, and play. In addition to combatting the abuse of disability placards, Project SPACE, will ultimately create more parking spaces for everyone."

As part of Project SPACE, approximately 200 on-street parking spaces with highly accessible, ADA compliant single-space meters have been reserved for vehicles displaying a disability placard or tags. Additionally, all EZ Park meters throughout the Central Business District have been retrofitted to meet new ADA standards, making them even more accessible for people with disabilities. To meet state requirements, the time limit for all on-street parking spaces within areas affected by Project SPACE will increase to four hours.

Project SPACE is part of the solution to a major, ongoing parking problem in Baltimore City. Current policy allows individuals displaying a disability placard or license plates to park in metered on-street parking spaces free of charge. This often results in illegal use by motorists parking for long periods of time, and promotes theft of disability placards—which are now the number one item stolen out of vehicles. By removing the financial incentive to abuse a disability placard and requiring all drivers to pay for parking, Project SPACE aims to prevent placard theft and increase the number of available parking spaces for all drivers.

"We have performed a number of parking studies that have shown that, in certain city blocks, vehicles displaying disability placards often take up 100 percent of on-street spaces and remain parked there all day," said Peter Little, executive director of the Parking Authority of Baltimore City. "Stricter enforcement will create more parking turnover and increase the number of available parking spaces as abusers seek less expensive parking options off street."

While Project SPACE is launching in the Central Business District—an area defined as the streets bounded by Franklin Street on the north, President Street on the east, Key Highway on the south, and Martin Luther King, Jr. Boulevard on the west—the program will eventually expand to Fells Point, Harbor East, Federal Hill, Mount Vernon, and beyond.

"We work to promote equal rights and opportunities for people with disabilities, including making sure people with disabilities have adequate access to accessible parking options in Baltimore City," said Dr. Nollie Wood, Jr., executive director of the Mayor's Commission on Disabilities. "The Mayor's Commission on Disabilities supports Project SPACE, because it helps accomplish our overall goal. We're looking for equal opportunity—not cheaper services."

For more information on Project SPACE, please visit www.MoreSpace4All.com. Project SPACE is also on Facebook at www.facebook.com/MoreSpace4All and on Twitter and Instagram at @MoreSpace4All.

About the Parking Authority of Baltimore City Parking Authority of Baltimore City (PABC) is a "quasi" governmental agency of Baltimore City and a registered 501(c)(3) organization with a mission to find, or create, and implement parking solutions for Baltimore City and to be the resource on all things "parking" in Baltimore. PABC oversees the management of 17 parking garages, numerous lots, over 800 EZ Park Meters, over 1,500 reserved residential handicap parking spaces, and 46 residential permit parking areas.

About the Mayor's Commission on Disabilities The Mayor's Commission on Disabilities was created by City of Baltimore Ordinance #93-237 to promote equal rights and opportunities for people with disabilities. The Commission assists the City in assessing the accessibility of City facilities, programs, and services for citizens with disabilities; providing information and education programs to city government, businesses, and industries concerning issues relevant to citizens with disabilities; and complying with the Americans with Disabilities Act (ADA).





____________________________________________________


Speed cameras as predator as the entire system is a failure ticketing massive numbers of people for no reason----sound familiar.  It took constant media shaming and wide-spread citizen outcry to stop the fraud and theft of public money.  So, you never know when you come to Baltimore if you are going to be fleeced by parking meters or speed cameras and then save a lot of time to fight it. 

PAY THE FINE THEY SAY----WE HAVE CORPORATE FRAUD, TAX EVASION, AND TAX BREAKS TO PAY FOR.


Add to that public policy that deliberately keeps unemployment in Baltimore high and you have no working economy.  Remember, the global corporations like Johns Hopkins do not want a thriving domestic economy----all the money is being made overseas.  It is deliberate policy meant to keep domestic citizens impoverished while all the revenue generated maximizes profits.  If you are not impoverished now---you and/or your children or grandchildren will be.  Think how these policies will get worse over time.

WE SIMPLY NEED A PUBLIC SECTOR PROVIDING OVERSIGHT AND ACCOUNTABILITY.  PUBLIC ASSETS DO NOT COST THE TAXPAYER----THEY BRING REVENUE TO GOVERNMENT COFFERS.




Maryland Speed Camera Fraud

Posted on March 20, 2013 by Tony McConkey

It is a violation of the public trust to continue to collect revenue from speed cameras that are inaccurate.  Baltimore City and other local governments should immediately issues refunds when a citation is false, and government has a duty to be proactive and to verify all cameras are working correctly.




Citation Payment Information
  • If your vehicle is currently booted or immobilized do NOT pay here. Instead, please call the Boot Release Line at 1-877-810-7907 to speak to an operator 24 hours a day, 7 days per week. (Call this number only for booted or immobilized cars.) If you pay on this website for a booted or immobilized vehicle, your car’s release will be delayed and it may be towed
  • Citations for most parking, red light, and speed camera violations are available for payment on this website the next business day. (Hand-written citations may take more than 1 month.)
  • Payments may not appear on this website for 3 business days. Payments take 1 to 3 business days to post, and this website reflects only posted payments. Unposted payments are not reflected on this website, which also may not reflect the $25 registration flag fee. Please call 410-396-4080 Monday–Friday (except holidays) 8:00am–4:30pm to verify your payment or confirm the amount due.
  • If you have 3 or more unpaid tickets more than 30 days old, your car may be immobilized or impounded.
  • Red Light and Speed Camera Citations with a violation date on or before December 31, 2012 are available at www.public.cite-web.com(External Link) (External Link). Enter your citation’s violation code and PIN number.
  • Red Light and Speed Camera Citations with a violation date on or after January 1, 2013 are available at www.ip360BaltCity.com (External Link). Enter your citation’s violation code and PIN number.
  • The CIty of Baltimore no longer faxes VR119 release forms to the Department of Motor Vehicles. All requests will be mailed within 2 to 3 business days.
Baltimore City provides online access to the public information maintained in its records. While the city has confidence in the accuracy of these records, Baltimore City makes no warranties, expressed or implied, regarding the information.

_____________________________________________
SEE WHAT O'MALLEY AND MARYLAND ASSEMBLY AND RAWLINGS-BLAKE AND BALTIMORE CITY HALL ARE UP TO! 

THIS IS WHY MARYLAND AND BALTIMORE PARKING AUTHORITY IS SO PREDATORY AND INCREASINGLY PROFITEERING----THE MORE MONEY GENERATED THE MORE MONEY MOVED TO WALL STREET THROUGH BONDS PURCHASE.  TAKES THAT MONEY RIGHT OUT OF GENERAL FUNDS TO BE USED BY EVERYONE AND DIRECTS IT TO INVESTMENT FIRMS AND DEVELOPERS.

This is what I mean about hiding Maryland debt. Maryland looks like it has less debt because of these credit leverages.  Don't think only neo-liberals are doing this----this is actually a Republican policy that has gone neo-con/neo-liberal as global corporations are getting all the money.   There is not a public revenue maker in Maryland that is not leveraged to credit bonds and here we have our parking agencies tied to Moody's.  This speaks of the Maryland Parking Authority but Baltimore Parking Authority is doing the same.  When every revenue source in a state is mortgage with credit bonds as is Maryland, when these economics crashes happen defaults occur and taxpayers lose hundreds of millions of dollars----which is the plan.  There deals not only feed Wall Street----the private corporations partnered with public parking are stealing right and left and profiteering on the backs of Maryland citizens......and this is super-sized in Baltimore.


Please think about what these neo-liberals and neo-cons are building with this money------restaurants, retail stores, financial businesses.  None of this builds a strong, healthy economy.  It is what exists in third world countries....tourism economy.  Think how many small businesses could be started with the money tied up in these bonds.  Remember, a bond market crash is coming very soon.  Even the Maryland and Baltimore Parking Authority is mortgaged.

Related Issuers
Maryland Transportation Authority


  Rating Action: Moody's affirms the A2 on Maryland Transportation Authority's Baltimore/Washington International Thurgood Marshall Airport Parking Revenue Refunding Bonds Series 2012A and B; The outlook is stable Global Credit Research - 25 Mar 2014 Approximately $182.02 million of debt outstanding affected New York, March 25, 2014 -- Moody's Investors Service has affirmed the A2 rating on the Maryland Transportation Authority's (MDTA) Baltimore/Washington International Thurgood Marshall Airport (BWI) Parking Revenue Refunding Bonds Series 2012A and B. The outlook is stable.



RATINGS RATIONALE

The A2 rating on the parking revenue bonds reflects the strong coverage provided by a pledge of the net parking revenues of all parking facilities operated by the Maryland Aviation Administration (MAA), notwithstanding downturns in passenger enplanements at BWI in the last couple of years. While the pledge of only parking revenues presents a relatively narrow revenue stream, the parking facilities are essential to the airport operations, given the lack of convenient alternatives to reach BWI and the long established customer trends for parking at the airport. The A2 rating also reflects the strong demand for passenger travel in a large, affluent service area, and strong debt service coverage levels.



The parking revenue bonds were issued by the Maryland Transportation Authority (MDTA) on behalf of the MAA which operates BWI. The MDTA has entered into leases with the MAA, which obligates the MAA to remit parking revenues for the repayment of the debt.




STRENGTHS

* Service area contains some of the wealthiest counties in the US as well as a premium tourist destination in Washington, D.C.

*BWI remains a strong origination & destination (O&D) market which drives parking revenues; Southwest Airlines is the largest carrier at the airport with 71.4% of enplanements as of FY 2013

*Total enplanements have been on a mostly positive trajectory since FY 2010

* Airport operates efficiently, with airline costs per enplanement lower than regional competitors Reagan National Airport and Washington-Dulles International Airport (Metropolitan Washington Airports Authority, A1/Stable). Low cost per enplanement is helped by the airport's absence of general aviation debt.

*Debt service coverage ratios (DSCR) have remained stable and are estimated to be maintained at similar levels in the next year

*There is no additional debt expected to be supported by parking revenues.



CHALLENGES

*Market strength could be challenged by possible cuts in federal government spending given the concentration of federal jobs in the immediate region.

* Significant regional competition from other Washington area airports.

* Highly concentrated airline market share, with the combined Southwest/AirTran airline accounting for over 70% of enplanements in FY 2013

*Off-airport parking lots could pose a competitive threat to transaction growth at certain MAA parking facilities, such as the express and long-term parking lots.

* Reliance on dedicated and more restricted parking revenue streams which tend to decline more steeply than airport enplanements and lag in recovery

*Declining O&D passenger base as a result of Southwest increasing use of BWI as a connector negatively affects highly sensitive and narrow dedicated streams of parking revenues



Outlook

The stable outlook is based on expectations that enplanement and O&D passenger base will remain around current levels, supporting DSCRs at similar levels. The outlook also anticipates the successful renewal of the parking agreement for another 5-year term.



What could change the rating--UP

The rating is well placed in its category given the narrow nature of the revenue flow to cover debt service payments. Nonetheless, a marked improvement in revenues due to a sustainable positive change in the fundamental strength of the O&D enplanement base at BWI Marshall could exert positive ratings pressure.



What could change the rating--DOWN

Strong DSCR is key to the current rating level. Hence, a weakening of revenues over more than one year period that reduces financial margins could place some negative pressure on the rating.




The principal methodology used in this rating was Generic Project Finance Methodology published in December 2010. Please see the Credit Policy page on www.moodys.com for a copy of this methodology.



REGULATORY DISCLOSURES



For ratings issued on a program, series or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the rating action on the support provider and in relation to each particular rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.



Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.



Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating.

Jennifer Meihuy Chang
Analyst
Public Finance Group
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653


Chee Mee Hu
MD - Project Finance
Public Finance Group
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653


Releasing Office:
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

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July 21st, 2014

7/21/2014

0 Comments

 
IT'S CALLED SOVEREIGN DEBT/MUNICIPAL BOND FRAUD FOLKS------NEO-LIBERALS SIMPLY FOLLOW WALL STREET'S LEAD NO MATTER WHERE IT ENDS.


I'd like to spend one more day on the bond market and the coming crash.....looking today at the public and private pensions.  Folks, neo-liberals and neo-cons look at pensions as fodder only meant to boost Wall Street profit. 

LOOK AT WHERE YOUR PENSIONS ARE INVESTED BECAUSE MARYLAND IS RUN BY NEO-LIBERALS WORKING FOR WALL STREET PROFIT AND NOT YOU AND ME!

I pointed to Maryland pol Dulaney and his focus on repatriation taxes and bond market for corporations.  The timing of this legislation is no accident----the bond market crash will place this market at the bottom ready to climb to profits just as the 2008 crash made the stock market bottom.  So, Dulaney is not warning his constituents that the bond market crash is coming and will take away most of the value recovered since the last crash-----he is only thinking of what legislation with maximize corporate profit.  THAT'S A NEO-LIBERAL FOR YOU BUT WHY IS HE RUNNING AS A DEMOCRAT????

The second point is that as you can see all of the major news journals are now reporting the crash is coming just as I have written for four years.  What I said was the plan-----and everyone knew it.
  Please consider where you get your information-----all neo-liberal media like MSNBC and NPR never mentioned these policy goals-----

I spoke of the public malfeasance behind the public pension losses last crash were politicians moved public pensions from the then safety of the bond market into a collapsing stock market in 2007 just to buoy the Wall Street banks.  THIS WAS ILLEGAL AND PUBLIC MALFEASANCE AND FRAUD. All of the pols in Maryland involved in doing this were simply re-elected and public sector unions simply agreed to cuts rather than take the fraud to court.  The failure to address the last fraud has the same thing coming with this bond crash.....public and private pensions have been used to buoy the coming bond market as investment firms jump ship. 

DO YOU HEAR YOUR POLS SHOUTING ALL OF THIS IS BAD FOR THE PEOPLE WHO ELECTED THEM???????  I DON'T HEAR A THING!


Below is a UK article that speaks to what is coming.  Look how it states the FED is considering making people stay in the bond market to stop a run.  It created the conditions for the crash and now it wants to force people to stay in......punitive exit fees.
  Remember, people went to bonds because the stock market is criminal.......they are now being forced back into this criminal market because Wall Street imploded the only safe investment ------bonds.

Can you save your pension from the great bond bubble? Why a bank rate rise could ruin your retirement...

‘Those limits will be set by each individual fund — they may put a cap on how much you can withdraw, or reduce the value by a percentage.’


By Holly Black  Daily Mail Pensions and Retirement

PUBLISHED: 18:34 EST, 17 June 2014 | UPDATED: 03:20 EST, 18 June 2014

About £800billion of savings and investments sitting in bond funds could fall in value if interest rates begin to rise.


An increase in the Bank of England base rate threatens to burst the five-year bond bubble that has seen the value of funds soar by as much as 137 per cent.

It threatens to wipe out a chunk of the life savings of an estimated 500,000 people who have put their money into bond funds, and millions more in company pension schemes.


Bond bubble: When interest rates rise the value of bonds will fall



However, while any rise in rates is likely to cause a fall in bond funds - any increases should be small, giving investors time to react. There are, though, fears that money in bond funds could be locked up.

In the U.S. there are already reports that the Federal Reserve is considering imposing punitive exit fees on anyone trying to take their money out of bond funds to halt a run on the investments.



Brian Dennehy, founder of investment research site Fund Expert, explains: ‘When there is sustained heavy selling there will almost certainly be restrictions, if you’re allowed to sell at all.


‘Those limits will be set by each individual fund — they may put a cap on how much you can withdraw, or reduce the value by a percentage.’


Bonds are essentially IOUs issued by companies and governments. In exchange for your money, they promise to pay you a rate of interest. These are not fixed-rate savings bonds offered by High Street banks and building societies, which keep your capital safe and your interest fixed.


With investment bonds the value can rise and fall, and they were often seen as a safer type of investment, as they don’t change in value very much. But because of poor rates on High Street savings accounts, bonds have become wildly popular and, as a result, prices have surged.


Someone who put £10,000 into the average strategic bond fund five years ago would have £15,500 today. The best fund would have grown to £23,700.


At risk: A substantial chunk of the £770bn of our pensions is invested in bonds



How £800billion could be trapped
Fears of a fall in value of these funds could now lead to a great bond sell-off. A bond-fund plunge has been widely expected since late 2012.



Then, the value of funds had increased by 50 per cent following the Government’s policy of printing money to boost the economy, known as Quantitative Easing. This involved the Bank of England flooding the economy with cash, by buying bonds — which led them to increase in value.


Now that QE has come to an end, and the economy is recovering, interest rates could soon rise. When this happens, the value of these bonds will fall, and the interest they are paying will suddenly seem less attractive.


Unlike with shares, the money in bonds is tied up. It means that investors may not be able to trade their bonds freely to eager buyers, leaving them trapped because no one will want to buy them.


Retail investors who have relied on bonds for the past six years have a massive £126billion of their savings tied up in these funds. But a substantial chunk of the £770billion of our pensions is invested in them, too, because many stock-market-linked company schemes move savers’ money into bonds the closer they get to retirement.


This is done to protect the cash they have built up over the years by transferring it out of supposedly riskier stocks and shares. The strategy is known as life-styling and happens automatically. But it has meant that workers are being unwittingly exposed to any potential fall in the bond market.


Thousands of investors found themselves stuck in property funds in 2008 when there was a run of people withdrawing cash from these investments. A lack of ready cash available in them meant firms were telling their customers they could not have their money.


Many property funds own entire buildings directly so that if they need to raise money they have to sell them, rather than just sell shares, which is a much quicker and easier process. Bond funds face similar problems.

Bonds have a fixed duration and if funds can’t find a willing buyer to dispose of them, they will have to hold onto the investment. That means they can’t raise any money to give back to investors looking to sell their units in the fund.

Should you hang on or try to sell?
Many fund managers are already selling their bonds. Marcus Brookes, head of multi-manager funds at Schroders’, has reduced his bond holdings to just 10 per cent of his assets and he is planning to sell more.

  ‘Returns have been amazing for too long and we’re starting to worry,’ he says. And Mr Dennehy points out that with interest rates likely to rise in ‘baby steps’, investors shouldn’t have to rush out of all of their bonds at once.

‘But you should still ask yourself why you are bothered to invest in bonds,’ he adds. ‘At best, they won’t lose any of your money this year, but I don’t think they will make any either.’


Yet this could leave investors with another dilemma. Ben Gutteridge, head of fund research at wealth management company Brewin Dolphin, explains: ‘If you are taking your money out of bonds, where are you going to put it?


‘The obvious choice is equities. But if all of your investments are equities, that’s incredibly risky.’


Because of this, investors may be forced to accept the risk of staying in bonds in a bid to spread the risk in their portfolio.

Or else they may have to pull out of the stock market completely and bide their time in cash just to make sure that they’re not losing any money.


__________________________________________

Wall Street and their pols knew people would leave the stock market for the safety of the bond market after the 2008 crash so they started immediately to create the conditions to fleece these bond investors.  Congress and Obama created legislation that pushed US bonds to the world market just as they did subprime mortgage loans they knew were fraudulent.  Watching the FED and QE create the ballooning of the bond market just to accommodate Wall Street profit knowing a bond collapse would hit Federal, state, and local governments hard.

IT IS A CRIME AGAINST HUMANITY!!!!  THESE ARE SOCIOPATHS FOLKS!


Public pensions were never too much to handle for states and local governments-----neo-liberals simply never intended to fund them just as corporations were never made to actually fund their contributions as these benefit packages required.  So, there is no pension deficit weighing on governments----it is the fiscal policy schemes that are designed to bring ever more money to Wall Street that are soaking taxpayers.  Below you see just another financial instrument that again placed public wealth in harms way.  Remember, we went through a fiscal boom last decade albeit fueled by corporate fraud so government coffers should be flush.  Rather, billions of dollars were lost to public malfeasance and fraud.  The article below shows states using pension investments that were known to be bad policy-----placing bonds into plans at the wrong time and this is not an accident.  It takes no rocket scientist to know all of these investment strategies were bad for the public.  These neo-liberals did it to hide debt to take on more debt knowing Wall Street would bring in tons of profit.


The story of Oregon is Maryland's story and Martin O'Malley and the Maryland Assembly are the stars of this public abuse.
  Now, the same thing was done for private pensions as corporations were allowed to fail to fund and place pensions into ever riskier investments everyone knew would fail.

Just think.......if we all knew years ago that the policies since the 2008 crash would implode the bond market-----do you leave state and local governments exposed to bond leveraging?  OF COURSE NOT UNLESS YOU WANT TO IMPLODE GOVERNMENT BUDGETS.

Pension Obligation Bonds: Risky Gimmick or Smart Investment?

Pension obligation bonds have bankrupted whole cities. Yet some governments are still big players. BY: Eric Schulzke | January 2013



“It’s the dumbest idea I ever heard,” Jon Corzine told Bloomberg.com in 2008 when he was still governor of New Jersey
. “It’s speculating the way I would have speculated in my bond position at Goldman Sachs.”

Corzine, who followed up his tenure as governor with a $1.6 billion investment debacle as chairman of MF Global, seemed to know a thing or two about risky ventures. In this case, he was speaking of pension obligation bonds. POBs are a financing maneuver that allows state and local governments to “wipe out” unfunded pension liabilities by borrowing against future tax revenue, then investing the proceeds in equities or other high-yield investments. The idea is that the investments will produce a higher return than the interest rate on the bond, earning money for the pension fund. It’s a gamble, but one that a lot of governments are willing to take when pension portfolio returns plummet, causing unfunded liabilities to run dark and deep.

Almost every fund has faced such liabilities from time to time, though current times have been more treacherous than others. As Paul Cleary, executive director of the Oregon Public Employees Retirement System (PERS) points out, since 1970 his state’s pension fund has suffered annual losses only four times
. But three of those losses were in the last decade, and one, in 2008, was a catastrophic 27 percent decline.

Faced with such losses -- and with a dearth of state and local revenue to make up for the shortfalls -- POBs have become a favored tool to fix pension woes. Oregon is a big player in the POB market, along with scores of its cities, counties and school districts. Other major POB issuers include California, Connecticut, Illinois and New Jersey.

The bonds took on some notoriety this past summer when two California cities, Stockton and San Bernardino, went bankrupt. Generous pensions awkwardly propped up with ill-timed POBs contributed to both debacles.


Over the years, returns on POBs have often fallen below the interest rate the state or locality paid to borrow the money, digging the liability hole even deeper
. Nonetheless, they remain popular with politicians in a revenue pinch. Politically, it is easier to borrow money to pay for pension costs than it is to squeeze an already-stressed budget. While many economists and policy analysts view them as risky gimmicks and question the high market growth assumptions that make them seem viable, POBs have defenders who believe that with careful timing they can pay off.

When Oakland, Calif., launched the first pension obligation bond in 1985, it appeared to be a reasonable strategy. It qualified as a tax-free bond that could be issued at the lower municipal bond rates. A state or city could then pivot and invest the funds in safe securities -- a corporate bond, for instance -- at a slightly higher rate. “That was classic arbitrage,” Cleary says. “You were locking down the difference between nontaxable bonds and taxable bonds.”


The Tax Reform Act of 1986 ended that strategy by prohibiting state and local governments from reinvesting for profit the money from tax-free bonds. When the concept resurfaced, the strategy called for states or localities to issue a taxable bond and leverage the higher interest rate of that bond against higher return but riskier equity market plays. So long as markets boomed, the new tactic seemed savvy. “Some people call this arbitrage, but it’s not,” Cleary says of post-1986 POBs. “It’s really an investment gamble.”

Arbitrage occurs when prices for the same product differ between two markets, allowing a nimble player to exploit the difference. “Real arbitrage is free money,” says Andrew Biggs, a scholar at the American Enterprise Institute. “But it doesn’t hang around very long.”


Safe bonds and risky equities are not the same product, but public pension accounting currently permits state and localities to treat them as if they were.
“They are counting the return on the stocks before the return is there,” Biggs says. “If you borrowed money to invest in the real world, you would factor the current value of the debt with the current real value of the stocks.”

Given the inherent risks and possible rewards, how have POBs fared? In 2010, a research team led by Alicia Munnell, director of the Center for Retirement Research at Boston College, ran some numbers to find out. The team took 2,931 POBs issued by 236 governments through 2009. They used each bond’s repayment schedule to calculate interest and principal, and then clustered them into cohorts based on the year issued. They assumed a 65/35 investment split between equities and bonds and tracked the results with standard indexes. They then produced two composite graphs -- one at the height of the market in 2007 and the second in 2009, after a crash and before recovery.

In general, bonds issued in the early stages of a stock boom performed well prior to the crash. Thus, POBs issued in the early 1990s were healthy, ranging from 2 to 5 percent net growth. Borrowings in 2002 or 2003 also looked good.


Those issued in the latter years of the 1990s or 2000, however, were in negative territory even before the 2008 crash, having suffered serious losses to their principal in the 2001-2002 downturn. After 2008, all POBs were under water -- except those issued in the trough of the collapse, which by 2009 were already pushing 25 percent gains.

Oregon’s numbers mirror Munnell’s findings. Local government POBs issued in 2002 at the depth of that market collapse and managed by Oregon PERS gained an annual average of 8.84 percent through 2012, before principal and interest on the bond. Less lucky were bonds issued in 2005. The Springfield School District’s POB earned just 5.53 percent, for example. Since that bond carried 4.65 percent interest, it likely earned roughly one point annually -- not much, but slightly above neutral. Oregon’s 2007 issuers earned just 2 percent on their investments through 2012, and are upside down today after debt service.

The same fate befell Stockton, Calif., which also came to market in 2007. Similarly, New Jersey issued a $2.8 billion POB in 1997 -- on the wrong side of another stock bubble.

“The whole thing is the timing,” Oregon’s Cleary says. “You are trying to issue them when the market has bottomed out and when interest rates are reasonable, because really what you are doing is making an investment bet. If people thought when they did POBs that they were refinancing a debt or doing a locked-in arbitrage, rather than an investment play, I’m sure they have been very surprised by the results.”


And yet that is exactly how they were sold. When Oregon voted on new POBs in 2009, the voter education pamphlet argument in favor of issuance explicitly framed the choice as a “refinance” and cast the projected returns as money “saved.”

“Just like many homeowners are refinancing their home mortgages,” the pamphlet read, “the State should take advantage of these historically low rates, which can save Oregon more than $1 billion over the next 25 years. The money saved will help reduce cuts and protect services that all Oregonians rely on.”

Because POBs demand headroom between the interest an issuer pays to borrow and the high returns promised on resulting investments, their investment strategies tend to chafe against safer portfolios. Without a hefty “discount rate” -- as the projected annual gain assumed by a pension fund is known -- the pension bonds would not be possible.

In a 2012 paper, Andrew Biggs argues that the aggressive 8 percent discount used by many states overstates likely earnings and understates risks. A fund that required $100 million in 20 years and employed an 8 percent discount rate would be “fully funded” with $21 million, Biggs notes. But if that same fund were to gain only 5 percent annually, it would need $38 million today to be fully funded in 20 years.


Many experts argue that because public pension obligations are legally binding, pension funds should be discounted at close to zero risk on the front end -- at or near the rates offered by government bonds.
“While economists are famous for disagreeing with each other on virtually every conceivable issue,” wrote then-Federal Reserve Board Vice Chairman Donald Kohn in 2008, “when it comes to this one there is no professional disagreement: The only appropriate way to calculate the present value of a very-low-risk liability is to use a very-low-risk discount rate.”

In point of fact, the 8 percent discount rate may be on its way out. The Governmental Accounting Standards Board (GASB) is launching a complex hybrid discount standard in 2014, which will affect the assumptions states make with their funds. Some fear the GASB rule will only create more confusion. Bond rater Moody’s is taking a simpler tack in weighing government pension plans, having recently proposed to shift its pension discount rate down to the level of AA taxable bonds, which are now at 5.5 percent. “Currently, discount rates used by state and local governments are all over the place,” says Tim Blake, Moody’s managing director of public finance. “Most are in the range of 7.5 to 8 percent. We need a uniform rate.”

Not surprisingly, 5.5 percent is very close to the rate at which many POBs are sold to investors.


With aggressive 8 percent discount rates now under attack by economists, oversight boards and rating agencies, issuers who counted on rosier outcomes have learned some hard lessons. Five years ago, when Connecticut State Treasurer Denise L. Nappier announced a new $2.28 billion pension bond, she noted that the state had “achieved a favorable borrowing cost of 5.88 percent, which is well below the 8.5 percent assumed long-term return on assets of the Teachers’ Retirement Fund. This will provide significant cash flow savings over the long term and a potential savings to taxpayers of billions of dollars.”

When the bond was issued in April, the Dow Jones average stood just shy of 13,000. By November, the market was in free fall. It bottomed out the following March at just over 6,600. Connecticut’s timing could hardly have been worse. As the market plunged, Pensions & Investments lit into POBs, singling out Connecticut. The editors argued that POBs shove obligations “that should have been paid as earned” onto future generations, along with the risk of the debt.

By 2010, with the market still emerging from the trough, Connecticut’s finances were as messy as ever. But now there was little appetite for more bonds. POBs “are certainly a risky proposition,” Michael J. Cicchetti, chairman of Connecticut’s Post Employment Benefits Commission, told the CT Mirror. “Things are different now than they were then.”


______________________________________________

Wall Street has the nerve to state that public sector pensions are too big of a liability for governments.  After all, Wall Street fraud caused a loss of 1/2 pension value in 2008 and the rating corporations like Moody's was ground zero for the fraud---they should know pensions are limping along!

Indeed, simply taking the assets of the three major rating corporations and pushing them into bankruptcy for their part in the fraud would have made pensions flush with cash.  RULE OF LAW WOULD HAVE SOLVED GOVERNMENT PENSION SHORTFALLS.  No one shouted this!  Did you hear your pols shouting for recovery of pension losses from fraud to make up the shortfall?  They went straight to cutting benefits.  They through pensions into bad investments just to claim they were liabilities that needed to be cut.

THAT'S A NEO-LIBERAL FOR YOU-----WORKING TO MAXIMIZE WALL STREET PROFITS AT PUBLIC EXPENSE!

Now, why should all citizens be concerned about pension fraud ----even those with no pensions? 


THE SAME THING IS HAPPENING WITH SOCIAL SECURITY!  YOUR RETIREMENT PROGRAM IS BEING RAIDED BY THE SAME PEOPLE.  DO NOT THINK IT OK FOR SOME PEOPLE TO LOSE THEIR RETIREMENTS WHEN THE PROBLEM IS CORPORATE FRAUD AND CORRUPTION AND NOT THE BENEFIT!

So while neo-liberals like Dulaney are busy making sure legislation places corporations into positions to earn grand profits-----they are setting you and I to take the losses once again.

The policy of risk-free rating is not a bad thing-----what is bad is that it comes at a time when pensions are waiting for recovery from fraud by Moody's and it comes as the bond market is ready to implode from public sector malfeasance.  Can you imagine how impossible it will be to meet these obligations after an economic crash bigger than 2008? 

THAT'S RIGHT-----THEY DO NOT WANT TO BE ABLE TO MEET THEM!  THAT IS WHY THEY ARE IMPLODING THE BOND MARKET FOR GOODNESS SAKE!


A Maryland neo-liberal running for Governor of Maryland Heather Mizeur actually stated-------if public employees gave up pension benefits we could build all these schools in Baltimore.  That is what neo-liberals do----pit people in the same Democratic base against one another.  It is not an either/or----STOP THE CORPORATE FRAUD AND PROFITEERING!

LABOR AND JUSTICE ARE THE DEMOCRATIC BASE!

Moody’s Playing Dangerous Games With Public Pension Funds

Tuesday, 07 May 2013 09:29 By Dean Baker, Truthout | Op-Ed

The bond-rating agency Moody's made itself famous for giving subprime mortgage backed securities triple-A ratings at the peak of the housing bubble. This made it easy for investment banks like Goldman Sachs and Morgan Stanley to sell these securities all around the world. And it allowed the housing bubble to grow ever bigger and more dangerous. And we know where that has left us.

Well, Moody's is back. They announced plans to change the way they treat pension obligations in assessing state and local government debt.

Instead of accepting projections of pension fund returns based on the assets they hold, Moody's wants to use a risk-free discount rate to assess pension fund liabilities. This will make public pensions seem much worse funded than the current method.

While this might seem like a nerdy and technical point, it has very real consequences. If the Moody's methodology is accepted as the basis for accounting by state and local governments then they will suddenly need large amounts of revenue to make their pensions properly funded. This will directly pit public sector workers, who are counting on the pensions they have earned, against school children, low-income families, and others who count on state supported services.

In other words, this is exactly the sort of politics that the Wall Street and the One Percent types love. No matter which side loses, they win. While public sector workers fight the people dependent on state and local services, they get to walk off with all the money.

Wall Street is expert at these sorts of accounting tricks; it is after all what they do for a living. And this is not the first time that they have played these sorts of games to advance their agenda.

The current crisis of the Postal Service, which is looking at massive layoffs and cutbacks in delivery, is largely the result of accounting gimmicks. In 2006 Congress passed a law requiring an unprecedented level of pre-funding for retiree health care benefits. The Postal Service is not only required to build up a massive level of prefunding, it also is using more pessimistic assumptions about cost growth than any known plan in the private sector.

This requirement is the basis for the horror stories of multi-billion losses that feature prominently in news stories about the Postal Service. The Postal Service would face difficulties adjusting to rapid declines in traditional mail service in any case (it doesn't help that they are prohibited from using their enormous resources to expand into new lines of business), but this accounting maneuver is imposing an impossible burden. The change in pension fund accounting could have a comparable impact on state and local governments.

Moody's change in accounting is not just bad politics, it is horrible policy. The key question is how we should assess the returns that pension funds can anticipate on the assets they hold in the stock market. Moody's and other bond rating agencies did flunk the test horribly in the 1990s and 2000s. They assumed that the stock market would provide the historic rate of return even when price to earnings ratios were more than twice the historic average at the peak of the stock bubble.

While some of us did try to issue warnings at the time (here) and (here) the bond rating agencies were not interested. As a result, when the stock market plunged, many pensions that had previously appeared to be solidly funded, suddenly faced substantial shortfalls.

It is possible to construct a methodology that projects future returns based on current market valuations and projected profit growth that maintain proper funding levels, while minimizing the variation in contributions through time. By contrast, if the pension funds adopted the Moody's methodology as the basis for their contribution schedules, they would find themselves making very large contributions in some years followed by years in which they made little or no contribution.

A state or local government that used the Moody's methodology to guide their contributions would effectively be prefunding their pensions in the same way that it would be prefunding education to build up a huge bank account so that K-12 education was paid from the annual interest. While it would be nice to have the cost of these services fully covered for all time, no one thinks this policy makes sense. We would be hugely overtaxing current workers so that future generations could get a huge tax break.

Even worse, Moody's scoring of pensions may discourage pension managers from holding stock as an asset. They would be held accountable for any losses in bad years, but would not get credit for the higher expected returns on stock. For this reason, risk averse pension managers may decide to hold safe but low yielding bonds.

This would lead to the perverse situation in which collectively invested funds held in pensions only hold safe bonds, even though market timing carries little risk for them. On the other hand individual investors, who are hugely vulnerable to market timing, would be holding stock in their 401(k)s.

That outcome makes no sense. But of course it didn't make sense that subprime mortgage backed securities were Aaa. This is Moody's we're talking about.


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July 18th, 2014

7/18/2014

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from subprime mortgage fraud to municipal bond fraudFRO
FROM SUBPRIME MORTGAGE FRAUD TO MUNICIPAL BOND FRAUD-----NEO-LIBERALS AND NEO-CONS ARE ALL ABOUT MOVING MONEY TO THE TOP ANY WAY POSSIBLE

Let's compare again the 2008 subprime mortgage crash and the coming bond market crash to see it is neo-liberals working with neo-cons deliberately manufacturing these crashes with the goal of moving ever more public assets to the top.  Clinton's administrative team with Robert Rubin at Citigroup created the subprime mortgage plan with Greenspan and Tim Geithner and the Federal Reserve's Bernanke with Obama created this bond market crash.  Both required the neo-liberals in Congress to pass the laws allowing the conditions.

As we know the foreclosures on homes are still going strong and Maryland leads the pack.  Remember, almost none of the parking ticket of a settlement for subprime loan fraud made it to the victims of fraud---it is being sent back to the banks paying the settlement in the form of development subsidy.  So the transfer of homeownership has never stopped since we elected a super-majority of neo-liberals.  A ridiculous attempt at refinancing with a program called HARP delayed dispensing money for years and is now advertizing to help through the same mortgage lenders having committed the frauds.  Most people have of course lost their homes through yet again a fraudulent foreclosure process.  Can you imagine handing HARP to the same institutions defrauding trillions from the FHA? 

THESE CORPORATE POLS COULD CARE LESS WHAT YOU AND I THINK----THEY THINK THEY HAVE ELECTIONS CAPTURED AND WE CANNOT MAKE CHANGE!  THEY ARE WRONG!



'So, have QE and the ballooning debt been a fantastic success or a Questionably Effective policy designed to recapitalize banks and the financial elite at the expense of most others, including pension funds, retirement accounts, savers, and bond funds'?

QE is simply a policy to allow the FED to leverage debt to buy the toxic subprime loans from Wall Streets accounts making them look as though they have recapitalized.  Those trillions that the FED bought are the most toxic of subprime mortgage loans.  The second goal was lowering the interest rate for selling homes because after all Wall Street had tens of millions of foreclosed homes coming to them and they needed to sell them as cheaply as possible to maximize bank profits.  So while neo-liberals in Congress bailed out the banks---they left Main Street in mass foreclosure all designed to move these homes to Wall Street where they were bundled and resold to the same investment firms creating the mortgage frauds.  QE lowered interest rates to zero and the only ones benefitting were those banks peddling foreclosure bundles and the foreigners laundering their looted wealth from their country to US real estate.  That was the rising sales you heard on TV news.  We see it in Baltimore as developers are buying huge tracts of communities for next to nothing ----these communities being the ones devastated by the subprime loan fraud and foreclosures.  Consolidated ownership of property is good for no one.

The FED has a mission of economic stability and low unemployment and it is fraud and malfeasance when the policies they push do the opposite.  They pretended unemployment went down when it is now at 36%----they pretended they were keeping inflation low when it is at 5% ---and they certainly will not be able to claim economic stability when the market crashes in 2015 from the bond implosion. 

ALL INSTITUTIONS ASSOCIATED WITH GOVERNMENT ARE OPENLY WORKING AGAINST THE MISSION OF PROTECTING THE AMERICAN PEOPLE AND ONLY A FEW ARE BEING MADE RICH FROM THIS MALFEASANCE.

For those thinking their pensions have made gains to replace losses from 2008-----those gains are about to disappear and then some.


QE: Quantitative Easing or Questionably Effective

-- Posted Tuesday, 8 July 2014
By GE Christenson

We all know the S&P 500 Index has been on a 5+ year rally to all-time highs – thanks to ultra-low interest rates and the levitating wonder of “printing money” via QE – Quantitative Easing.  Examine the following chart of the S&P for the past 20 years.

If you were a member of the top 5 – 10% and had a large investment in the stock market, you increased your nominal net worth. However, if you were in the bottom 90%, then the wonders of QE did not “trickle down” to you and your family, except as higher prices.

Pension and retirement funds benefitted to the extent of their stock investments but they were hurt by generational low interest rates in their bond portfolios.  Simply put, the stock market rally benefitted a narrow band of society – mostly the political and financial elite and upper middle class.

But how does the massive rally in the S&P look when priced in barrels of crude oil?  Examine the following chart of weekly S&P divided by weekly Crude Oil prices – both smoothed with a 52 week moving average.


That rally in the S&P, when priced in barrels of crude oil, does not look nearly as impressive.  Remember – a small percentage of people benefit from higher stock prices, but everyone pays when oil prices rise.  The price of crude oil affects food prices, gasoline prices, shipping costs, home heating costs, mining and manufacturing costs, and so many more. 

When we look at the S&P in terms of crude oil, we see:

1)    The ratio is DOWN over 75% from its peak.

2)    The ratio has been essentially unchanged since 2006.

3)    The price of crude has risen for the last 14 years - much more rapidly than the S&P, along with a massive increase in debt and the money supply.

4)    A few people benefitted from the nominal rise in the S&P and most people were hurt by the rising costs of energy, gasoline, manufacturing, food, and so on.

5)    The overall US economy seems to be sputtering, unless you believe what financial television is “selling.”

So, have QE and the ballooning debt been a fantastic success or a Questionably Effective policy designed to recapitalize banks and the financial elite at the expense of most others, including pension funds, retirement accounts, savers, and bond funds?

QE looks like it produced a toxic cloud of dangerous mal-investment, debt and currency bubbles, higher consumer prices, and a weakened economy. 

___________________________

The FED was busy taking trillions of subprime mortage loans off banks accounts leaving the FED leveraged to the max right before this coming bond crash.  What happened when the insurance corporation AIG was tethered to this same fraud?  Taxpayers paid the debt and indeed the FED's debt will be handed to taxpayers with this coming bond crash.

The other stash for toxic loans was Freddie and Fannie and rather than making banks write off those fraudulent loans to clear the debt on these public/private entities-----Obama and neo-liberals are embracing the debt as public debt and taxpayers are paying off yet another trillion in fraudulent loans there.

Friday, September 14, 2012
 
QE Infinity: Fed Buying More Toxic Assets From Banks Will NOT Help Main Street Dees Illustration

Eric Blair
Activist Post

Ben Bernanke and the Federal Reserve announced an open-ended bailout for the banks yesterday by a new mechanism called QE Infinity where they plan to purchase $40 billion of toxic mortgage-backed securities per month "until further notice".

Shrouded in confusing language like "unlimited stimulus" or "quantitative easing", this unprecedented move and rule change by the Fed was said to be warranted because employment remains weak even though they still maintain the false notion that "economic activity has continued to expand at a moderate pace in recent months."

As stated in the FMOC press release:
If the outlook for the labor market does not improve substantially, the Committee will continue its purchases of agency mortgage-backed securities, undertake additional asset purchases, and employ its other policy tools as appropriate until such improvement is achieved in a context of price stability. Of course this move "to foster maximum employment and price stability" does nothing to directly help job creation, and will continue to hurt main street by inflating the price of everything purchased by dollars. Yet it will clearly reward the investor class who already own most of the dollar-based assets.

The theory is that by removing toxic assets from the bank's books they have more liquidity to offer more credit, or to purchase more government debt. Somehow this is supposed to trickle down and help improve unemployment, which real numbers show to be in the 20% range when all factors are considered.

After a combined $2.3 trillion from
QE1 ($1.7T) and QE2 ($600B), plus over $16 trillion is secret bailouts to recapitalize banks with absolutely no measurable improvement in the economy, how could any thinking person believe this policy will be beneficial?


Since mortgage-based assets total a conservative $600 TRILLION, QE Infinity is nothing more than an endless giveaway to the criminal banks at the expense of struggling taxpayers. Wall Street will obviously celebrate the move and stock prices will go up, along with food and energy prices.

It is so blatantly a policy that will steal from the poor to give to the rich.  It also makes one wonder how can the government cry poor when it comes to paying for food stamps, healthcare, education, and other benefits for the needy when they have endless trillions to prop up the banksters?

Significantly, this announcement comes on the heels of a census report that shows median incomes have fallen to levels of the
late 1960s and early '70s. Of course, the mainstream version is they've only fallen to 1989 levels, which is hardly any better.

ShadowStats.com
The census report showed that the middle class is struggling with a median family income of $50,054. In 2010, Michael Snyder decisively proved that it is flat impossible for a family of four to survive on this income in America, and prices for essentials have only increased over the last two years primarily because of the Fed's reckless money printing.

This policy is an absolute disgrace and represents the final looting of the American people. There will simply be nothing left to the value of the dollar, and all of the important assets will be funneled straight up to the elite banksters.

You think you are slaves now?  Just wait.

______________________________

JUST WAIT says the article above.  Below you see how Obama and neo-liberals in Congress passed the laws creating the conditions for this bond bubble knowing a crash would hit Federal, state, and local governments the hardest.  As I question Maryland politicians about these bond leverage deals that place the taxpayer in charge of debt for decades and telling them the bond market is getting ready to crash----they tell me----OH, THAT WON'T EFFECT A PLAIN VANILLA BOND DEAL LIKE THIS!  Plain vanilla bond deal?  When Obama and Congress created terms for bonds that made the world want to buy them the bond bubble soared.  Then, the FED QE made them soar.  Remember, when the subprime loan crash came we found all of Wall Street investors in these loans had Credit Default Swaps-----insurance against losses ----with AIG being the corporation served up in sacrifice for the fraud.  These toxic policies were insured for 100% on the dollar and Obama and Geithner made sure that 100% was paid by taxpayer bailout.

Below you see the same thing happening.  The boom market now in insurance is Bond Insurance.  We see this corporations looking to be the AIG of this bond fraud as it insures bond deals against losses at 100%.  We all know the crash is coming so why are these insurance deals happening?  Taxpayers will come in to bailout this insurance corporation when the bond crash occurs. 

As you see Moody's and the other rating corporations are still in the game rating these bonds and the insurance no doubt AAA as it does Maryland and its financial picture. 


THIS ENTIRE BUSINESS DEVELOPED IN RESPONSE TO THE POLICIES IMPLEMENTED BY OBAMA, CONGRESS, AND THE FED.  IT IS THERE SIMPLY TO ALLOW THESE BANKS TO CREATE BOOM AND BUST WITH NO LOSSES FOR THE PEOPLE DOING IT.


Answers to Questions about the Novation of CIFG Assurance North America, Inc. Municipal Bond Insurance Policies to Assured Guaranty Corp.
 
December 12, 2011

In January 2009, CIFG Assurance North America, Inc. (CIFG) and Assured Guaranty Corp. (AGC) entered into a reinsurance transaction whereby AGC provides reinsurance to CIFG with respect to certain U.S. public finance and infrastructure bond insurance policies (the "covered policies").  CIFG and AGC also agreed that they would use commercially reasonable efforts to novate the covered policies to AGC.  CIFG has begun sending requests to the issuers of insured obligations (or to the applicable trustee of the bondholders) seeking consents for the novation of the covered policies. 

The novation is being implemented in two phases.  In the first phase, consents are being solicited for bonds insured in the primary market.  Bonds insured in CIFG’s secondary market custodial receipt program will be solicited in the second phase.
To the extent regulatory filings or approvals are required in connection with the novation of any policy, requests for consent will only be sent after any applicable waiting periods have elapsed or any required approvals have been obtained.

What are the benefits of novation?

Novation gives bondholders the direct protection of AGC’s claims-paying resources.  Once a municipal bond insurance policy has been novated,
AGC will request, and expects to obtain, an AGC insured rating from S&P, Moody’s or both depending on which originally provided a CIFG insured rating for the related bonds.  Although AGC already provides 100% reinsurance for the covered policies and administers the policies on behalf of CIFG, CIFG remains the insurer until the policies are novated, and the bondholder remains subject to credit risk of CIFG.

As a bondholder, do I need to take any action for the bond insurance policies to be novated?

In general, bondholders are not being asked to take any action at this time.  If there is a trustee for an issue insured by CIFG at origination, the trustee has been asked to execute a consent to the novation.  If there is no trustee (as is true for many municipal general obligations that utilize a paying agent), then the issuer has been asked to execute such consent.  If an insurance policy was written by CIFG after the bonds began trading in the secondary market, the custodian bank holding the custodial receipt that associates the policy with the insured bonds will be asked to execute the consent. Bondholders may be contacted directly by the applicable trustee, issuer VIEW LIST OF COVERED POLICIESor custodian bank as part of the consent process.

The offer to novate a particular municipal bond insurance policy will be open through the date specified in the offer unless such date is extended or the solicitation is earlier terminated at the sole discretion of CIFG and AGC.   Bondholders should contact the trustee, issuer or custodian to inquire about the status of the request and whether any action has been taken.  Bondholders are also encouraged to send their contact information, together with the name of the issuer, CUSIP number, original par, series and other identifying information concerning the insured bonds, to CIFG at novationteam@cifg.com in order to facilitate the novation process.

How will I know if the insurance policy has been novated? 

Novated policies will be identified in a list of covered policies maintained on this page of the Assured Guaranty website, which may be reached at www.assuredguaranty.com/novation.  Additionally, once S&P and Moody’s have issued new insured ratings for a given issue, those ratings should be reflected on data services such as Bloomberg.

VIEW LIST OF COVERED POLICIES
What happens to the insurance policy when novation takes place?

All of the terms and conditions of the policy will remain unchanged, except that AGC will be the insurer in full substitution for CIFG and, because of that substitution, AGC will have all of the rights and obligations of CIFG under the policy and related documents and CIFG will be fully released of its obligations under the terms of the policy. The consent form signed by AGC and the issuer, trustee or custodian, as the case may be, and a notice of effective date issued by AGC following receipt of the signed consent form will become part of the policy.

Will all the municipal bond insurance policies be novated at the same time?

No.  Except as described below, the effective date for each policy’s novation is the date on which CIFG receives an executed consent form for that policy.

If CIFG issued a debt service reserve fund surety bond or a swap insurance policy in connection with my CIFG-insured bonds, will that be novated, too?

Separate consent requests are being sent to issuers, trustees or swap counterparties, as appropriate, for each debt service reserve fund surety bond and swap insurance policy.  In cases where a debt service reserve fund surety bond or a swap insurance policy was issued in connection with a bond insurance policy or policies, CIFG must receive the executed consent forms for each bond insurance policy, debt service reserve fund surety bond and swap insurance policy, as applicable, before the novation of such policies and surety bond shall become effective.  (Where there is no debt service reserve fund surety bond or swap insurance policy, multiple bond insurance policies issued in connection with a single bond transaction may be novated independently.)

________________________________________________

Do you see anything below that leads you to believe the FED is acting in the public interest?  It is Obama and Congress that appoints these FED chairs.  DO YOU HEAR YOUR POLS SHOUTING THE FED IS ACTING CRIMINALLY?

If you do not hear your pols shouting about this rogue FED policy they are neo-liberals working for wealth and profit ----NOT DEMOCRATS FOR GOODNESS SAKE.  GET RID OF THEM!


Mission
The Federal Reserve System is the central bank of the United States. It was founded by Congress in 1913 to provide the nation with a safer, more flexible, and more stable monetary and financial system. Over the years, its role in banking and the economy has expanded. Today, the Federal Reserve's duties fall into four general areas:

  • conducting the nation's monetary policy by influencing the monetary and credit conditions in the economy in pursuit of maximum employment, stable prices, and moderate long-term interest rates
  • supervising and regulating banking institutions to ensure the safety and soundness of the nation's banking and financial system and to protect the credit rights of consumers
  • maintaining the stability of the financial system and containing systemic risk that may arise in financial markets
  • providing financial services to depository institutions, the U.S. government, and foreign official institutions, including playing a major role in operating the nation's payments system

Is the Federal Reserve accountable to anyone?
 
The Federal Reserve is accountable to the public and the U.S. Congress. The Fed has long viewed transparency as a fundamental principle of central banking that supports accountability. In the area of monetary policy, the Federal Reserve reports
twice annually on its plans for monetary policy. In addition, the Chairman and other Federal Reserve officials often testify before the Congress. To further foster transparency and accountability in monetary policy, the Federal Open Market Committee publishes a statement immediately following every FOMC meeting that describes the Committee's views regarding the economic outlook, and provides a rationale for its policy decision. Full minutes for each meeting are published three weeks after each FOMC meeting. Full verbatim transcripts of the FOMC meetings are made available with a five-year lag. Further, the Federal Reserve Chairman holds press conferences after selected FOMC meetings to discuss the monetary policy outlook.

The Federal Reserve is transparent and accountable in its other functions as well. The Board of Governors prepares an
Annual Report summarizing activities of the Board and all Reserve Banks; the annual report is delivered to the Congress. To ensure financial accountability, the financial statements of the Federal Reserve Banks and the Board of Governors are audited annually by an independent outside auditor. In addition, the Government Accountability Office, as well as the Board's Office of Inspector General, frequently audit many Federal Reserve activities. Weekly, the Board of Governors publishes the Federal Reserve's balance sheet. During the recent financial crisis, the Federal Reserve provided information about its lending programs on its public website and in a special monthly report to Congress.







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July 17th, 2014

7/17/2014

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THESE ARE SOME OF THE THINGS TO WATCH FOR AND THINK ABOUT THESE NEXT MONTHS AS THE BOND MARKET PREPARES TO COLLAPSE.  I WANT PEOPLE TO KNOW THAT AS WITH THE SUBPRIME MORTGAGE LOAN COLLAPSE YOUR POLS NOT ONLY KNOW IT IS GOING TO HAPPEN----THEY ARE CREATING THE CONDITIONS FOR THE CRASH.  THAT IS BECAUSE THEY WORK FOR GLOBAL CORPORATIONS AND PROFIT.  GET RID OF THEM!



Keep in mind the entire financial system of frauds is based on tricking people, or allowing others to trick people into taking on more debt than they can handle knowing the end result will be a collapse in market that leaves people/government unable to pay the debt. With the subprime mortgage fraud the banks targeted low-income homeowners not only to gain control of real estate in urban areas but to target the Federal Housing Authority and its taxpayer payments of fees and loans.  This coming municipal/sovereign debt fraud collapse targets again government coffers and taxpayers as corrupt neo-liberal politicians load the states and cities with debt knowing this crash in 2015 is a sure thing.  Public officials take an oath to serve and protect the Constitution and citizens and none of this meets this oath.  They are aiding and abetting a crime by knowingly placing the public in harms way.  Remember, we can build Baltimore schools by simply ending the billion in fraud and corruption each year so there is plenty of taxpayer money for these infrastructure projects.  It is the leverage needed to implode the state and city economy.

AGAIN, WE CAN REVERSE THIS----WE SIMPLY NEED TO ELECT POLS THAT REBUILD RULE OF LAW AND OVERSIGHT AND ACCOUNTABILITY.  EASY PEASY.


I want to make sure people understand that all of this was known years ago---below you see in 2011 financial analysts were advising to prepare for the collapse.  During that time think how many credit bond and leveraging deals have been made in Maryland and Baltimore---including the big $1 billion deal to rebuild public schools.  I was shouting and writing to show the public knew this was malfeasance so we are under no obligation when the crash comes to hand everything to investment firms as they plan.  We must have Rule of Law to provide that protection.  This is why these elections are critical these next few election cycles and it is why Maryland was willing to allow systemic election violations for Governor to make sure the right person was in place to protect the fraud when this collapse comes.


Keep in mind the FED controls when this crash occurs to the extend of ending QE and allowing the manufactured  inflation be replaced by real inflation numbers . This will create the environment for mass exodus from the bond market and she has no way to stop this as it has maxed and is now unable to be contained.  She may delay it, but it will come and it appears likely 2015 will be the longest she can delay.  Inflation which is now thought to be 5% or so will jump to some of the highest levels in US history and it is all because of FED policy and Congress and Obama passing laws that made municipal bond markets artificially attractive.  They sold our bond market to the world just as they sold toxic subprime mortgage loans to the world.  They earned trillions and the American people lost everything as will happen this time around.


This article refers to the last time the FED considered ending QE in 2011.... as we know Bernanke decided to extend the death sentence and allow Yellen to handle the collapsing economy.
 

SHE WILL HAVE NO CHOICE AS THE FED IS MAXED IN DEBT AND INFLATION IS NOT CONTAINABLE. IT'S ONE BIG PONZI SCHEME.

O'Malley and the Maryland Assembly sold citizens out statewide and Rawlings-Blake and Baltimore City Hall sold citizens out locally as they did during the subprime mortgage loan fraud.

The Coming Bond Market Crash: The Three Moves Every Investor Must Make
  • By Martin Hutchinson, Global Investing Specialist, Money Morning  ·   July 1, 2011 



Since last November, the U.S. Federal Reserve has been buying U.S. Treasury bonds at a rate of about $75 billion a month. That's part of Fed Chairman Ben S. Bernanke's "QE2" program, under which the central bank was to buy $600 billion of the government bonds.

But QE2 ended yesterday (Thursday), meaning the Fed will no longer be a big buyer of Treasury bonds.

So starting today (Friday), the U.S. Treasury needs to sell twice as many Treasury bonds to end investors as it had been.

But the problem is, who's going to buy them?

Not China, which is diversifying its trillions in assets to get as far away from the U.S. dollar as fast as it can.

Not Japan, which is trying to rebound from its March 11 earthquake, tsunami and nuclear disaster - and is focusing all its spending on reconstruction.

And - as we've seen -neither is the Bernanke-led Fed.

I'm telling you right now: We are headed for an epic bond market crash. If you don't know about it, or don't care, you could get clobbered.


But if you do know, and are willing to take steps now, you can easily protect yourself - and even turn a nice profit in the process.

Let me explain ...

A Timetable for the Coming Crash I'm an old bond-market hand myself - my experience dates back to my days at the British merchant bank Hill Samuel in the 1970s - so I see all the signs of what's to come.

Having the two biggest external customers of U.S. debt largely out of the market is a huge problem. Unfortunately, those aren't the only challenges the market faces. The challenges just get bigger from there - which is why I'm predicting a bond market crash.

Latest Comment^ It is 2013, QE3 is out so maybe his timing is off but with all the printed mon…

Steadily rising inflation is one of the challenges. Inflation is a huge threat to the bond markets, and is almost certain to create a whipping turbulence that will ultimately infect the stocks markets, too.

Many pundits will tell you that if investor demand for bonds declines, and investor fear of inflation increases, bond-market yields could increase in an orderly fashion.

But I can tell you that the bond markets don't work like that. Price declines affect existing bonds as well as new ones, so the value of every investor's bond holdings declines. And with many of those investors heavily leveraged - especially at the major international banks - the sight of year-end bonuses disappearing down the Swanee River as bonds are "marked to market" will cause a panic. That's especially true when end-of-quarter or end-of-year reporting periods loom.

That's why we can expect a bond market crash at some point. If you ask me to make a prediction, I'd say that September or December were the most likely months for such a crash.

A Boxed-In Bernanke One sad - even scary - fact about what I'm predicting is that Fed Chairman Bernanke won't be able to do much about it ... though he'll certain try.

Consumer price inflation is now running at 3.6% year-on-year while producer price inflation is running at 7.2%. In that kind of environment, a 10-year Treasury bond yielding 3% is no longer economically attractive. Since monetary conditions worldwide remain very loose, inflation in the U.S. and worldwide will trend up, not down.

The bottom line: At some point, the "value proposition" offered to Treasury bond investors will become impossibly unattractive. When that happens, expect a rush to the exits.

If Bernanke attempts "QE3" - a third round of "quantitative easing" - he will have a problem. If other investors head for the exits, Bernanke may find that the U.S. central bank is as jammed up as the European Central Bank (ECB) currently is with Greek debt: Both will end up as the suckers that are taking all the rubbish off of everyone else's books.

There's a limit to how much Treasury paper even Bernanke thinks he can buy. And if everyone else is selling, that "limit" won't be high enough to save the bond market.


With Bernanke buying at a rapid rate, the inflationary forces will be even stronger,
so every Bureau of Labor Statistics report on monthly price indices will be marked by a massive swoon in the Treasury bond market.

Eventually, there has to be a new head of the Fed - a Paul A. Volcker 2.0 who is truly committed to conquering inflation. Alas, it won't be Volcker himself since, at 84, he is probably too old.

But it might be John B. Taylor, who invented the "Taylor Rule" for Fed policy. The Taylor Rule is actually a pretty soggy guide on running a monetary system. But it has been flashing bright red signals about the current Fed's monetary policy since 2008.

However, since a Fed chairman who is actually serious about fighting inflation would be a huge burden for current U.S. President Barack Obama to bear - and could badly hamper his chances for re-election, any such appointment is unlikely before November 2012.

How to Profit From the Bond Market Crash


Given that reality, it's likely that Bernanke will attack any bond market crash that occurs ahead of the presidential election just by printing more money; there won't be any serious attempt to rectify the fundamental problem, meaning inflation will continue to accelerate.

For you as an investor, this insight leads to two conclusions that you can put to work to your advantage. The scenario I've outlined for you will be:

Very good for gold and other hard assets. Challenging for Treasury bonds; prices will remain weak no matter how vigorously Bernanke attempts to support them.

So what should you do with this knowledge? I have three recommendations.

First and foremost, if Bernanke were not around, I would expect gold prices to fall following a bond market crash. But since he's still at the helm at the Fed, I expect him to do "QE3" in the event of a crash. And that means gold - not Treasury bonds - would become an investor "safe haven."

You can expect gold prices to zoom up, peaking at a much higher level around the time Bernanke is finally replaced. Silver will also follow this trend. So make sure you have substantial holdings of either physical gold and silver or the exchange-traded funds (ETFs) SPDR Gold Trust (NYSE: GLD) and iShares Silver Trust (NYSE: SLV).

Second, if you want to profit more directly from the collapse in Treasury bond prices, you could buy a "put" option on Treasury bond futures (TLT) on the Chicago Board Options Exchange (CBOE). The futures were recently trading around 94, and the January 2013 80 put (CBOE: TLT1319M80-E) was priced around $4.50, which seems an attractive combination of low price and high leverage.

Finally, if you don't already own a house, you should buy one - and do so with a fixed-rate mortgage. A U.S. Treasury bond market crash will send mortgage rates through the roof, so today's rates of about 4.8% will represent very cheap money, indeed. Even if house prices decline by 10%, a 2% rise in mortgage rates would increase the monthly payment (even accounting for a 10% smaller mortgage), by a net 11.8% (the payment on a $100,000 mortgage at 4.8% is $524.67; that on a $90,000 mortgage at 6.8% is $586.73).

Needless to say, the same benefits apply to rental properties financed by fixed-rate mortgages: With lower home ownership and rising inflation, rents are tending to rise significantly.

There's a storm coming in the Treasury bond market. But by recognizing its approach, we can turn the bond market crash to our advantage.


_________________________________________________

HMMMMMM.....reduce reserve funds and raise public debt.....all to augment the billions of dollars lost to the Maryland economy to fraud each year.

The debt takes the form of state leverage for projects and services----they have even leveraged the public pension funds all with no indication that 2015 will bring a major recession/depression.  DIDN'T SEE THAT COMING YOUR NEO-LIBERALS AND NEO-CONS WILL SAY!


All that leverage supposedly balanced the state budget and O'Malley pretended to be saving public sector jobs and pensions all while knowing this economic crash will lead to huge layoffs and end public sector pensions.
  Labor union leaders know this dynamic and still go with the neo-liberals doing it!
  As we all know each year since this 2010 article the public debt and leverage has increased.  Again, Republicans in other states are doing the same thing so do not listen to Maryland Republicans playing this card---they would do the same.

Maryland Governor’s Budget Cuts Reserve Payments, Boosts Debt

by Patrick Temple-West JAN 20, 2010 8:44pm ET Bond Buyer


WASHINGTON — Maryland Gov. Martin O’Malley yesterday released a proposal for the state’s fiscal 2011 budget that would reduce reserve fund contributions and increase public debt by 7.1% over fiscal 2010.




Below you see what is only the tip of the iceberg with tax credits that commit a level of tax forgiveness for decades that starves our government coffers.  O'Malley cut higher education aid and public transportation funding to pay for just a few of these corporate subsidies all in the name of jobs.  Well, when the bond market crash comes and the jobs are gone because of the recession global corporations will still be receiving tax breaks as they do business/make profits overseas. 

WHO CARES ABOUT LEVERAGE AND STATE DEBT WHEN THE IDEA IS TO MAXIMIZE PROFITS FOR GLOBAL CORPORATIONS.

We'll just cut more services, programs, sell public assets, and let global corporations handle the business of government that now has no revenue.

I'm not going to format since one can just look down very quickly to see all of the development is done with tax credits. They all are supposed to create jobs and help low-income people all of which will be killed by the coming economic crash from the credit leverage in these very policies.  Attracting global corporations to Maryland is the answer to jobs and a strong economy say neo-liberals-----only it does the opposite.  Most of these tax breaks will go to large corporations.

$2 million in tax credits for creating 10 poverty jobs......hmmmmmm.

Maryland Department of Business & Economic Development

economic development and the creation of jobs. MVF targets emerging technology-based businesses including biotechnology, information technology, telecommunications, software development and advanced materials.• Challenge Investment Program – $650,000 to ten start-up firms.• Enterprise Investment Fund – $2.2 million – three new firms and follow-on funding to five companies.Federal IncentivesCommunity Development Block Grant Program – Economic DevelopmentThis program assists local governments in implementing commercial and industrial economic development projects. Approved program funds are disbursed to eligible local jurisdictions as conditional grants and used for public improvements for business start-up or expansion or business loans. Projects must create jobs with the majority targeted to individuals from low to moderate income or eliminate blight conditions that impede commercial and industrial development. Fund uses include acquiring fixed assets, infrastructure and feasibility studies. • CDBG-ED funds of $2.2 million supported seven closed projects to create or retain 185 full-time jobs. Three projects worth $1.3 million were approved, representing 129 new or retained jobs.Maryland Economic Adjustment FundMEAF assists small businesses with upgrading manufacturing operations, developing commercial applications for technology, or entering new economic markets. Eligible businesses include manufacturers, wholesalers, service companies and skilled trades. Funds can be used for working capital, machinery and equipment, building renovations, real estate acquisition and site improvements. •Four Maryland Economic Adjustment Fund projects totaling $703,000 were approved and five transactions totaling $726,500 were closed.Tax Credit ProgramsOne Maryland Tax Credit Program Businesses can qualify for up to $5.5 million in income tax credits under the program when they invest in an economic development project in a “qualified distressed county.” Qualified Distressed Counties currently include: Baltimore City, Allegany, Dorchester, Garrett, Caroline, Somerset and Worcester. The business must create at least 25 new full-time positions at the project within 24 months of the date the project is placed in service. The business must be engaged in an eligible activity and incur eligible project or start-up costs. • FY2009 – 3 final certificates of eligibility issued for businesses that created 219 new jobs.Job Creation Tax CreditEncourages businesses to relocate to or expand in a Maryland Priority Funding Area by providing income tax credits based on new jobs created. Subject to various restrictions and conditions including location, wage levels and number of jobs created the credit may be for 2.5% up to $1,000 per job or 5% of annual wage up to $1,500 per job. • FY2009 – 7 final certificates of eligibility issued for businesses that created 307 new jobs.Enterprise Zone ProgramBusinesses located in a maryland enterprise Zone may receive income and real property tax credits in return for creating jobs. Local governments apply to the Department to designate Enterprise Zones. The ten-year real property tax credit reduces taxes on property improvements for ten years. The income tax credit for creating new jobs is$1,000 per new worker; for hiring economically disadvantage employees, up to $6,000 per new employee (over three years).• As of June 2009, there were 29 Enterprise Zones and two focus areas. • FY2010– 753 businesses will receive property tax credits totaling $26.3 million.– State share to reimburse localities will be $13.1 million, assuming the State’s full obligation is met.– Credits are based on real property investments totaling $1.945 billion.AGENCY MISSION & ACTIVITIES (contintued)

_____________________________________________

Here you see for whom neo-liberals and neo-cons in Maryland work---as they say we do not need to bring money home to pay taxes and  build infrastructure---we have plenty of business overseas thanks to O'Malley's 8 years of sending all of Maryland's revenue to building global structures for development.  We are exporting education and health care businesses none of which grows jobs in Maryland.

This is why neo-liberals are not concerned about the coming economic crash----it will not hurt these global corporations and it will provide excuses to hand more public operations/assets to these global corporations
.  Dulaney and neo-liberals are trying as hard as they can to repatriate global tax requirements in schemes to build infrastructure.  Remember, if they paid taxes we would have the money for infrastructure.  Domestic businesses pay taxes so the answer is GET RID OF GLOBAL CORPORATE CONTROL OF YOUR ECONOMY!  Dulaney is a Clinton investment banker who knows banks owe tens of trillions of dollars in fraud but does not seem to want to offer that solution.  Buying Treasury bonds when the bond market is preparing to collapse?  REALLY MR DULANEY?

Raise your hand if you know the answer is to get rid of global corporations from the Maryland economy rather than pretending to need to beg them for their taxes!!!!!  EVERYONE.  Raise your hand if you understand that tax breaks in exchange for bond purchases just when the bond market is ready to collapse will simply allow corporations to enter a bond market at the bottom for tremendous profits just as happened in 2008 with the stock market crash.  THAT'S WHAT THESE POLICIES ARE ALL ABOUT!


Everyone knows as well that the main avenue for recovering those tens of trillions of dollars in corporate fraud is HIGHER CORPORATE TAXES but as this article shows neo-liberals and neo-cons only intend to lower corporate taxes....you know, its all about job creation.


Md. Companies Have Billions in Assets Overseas Business Top News — 28 March 2014 By Fola Akinnibi
Capital News Service

6 WASHINGTON – The president’s budget, released in early March, called for the creation of a national fund to finance repair of the nation’s crumbling roads, bridges and other infrastructure — an idea also proposed by a freshman Maryland congressman.

Rep. John Delaney, D-Potomac, wants to fund infrastructure repair by bringing home billions of dollars in foreign earnings from U.S.-based corporations.  The congressman said he has been long concerned about decaying infrastructure.

Delaney’s Partnership to Build America Act would create a new way to pay for these repairs. Corporations would provide the money by buying bonds in The American Infrastructure Fund.


In exchange, they would be allowed to bring back money locked up overseas without paying the full 35 percent corporate tax rate.

Delaney’s bill could come as a relief to corporations with large foreign operations that have deferred paying U.S. corporate taxes on their overseas earnings indefinitely. For example, 10 Maryland-based multinational corporations, including Columbia-based MICROS Systems Inc. and Baltimore-based Under Armour Inc., are holding a combined $3.5 billion overseas, according to filings with the Securities and Exchange Commission.

While it would mean a major tax savings, none of the 10 publicly held Maryland companies contacted would comment on the proposed legislation.


One expert said there’s little incentive to bring the funds back with so much business opportunity overseas. Instead, it makes sense for U.S. companies to let the overseas funds stay put and postpone a U.S. tax bill.

“It’s better to defer,” said Michael Faulkender, a finance professor at the University of Maryland’s Smith School of Business.

Further, the Delaney proposal is out of sync with many plans to overhaul the U.S. tax code, he said. “Every proposal on the table is for the corporate tax rate to go down, not up.”

Rich Badmington, W.R. Grace & Co.’s vice president of global communications, said most of the Columbia chemical company’s revenue comes from international operations. The company plans to continue investing in those operations.

“We are able to do that without bringing cash back to the U.S. because we are continuing to invest,” Badmington said. “(Research and development) is a function that requires continuing investment and we have quite a lot of that outside the U.S.”

President Barack Obama’s latest budget plan called for the creation of a government-owned entity to finance infrastructure projects. Delaney said the president’s support for something similar to his bill was “great,” and said it shows how much momentum the bill has.

“We’re very optimistic about it, we have strong bipartisan support,” Delaney said.

The bill has 57 co-sponsors in the House and 12 in the Senate, including Sens. Lindsey Graham, R-S.C., and Michael Bennet, D-Colo., head of the Senate Finance Committee’s Taxation and IRS Oversight subcommittee. Hearings have not been scheduled for the bill.


Under the tax code, corporations can avoid paying taxes on foreign earnings as long as the money is being permanently reinvested overseas. When the corporations decide to bring these funds back home, a process called “repatriation,” the money then is subject to U.S. taxes.

Originally, the tax exemption was meant to help U.S. corporations compete overseas, said Mitchell Kane, a tax professor at New York University’s School of Law. Companies claimed paying taxes in two countries would put them at a disadvantage and the government responded with the exemption, he said.

The plan was to have the companies pay foreign taxes, which in many cases are lower than the U.S. tax rate, and then pay U.S. taxes when the money was repatriated. After this process, the company would receive a credit for any foreign taxes paid, Kane said.

Allowing such an exemption has created an incentive for companies to keep their money overseas and defer the U.S. corporate tax, said Jane Gravelle, an economist with the Congressional Research Service. But parking money offshore isn’t a long-term solution for companies, she added.

“They may think they can hold their breath forever and borrow money,” Gravelle said. “How long are they going to be able to do that? Shareholders eventually want dividends.”


This exemption could result in $265.7 billion in lost revenue for the federal government through 2017, according to a 2013 report by Congress’ Joint Committee on Taxation.

For now, however, companies aren’t likely to repatriate without a major tax discount.

W.R. Grace has more than $1.1 billion held overseas and would have to pay $149.7 million in taxes if it was repatriated, according to SEC filings. That money will remain overseas, except in instances where repatriation would result in minimal or no U.S. taxes, the company said in its most recent SEC filing.

MICROS Systems, a Maryland-based computer hardware and software producer,
has about 61 percent of its cash and cash equivalents, $385.8 million, held internationally with no plans to repatriate, according to the company’s most recent filings with the SEC.

Maryland-based apparel company Under Armour has $95.2 million, or 27 percent, of its cash and cash equivalents held overseas with no plans to bring it back.

Spokespersons from MICROS and Under Armour could not be reached for comment.

Other companies have begun to repatriate their foreign funds, which Kane said could help cover corporate expenses. McCormick & Company, a spice, herbs and flavoring manufacturer, repatriated $70 million in 2012, according to the company’s most recent SEC filings. Even still, most of the company’s cash is held in foreign subsidiaries, the filings said.

A spokesperson for McCormick and Co. could not be reached for comment.

Some of the largest U.S. corporations make about half of their money internationally, Delaney said. The bill is just a way to get some of it back.

“It creates a way for some of that money to come back, which is good for our economy,” Delaney said. “And it creates this large-scale infrastructure fund, which is good for our country.”


Instead of government funding, the American Infrastructure Fund would raise cash through a $50 billion bond offering.
Companies would buy the bonds at a 1 percent fixed interest rate and a 50-year term, in exchange for a chance to repatriate a certain portion of overseas earnings tax-free for every dollar spent on bonds.

A bond to repatriation ratio would be determined by an auction and could result in companies paying an effective 12 percent tax rate, Delaney said. Money raised in the bond sale could then be leveraged and loaned to state and local governments for projects.

The auction process will benefit both the infrastructure fund and the corporations, which will be able to find a price that is right for them, Delaney said.

“We’ve talked to them and they’re very supportive of it,” he said.

The American Business Conference, Associated Equipment Distributors and Terex Corporation are among those supporting the bill.

Tech giants and pharmaceutical corporations have lobbied for a repatriation holiday since the 2004 American Jobs Creation Act allowed them to repatriate at a discounted rate. Because of the intellectually-based capital that these companies thrive on, it is sometimes easier for them to keep assets overseas.

For example, Apple has $124.4 billion held overseas, according to the company’s most recent SEC filing.

The 2004 bill reduced repatriation taxes to 5.25 percent if corporations promised to invest the money at home. The one-year holiday is widely regarded as a failure because it spurred an increase in repatriation, but not an increase in jobs or investments, according to a report by the Congressional Research Service.

“The argument was that it would be a stimulus” to the U.S. economy, Gravelle said. “Most people who studied this found out it was being used to repurchase shares.”

Share repurchases are a common way to boost stock prices.

Corporations used the money to pay stockholders dividends and pay off debts, which doesn’t make for a good stimulus, she continued.  Instead, the holiday created a “moral hazard” and companies have parked money overseas, waiting for the next holiday, Gravelle said.

Delaney’s bill has short-term benefits but doesn’t address the larger problems with the tax code, Faulkender said. Corporations will want to move more and more operations overseas if they can find discounts on U.S. taxes, he added.

“If you signal that firms are going to realize a lower tax rate, even after repatriation, on their foreign operations than on their domestic operations, you’re going to incentivize even more offshoring,” he said.

“I don’t think that’s good for the U.S. economy.”


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July 16th, 2014

7/16/2014

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THE NEXT FEW DAYS I WANT TO TALK ABOUT THE COMING ECONOMIC COLLAPSE IN 2015.  I WILL START BY REMINDING PEOPLE WANT CAUSED THE 2008 CRASH AND SHOW HOW THE TWO ARE TIED TO TRANSFERRING ALL WEALTH TO THE TOP AND USING THE EXCUSE OF GOVERNMENT DEBT TO DISMANTLE OUR DEMOCRATIC STRUCTURES.  NEO-LIBERALS AND NEO-CONS WILL TAKE IT ALL!


I want to encourage people to pay attention to a subject that bores everyone but is the source of the looting of US government coffers and individual's pockets.  The Federal Reserve and Wall Street frauds. We need to know all of this CAN be reversed.  The economy is closer to collapse yet again by the same people playing the same games and all of it illegal.  So, let's review what caused the crash of 2008 to see how it relates to what will bring the economy down in 2015.
Remember, these economic policies started when Reagan/Clinton took the Republican and Democratic Parties to neo-liberalism.  The goal back then was to dismantle all of the public structures built for strong 1st world country to create the wealth inequity that goes with empire-building. The same was happening in Europe and the UK.  This is why Maryland has no public justice or oversight and accountability today----all of this boom and bust is no accident----it is all about wealth redistribution to the top.

Clinton deregulated and broke the Glass Steagall to set the stage for this explosive growth of US corporations with no overight and Bush simply allowed for an 'anything goes' environment.  Reagan/Clinton/Bush working with Alan Greenspan and Wall Street.
  Greenspan/Geithner allowed open fraud and corruption in the financial markets and Bush made sure the US Justice Department and financial agencies aided and abetted these crime.  The goal was transferring real estate from citizens to the banks through foreclosure so to control development especially in urban centers like Baltimore as well as sending trillions of dollars in government funding for these subprime loans to the banks.  

 
'We didn't see that coming' said Greenspan. Meanwhile, neo-liberals at the state and local levels were allowing the subprime mortgage fraud go wild. This same thing happened in Europe as subprime mortgage loans filled their economy as well.  It was Obama's job to make sure the money stayed with those committing the fraud.


The constant portrayal of this Visigoth looting as creating homeownership for low-income people -----knowing a collapse would send people into foreclosure-----shows the social pathology driving Wall Street and neo-liberals and neo-cons.

IT IS NOT LEGAL FOR ANYONE TO ALLOW OPEN FRAUD AND CORRUPTION AND GREENSPAN WAS ALLOWED TO JUST FADE AWAY FOR ONE OF THE GREATEST CRIMES IN HISTORY.

This was no maestro---he simply used people's faith in government and Rule of Law and sold people in investing in a system he knew would blow up making most people losers.  Think what is happening today---media is telling you the market is strong, politicians are throwing pensions into it and we all know it is getting ready to crash....and in 2015 we will hear O'Malley and Rawlings Blake who are loading the state with debt just as they oversaw the subprime mortgage fraud----'I didn't see that coming'!
WELL, WE SEE IT COMING AND IT IS INFUSED WITH PUBLIC MALFEASANCE AND FRAUD.

Alan Greenspan: Public Enemy Number One


By Stephen Lendman Global Research, October 27, 2008

With so many good choices, it’s hard just picking one. But given the gravity of today’s financial crisis, one name stands out above others. The “maestro,” as Bob Woodward called him in his book by that title. The  “Temple of Boom” chairman, according to a New York Times book review. Standing “bestride the Fed like a colossus.” Now defrocked as the “maestro” of misery. Alan Greenspan. From August 11, 1987 to January 31, 2006, as head of the private banking cartel euphemistically called the Federal Reserve. That Ron Paul explains isn’t Federal and has no reserves.

It represents bankers who own it. Big and powerful ones. Not the state or public interest. It prints money. Controls its supply and price. Loans it out for profit and charges the government interest it wouldn’t have to pay if Treasury instead of Federal Reserve notes were issued. People, as a result, pay more in taxes for debt service. The nation is more crisis-prone. Over time they increase in severity. The current one the most serious since the Great Depression. Potentially the greatest ever. The result of Greenspan’s 18 year irresponsible legacy.

He championed deregulation and presided over an earlier version of today’s crisis. The Reagan-era savings and loan fraud. It bankrupted 2200 banks. Cost taxpayers around $200 billion and for many people their savings in S & Ls they thought safe.

In the 1990s, he engineered the largest ever stock market bubble and bust in history through incompetence, subservience to Wall Street, and dereliction of duty. In January 2000, weeks short of the market peak, he claimed that “the American economy was experiencing a once-in-a-century acceleration of innovation, which propelled forward productivity, output, corporate profits, and stock prices at a pace not seen in generations, if ever….Lofty stock prices have reduced the cost of capital. The result has been a veritable explosion of spending on high-tech equipment….And I see nothing to suggest that these opportunities will peter out anytime soon….Indeed many argue that the pace of innovation will continue to quicken….to exploit the still largely untapped potential for e-commerce, especially the business-to-business arena.”

A week later, the Nasdaq peaked at 5048. Lost 78% of its value by October 2002. The S&P 500 49% from its March 2000 high to its October 2002 bottom. Individual investors were left high and dry as a result. For Mr. Greenspan, it was back to engineering multiple bubbles with 1% interest rates and a tsunami of easy money.

He advocated less regulation, not more. Voluntary oversight. The idea that markets work best so let them. Government intervention as the problem, not the solution. In the mid-1990s, he told a congressional committee:

“Risks in financial markets, including derivative markets, are being regulated by private parties. There is nothing involved in federal regulation per se which makes it superior to market regulation.”

On October 23 before the House Government Oversight and Reform committee, he refused to accept blame for the current crisis, but softened his tone and admitted a “flaw” in his ideology. Confessed his faith in deregulation was shaken. Said he was in a “state of shocked disbelief.” Unclear on what went wrong. Not sure “how significant or permanent it is,” and added:

– “We are in the midst of a once-in-a century credit tsunami (requiring) unprecedented measures;”

– “This crisis has turned out to be much broader than anything I could have imagined;”

– “fears of insolvency are now paramount;”

– significant layoffs and unemployment are ahead;

– a “marked retrenchment of consumer spending” as well;

– containing the crisis is conditional on stabilizing home prices;

– at best, it’s “still many months in the future;”

What went wrong with policies that “worked so effectively for nearly four decades,” he asked? Securitizing home mortgages. “Excess demand” for them, and failure to properly price them he answered. Unmentioned was unbridled greed. The greatest ever fraud. No oversight, and a predictable crisis only surprising in its magnitude and how it grew to unmanageable severity.

Greenspan is now softening on regulation but barely enough to matter. Too little, too late by any standard, and only to restore stability after which chastened investors “will be exceptionally cautious.” In the end, in his view, “This crisis will pass, and America will reemerge with a far sounder financial system.” Until another Fed chairman repeats his mistakes. Creates a crisis too big to contain. Destroys unfettered capitalism as we know it. Changes the world irrevocably as a consequence. Unless this time is the big one and does it sooner.

In March 1999, Greenspan was optimistic at the end of a robust decade (that James Petras calls “the golden age of pillage”) with no worries about new millennium meltdowns. He addressed the Futures Industry Association and said it would be “a major mistake” to increase rules on how banks assess risks when they use derivatives. He added: “By far the most significant event in finance during the past decade has been the extraordinary development and expansion of financial derivatives.” By a compounded 20% rate throughout the decade. Around 30% alone by banks in 1998. And, according to Greenspan, “The reason that (derivatives) growth has continued despite adversity, or perhaps because of it, is that these new financial instruments are an increasingly important vehicle for unbundling risk….the value added of derivatives themselves derives from their ability to enhance the process of wealth creation (and) one counterparty’s market loss is the (other’s) gain.”

Overall, they’ve increased the standard of living of people globally, he claimed. In fact, they contributed to global crises in the 1990s. Hot money in, and meltdowns when it exited. The problem is derivatives work well in bull markets, but are disastrous when they’re down. Going up they do nothing for ordinary people, but during downturns receding tides sink all boats and all in them and aren’t the zero sum game Greenspan suggested.

Worst of all are so-called credit default swaps (CDSs). The most widely traded credit derivative. In the tens of trillions of dollars. A $43 trillion market, according to PIMCO’s Bill Gross. The International Swaps and Derivatives Association (ISDA) estimates it at $54.6 trillion. Down from $62 trillion at yearend 2007. Others place it higher, but key is what they are and how they’re used. They resemble insurance (on risky mortgages), but, in fact, are for little more than casino-type gambling. Unregulated with no transparency in the shadow banking system that dwarfs the traditional one in size and risk.

Gross describes it this way. It “craftily dodges the reserve requirements of traditional institutions and promotes a chain letter, pyramid scheme of leverage, based in many cases on no reserve cushion whatsoever.” CDSs are at the center of shadow banking, and Gross and others warn about possible financial Armageddon if things begin collapsing.

A “Cheerleader for Imprudence”

That, according to James Grant, editor of Grant’s Interest Rate Observer. Greenspan’s “biggest mistake was inciting people to do imprudent things.” He called him “marble-mouthed” for his “Greenspeak” and not simply admitting he “was as blind as those (he) pretended to lead. This sense of security that people invested in the idea of perfect control by an all-knowing brain at the top, that idea’s been shattered.”

In July, Grant was outspoken in a Wall Street Journal op-ed titled “Why No Outrage?” He quoted Mary Elizabeth Lease from the Populist era haranguing farmers to “raise less corn and more hell.” He asked why today’s financial victims aren’t protesting Fed policy “of showering dollars on the (monied) people who would seem to (least) need them.” Where are the “uncounted improvident?” Have they “not suffered (enough) at the hands of what used to be called The Interests? Have the stewards of other people’s money not made a hash of high finance? Where is the people’s wrath?” In the wake of the “greatest (ever) failure of ratings and risk management.”

Greenspan’s Fed cut interest rates to 1%. “House prices levitated as mortgage underwriting standards collapsed.” He claimed earlier that property appreciation was a sign of prosperity and a strong economy and “while home prices do on occasion decline, large declines are rare.” Most homeowners experience “a modest but persistent rise in home values that is perceived to be largely permanent.”

Especially, according to Grant, at a time that “credit markets went into speculative orbit, and an idea took hold. Risk….was yesterday’s problem.” It led to “one of the wildest chapters in the history of lending and borrowing.” As a consequence, an $8 trillion home valuation wealth bubble and an unprecedented oversupply of unsold properties. Now in even more  oversupply as owners default. Are foreclosed on or simply walk away from unaffordable underwater assets. They sit empty with no one to buy them except for those able in distressed sales.

The whole episode criminal and avoidable had the Fed used its authority under the 1994 Home Ownership and Equity Protection Act. It authorized the central bank to monitor abuses and intervene, if necessary, to prevent abusive lender practices. It failed to do it.

The result was predictable. People and the economy in crisis. Greenspan orchestrated it. His successor Bernanke did nothing to curb it. Wall Street was on a roll until it crashed. Huey Long once compared JD Rockefeller to “the fat guy who ruins a good barbecue by taking too much.” Wall Street thrives on it. Fed largesse enables it. The problem is their indigestion affects everyone. A stomachache spreading round the world. How bad it’ll get and where it stops nobody knows. Blame it on Greenspan. Our “former clairvoyant,” according to Grant.
___________________________________________


Below you hear the same talk as we did in 2006-2007 as the subprime mortgage market began to implode and again it was the FED policy and the Obama Administration/Congress that fueled this crash just as it was Greenspan and Bush with the subprime mortgage loans.

Where last fraud centered on redistributing real estate to the few----this fraud centers on using credit bond and municipal debt to create the excuse to privatize all that is public and end public sector pensions and benefits.  The 2015 crash will be so deep with no help from the Federal government still holding $17 trillion in debt from the last massive corporate fraud that the US economy will look like Greece and Spain.  It will place the US in the same double-disaster as Europe---subprime loan fraud/sovereign debt fraud.

As the article below states-----hold on to your hats as the market sees a mass exodus from the bond market!!!


Where this article makes it sound that Yellen is being a 'dove'....she has no options....the FED under Bernanke did what the FED under Greenspan did......fed the bond market bubble until there was no return.  Remember, Wall Street wants people back in the stock market and blowing up the once safest place to invest, the bond market, will do that.  Soon, everyone will be fleeing the bond market as it collapses right back to the stock market.  They are making trapped rats of our pension system and giving us no opportunity for a stable economy.


THAT'S A NEO-LIBERAL/NEO-CON FOR YOU!!!!!  GET RID OF THEM!!!


Fed Officials Trying to Warn Bond Markets
July 15th, 2014
in contributors

by EconMatters, EconMatters.com

The Purpose of Complacency Talk

The Fed officials have been coming out in speeches the last couple of weeks with rhetoric about 'complacency' and other such code words for chasing risk ahead of what the Federal Reserve knows is going to be an abrupt change in monetary policy over the next six months.


Follow up:

The Fed is concerned because they know they want an orderly transition in markets and not causing major dislocations in markets by massive selloffs. However, the getting is so good with interest free money that participants are going to push this edge they have in markets right up until the last possible exit minute.

So despite the fact that QE ends in October with no more bond buying by the Fed, the 10-Year is still sitting at 2.50% with participants making money hand over fist with the borrow at 15-25 basis points and investing in yield instruments with massive leverage trades that has been so popular and irresistible by investors looking for 'free money arbitrage' opportunities.



An Orderly Unwind

The problem that the Fed has rightly identified is that they are not going to get an orderly exit at this pace, the unwind is going to be massive, jarring, and definitely not 'orderly'! The Bond markets, take the 10-year yield could literally have a 25 or 35 basis point move over a 24 hour period that would wreak a lot of havoc on fund flows, asset classes and financial markets.

This turmoil in the bond market could really be disastrous because the Fed participants realize the bond market isn't being priced currently where the Fed is moving to in terms of monetary policy. The Fed should be alarmed because the unwind is setting up for a possible 100 basis point move in two months' time frame type of fund dislocation and reallocation of capital, and that is going to be problematic for markets!



But the Fed only has themselves to blame for this predicament as in this case you cannot have your cake and eat it too! Janet Yellen cannot be so dovish at Fed news conferences given her reputation as a dove among doves, and get any respect from market participants; the trade is going to be all-in and one-sided without the slightest regard for the risks associated with being so aggressive.

In short, Janet Yellen has encouraged the one thing that Fed governors should always avoid being so 'transparent' that market participants go full boar on a trade, one-sided, highly levered, unhedged, and nothing could possibly happen with this dovish a Fed Chairperson at the helm trade! In a nutshell they have become too 'complacent' or they have taken her dovishness for granted.

Pigs at the Bond Trough

The pattern has been quite clear in Bond Markets wait until after the 200k plus Employment Report blows the 10-Year up to 2.70%, and come in and buy bonds like there is not tomorrow with huge leverage, until they have to get out of the way of the next CPI, GDP or Employment Report - as this process has repeated itself over the last four months of financial markets. The Levered Yield Trade has been the trade of the year so far in 2014 - the strategy of investing in anything with yield from over-valued utilities, pricey bonds and even stodgy low growth Big Caps with some semblance of a dividend yield!

Janet Yellen cannot have her Dovish Cake, and eat it too in the form of an "Orderly Unwind"!

So the Fed has to realize that sending out the mignons of the Fed isn't going to counteract Janet Yellen's dovishness. If they want markets to start unwinding trades ahead of policy adjustments that are coming and not wait until the last possible minute, then Janet Yellen herself is going to have to send a shot across the monetary bow so to speak!

She is going to have to come out with a hawkish tone to garner some healthy respect for normalization of fed policy by markets. She is dovish we get that, but the Fed is about to change monetary policy, and much sooner than is currently priced into many asset classes, and it is going to take some considerable time if participants started repositioning today to unwind many of these massive positions in markets, any sense or orderliness necessitates a little at a time versus all at once!

Janet Yellen has got to start talking hawkish to get this process started otherwise her worst fear is going to materialize in spades as market participants are all going to wait until the last minute trying to make that last dollar on the yield trade, and cause huge market turbulence when they all try to get out at once!



The Data Indicate 1st QTR 2015 Rate Hike at the Latest!

The Employment numbers, the inflation numbers, and the risky valuations in financial markets all point to the Fed needing to start raising rates sometime in the first quarter of next year. This is much sooner than Janet Yellen's Dovish talk has markets pricing in with their forecast for late in 2015 for the first rate hike.

Market participants are far too levered up, all on the same side, and well behind the monetary normalization curve of when the first rate hike is actually going to occur. This is a recipe for disaster, and that seminal light bulb moment in financial markets when everybody realizes, that moment in Margin Call where the analyst drops the ear-buds out saying internally holy shit, that they need to liquidate everything right now. In other words, the entire market all hits the sell button at the same time!


_______________
Wall Street and the FED thinks the steps towards stabilizing the economy have been a success and they are ready for the coming crash.  What's not to like---the American people lose all their wealth as the richest wealth soars.

Below you see an article that shows the progression of the plan.  Goldman Sachs was key to the financial frauds in the US but were key in bringing down the European social society.  They targeted especially Greece and Spain with fraudulent financial instruments loading these nations with huge sovereign debt having the goal of imploding the economies forcing the dismantling of social society.  Why this is important to Americans today? It is these same tactics are now coming to the US.  We experienced the subprime mortgage fraud in the US as they did in Europe but Europe was brought down harder because a second fraud----sovereign/municipal debt fraud ----completely emptied their government coffers.  This is why Europe is in deeper distress than the US.  Well, the time is now for the sovereign debt fraud in the US and it looks like levered municipal bond debt, mortgaged tax debt, and state and local money tied to development that cannot be afforded. 

THIS MASSIVE DEBT BUILDUP ON THE BACKS OF OUR GOVERNMENT IS WHAT CREATED IN EUROPE THE DEEPEST OF RECESSIONS.

This happened in Europe between 2001 and 2007 and now it is being done here in the US between 2008 and 2015.  The subprime mortgage fraud was about taking the American people's wealth-----this coming municipal bond leverage fraud is about taking the government wealth as happened in Europe.

Goldman Sachs and DeutscheBank both created fraudulent financial instruments that allowed government officials to hide their national debt so more debt could be taken.  None of this is legal and Goldman Sachs knew it was breaking the law.  So Greece and Spain were made to look like the government budgets were balanced when they were ever deeper in debt.  Making these governments look like they were AAA mirrored making subprime mortgage loans look AAA.  These government officials in Greece and Spain took more and more credit and distributed money to friends and off-shored it until these economies imploded from debt.  Europe's TROIKA then came in to make the Greek and Spanish people pay for the fraud just as is happening in the US with the subprime mortgage and other financial frauds.
  You see Europe's Draghi and his connection to Goldman Sachs overseeing the crisis just as Tim Geithner did in the US.

THE KEY WORDS HERE ARE HIDING SOVEREIGN DEBT TO LOAD MORE DEBT TO MAKE THE IMPLOSION SO DEEP AS TO FORCE THE DISMANTLING OF GOVERNMENT ASSETS.

That is what happened in Europe.  Subprime mortgage fraud and sovereign debt fraud.  Today, the US economy is ready to implode from sovereign/municipal bond debt.
  Maryland is ground zero for this.  O'Malley and Maryland Assembly and Baltimore City Hall has loaded the state and city with so much leverage in credit bonds and tax deals that when the crash comes in 2015 the public will be stuck with debt so large----just as Greece and Spain---that the recession will be deep and the debt too large, forcing the privatization of all that is public. 

THIS IS A PLAN---NOT SIMPLY GREED OR BAD POLICY.
  'MARYLAND HAS A 'AAA' RATING FROM MOODY'S YOU SAY'-----you mean the same Moody's that gave subprime mortgage loans the same AAA? 

Maryland's economy is one great big shell game.
  This is not a Democrat vs Republican issue because Republicans are doing the same in their states.  It is a complete breakdown of Rule of Law and a rush to take what you can.  The article below is long but please glance through to see how Goldman Sachs worked to implode Greece's economy and think about what is happening in Maryland!
Another long article but please glance through.

EU Ignores Falsification of Greek Public Finance Data
Posted on 18 December 2011 by
admin by Guest Author ECB Watch

This is a companion to another article to be published Draghi Nomination Based on Deception.  Here, we address the broader issue of the falsification of Greece’s public finance data.   We will look into Eurostat audits (Walter Radermacher), the ECB’s willful hindrance against the release of records (Jean Claude Trichet), Goldman Sachs’ communication (Gerald Corrigan), and the actions of the European parliament (Sharon Bowles), the Commission (Olli Rehn) and the European Securities and Markets Authority (Verena Ross). Click on cartoon for larger image.


Summary

Eurostat ran a series of audits of Greece’s public finances from 2009 to 2010, including for the swap transactions contracted with Goldman Sachs in 2001. These were used to misrepresent, by a few % relative to GDP, the extent of debt and deficits. Eurostat says it only became aware of it in early 2010: this calls for an explanation because news of the contentious transactions broke in 2003. According to the final audit, in 2010, the window dressing scheme initiated in 2001 was significantly restructured in August 2005. Soon after, Goldman Sachs sold its position for cash to the National Bank of Greece. This 2005 modification of the 2001 contract resulted in a 81% increase in the amount of concealed debt, in the accounts of 2006, relative to the initial amount. According to the same audit, Greece willfully misled Eurostat in 2008, when the contracts were still in effect (in fact, they will be until 2037). The national accounts of Greece were regularized by Eurostat in November 2010.

Spokesman for the bank Gerald Corrigan testified before the British parliament in February 2010. He personally vouched that the letter of the law was obeyed in the 2001 deal, suggesting that it was EU’s fault for allowing a loophole in its regulations. To minimize the perception of wrongdoing he reminded the audience that similar practices were age-old and common in the industry. Yet he stonewalled the questions of whether specific countries, Portugal and the UK, respectively, were clients that fell under this category. His leaving out the 2005 restructuring in his testimonial is an odd oversight.

He [Gerald Corrigan] personally vouched that the letter of the law was obeyed in the 2001 deal, suggesting that it was EU’s fault for allowing a loophole in its regulations. In April 2010, former prime minister of Belgium Guy Verhofstadt spearheaded a hearing, Greece : the moment of truth. It was held by the Economic and Monetary Affairs Committee of the EU Parliament under Sharon Bowles’ chairmanship. There appears to be a disconnect between the objective and what Sharon Bowles delivered, as we argue further down in relation to ESMA, but another indication of it is that the deposition of the spokesman for Goldman Sachs, Gerald Corrigan, bears no relation to the stated topic (the word Greece is not to be found).  This is perhaps an indication of a disconnect between the objective and what Sharon Bowles delivered. We will argue it further below in relation to ESMA. In November 2010, Jean Claude Trichet obstructed the release, requested by Bloomberg, of ECB documents detailing the swap transactions. In May 2011, he went as far as vetoing a legal claim, made by Bloomberg, to reopen these archives. Was his justification, preventing acute market risks, satisfactory?

In August 2011, the Commissioner for Economic and Monetary Affairs, Olli Rehn, to appease the concern of an MEP about the possible connection of Mario Draghi to the falsification of Greek public finance data, misrepresented the evidence contained in a November 2010 Eurostat audit report as to this connection. Recall that Mario Draghi’s hearing in June, just before a vote by the European parliament on his nomination, was, and remains to this day, controversial due to discrepancies between his defense on this issue and verified facts.

The legislative branch, in the U.S., has gone to great length to learn from the mistakes of the financial crisis.  In addition it came with evidence based recommendations to pursue criminal investigations that were or have been carried out by federal agencies and the department of justice.  In fairness, this process has been stymied by powerful interest groups.  Even so, Europe’s response, in comparison, for the case studied here, which is a significant chapter of the Greek debt crisis, looks unfavorable. The hearing Greece : the hour of truth may well have been a pretense, as hinted at. We now argue it further. The Commission and the European parliament would have had the authority to commission ESMA to investigate the matter.  Neither Olli Rehn nor Sharon Bowles, it seems, has taken this step.  Had it been the case, ESMA would have had the authority, if the conclusion of the investigation called for it, to bring a legal case against any alleged perpetrator of fraud, or delegate that task to national authorities.  Instead, ESMA’s stated priorities, under the leadership of its new Executive Director, Verena Ross, are the single rule book, production and analysis of data, and supervising credit rating agencies…

Note : we now use the EU institutions’ convention that ECON stands for Economic and Monetary Affairs.

Eurostat audits

Eurostat is the statistical office the EU Commission, whose current Director General is Walter Radermacher. In Eurostat parlance, a methodological visit is an audit that is undertaken in cases where the Eurostat identifies substantial risks or potential problems with the quality of the data.   There were a series of methodological visits to Greece. They began in 2009 and continued through 2010. Three major reports were produced, one on 29 October 2009, the second on 8 January 2010 and the third in November 2010.  According to the last one, a series of failings in the institutional arrangements and practical compilation of Greek public finance data. We skimmed through the January report and read the November 2010 report.  Only the latter addresses the contentious Greek swaps transaction.  It concluded as follows: Taking into account the work carried out [i.e. corrections to misreported data], as described in this report, the latest debt and deficit data for Greece now gives, in Eurostat’s view, an essentially reliable picture, [including for] fiscal data for the years 2006-2009. It is, therefore, an important report as it represents Eurostat’s final opinion on the issue of the Greek swaps contracted with Goldman Sachs.

Greece patently misled it in 2008, claiming that it neither engaged in FOREX swaps, nor in off market swaps. Eurostat’s summary of its dealings with Greece as pertaining to these swaps would be hard to reconcile, prima facie, with the blithely reported claim that the transactions were legal.  First, Eurostat says that At the beginning of the year 2010, it became known that Greece had entered in 2001 into currency off-market swap agreements with Goldman Sachs, using an exchange rate different from the spot prevailing one. This is strange, however, because the scheme was reported in 2003 by Risk.net.  Perhaps not coincidentally, notes the article, Greece’s credit rating by one of the three major credit rating agencies was raised, that year, from A to A+.  Second, Eurostat says that Greece patently misled it in 2008, claiming that it neither engaged in FOREX swaps, nor in off market swaps. These are exactly the type of transactions agreed between Greece and Goldman Sachs in 2001 and, as we see next, were actively managed thereafter. Eurostat’s audit says that in August 2005 a significant restructuring of the swap contract took place. The maturity of the swap was extended from 2019 to 2037.   This, together with other modifications, resulted in an increase in the amount of undisclosed Greek debt data, for the portion that is imputable to the deal, from 2.830 bn euros in 2001 [1] to 5.125 bn euros in 2006. It’s a 81% increase. Eurostat adds that [a]lmost at the same time, GS sold its rights and obligations to the National Bank of Greece (NBG, a bank completely privatised in November 2004). As a side note, Mario Draghi was appointed head of Bank Italy in 2006, ending his employment at Goldman Sachs. The latter had begun in 2002, when Goldman Sachs was reportedly the lead manager of Greece’s debt underwriting. His denial of any connection to the deal in a hearing before the ECON Committee in June 2001 remains controversial to this day.

There is no question that the 81% increase in the debt hiding scheme, in 2006, is imputable to the August 2005 modification: the restructuring operations implemented in 2005 and 2008 were in fact the explicit recognition of an increase of the liability (principal amount of the loan) to be recorded as debt of Greece. To complete our coverage of the swap transactions, let us quote Eurostat: [t]he swap was marginally restructured again in late 2008 [and was] securitised in February 2009 via a Special Purpose Vehicle (Titlos) that paid EUR 5.5 billion to the NBG. There is no question that the 81% increase in the debt hiding scheme, in 2006, is imputable to the August 2005 modification : the restructuring operations implemented in 2005 and 2008 were in fact the explicit recognition of an increase of the liability (principal amount of the loan) to be recorded as debt of Greece. The corresponding amount, 5.125 bn euros, persisted until 2007. The 2008 modification pushed it to 5.4 bn euros, and 2009 saw a decrease to 5.281 bn euros. We think the decrease is the result of an amortization scheme kicking in after a grace period of two years mentioned in the report. In 2010, Eurostat assigned these amounts as additions to government debt for the years 2006—2009. Goldman Sachs’ communication

Goldman Sachs Managing Director Gerald Corrigan testified before the House of Commons on February 22, 2010. This came to our attention in an article by Finfacts Ireland, and the transcript is contained in the document Too important too fail, too important to ignore (March 2010).  In question 295, for short Q295, he is asked [H]ave banks like Goldman’s not accentuated sovereign risk in countries like Greece by arranging loans for securitisation against future revenue streams that do not appear on the books or currency swaps that have not been calculated at normal exchange rates? To which, Corrigan personally vouches that the transactions were legal : [It] is very clear to me, based on the investigation that I have done over the past few days, that those transactions were very much consistent and comparable with the standards of behaviour and measurement used by the European Community.  There was nothing inappropriate. They were in conformity with existing rules and procedures when they were entered into. To back it up, he cites a consultation with Eurostat: When those transactions were entered into personnel from Goldman Sachs consulted with the appropriate authorities at Eurostat, as did, as I understand it, the Government of Greece and, again, there was no indication whatsoever that those transactions were not in line with existing practices, policies and guidelines.

Goldman Sachs identified a flaw in EU rules, in 2001, and exploited it—opportunity.  He [Corrigan] has not explicitly answered the question i.e. whether it increased sovereign risk —harm— but, absent his denial, it was implicitly conceded. Finally, he shifts blame on the EU not having stringent enough rules:  I should also say that those guidelines and standards were modified in 2007 which suggests that perhaps they were more liberal than they should have been back in 2001. In other words, Goldman Sachs identified a flaw in EU rules, in 2001, and exploited it—opportunity.  He has not explicitly answered the question i.e. whether it increased sovereign risk —harm— but, absent his denial, it was implicitly conceded.  The rest of his answer is laced with the mitigating factors that these practices have been around for decades, if not centuries and not limited to Goldman Sachs and Greece—rationalization.   However, when asked to confirm whether a similar deal was contracted with Portugal (Q296) and Great Britain (Q297), he dodged and could not confirm, respectively, reiterating the above rationalization in each case. The white elephant in the room, in this hearing, is the August 2005 significant restructuring of the swap contract.”  That’s keeping in mind that Greece is alleged by Eurostat to have misled it in 2008 about the existence of such transactions.  Although Goldman Sachs was no longer the counter party in 2008, it suggests that this modification has gone under the radar from August 2005 until Eurostat looked into the matter in 2010.

Let’s review some traits in Corrigan’s answers. He hinted at what we labeled an opportunity and had recourse to the same rationalization multiple times. These are two of the three factors that fall under the definition of the Fraud Triangle.   This is merely superficial but, unfortunately, there is a significant legal precedent attesting of unethical business practices at this company:   Goldman Sachs paid half a billion dollars to settle SEC charges that it misled investors in a subprime mortgage product (ABACUS) just as the U.S. housing market was starting to collapse.  The third factor is a motive.  The transaction generated hundreds of millions of dollars for the firm according to a press release by Bloomberg, EU seeks Greek swaps disclosure after ministry probe.  The ratio of the upper estimate of the fees (200 millions euros) to the amount of Greek debt masked under the 2001 deal (2.830 bn euros) is 7.1%. The key deal maker, Antigone Loudiadis, made a substantial fortune from the deal in just one year, reported the Wall Street Journal in 2010, and enjoyed a career boost thereafter.  Incidentally, she made controversial headlines again, reported Bloomberg in May 2011, as CEO of Rothesay Life, as regards to death derivatives.

He [Corrigan] hinted at what we labeled an opportunity and had recourse to the same rationalization multiple times.  These are two of the three factors that fall under the definition of the Fraud Triangle. Zero Hedge reported that, on the same day as Corrigan’s testimonial, the bank issued a communique. It essentially summarizes his arguments, with a few more figures but, again, makes no mention of the 2005 restructuring. Finally, Gerald Corrigan’s written statement does not address any of the above. Obstruction by Jean Claude Trichet

First, Bloomberg filed a request with the ECB in November 2010 to have access to ECB internal documents detailing the contentious transactions.  It was denied.   Second, Bloomberg contested the decision at the EU’s General Court in Luxembourg in December 2010.   Third, the ECB asked the General Court to dismiss the lawsuit, in May 2011, just one month before Mario Draghi’s nomination, apparently using a veto prerogative.  That’s one month before the nomination of the next ECB President whose possible role in the falsification of Greek debt as Goldman Sachs VP from 2002 to 2005 was raised by Simon Johnson as early as February 2010. Fourth, Bloomberg reacted in June 2011 with these words : The European Central Bank allowed itself to be deceived by a default in the making and now refuses to share with the taxpaying citizens it represents the details of the deception.  Secret and opaque financing got Europe into a mess that can only be resolved by the transparency of full disclosure.


The European parliament

As a member of the UK’s Liberal Democratic Party, Sharon Bowles is also affiliated with the Alliance of Liberals and Democrats of Europe, in short ALDE.   In March 2010, the former prime minister of Belgium and group leader of ALDE, Guy Verhofstadt, made a proposal to to promptly convene a public hearing of all those implicated in the falsification of Greek public accounts. He followed up with a declaration on 14 April 2010, reported in a press release known as Greece: the moment of truth, for Sharon Bowles to ask Director General of Eurostat to explain how accounts could have been legally modified and what measures were taken in the aftermath to prevent such actions. This was supposed to be discussed in a hearing, the same day, titled The fiscal crisis in the European Union – lessons from Greece.  According to the ECON Committee’s final draft programme, its participants were Sharon Bowles (moderator), Olli Rehn, Walter Radermacher, Gerald Corrigan, and a representative from a financial derivatives organization (ISDA), Richard Metcalfe.  We did not find the transcript of the hearing at EU Parliament’s portal, which is unfortunate, but we did find the deposition of Gerald Corrigan.  It contains insights on two subjects and nothing more.  The first is perspective on government debt management, such as the benefits of issuing debt through primary dealers.  The second is facilitating derivatives market surveillance, which recounts the initiatives of the financial industry policy group chaired by Corrigan, the Counterparty Risk Managment Policy Group (CRMPG).  This hardly addresses Guy Verhofstadt’s injunction, quoted in the press release Greece: the moment of truth : The chairman of Goldman Sachs in the US in particular should justify his bank’s speculation against Greek sovereign debt and the motivation of the investment bank which did not seem to be entirely based on economic considerations.

“widespread misreporting of deficit and debt data by the Greek authorities during in November 2004, [...] and on five occasions between 2005 and 2009.“  Eurostat audit January 2010 The topic reemerged in a parliamentary debate about Quality of statistical data in the Union and enhanced auditing powers by the Commission, on 15 June 2010. To frame it, we suppose, Sharon Bowles posted on 4 June 2010 the question of “whether any [Member States] have submitted falsifications or false data or statistics either intentionally or by neglect?”  The January 2010 audit had already answered that question for Greece: widespread misreporting of deficit and debt data by the Greek authorities during in November 2004, [...] and on five occasions between 2005 and 2009.” “In short, there is circumstantial evidence that the chair of the ECON Committee, Sharon Bowles, around 2010, was lagging behind Eurostat’s methodological visits to Greece. To conclude this section, former PM of Belgium Guy Verhofstadt’s high hopes, Greece : the moment of truth, in April 2010, may have fallen flat; that is, the EU parliament failed to deliver an account of who did what?


The Commission

In ECON Commissioner Olli Rehn‘s words spoken during the aforementioned 15 June 2010 debate, the closest match to Sharon Bowles’ question was As is well known, the Commission has undertaken in-depth work on Greek statistics over several years. The amended regulation should, in future, better mitigate the risk of fraud or manipulation of statistics, or of any other kind of irregularity.  Yesterday, there was a new development concerning Greece.  You will know that Moody’s decided to downgrade Greek bonds yesterday. On 21 July 2011, a parliamentary question was addressed to him, on the subject of Appointment of Mario Draghi as President of the European Central Bank.  This question was : Does the Commission have information on Mario Draghi’s involvement, whilst he was Goldman Sachs’ European vice-chair, in the dealings between the bank and the Greek Government over the concealment of accountancy fiddles? Olli Rehn’s answer, on 22 August 2011, was that transactions in derivatives between the Greek debt agency and Goldman Sachs dated back to 2001, implying that the President of the ECB had no connection to them. This is one of the two arguments presented by Mario Draghi before the ECON Committee in June, just before the vote on his nomination, that were found to be unsatisfactory.  Olli Rehn backs up his claim by citing the November 2010 Eurostat audit.  This is perplexing because the audit reveals that the terms of the contract between Goldman Sachs and the Greek Ministry of Finance were modified in August 2005.   This modification resulted in an 81% increase in the amount of debt concealed through this type of scheme.  Presumably, Mario Draghi still worked at Goldman Sachs at the time, since his term of office at the Central Bank of Italy started in January 2006.

In short, in August 2011, the Commissioner for ECON either misled the MEP (Willy Meyer) having some concern about Mario Draghi’s past at Goldman Sachs, or had superficial knowledge of the Eurostat audit he cited as evidence in defense of Mario Draghi’s reputation.

Has justice run its normal course?

Let’s try to understand by looking at a comparable case, the United States, where the financial lobby is nonetheless powerful. The above mentioned settlement with the SEC in July 2011 marked the end of a civil lawsuit that had begun in April 2010.  On 30 April 2011, Reuters reported that federal prosecutors in New York had begun a criminal investigation into other transactions, upon referral by the SEC.  In parallel, the Senate Permanent Subcommittee on Investigations, for short PSI, was investigating the financial crisis. It’s outcome, a bipartisan report, known as the Levin-Coburn report, was released in April 2011.  According to the Wall Street Journal, it asked for bank regulators to examine mortgage-related securities to identify any possible legal violations and use Goldman Sachs as a case study in implementing conflict prohibitions. October 2011, the aforementioned federal investigation, in New York, reportedly materialized with $1bn lawsuit against the bank, using evidence of investment bank abuses from the Levin-Coburn Report: Timberwolf was cited in a scathing U.S. Senate panel report in April that faulted Goldman, Deutsche Bank AG and others for hawking debt they expected to perform poorly..

Is the system of government fundamentally different in Europe, in this respect?  Of course not.  The equivalent of the SEC, in the EU, is the European Securities Markets Authority, for short ESMA, formerly the CESR.   It has only recently been granted enforcement authority known as level 4 of its governing procedure. Yet, it can issue a recommendation to a national authority[to carry out legal action].  To do so, ESMA must first carry out an investigation.  According to the same provision (level 4), the European parliament (Sharon Bowles), or the Commission (Olli Rehn) can request ESMA to get it under way.

The falsification of Greek debt, based on what was said thus far, and the fact that Goldman Sachs did not disclose it (See February 2010 Bloomberg article),  presumably constitutes a fairly obvious breach of their fiduciary duty as a primary dealer—a privileged position in the market.  Is anyone aware of Sharon Bowles or Olli Rehn launching an investigation into this scheme?  Let’s try to find out.

But in view of what precedes, there is reason to suspect that authorities have turned a blind eye to the problem. [referring to the falsification of Greek debt] In October 2011, a new Executive Director of ESMA, Verena Ross, was nominated, with the ECON Committee’s approval.  She gave a keynote speech to that effect in October 2011, in which she laid out her vision of the future focus of the work [of ESMA]. A lot has to do with harmonizing rules and processes across member states [2].  None of it addresses the glaring priority of bringing to justice the suspected perpetrators of financial crime.  If Verena Ross’ speech is to be taken at its word, the future focus of ESMA has a negative connotation:  turn the page and pretend that financial crime never happened.  In fairness, there were reports of a possible probe into this bank’s activities by the UK’s FSA and Bafin in Germany in the first half of 2010, but nothing specific about the falsification of Greek debt that we are aware of.  There was, however, a specific reference to that effect, in the US, by Fed Chairman Bernanke in the same period.   We can’t be certain that these investigations have stalled, or were put to rest.  But in view of what precedes, there is reason to suspect that authorities have turned a blind eye to the problem. Some financial experts allege a broader cynical scheme undertaken by the bank, that is reminiscent of its practices in the subprime crisis.  Essentially, these are hedging and speculative bets using insider knowledge of Greek public finances.   Let’s briefly review the literature.  In February 2010, two authors, Marshal Auerback and L. Randall Wray alleged that From 2001 through November 2009 [...] not only did Goldman and other financial firms help and encourage Greece to take on more debt, they also brokered credit default swaps on Greece’s debt—making income on bets that Greece would default.  No doubt they also took positions as the financial conditions deteriorated—betting on default and driving up CDS spreads. Corroborating evidence and analysis can be found in the following articles, listed in in chronological order : What about Greece and Goldman Sachs (Diplomatic World, Spring 2010), Clearing the air: Goldman Sachs and Greece (Hellenesonline, January 2011) and Goldman bet against entire European nations —who were clients— the same way it bet against its subprime mortgage clients (Washington’s blog, July 2011).



Notes

[1] The masking scheme is the combination of two sets of swaps. In the first set, a currency swap neutralizes Greece’s currency risk resulting from preexisting foreign denominated debt:  In 2001 a series of off-market cross-currency swaps were effectively linked to underlying debt instruments issued on foreign markets. This would have been standard practice, except for this clause:  the contracts were not based on the prevailing spot market rates of exchange [such that] the Greek government debt was de facto [immediately] reduced by EUR 2.4 billion by the conversion process. The second contains off-market interest swaps that are equivalent to a promise by Greece to make a stream of payments to Goldman Sachs.  This second set was designed to offset the gain for Greece resulting from the first set, such that its impact on debt and deficit, we must assume, would be gradual and slow.

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March 24th, 2014

3/24/2014

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THIS 2014 ELECTION FOR GOVERNOR AND 2016 ELECTION FOR PRESIDENT ARE CRITICAL. IF WE DO NOT HAVE A PEOPLE'S PERSON IN OFFICE RATHER THAN THE NEO-LIBERALS WE HAVE NOW, ALL THAT IS PUBLIC WILL GO TO THE RICH AND ANY WEALTH WE HAVE WILL DISAPPEAR. 

SHAKE THE BUGS FROM THE RUG AND GET RID OF CORPORATE NEO-LIBERALS!


Gansler, Brown, and Mizeur are all ready to protect wealth and profit.  DO YOU HEAR THEM SHOUTING EVER???


People always doubt when I give them the 35-45% unemployment number, but think to yourself, if over 175,000 new jobs must be created every month just to stay even.....the US has had very few of these weeks in years....each month unemployment numbers grow even as people fall off unemployment payments.  This is huge.  The FED gives the US Federal agencies these rates of 6.7%.

Remember, a third world country must impoverish 90% of people in order to control the population.  You see massive poverty with politicians promising hand-outs of basic human needs to get elected.  SOUND FAMILIAR? 

CONGRESS AND OBAMA IS BLEEDING THE PUBLIC DRY OF WEALTH WHILE PRETENDING TO ADVANCE SURVIVAL POLICY.  RULE OF LAW WOULD PAY THE NATIONAL DEBT WITH RECOVERY OF CORPORATE FRAUD MAKING FLUSH ALL PUBLIC TRUSTS AND GOVERNMENT COFFERS!

I spoke last time of Yellen and the FED policy meant to super-size wealth and keep unemployment high with the intent to bankrupt the public sector entirely with leveraged government debt and continuous fleecing of billions from government coffers.  All of this advances the neo-liberal goal of third world conditions here in America.  I use the leveraging of Baltimore City schools as an example, but all public projects in Maryland are leveraged and tied to Wall Street financial deals that will have the public sector fleeced just as people were of their homes and students were of their education/careers.

STILL, ALL YOU CAN HEAR ON MARYLAND MEDIA ARE 3 NEO-LIBERALS ALL SHOUTING TO LEVERAGE MORE, GIVE MORE TAX CREDITS, AND MARYLAND'S ECONOMY IS DOING FINE!


'The ultimate kicker is how closely the U.S. stock market is mirroring the market in 1929 (right before the Great Depression)'.


Actual U.S. unemployment is 37.2%, not "6.7%", record number of households on food stamps in 2013
RT
Wed, 22 Jan 2014 12:04 CST © Andrew Burton/Getty Images/AFP


A girl pays for her mother's groceries using Electronic Benefits Transfer (EBT) tokens, more commonly known as Food Stamps, at the GrowNYC Greenmarket in Union Square on September 18, 2013 in New York City. As the White House proclaims a recovery is occurring, and the stock market has a head of steam, millions of Americans and their dependents are being left out of the recovery, according to a set of economic indicators.

Perhaps the most worrying yet least reported aspect of the so-called US recovery involves the national labor picture. Although the official US unemployment rate is 6.7 percent, this figure obscures the reality, according to an influential Wall Street adviser.

In a leaked memo to clients, David John Marotta calculates the actual unemployment rate of Americans out of work at an astronomic 37.2 percent, as opposed to the 6.7 percent claimed by the Federal Reserve.

"The unemployment rate only describes people who are currently working or looking for work," he said.

"Unemployment in its truest definition, meaning the portion of people who do not have any job, is 37.2 percent. This number obviously includes some people who are not or never plan to seek employment. But it does describe how many people are not able to, do not want to or cannot find a way to work," he and colleague Megan Russell reveal in their client report, which was leaked to the Washington Examiner.

Contrary to expectations, a drop in the unemployment rate, Marotta argues, is presently a sign that the unemployed are simply dropping out of the job market.

The "officially-reported unemployment numbers decrease when enough time passes to discourage the unemployed from looking for work," said Marotta andRussel. "A decrease is not necessarily beneficial; an increase is clearly detrimental."

The authors then take aim at the so-called Misery Index, which provides something of a pulse rate of American prosperity, based on unemployment and inflation. The Wall Street adviser said the Index, which he maintains is actually over 14, as opposed to the 8 advertised by Washington, fails to address how the US economy is being hugely subsidized by various schemes, including monthly bond purchases by the Federal Reserve.

"Today, the Misery Index would be 7.54 using official numbers," the two analysts wrote. However, taking into consideration the full unemployment picture, including workers who have given up the job search, which is 10.2 percent, together with the historical method of calculating inflation, which is now 4.5 percent, 'the current misery index is closer to 14.7."

© Reuters/Jonathan Ernst
Protesters hold replicas of food stamps during a rally in support of higher pay for low-wage earners outside the National Air and Space Museum in Washington, December 5, 2013.In food stamps we trust

Marotta's findings, which put the actual US unemployment rate at over 37 percent, seem more credible when viewed alongside other indicators, including the number of Americans who now rely on government assistance to make ends meet.

It has just been reported that a record 20 percent of American households were receiving food stamps in 2013, according to data from the US Department of Agriculture (USDA).

The USDA data shows there were 23,052,388 households on food stamps in an average month of fiscal 2013, a jump of 722,675 from fiscal year 2012, when there were 22,329,713 households on food stamps per month on average.

Last year, according to data from the Census Bureau, there were 115,013,000 households. With 23,052,388 households - or 20 percent of the total number of households - now dependent on food stamps.

In just half a decade, the number of American households on food stamps has significantly increased. In fiscal year 2009, for example, the number of households receiving the government assistance program was 15,232,115. Five years later, in 2013, that number had surged by 51.3 percent to hit 23,052,388 households.

Meanwhile, the monthly average for individuals on food stamps hit an all-time-high of 47,636,084, according to the USDA. This is an increase of 1,027,012 over the 46,609,072 people who were getting food stamps in 2012.

In 2009, the number of individuals relying on the government program stood at 33,489,975. In 2013, the number was 47,636,084, an increase of 42.2 percent.

It should come as no surprise that spending on the US government's food stamp program, officially known as the Supplemental Nutrition Assistance Program (SNAP), has reached an all-time high.

Last year, SNAP cost $79,641,880,000 - a 164 percent increase over the past decade.

During the last five years, the SNAP program exploded by 36.8 percent, from $58,223,790,000 in 2009 to $79,641,880,000 in 2013.


_________________________________________
Your media pundit and politicians, labor and justice leaders will say they never saw this coming.....but they did.  I have shouted it for years and it is obvious to all.  So, all of O'Malley/Brown's credit bond leveraging and TIFs were designed to suck all public wealth and leave governments controlled by corporations.  That is what O'Malley's terms have been about and indeed, all governors across the country have been getting ready for this next collapse.  Sadly for you and me neo-liberals control most state and city executive offices like O'Malley and Rawlings-Blake in Maryland.  The City and State are so mortaged and taxes so high on the working and middle class now, that when the crash comes there will be nothing to tap.  There will be great defaults.

Now, if you elect for
Governor of Maryland  someone who will work to make the corporations and rich pay down these debts.....we the people will be OK.  If you elect a neo-liberal like Gansler, Brown, and Mizeur......everything will go the the rich.




Safety First: Strapping on Your Seat Belt Before the Coming Economic Crash

February 23rd, 2014   Investment Watch


It has been a while since the Global Economic Crisis has been the headline in the news. That doesn’t mean that it has ended. In fact, the world is moving further into a Global Economic Crisis daily, but people’s senses are dulled by the other new headlines such as Justin Beiber’s recent arrest and the Winter Olympics. Although it may seem irrelevant right now, global economic problems are brewing to levels that we have never seen before. These problems will begin to affect the U.S. soon.

Part of the problem is the federal reserves reckless money printing. This money was being used to fuel emerging markets and economies and to keep other economies afloat:

The Fed essentially is printing $85 Billion per month, out of thin air, using that digital money to buy bonds up, and trade them out with cash reserves or ultra-short term notes. Banks and hedge funds that owned the original bonds are then supposed to pump that money into the economy, creating a virtuous cycle.

Now, that they have slowed this process. Investors are taking this as a cue that the fun is over. They are beginning to pull their money from the markets:

Emerging market stocks, bonds and currencies—long coveted by investors attracted by the prospects of faster economic growth and access to young consumers—had a rocky start to 2013 as expectations of reduced U.S. monetary stimulus spurred capital outflows. Economic activity in many regions has slowed and faster inflation has eaten into savings.

This is causing massive financial instability in markets all over the globe.

In the past when nations were having trouble they could turn to financial powerhouses like

China for help. This will not be an option this time around with problems in Europe and Asia continuing to grow. XI Jinping of China has decided to stop letting the market run wild and has a plan for deflation. Deflation would be horrible for many economies because:

-Price deflation results in a real increase in the value of debt and a nominal decline in asset values. Debt can no longer be serviced.

-Price deflation would lead to massive tax revenue declines for the government due to a declining taxable base.

-Deflation would have fatal consequences for large parts of the banking system.

-Central banks also have the mandate to ensure ‘financial market stability‘

With unemployment statistics hitting all time highs in Greece and France and businesses failing at an alarming rate it is easy to see why the people there are in a state of unrest. In developing countries like Venezuela it has gotten so bad that armed military groups roam the streets. Topping this list of economic woes is Ghana who is on the cusp of economic collapse with a prominent economist from the country predicting that the country’s financial market will collapse by June if something is not done.

What messes everyone up is that these crises are not isolated incidents. When these crises strike one nation they affect everyone because all nations are connected. Although popular media would like you to believe that all nations are against each other, it is not that clear cut. All nations are connected through investments they’ve made in each other. So, when one fails all nations feel a little pain that they would like to avoid, so in most cases they band together to help whoever is struggling. This can easily be seen in the relationship between the US and China. The two nations compete in many subjects from sports, education systems, and even in their economies. However, when the US was having some major economic problems China was there to bail the US out. This came with some benefits for China, but it also made China even more invested in the well-being of the US since it has put more assets into the US’s economy. Investment Officer Alexander Friedman explains it perfectly:

The twenty-first-century economy has thus far been shaped by capital flows from China to the United States – a pattern that has suppressed global interest rates, helped to reflate the developed world’s leverage bubble, and, through its impact on the currency market, fueled China’s meteoric rise. But these were no ordinary capital flows. Rather than being driven by direct or portfolio investment, they came primarily from the People’s Bank of China (PBOC), as it amassed $3.US Treasury securities…But selling off US Treasury securities, it was argued, was not in China’s interest, given that it would drive up the renminbi’s exchange rate against the dollar, diminishing the domestic value of China’s reserves and undermining the export sector’s competitiveness

A wise man once said that, “those who don’t learn from the mistakes of the past are doomed to repeat them in the present. This statement rings very true. Especially, since all of these problems are being caused because the problems from the financial crisis of 2008 were never fixed. This is true everywhere considering the economist from Ghana was touching on the same principle when predicting why Ghana’s economy would crash:

The government is facing liquidity problems and if we don’t get the appropriate remedies to address the issues at hand the situation may worsen and by June the economy may crash…I said if they don’t address the fundamental problems facing the economy, by June the country’s economy will crash because the government has not even paid University Lecturers since last year among other pressing issues which needs to be address

The ultimate kicker is how closely the U.S. stock market is mirroring the market in 1929 (right before the Great Depression).

Remember Von Mises’s wise words:

There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved

The first step in preparing for any crisis is awareness, so at least the readers of this article will know to hold on and to buckle their seat belts before this economic crash.

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Obama, neo-liberals in Congress, and the FED have spent these years since the economic collapse in 2008 making sure those richest had all the money they could to expand overseas.  Global corporations getting bigger and global markets expanding into developing worlds.  They need to build another middle-class to consume now that they fleeced Americans of all their wealth.

All those trillions of dollars in corporate tax breaks, job stimulus money, and all of the tens of trillions of dollars in corporate fraud never recovered have gone to these developing world markets.  Over $600 trillion in derivatives leverage just as in 2007.  All of this done knowing this massive collapse would come and all done so that those at the top would be shielded.  This is why Yellen comforted everyone with the idea that the US global banks will not be harmed by this next crash.



So, WYPR exposed you and I to corporate NPR/APM and Basu telling us that nothing was wrong with policies, that the economy was growing, that jobs were being created AND NONE OF IT WAS TRUE AND THEY KNEW IT!


 6 Signs That 2014 Will Be The Year Of The Super Crash

6 Signs That 2014 Will Be The Year Of The Super Crash Gold Silver Worlds | January 30, 2014

As we have finally arrived in the magic year 2014, in which almost every economic and business cycle is trending down, it seems that things are perfectly lining up for a melt down. If it would have been true that the debt crisis was contained (like our political leaders try to make us believe), then there is a huge divergence with recent trends.

Are we pessimistic? No. Are we optimistic? We do our best. Above all, we aim to be unbiased and neutral. In any case, this article is not an attempt to predict prices or to time any market. That is useless and serves only marketing purposes. This article looks at six different trends which are lining up for an historic sell off in the markets. As readers observe, we stay as factual as possible.

Trend 1:


Market distortions because of QE appearing in emerging markets Up until now, the vast majority of economic and financial pundits have been praising the Western central banks for their monetary miracles. The last two weeks, however, were extremely important as we got evidence of the direct destructive effects of monetary easing. In particular, the carnage in emerging markets and their respective currencies revealed that things can get out of hand and have the ability to spiral out of control (much faster than governments can intervene).

Bloomberg says this is the worst selloff in emerging-market currencies in five years, revealing the impact from the Federal Reserve’s tapering of monetary stimulus. “Investors are losing confidence in some of the biggest developing nations, extending the currency-market rout triggered last year when the Fed first signaled it would scale back stimulus. While Brazil, Russia, India, China and South Africa were the engines of global growth following the financial crisis in 2008, emerging markets now pose a threat to world financial stability.”

Once the destructive power of this monetary experiment starts manifesting itself, it is likely to see spill over effects to all markets. Monetary easing could still look like innocent and constructive, but the side effects are unknown at present, as this is the first monetary experiment at this scale. The most concerning fact is that nodoby has an idea about how exactly the markets will react on each slice of tapering, and the precise timing of all effects (including the unintended consequences).

Trend 2:


There are almost no buyers left in equities Equity markets have shown exceptional yields in 2013. In a world with no yields, investors are chasing assets which yield more than nothing.

It has been thought that quantitative easing would create bubbles, but as it looks now it is resulting in bubbles in specific asset classes, as Marc Faber correctly predicted a while ago. The problem is that sentiment in the stock market has become far too optimistic. It’s not surprising, nor are investors or traders to blame, in a zero-yield world. The first chart shows the extreme optimism based on a bull/bear ratio.



 Another red flag is related to margin debt, see next chart. It shows the level of leverage in the equity market. We are well past the previous peaks.



However, there are reasons to believe that a crash is not imminent. Equities have surged but the margin debt to equities growth ratio is not as extreme as in the 2000 and 2007 peaks. This metric suggests there is some room for more upside.



We all know what happens when there is nobody left to buy. That point could be very close.


Trend 3:


 Manipulation is entering the public debate Currency markets, LIBOR, base metals, energy, … almost every single market has been manipulated. That is no news, of course, but the fact that it has become widely accepted is an important trend. Consider these headlines in the last few weeks:

  • Federal Reserve Said to Probe Banks Over Forex Fixing (Bloomberg)
  • Deutsche, Citi feel the heat of widening FX investigation (Reuters)
  • HSBC, Citi suspend traders as FX probe deepens (Reuters)
Even the precious metals manipulation debate is going mainstream. Up until now it remained in the “dark corners” of the internet, in the “blogosphere” and “gold bull” sites. Now it is the German financial regulator Bafin who says that “Metals, Currency Rigging Is Worse Than Libor” (via Bloomberg).

The key is that it has the potential to undermine trust. As readers know by now, trust is the pillar on which the current financial system is built. Once there was a tangible asset backing up the monetary and financial system; it was called gold. Not so anymore. A large scale loss in trust will have disastrous effects.

Trend 4:


Banks are once again reporting losses Several mega banks have been reporting losses in the last weeks. Is this a repeat of the 2008 scenario?

Consider Royal Bank of Scotland, who faces £8bn in full year losses. BBC writes: “RBS may face full-year losses of up to £8bn, after the bank said it needed another £3.1bn for claims relating to the financial crisis. RBS boss Ross McEwan said: “The scale of the bad decisions during that period [the financial crisis] means that some problems are still just emerging.”

Another giant, Deutsche Bank, posted EU1.2 billion losses in the fourth quarter. Via Bloomberg: “Deutsche Bank AG, Germany’s biggest bank, said this year will be challenging after a surge in legal costs and lower debt trading revenue spurred a surprise fourth-quarter loss. The shares slumped. Depressed interest rates in Europe and declining demand for banking services are also among the headwinds the bank is confronting in 2014, Co-Chief Executive Officer Anshu Jain said on a conference call with analysts from Frankfurt today.”

Wait a minute. The central banks of this world have injected close to $10 trillions in the banking system since March 2009, in order to prevent a melt down. They have reported happily that, by doing so, they not only saved the world but also generated economic growth. But at the time of victory, mega banks are reporting losses. Something does not add up here.

Trend 5:


The alarms of financial repression are deafening It is getting really ugly with financial repression.

Reuters reported this week that Germany’s Bundesbank publicly commented that countries about to go bankrupt should draw on the private wealth of their citizens through a one-off capital levy before asking other states for help. The Bundesbank’s tough stance comes after years of euro zone crisis that saw five government bailouts. There have also bond market interventions by the European Central Bank in, for example, Italy where households’ average net wealth is higher than in Germany.

“(A capital levy) corresponds to the principle of national responsibility, according to which tax payers are responsible for their government’s obligations before solidarity of other states is required,” the Bundesbank said in its monthly report. It warned that such a levy carried significant risks and its implementation would not be easy, adding it should only be considered in absolute exceptional cases, for example to avert a looming sovereign insolvency.”

The annoying part here is that the bail-ins debate is becoming mainstream. So it was no mistake from Dijselbloem a year ago when he said bail-ins will become the template for the future.

Moreover, some HSBC customers have been prevented from withdrawing large amounts of cash because they could not provide evidence of why they wanted it. The BBC writes: “Listeners have told Radio 4′s Money Box they were stopped from withdrawing amounts ranging from £5,000 to £10,000. HSBC admitted it has not informed customers of the change in policy, which was implemented in November. The bank says it has now changed its guidance to staff.”

Over to Russia, where, according to Zerohedge, the bank Lender has introduced complete ban on cash withdrawals until end of week, news agency reports, citing unidentified person in call center.

The subject is also going mainstream in the literature. A recent IMF working paper from Reinhart and Rogoff says: “The endgame to the global financial crisis is likely to require some combination of financial repression (an opaque tax on savers), outright restructuring of public and private debt, conversions, somewhat higher inflation, and a variety of capital controls under the umbrella of macroprudential regulation. Although austerity in varying degrees is necessary, in many cases it is not sufficient to cope with the sheer magnitude of public and private debt overhangs.”

The annoying part is that the financial repression story is intensifying. It is being accepted in the literature, among politicians and now we see an increasing number of initiatives being rolled out. Not good.

Trend 6:


Complexity theory points to a collapse Jim Rickards recently suggested that the world has become so interconnected that it has the looks of an extremely complex system. His research points out that complexity theory can be useful as an analogy to determine what comes next. Prior experiments in complexity theory suggest there is a point of no return: when things become too complex and interconnected, they can only come down.

Rickards sees a similar situation in the markets today. In fact, he saw something similar in 2006 and 2007. We all know what happened afterwards.

But what has the central bank noticed? Apparently nothing, as evidenced by their systemic risk model on the next chart. It is at an all-time high.



Should we be concerned when there is nothing to be concerned?

A valid question to ask is why Jim Rickars can detect things that the central bankers cannot. Rickards himself explains it in a very simple and short way: the Fed is using the wrong economic models. Their models could be fine theoretically, but they do not reflect reality.

Protect yourself Are six red flags enough to start protecting yourself? When things get out of hand, our world will become very selfish. The most likely outcome is that everything will come down initially, comparable to what happened in 2008. Chances are high that precious metals will recover fast.

The point in all this is that asset prices will be of secondary importance. Avoiding a total catastrophe could be far more important. There really is a reason why we advocate holding physical precious metals outside the banking system or open an offshore bank account with a debit card in gold or silver at a reserve bank.

_________________________________________

THIS IS WHY IT IS IMPORTANT TO HAVE ELECTED OFFICIALS IN TOP OFFICES THAT WILL LOOK OUT FOR THE PEOPLE AND NOT CORPORATIONS AND PROFITS.  BERNIE SANDERS MAY BE THAT PERSON FOR PRESIDENT AND CINDY WALSH IS THAT PERSON HERE IN MARYLAND!

'He believes that the next financial crash will result in society realizing that “modern financial institutions cannot in general be trusted with either individuals’ money or the provision of financial services to viable economies”
'


2014: Renewed Economic Growth or Financial Crash? DEVELOPMENT & SOCIETY : Business, Economics, Energy, Risk 2014•01•17 Brendan Barrett United Nations University

Your instincts may be telling you otherwise, but the global economy will be strengthening in 2014, according to two major reports released in recent weeks.

In an improvement over 2013’s global economic growth of 2.1 percent, we will see a 3 percent rise this year and a bump up to 3.3 percent in 2015, predicts the United Nations’ World Economic Situation and Prospects 2014 report.

This positive news is echoed in the slightly more optimistic Global Economic Prospects report issued by the World Bank this week that states:

“Global GDP is projected to grow from 2.4 percent in 2013 to 3.2 percent this year, stabilizing at 3.4 percent and 3.5 percent in 2015 and 2016, respectively, with much of the initial acceleration reflecting a pick-up in high-income economies.”

At the same time, the World Bank projects that developing country growth will rise above 5 percent in 2014, with China’s economy growing by 7.7 percent, India’s by 6.2 percent, Mexico’s 3.4 and Brazil’s 2.4 percent.

Global economy: the patient shows signs of recovery The UN report reads very much like the medical examination results for a sick patient who has had to take some pretty strong medicine, but while still looking rather pale and tired, is showing some signs of recovery.

Inflation (like high blood pressure) remains benign worldwide, the report states. It has decelerated in the United States and euro-zone, dropping to 2 percent in the former, and 1 percent in the latter. This is causing concerns from the International Monetary Fund that we could be entering a period of deflation (overly low blood pressure) and that could undermine the global recovery.

In the developing world, inflation rates are above “10 percent in only about a dozen countries scattered throughout different regions”, according to the UN report, and that is arguably a good thing.

High unemployment is part of the explanation for the lower inflation figures and unemployment rates remain a serious challenge, particularly for the euro zone where they reached record levels at 12.2 percent in 2013, but as high as 27 percent in Greece and Spain. Renewed GDP growth in 2014 is projected to bring reductions in these rates in both Europe and the US, with the latter dropping below 7 percent. Again, a very good development, if it happens.

There are, however, major concerns for developing and emerging economies highlighted in the UN report. First, there has been a measurable decline in private capital inflows to “emerging markets, a sub-group of developing countries”. Second, volatility in these markets has increased with equity market sell-offs and local currency depreciation.

Risk and uncertainties: It could all go very badly wrong While delivering these positive forecasts, the UN and the World Bank devote half of their respective press releases to the risks and uncertainties facing the global economy.

The Chief Economist at the World Bank, Kaushik Basu, suggests that “one does not have to be especially astute to see that there are dangers that lurk beneath the surface”. Over at the UN, Shamshad Akhtar, Assistant Secretary-General for Economic Development, claims that “uncertainties and risk coming from possible policy missteps as well as non-economic factors … could stymie economic growth”. By non-economic factors she is referring to the situation in Syria and the Middle East.

By far the biggest concern is the potential impact of the US Federal Reserve’s exit from the quantitative easing programmes. The aim of these programmes is to “inject money into the economy in order to review nominal spending”. This involves “purchasing financial assets from the private sector” using “new central bank money, in addition to boosting the amount of central bank money held by banks…”.

The problem is one of weaning the economy off these programmes with one danger being that the medicine itself could become a form of poison for the global economy. Rather than using the term weaning, the Federal Reserve talks about “tapering”, with the goal being to reduce the monthly amount of quantitative easing in the US, to gradually wind it down and to conclude their programme at the end of 2014.

The authors of the UN report are concerned, however, that tapering could lead to “a sell-off in global equity markets, a sharp decline in capital inflows to emerging economies and a spike in the risk premium for external financing in emerging economies”.

Andrew Burns at the World Bank argues that this decline in capital inflows to developing countries could fall by as much as 50 percent for several months “provoking a crisis in some of the more vulnerable economies”, specifically Brazil, Turkey, India and Indonesia.

Meanwhile, the UN report points to other risks including “fragility in the banking system and the real economy in the euro area and the continued political wrangling in the US on the debt ceiling and the budget”.

Neither the World Bank nor the UN consider that a crisis is inevitable but they do call for strengthened international policy coordination, renewed reform of the financial system and in some instances the tightening of fiscal policies.

Déjà vu – Feels like 2007/8 all over again Reading these reports, I am reminded of the situation back in 2007/8 when we first began work on the Our World magazine. At that time, I became aware of signals among noise about the state of the global economy when the era of cheap energy is over and decided that the magazine should focus on some of the major issues facing the world. One of those issues was the peaking of global conventional oil production.

So in 2007 we began working on the magazine and successfully launched at the beginning of July 2008, just before oil prices peaked at around US$147 per barrel. At the same time, the financial system was just beginning to unravel and a serious collapse looked imminent. Fortunately for us, the global leaders managed to rally around the problem and prevent the world from slipping into depression.

Now, I have that 2007/8 feeling all over again and you probably share it. Particularly, I am struck by a number of signals from financial commentators like Peter Schiff, author of The Real Crash, and Robert Wiedemer, author of Aftershock, who are warning that a second financial crash is just around the corner for the US.

They made similar predictions before the 2008 financial crash and you could argue that they are in the “economic collapse prediction business”, since they also offer their services as investment advisors. Their basic message is that you should try to save yourself and your money in difficult economic times, and if you buy their books you will know what to invest in and what to avoid.

It would be all too easy to dismiss these pundits were it not for the fact that the UN and World Bank reports mentioned above appear so cautious about their growth projections and about the fragile nature of the economic recovery. It is almost as if they are covering their options so that they can say, if things go wrong, “we did try to warn you about the risks we are currently facing”.

The question is whether our leaders are aware of these risks or blind to them.

Risk Blindness and the Road to Renaissance Coincidentally, I have just finished reading the most recent book from Jeremy Leggett – The Energy of Nations: Risk Blindness and the Road to Renaissance. Leggett describes himself as a “social entrepreneur” and is the founder of a renewable energy company, SolarCentury. He maintains a blog called the Triple Crunch Log that covers the interaction between energy, climate and the financial crisis.

Using the log, which tracks events as far back as 2006, Leggett’s book presents a blow-by-blow chronological account of how these three factors have played out in the past seven years.

In the United Kingdom he appears to be viewed by politicians, government officials and the major energy companies as the acceptable face of the environment, climate and/or peak oil community. As he puts it, he is a pinstripe suited, Financial Times carrying, climate change and peak oil concerned capitalist.

In his book, he describes numerous meetings where he interacts with the British government and Big Energy, often behind closed doors. In some instances, his accounts of those interactions read like episodes from Armando Iannucci’s dark political comedy, The Thick of It shown on the BBC.

Here is one example. A group of concerned business leaders representing the UK Industry Taskforce on Peak Oil and Energy Security (that Leggett helped set up) meet with the Secretary of State for Energy and Climate Change. Together they agree on a proposal for the government to work with the Taskforce to develop an oil shock emergency response plan. Subsequently, the business leaders issue a press release to announce the collaboration, only to find limited media coverage. They then discover that the civil servants in the Ministry had been informing the press that no such agreement was ever made. It would be a hilarious episode of The Thick of It, were it not actually true (check it out in the book).

What Leggett describes in his dealings with our leaders in government and the energy sector is a tendency towards “risk blindness” around climate, energy and the financial concerns. He suggests that this tendency will push us towards a financial collapse in the next few years. On the energy front, he sticks to his earlier prediction of an energy crash by 2015.

Leggett points out that many financial commentators believe a second financial crash is imminent. “The weight of debt that we have allowed to accumulate around the world will prove just too heavy for the financial system,” he writes in his book. “As things stand, a seemingly small event holds the potential to trigger the mass failure of banks.”

One such event could be the private equity decline mentioned in the above reports. We have to acknowledge the important role the UN and the World Bank are playing in outlining the risks so clearly and can only hope that the leaders of the world are not blind to them. Leggett, however, suggests that the problems are more profound than even the UN and World Bank officials are willing to admit.

He believes that the next financial crash will result in society realizing that “modern financial institutions cannot in general be trusted with either individuals’ money or the provision of financial services to viable economies”
. He further argues that “light touch regulation” of the financial system no longer works. To get us through the next crisis, we are going to need, he explains, a critical mass of “presidents and prime ministers keen to sit constructively in a multilateral emergency room”.

But Leggett is an optimist. With crisis comes opportunity and Leggett would like to see that the road forward takes us to a renaissance based on people power, community interests and the explosive growth of clean energy. In this context, The Energy of Nations is essential reading for those concerned with the interaction of the pressing global issues of today.

If the caution expressed in the UN and World Bank reports is correct then we find ourselves in a time of great risks and uncertainty. If the financial pundits are right then an economic catastrophe lies just ahead. If risk aware business leaders like Jeremy Leggett are making reliable observations then we have “arrived irredeemably in a time of consequences”.




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March 03rd, 2014

3/3/2014

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CORPORATE FRAUD RECOVERY AND TPP ARE THE TWO TOP ISSUES IN THIS ELECTION RACE. IF YOUR POL IS NOT MAKING THAT FRONT AND CENTER....THEY ARE NEO-LIBERALS WORKING FOR WEALTH AND PROFIT-----LOOK BELOW AT BERNIE SANDERS SHOUTING FRAUD NEEDS TO BE RECOVERED!!!!


Regarding the continued error in the phrase 'wealth inequity':

Again Basu tries to inform listeners of regional economic prosperity while failing to speak of the economic balance that will come when massive corporate fraud of tens of trillions of dollars comes back to government coffers and individual's pockets.  Until that rebalancing occurs, we cannot know one region's economic health over another.  Now, it so happens that the areas listed by Basu are indeed the areas front and center in these massive frauds along with the national corporate headquarters around Washington DC.  

WE ARE TELLING PEOPLE REPORTING THAT THERE IS GREAT WEALTH INEQUITY THAT YOU DO NOT CLAIM A BANK ROBBER RICHER THAN THE BANK FROM WHICH HE STOLE THE MONEY.

If you listen to pundits or politically align media like neo-liberal MSNBC you will hear this mantra....WE HAVE TO REVERSE WEALTH INEQUITY and not once do they say IT'S RULE OF LAW THAT WILL DO IT! They are pretending we are back in the 1960s and simply need progressive policies as if the massive public wealth fraud never happened.  Robert Reich is a neo-liberal economist who was part of the Clinton Administration as Labor Secretary when all the policy creating this third world status of our country to gain hold.  Nafta and breaking Glass Steagall assured this massive wealth inequity and unaccountable global corporate rule would occur.  Neo-liberals like Clinton, Reich, and Obama work to see that wealth consolidation indeed occurs in any way possible...ergo, suspension of Rule of Law.

IF A POLITICIAN OR PUNDIT IS SHOUTING THERE IS WEALTH INEQUITY WITHOUT SHOUTING FOR JUSTICE FROM MASSIVE CORPORATE FRAUD-----WHICH WILL ITSELF REVERSE THIS WEALTH INEQUITY----THEY ARE WORKING FOR THOSE COMMITTING THE FRAUD.

We know of course that New York City is ground zero for the frauds and therefor little of the wealth they claim is actually theirs......it is our home equity, retirement, pensions, health care, and public assets.  WE OWN MUCH OF NYC WEALTH.  San Francisco has legitimate wealth with the TECH industry although they are evading taxes.  This area is ground zero for subprime mortgage, defense, and for-profit education industry frauds.  So, when all of that wealth is taken from San Francisco's economy....they will be ranked differently in wealth inequity.  Washington is of course ground zero for all of the Federal contract fraud in the trillions of dollars and with it are the headquarters of all of the global corporations fat with fraud.  When those fraudulent gains come back to the citizens and government coffers, that area will be ranked differently.  So, you can see that Basu's willingness to spout stats that have no basis in reality makes US media on par with the Romanian media in free press.  FREE PRESS HOLDS POWER ACCOUNTABLE....IT DOES NOT PROPAGATE PROPAGANDA.  If the people at the top think the American people are going to let the stealing of tens of trillions of dollars go------they are indeed out of touch!





Should the federal government being doing more to investigate fraud in the financial industry?  Bloomberg Poll

Yes - 93% (4385 votes)

No - 7% (322 votes)

Total Votes: 4,707 Percentages may not add up to 100% due to rounding





The assets of the big banks mostly belong to the public as bringing back fraud and recovering damages would make these global banks into the regional banks we need them to be.  There is not a bank executive known to play the most obvious roll in these massive frauds that is not back working in finance earning tons of money again.  THIS IS SUSPENSION OF RULE OF LAW AND WHEN A GOVERNMENT SUSPENDS RULE OF LAW, IT SUSPENDS STATUTES OF LIMITATION.

Below you see only an example of the costs of damages to the American people.....there are tens of trillions in actual corporate frauds yet to be recovered.  Imagine allowing rogue financial firms like Moody's and Standards and Poor (S & P)......tell government pension managers that pensions have to be cut because 1/2 their value was lost in financial fraud that has yet to be recovered.

 THIS IS THIRD WORLD AND SHOWS WE HAVE A KLEPTOCRACY IN PLACE AND WE NEED TO SHAKE THESE BUGS FROM THE RUG.  NEO-CONS AND NEO-LIBERALS ARE THE BUGS MOVING ALL WEALTH TO THESE GLOBAL CORPORATE COFFERS.


Now, we know as well that all that time writing the Financial Reform Bill and yet not implemented and enforced has the economy ready to collapse yet again.  We know as well that neo-liberals took over from the neo-cons the oversight of corporate writing of TPP.  TPP negates all of what the Financial Reform Bill does.  Do you really think your pol did not know that ending US sovereignty with all the US Constitutional protections of WE THE PEOPLE AND BILL OF RIGHTS would of course make the Financial Reform Bill null and void?  OF COURSE THEY KNEW AS THEY SPENT THE TIME SUSPENDING FRAUDULENT ACCOUNTABILITY.  We will act as though we are doing something as we ignore that no justice in massive fraud occurs.





Five years ago today, Lehman Brothers went bankrupt.


Instantly and inevitably, the house of cards otherwise known as Wall Street collapsed.

But after getting bailed out by the American taxpayers, Wall Street is doing just fine.

The people of Main Street? Not so much.

Here are some numbers to think about this Sunday morning.

    Amount the crash cost the U.S. economy: $22 trillion

    How much everyone would get if that $22 trillion were divided equally among the U.S. populace: $69,478.88

    Assets of the four biggest banks in America — JPMorgan Chase, Bank of America, Citigroup and Wachovia/Wells Fargo — when they were “too big to fail” in 2008: $6.4 trillion

    Assets of those four banks today: $7.8 trillion

    Of the 63 former Lehman Brothers employees identified by a bankruptcy examiner as being aware of an accounting scheme Lehman used to mask its true finances, number who are employed in senior financial services positions today: 47

    Number of the 25 banks responsible for the bulk of risky subprime loans leading up to the crash that are back in the mortgage business: 25

    Chances that an American voter thinks that regulating financial products and services is “important” or “very important”: 9 in 10

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BERNIE SANDERS IS THE ONLY NATIONAL POL THAT SHOUTS OUT RECOVERING CORPORATE FRAUD IS A MUST.  WHETHER DEFENSE INDUSTRY FRAUD TO PROTECT VETERANS....WALL STREET FRAUD RECOVERY....OR THE FEDERAL RESERVE....GROUND ZERO FOR GREAT FRAUD-----

IF A POL IS NOT SHOUTING THIS---THEY ARE AIDING AND ABETTING.

See why saying there is wealth inequity in America before justice reverses much of this fraud is propaganda?




    
The Fed Audit

Thursday, July 21, 2011

The first top-to-bottom audit of the Federal Reserve uncovered eye-popping new details about how the U.S. provided a whopping $16 trillion in secret loans to bail out American and foreign banks and businesses during the worst economic crisis since the Great Depression. An amendment by Sen. Bernie Sanders to the Wall Street reform law passed one year ago this week directed the Government Accountability Office to conduct the study. "As a result of this audit, we now know that the Federal Reserve provided more than $16 trillion in total financial assistance to some of the largest financial institutions and corporations in the United States and throughout the world," said Sanders. "This is a clear case of socialism for the rich and rugged, you're-on-your-own individualism for everyone else."

Among the investigation's key findings is that the Fed unilaterally provided trillions of dollars in financial assistance to foreign banks and corporations from South Korea to Scotland, according to the GAO report. "No agency of the United States government should be allowed to bailout a foreign bank or corporation without the direct approval of Congress and the president," Sanders said.

The non-partisan, investigative arm of Congress also determined that the Fed lacks a comprehensive system to deal with conflicts of interest, despite the serious potential for abuse.  In fact, according to the report, the Fed provided conflict of interest waivers to employees and private contractors so they could keep investments in the same financial institutions and corporations that were given emergency loans.

For example, the CEO of JP Morgan Chase served on the New York Fed's board of directors at the same time that his bank received more than $390 billion in financial assistance from the Fed.  Moreover, JP Morgan Chase served as one of the clearing banks for the Fed's emergency lending programs.

In another disturbing finding, the GAO said that on Sept. 19, 2008, William Dudley, who is now the New York Fed president, was granted a waiver to let him keep investments in AIG and General Electric at the same time AIG and GE were given bailout funds.  One reason the Fed did not make Dudley sell his holdings, according to the audit, was that it might have created the appearance of a conflict of interest.

To Sanders, the conclusion is simple. "No one who works for a firm receiving direct financial assistance from the Fed should be allowed to sit on the Fed's board of directors or be employed by the Fed," he said.

The investigation also revealed that the Fed outsourced most of its emergency lending programs to private contractors, many of which also were recipients of extremely low-interest and then-secret loans.

The Fed outsourced virtually all of the operations of their emergency lending programs to private contractors like JP Morgan Chase, Morgan Stanley, and Wells Fargo.  The same firms also received trillions of dollars in Fed loans at near-zero interest rates. Altogether some two-thirds of the contracts that the Fed awarded to manage its emergency lending programs were no-bid contracts. Morgan Stanley was given the largest no-bid contract worth $108.4 million to help manage the Fed bailout of AIG.

A more detailed GAO investigation into potential conflicts of interest at the Fed is due on Oct. 18, but Sanders said one thing already is abundantly clear. "The Federal Reserve must be reformed to serve the needs of working families, not just CEOs on Wall Street."

To read the GAO report, click here.


_________________________________


Below is a good analysis of the problem in Europe which of course is the same as that in the US.  This analysis has a second value because it shows that the same model of throwing Europe into sovereign debt crisis is now being used by US neo-liberals for the next Bain's Capital gutting of wealth assets from the public sector.  Remember, it was Iceland that from the start simply allowed the banks to default from the fraud and their economy is well on its way to being healthy while the US and Europe are still held hostage by TROIKA and WALL STREET/FED.  American academics have the same analyses showing direct cause and effect....proof of conspiracy to defraud.  We have all the data needed to show all of this CDS policy was a planned conspiracy that can be easily tried in court and won.

WE NEED LABOR UNION LAWYERS TO START ACTING AS US JUSTICE DEPARTMENT IN TAKING ALL OF THIS TO COURT AND DECRYING THE JUSTICE DEPARTMENTS SUSPENSION OF RULE OF LAW!


Anyone as nerdish as I am will like this research and analysis of how the same financial scheme brought to us with the subprime mortgage loan fraud with trillions of dollars of fraudulent loans insured with Credit Default Swaps by mainly one large insurance agency.....AIG all the time knowing these loans were toxic and all would collapse.  So, the Dodd Frank financial reform was to address this and of course nothing has been done and these same people are now thinking the subprime mortgage loan fraud was such a success as tens of trillions of dollars in fraud was left with the looters now think......let's do it again.

This time rather than the goal of capturing all of the nation's real estate holdings and consolidating land ownership to a few at the top.....this fraud has as its goal blowing up the public sector by super-sizing municipal debt and imploding the economy to make a crash that would create huge sovereign debt default.  You can do that only if you again use the Credit Default Swap insurance so that as everyone else loses all their wealth, you have this insurance that protects the very people imploding the economy.  None of this is legal as banks deliberately hid sovereign debt and municipal debt with financial instruments so more debt could be taken on.....ergo, the implosion we have in Europe in 2008.

This is important because the same thing is now happening in the US these few years of Obama's term as US state governors and mayors.....like O'Malley and Rawlings-Blake are doing to you and me what was done in the PIIGS nations in Europe.  Loading up municipal debt while insuring it all with Credit Default Swaps.  You know this is a plan as municipal bonds and public debt have never been allowed to use these CDS and now they are.  So, as governors and mayors load our government coffers with tons of debt tied to Wall Street financial instruments, the investment firms are protecting themselves from loss when the economic crash comes while the public sector.......MECU and the State of Maryland/City of Baltimore will default on their terms and lose most of the investment.

AGAIN, THIS IS ALL PUBLIC MALFEASANCE....IT IS ILLEGAL AND ALL TERMS CAN BE VACATED BECAUSE INVESTMENT FIRMS KNOW THIS IS ALL FRAUDULENT.

This article below is great and it is very long so I could not copy it here.......go to the webpage to see it in its entirety to see how these 1% are working to steal all that is public!


Analysis of European Sovereign Credit Default Swap during theSovereign Debt Crisis in Portugal, Ireland, Italy and Spain.
 byBerkay OrenA dissertation submitted in partial of theMSc Finance and InvestmentAtThe University of BrightonFaculty of Management and Information SciencesBrighton Business School(May 2013)


  Abstract

This thesis has represented the determinants of sovereign CDS spreads during currentsovereign debt crisis in periphery countries namely Ireland, Italy, Portugal and Spain. The period of analysis is between 4 March 2008 and 3 May 2012. After the demise of LehmanBrothers, the sovereign CDS market has attached significant attention and the credit marketshave been issue to an unprecedented re-pricing of credit risk. Moreover, Lehman Brothersdevastated investor confidence and decrease in the availability of credit. Massive assistanceof the banks was heightened public sector deficit. Thus it has led to high level sovereign debt.This means that the risk of default of sovereign became real in periphery countries. Thisthesis has been classified three phases. Firstly an analysis of credit default swaps and their use in the financial World. Secondly development of the European periphery economy on amacro level in Portugal, Ireland, Italy and Spain. Finally the statistical approach of ordinaryleast square is to be analysed. Main purpose of this thesis will identify sovereign creditdefault swaps associated with the current sovereign debt crisis.


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We want to remember that the reason Clinton and Bush targeted the low-income mortgage market for the subprime mortgage frauds was first, they wanted to consolidate real estate ownership and second they used the Federal assistance for these loans over and over again....this is where a large part of the fraud fleecing government coffers came.  They did it on purpose because they knew they would have someone in office that would suspend Rule of Law....if not Obama, Hillary, or Romney.  Sending low-income people to higher education and placing them in homes.....under programs filled with fraud was only cover for this massive fraud.  WE KNOW IF THE INTENT IS TO DO GOOD, YOU DO NOT ALLOW MASSIVE FRAUD OF THE PROGRAM TO OCCUR.  The same is happening today in the GREEN industry as a good program is riddled with fraud allowing 1/2 of the green spending to be defrauded.  

IF NO OVERSIGHT IS GIVEN AND NO JUSTICE IN PLACE....THE INTENT WAS INDEED TO DEFRAUD.

Below is a look at just the subprime mortgage fraud....we know that financial fraud was widespread and across corporate industries as well.  So, the few hundreds of billions of dollars collected in 'settlements' does nothing for tens of trillions of dollars in fraud.  THIS IS WHY ALL PUBLIC PROGRAMS, SERVICES, AND ASSETS ARE BEING HANDED TO PRIVATE ENTITIES UNDER THE GUISE OF STARVED GOVERNMENT BUDGETS.



Wall Street Bank Fraud Massive

Details
    Written by Dan McGookey

Share

The New York Times reported this week that Wall Street is now predicting that its Banks will be anteing up over $50 Billion in settlement payouts with the government and others as a result of their massive fraud perpetrated through the securitized lending system during the first eight years of this Century. Even this astounding number doesn't begin to tell the story of how widespread that fraud was, or the toll it took on this Country's economy, however.

Consider the fact that tens of trillions of dollars of wealth changed hands from Main Street to Wall Street in less than a decade through the vehicle known as securitized lending. That is the process whereby a mortgage loan is magically transformed into a stock certificate or security simply by bundling it with thousands of others and then selling "mortgage-backed certificates" (or stock) in that pool of loans. The problem was that the Wall Street Bankers were able to sell the stock in the loan pool at 10-20 times the face value of the loans. And the reason we say that tens of trillions of dollars shifted from Main Street to Wall Street by virtue of the corrupt securitized lending system is because it was city and state governments, retirement funds, insurance companies and the like who were the suckers buying up the absurdly over-priced stock. In other words, the money was stolen out of the wallets and purses of all Americans.

Even through the estimated amount of the penalties is tantamount to a slap on the wrist for the Banks, it at least serves to highlight the significance of Wall Street's corruption. And the news reports of that corruption will no doubt keep coming with increasing frequency as the depth of the fraud continues to be exposed. All we can hope for is that as that happens, our own Government's complicity in the scandal will be exposed as well.

Reverse Bank Robbery

The Wall Street Banksters obviously never read or simply didn't take heed of the following preaching of Socrates:

"Rather fail with honor than succeed by fraud."

Avoiding the Foreclosure Trap

As a homeowner struggling for mortgage relief with your bank, don't forget to be mindful of the following time-honored sage advice; "Forewarned is forearmed". Realize that the fraud involved with your mortgage didn't end after your loan's origination. Because foreclosure is a profitable business, there is a very good chance the fraud is continuing, along with your victimization.


Kate Eyster and Lauren McGookey contributed to this article.

Copyright 2014 Daniel L. McGookey


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Let's look at one other corporate fraud...this one tax fraud that is wide-spread and easy to find.  The IRS could  pay down much of the national debt itself by recovering corporate tax fraud yet we are told by neo-liberals those bad republicans are defunding the IRS.....indeed, it is being starved.  Yet, the financial settlements in the hundreds of billions requires that a percentage of all settlements go to rebuilding and strengthening fraud detection and prosecution......IT IS SELF-FUNDING.  So, all we need are state pols that shout loudly that none of this is happening----IT IS THE VOICE OF PUBLIC OFFICIALS THAT WOULD FORCE THESE CROOKS TO DO THE RIGHT THING.  IT IS THEIR SILENCE THAT IS DUPLICITOUS.  

IN MARYLAND, IT WAS ALL OF THE CURRENT POLS IN OFFICE THAT ALLOWED THIS MASSIVE CORPORATE FRAUD TO HAPPEN AND INDEED MUCH WEALTH INEQUITY IN MARYLAND IS A RESULT OF THIS FRAUD AND LACK OF JUSTICE!

Joe Biden's Delaware and Harry REid's Nevada are the two states with the most international business geared to off-shoring and hiding wealth.

THIS BILL WAS PASSED IN 2006 JUST AS THE DISMANTLING OF OVERSIGHT AND DEFUNDING WAS AT ITS HEIGHT.  REMEMEBER, THE RECOVERY OF FRAUD BY THE IRS SUPPORTS ALL THE OVERSIGHT AND ACTION NEEDED. THE IRS HAS PLENTY OF MONEY TO DO THE JOB WITHOUT CONGRESSIONAL FUNDING.

Trillions in fraud here....tens of trillions there.....makes for tons of lost revenue to the economy from corporate fraud at Federal, state, and local level.  When people like Basu or Robert Reich speak of wealth inequity as needing legislation and not Rule of Law...THEY ARE WORKING FOR WEALTH AND PROFIT.





Illegal Offshore Account Tax Fraud and Transfer Price Schemes Are Two Forms of IRS Tax Fraud That Can Be the Basis Of An IRS Whistleblower Reward Lawsuit



 by Illegal Offshore Account Tax Fraud Lawyer and Transfer Payment Tax Fraud Whistleblower Reward Lawyer Jason Coomer

Illegal Offshore Account Tax Fraud and Transfer Payment Tax Fraud are two forms of corporate tax fraud that are committed by large multinational corporations.  The IRS is offering rewards and protections for IRS whistleblowers and IRS informants that work through Illegal Offshore Account Tax Fraud Whistleblower Lawyers, Multinational Corporate Tax Fraud Whistleblower Lawyers, and Transfer Payment Tax Fraud Whistleblower Lawyers to identify tax fraud schemes that cost the United States millions of dollars.

Illegal Offshore Account Tax Fraud Whistleblower Lawyer, Multinational Corporate Tax Fraud Whistleblower Lawyer, and Transfer Payment Tax Fraud Whistleblower Lawyer, Jason S. Coomer, works with corporate tax fraud whistleblowers, illegal offshore account tax fraud whistleblowers, transfer payment tax fraud whistleblowers, and other corporate tax fraud whistleblowers to expose corporate tax fraud and other forms of tax fraud.  If you are the original source with special knowledge of tax fraud and are interested in learning more about a tax whistleblower lawsuit, please feel free to contact Illegal Offshore Account Tax Fraud Whistleblower Lawyer and Transfer Payment Corporate Tax Fraud Whistleblower Lawyer Jason Coomer via e-mail message.

Illegal Offshore Account Tax Fraud Lawsuit, Corporate Tax Fraud Whistleblower Reward Lawsuit, IRS Illegal Offshore Account Tax Fraud Whistleblower Reward Lawsuit, Transfer Price Scheme Tax Fraud Lawsuit, IRS Whistleblower Reward Lawsuit, & IRS Whistleblower Payment for Detection of Fraud Lawsuit Information

In 2006, the Tax Relief and Health Care Act that was signed into law included a whistleblower reward amendment that created mandatory reward language to the IRS to create a mandatory economic incentive to encourage tax fraud whistleblowers to step forward to help the government detect large scale fraudulent schemes.  By offering large potential rewards for reporting multimillion tax fraud schemes, the IRS has received hundreds of tax fraud tips from tax fraud informants regarding taxpayer fraud and massive violations of the tax code costing taxpayers Billions of dollars.  Many of the tips already received include fraud schemes of hundreds of millions and tens of millions of dollars.  It is estimated that this programs will result in hundreds of billions of dollars or even Trillions of dollars in tax fraud being detected.

The economic incentives in the Tax Whistleblower Reward Programs are designed to encourage insider tax fraud informants and tax fraud whistleblowers with knowledge and evidence of large tax violations and tax fraud schemes to step forward and report the massive tax fraud.  The IRS is hoping that there will be several tax fraud whistleblowers and tax fraud informants that will help them detect and collect on an estimated $3 Trillion in illegal offshore accounts as well as several other tax-avoidance schemes that have been perpetrated by billionaires and millionaires as well as large corporations.

The IRS Whistleblower Reward Amendment requires the Internal Revenue Service to pay rewards to whistleblowers who exposed large scale tax fraud and taxpayer fraud including major tax underpayments, violations of the Internal Revenue Code, or other fraudulent schemes to unlawfully not pay taxes.  The IRS Whistleblower Reward Program is aimed at large multimillion dollar fraud schemes and tax violations in that the total amount of fraud or underpayment of taxes in dispute would have to exceed $2 millions.

The IRS will pay the tax fraud whistleblower or tax fraud informant if the information presented substantially contributes to the collection of money by the IRS.  As such, the tax fraud whistleblower should have inside knowledge of and documentation of the tax fraud to be successful.     

Illegal Offshore Account Tax Fraud Lawyer, Corporate Tax Fraud Whistleblower Reward Lawyer, IRS Illegal Offshore Account Tax Fraud Whistleblower Reward Lawyer, Transfer Price Scheme Tax Fraud Lawyer, and IRS Whistleblower Reward Lawyer

Transfer pricing schemes involve the overpricing of imports and/or the underpricing of exports between related companies in different countries for the purpose of transferring profits or revenue out of the United States in order to evade taxes. The profits and revenue end up in a country that has a lower corporate tax rate than the US.  These fraudulent pricing schemes can be used both for stock manipulation and corporate tax fraud.  For more information on Corporate Tax Fraud Whistleblower Actions, please go to the following: Tax Fraud Whistleblower Reward Lawsuit, IRS Tax Fraud Whistleblower Award Lawsuit, and Corporate Tax Fraud Lawsuit Information web page.

Illegal Offshore Account Tax Fraud Lawsuit, Corporate Tax Fraud Whistleblower Reward Lawsuit, IRS Illegal Offshore Account Tax Fraud Whistleblower Reward Lawsuit, Transfer Price Scheme Tax Fraud Lawsuit, IRS Whistleblower Reward Lawsuit, & IRS Whistleblower Payment for Detection of Fraud Lawsuit Information

To qualify for a whistleblower award under section 7623 (b), the information must:

    Relate to a tax noncompliance matter in which tax, penalties, interest, additions to tax and additional amounts in dispute exceed $2,000,000.00

    Relate to a taxpayer, and in the case of an individual taxpayer, one whose gross income exceeds $200,000.00 for at least one of the tax years in question

If the information meets the above criteria and substantially contributes to a decision by the IRS to take administrative or judicial action that results in the collection of tax, penalties, interest, additions in tax and additional amounts, then the IRS will pay an award of at least fifteen percent, but not more than thirty percent of what the IRS collects.  26 U.S.C. at 7623(b)(1).

The IRS has authority to reduce the award to ten percent if the claim is based upon specific allegations disclosed in certain public information (e.g. government audits) and determines that the whistleblower's information was not the original source of information.  Further, the IRS also has the authority to reduce the award or not give an award if the whistleblower planned and initiated the actions that led to the tax underpayment.

The IRS Whistleblower Reward Program, Whistleblower Recovery Program, and IRS Corporate Tax Fraud Whistleblower Rewards

The Tax Relief and Health Care Act of 2006, signed into law on December 20, 2006 amended the Internal Revenue Code to provide rewards for turning in tax cheats including corporations and people that are committing tax fraud.  According to the IRS, the primary purpose behind the Tax Relief and Health Care Act of 2006 "was to provide incentives for people with knowledge of significant tax non-compliance to provide that information to the IRS."  The new program generally requires the IRS to pay rewards to whistleblowers if the information presented substantially contributes to the collection of money by the IRS.  The law created the IRS Whistleblower Office to receive, evaluate, and determine whether to pay the whistleblower an award.

The IRS has funded a robust IRS Whistleblower Program.  The new program focuses on large tax fraud and tax underpayment claims.  To qualify for the rewards, $2 million of taxes, penalties, and interest must be involved.  Individual taxpayers must have $200,000.00 of taxable income in any year.   The reward is from fifteen to thirty percent of the tax collected, depending upon the extent to which the whistleblower contributed to the additional collection.  If the IRS determines that the whistleblower's information was not the original source of information, but still contributes to the additional collection, the IRS can still award up to ten percent of the amount collected.

It is interesting to note that Congress passed the original tax whistleblower rewards law in March 1867 for people who reported tax crimes.  The law was enacted prior to a federal income tax, but was not effective because payment of the tax whistleblower reward was voluntary and no rewards were paid out until the rewards became mandatory through the 2006 amendment.

SEC Violation Whistleblower Lawyer, Financial Fraud Whistleblower Bounty Lawyer, SEC Whistleblower Incentive Program Lawyer, SEC Violation Lawyer, and Securities Fraud Whistleblower Lawyer

As a Financial Fraud Whistleblower Lawyer and Securities Fraud Whistleblower Lawyer, Jason S. Coomer commonly works with other powerful financial fraud and securities fraud whistleblower lawyers to handle large Securities Fraud Whistleblower Lawsuits, Securities Fraud Bounty Actions, Commodity Fraud Bounty Claims, and other Financial Fraud Lawsuits.  He also works on Medicare Fraud Whistleblower Lawsuits , Defense Contractor Fraud Whistleblower Lawsuits, Stimulus Fraud Whistleblower Lawsuits, Government Contractor Fraud Whistleblower Lawsuits, and other government fraud whistleblower lawsuits.

Illegal Offshore Account Tax Fraud Lawsuit, Corporate Tax Fraud Whistleblower Reward Lawsuit, IRS Illegal Offshore Account Tax Fraud Whistleblower Reward Lawsuit, Transfer Price Scheme Tax Fraud Lawsuit, & IRS Whistleblower Reward Lawsuit Information
by Illegal Offshore Account Tax Fraud Paid Informant Lawyer and Transfer Payment Tax Fraud Paid Informant Lawyer Jason Coomer

Illegal Offshore Account Tax Fraud Whistleblower Lawyer, Multinational Corporate Tax Fraud Whistleblower Lawyer, and Transfer Payment Tax Fraud Whistleblower Lawyer, Jason S. Coomer, works with corporate tax fraud whistleblowers, IRS tax fraud whistleblowers, and other tax fraud whistleblowers that are stepping up and blowing the whistle on IRS tax fraud, corporate tax fraud, IRS code violations, and other forms of tax fraud.  If you are the original source with special knowledge of tax fraud and are interested in learning more about a tax whistleblower lawsuit, please feel free to contact Illegal Offshore Account Tax Fraud Whistleblower Lawyer and Transfer Payment Corporate Tax Fraud Whistleblower Lawyer Jason Coomer via e-mail message.



_________________________________


Much of the wealth Basu speaks is tied to the Washington and San Franscisco, NYC is from this massive corporate fraud.  it is not real wealth.  Keep in mind that the defense industry budget is one of the largest.  NSA can see all, yet they could not build accountability into these computer systems.  Luckily, WIKILEAKS had a download of defense industry contracting and is now being reviewed by investigative journalists and international justice organizations.


JUST RECOVERING CORPORATE FRAUD WOULD PAY DOWN GOVERNMENT DEBT AT ALL LEVELS AND MAKE ALL PUBLIC TRUSTS AND PENSIONS FLUSH WITH MONEY! DO YOU HEAR YOUR POLS SHOUTING THIS?


 Grand Theft Pentagon, Massive Waste and Fraud

Politics / US Military Nov 21, 2013 - 12:39 PM GMT

By: Stephen_Lendman

Politics

Longstanding Pentagon operations reflect a black hole of unaccountability. Reuters published a two-part report. In July, it discussed the Defense Department’s “payroll quagmire.”

It’s bureaucracy is stifling. It’s “unyielding,” said Reuters. Active duty and retired military personnel are routinely cheated. Pay errors are widespread.

Correcting “or just explaining them can test even the most persistent soldiers.” Weeks or months pass without resolution.

Some personnel are cheated on pay. Others are penalized for overpayments. Their earnings are “drastically cut” unfairly. Precise figures are impossible to calculate.

At issue is “the Defense Department’s jury-rigged network of mostly incompatible computer systems for payroll and accounting, many of them decades old, long obsolete, and unable to communicate with each other,” said Reuters.

“The Defense Finance and Accounting Services (DFAS) still uses a half-century-old computer language that is largely unable to communicate with the equally outmoded personnel management systems employed by each of the military services.”

A December 2012 Government Accountability Office (GAO) report revealed unaccountable accounting. No way exists to assure correct amounts are paid. Errors can’t be tracked.

________________________________

As neo-liberals now pretend that wealth inequity exists and not simply a failure of justice to occur in moving money back to government coffers and individual's pockets, WE THE PEOPLE MUST SHOUT LOUDLY THE TRUTH---THAT JUSTICE WILL BE SERVED!!!



Bill Black: How Elite Economic Hucksters Drive America’s Biggest Fraud Epidemics



Posted on June 6, 2013 by Yves Smith

This article is part of an ongoing AlterNet series, "The Age of Fraud."

What do you get when you throw together economic fraudsters, plutocrats and opportunistic criminals? A financial crisis, that’s what. If you look back over the massive frauds that have swept the country in recent decades, from the savings and loan crisis of the 1980s to the 2007-'08 financial crash, this deadly combination always appears.

A dangerous cycle begins when prominent economists pander to plutocrats and bought politicians, who reward them with top posts, where they promote the perverse economic policies that cause fraud epidemics. Crises develop, and millions of people are ripped off. Those who fight for truth are ignored or ruined. The criminals get wealthier, bolder and more politically powerful, and go on to hatch even more devastating cons.

The three most recent financial crises in U.S. history were driven by a special type of fraud called “control fraud” — cases where the officers who control what look like legitimate entities use them as “weapons” to commit crimes. Each time, Alan Greenspan, former chairman of the Federal Reserve, played a catastrophic role. First, his policies created the fraud-friendly (criminogenic) environment that produces epidemics of control fraud, then he failed to identify those epidemics and incipient crises, and finally, he failed to counter them.

At the heart of Greenspan’s failure lies an ethical void in the brand of economics that has dominated American universities and policy circles for the last several decades, a brand known as “free market fundamentalism” or the “neoclassical school.” (I call it “theoclassical economics” for its quasi-religious belief system.) Mainstream economists who follow this school assert a deeply flawed and controversial concept known as the “efficient market hypothesis,” which holds that financial markets magically regulate themselves (they automatically “self-correct”) and are thus immune to fraud. When an economist starts believing in that kind of fallacy, he is bound to become blind to reality. Let’s take a look at what blinded Greenspan:

    Greenspan knew that markets were “efficient” because the efficient market hypothesis is the foundational pillar underlying modern finance theory.
    Markets can’t be efficient if there is control fraud, so there must not be any.
    Wait, there are control frauds! Tens of thousands of them.
    Then control fraud must not really be harmful, or markets would not be efficient.
    Control fraud, therefore, must not be immoral. As crime boss Emilio Barzini put it in The Godfather, “It’s just business.”

As delusional and immoral as this “logic” chain is, many elite economists believe it. This warped perspective has spawned policies so perverse that they turn the world of finance into the optimal environment for criminals. The upshot is that most of our elite financial leaders and professionals have thrown integrity out the window, and we end up with recurrent, intensifying financial crises, de facto immunity for our most elite criminals, and the rise of crony capitalism. Let’s do a little time travel to see exactly how this plays out.

How to Stoke a Savings and Loan Fiasco

The Lincoln Savings and Loan Association of Irvine, California was at the center of the famous crisis that rocked the financial world in the 1980s. A once prudently run company morphed into a casino when S&L associations became deregulated and started doing risky business with depositors’ money. Businessman, GOP darling, and anti-pornography crusader Charles Keating, ironically nicknamed “Mr. Clean,” took over Lincoln in 1984 and got the casino rolling. (It was a special kind of casino where the games were rigged – and not in favor of newlywed brides who were the subject of sexual extortion in Casablanca.) In a classic case of control fraud, Keating devoted himself to turning the company into a weapon of mass financial destruction and a source of wealth for his family. Keating’s “weapon of choice” for his frauds was accounting.

Keating went on a spree buying land, taking equity positions in real estate projects, and purchasing junk bonds. In 1985, the Federal Home Loan Bank Board (FHLBB), where I was the staffer leading the regulation efforts, grew alarmed at the new activities of savings associations like Lincoln. So we made a rule: S&Ls could not put more than 10 percent of company assets in "direct investments” – an activity that led to very large losses.

Alan Greenspan, chairman of an economic consulting firm at the time, urged us to permit Lincoln Savings to go full steam ahead. His memo supporting Lincoln’s application to make hundreds of millions of dollars in direct investments praised the company’s management (Keating) and claimed that Lincoln Savings “posed no foreseeable risk of loss.”

The FHLBB rejected Lincoln’s request to exceed the rule’s threshold because direct investments were a superb vehicle for accounting fraud – they made it easy to hide losses and to create fictional income. Nevertheless, Lincoln continued to violate the rule and created fictional (backdated) board consents with hundreds of forged signatures to make it appear that the investments were “grandfathered” under the rule. The hundreds of millions of dollars in unlawful direct investments were used for fraudulent purposes by Lincoln Savings’ controlling officers and caused enormous losses – many of them to elderly citizens who were conned into buying the junk bonds of Lincoln Savings’ holding company. The massive losses on Lincoln’s illegal direct investments were a major reason those bonds were worthless.

Hoping to use his political clout to continue the fraud, Keating hired Greenspan to lobby the senators who eventually became the known as the “Keating Five.” I remember well when these senators intervened at Keating’s request to try to prevent me and my colleagues from taking an enforcement action (or conservatorship) that would have saved over a billion dollars. (I took the notes of that meeting, which led to the Senate ethics investigation of the Keating Five.) The cronyism was so thick in Washington that William Weld, then a top Department of Justice official and later the Republican governor of Massachusetts, actually tried to gin up a criminal investigation of the regulators rather than Keating at the request of Lincoln’s lawyers who had just left the DOJ! Eventually, Keating and many of the senior managers of Lincoln Savings were convicted of felonies and Lincoln Savings became the most expensive failure of the S&L debacle.

When you look back on this expensive fiasco, you see that the work of respected professional economists was frequently called upon to support the fraudulent activities. One of the ways Greenspan tried to advance Keating’s effort to have the courts strike down the direct investment rule was to use a study conducted by a less famous economist, George Benston, who showed that S&Ls that violated the direct investment rule earned higher profits than those who didn’t. So he recommended the rule be dropped. Small problem: In less than two years all 33 of the companies Benston studied had failed. Most were accounting control frauds in which executives cooked the books to show fictional profits.

Keating had a talent for obtaining endorsements from prominent economists. He got Daniel Fischel to conduct a study that purported to show that Lincoln Savings was the best S&L in America. Fischel invoked the efficient market hypothesis to opine that our examiners provided no useful information because the markets had already perfectly taken into account any information to which we had access.  In reality, of course, this was nonsense, and Lincoln Savings was the worst S&L in the country.

Economists who pander to plutocrats have a great advantage over scholars in other fields: There is no reputational penalty among your peers for being dead wrong. Benston got an endowed chair at Emory, Fischel was made dean of the Univerisity of Chicago’s Law School, and Greenspan was made Chairman of the Fed. Those who got control fraud right and fought the elite scams and their powerful political patrons – people like Edwin Gray, head of the FHLBB, and Joe Selby, head of supervision in Texas – saw their careers ended.

Consider what that perverse pattern indicates about how badly ethics have fallen in the both economics and government.

How to Create a Regulatory Black Hole

Alan Greenspan was Ayn Rand’s protégé, but he moved radically to the wacky side of Rand on the issue of financial fraud. And that, friends, is pretty wacky. Greenspan pushed the idea that preventing fraud was not a legitimate basis for regulation, and said so in a famous encounter with Commodities Futures Trading Commission (CFTC) Chair Brooksley Born. “I don’t think there is any need for a law against fraud,” Born recalls Greenspan telling her. Greenspan actually believed the market would sort itself out if any fraud occurred. Born knew she had a powerful foe on any regulation.

She was right. Greenspan, with the rabid support of the Rubin wing of the Clinton administration, along with Republican Chairman of the Senate Banking Committee Phil Gramm, crushed Born’s effort to regulate credit default swaps (CDS). The plutocrats and their political allies deliberately created what’s known as a regulatory black hole – a place where elite criminals could commit their crimes under the cover of perpetual night.

Greenspan chose another Fed economist, Patrick Parkinson, to testify on behalf of the bill to create the regulatory black hole for these dangerous financial instruments. Parkinson offered the old line that efficient markets easily excluded fraud — otherwise, they wouldn’t be efficient markets! (Parkinson would later tell the Financial Crisis Inquiry Commission in 2011 that the “whole concept” of a related financial instrument known as an “ABS CDO” had been an “abomination”). Greenspan’s successor richly rewarded Parkinson for being stunningly wrong in his belief: Ben Bernanke appointed Parkinson — who had no experience as a supervisor or examiner — as the Fed’s head of supervision.

Lynn Turner, former chief accountant of the SEC, told me of Greenspan’s infamous question to his group of senior officials who met at the Fed in late 1998 or early 1999 (roughly the same time as Greenspan’s conversation with Born): "Why does it matter if the banks are allowed to fudge their numbers a little bit?" What’s wrong with a “little bit” of fraud?

Conservatives often support the “broken windows” theory of criminal activity, which asserts that you stop serious blue-collar crime by cracking down on minor offenses. Yet mysteriously, they never apply the concept to white-collar financial crimes by elites. The little-bit-of fraud-is-ok concept got made into law in the Commodities Futures Modernization Act of 2000, which created the regulatory black hole for credit default swaps. That black hole was compounded by the Commodity Futures Trading Commission under the leadership of Wendy Gramm, spouse of Senator Phil Gramm.

Enron’s fraudulent leaders were delighted to exploit that black hole, because they were engaged in a massive control fraud. They appointed Wendy Gramm to their board of directors and proceeded to use derivatives to manipulate prices and aid their cartel in driving electricity prices far higher on the Pacific Coast. In a bizarre irony, the massive increase in prices led to the defeat of California Governor Gray Davis (the leading opponent of the cartel) and his replacement by Governor Schwarzenegger – a man who was part of the group that met secretly with Enron’s leadership to try to defeat Davis’s efforts to get the federal regulators to kill the cartel.

How damaging was Greenspan’s dogmatic and delusional defense of elite financial frauds in the case of Enron? If you look closely, you can see that Enron brought together all the critical elements of a financial crisis: big-time accounting control fraud, derivatives, cartels, and the use of off-balance sheet scams to inflate income and hide real losses and leverage. On top of all that, many of the world’s largest banks aided Enron and its extremely creative CFO Andrew Fastow to create frauds. The Fed could have responded by adopting and enforcing mandates to end the criminal practices that were driving the epidemic, but it didn’t. Instead, Greenspan and other Fed economists championed Enron’s leadership and cited the company as proof that regulation was unnecessary to prevent control fraud. They were so extreme that they attacked their own senior supervisors for daring to criticize the banks’ role in aiding and abetting Enron’s activities.

Later, when risky derivatives activities and control frauds at large financial institutions were pushing us toward the catastrophic crash of 2007-2008, the Fed took no meaningful action based on the lessons learned from Enron. Greenspan and the senior leadership of the Fed had learned absolutely nothing, which shows how disabling economic dogma is to regulators – making them worse than simply useless. They become harmful, again attacking their supervisors for criticizing the banks’ fraudulent “liar’s” loans. When Bernanke placed Patrick Parkinson (an economist blind to fraud by elite banksters) in a supervisory role at the Fed, he sealed the fate of millions of Americans whose financial well-being would be sucked right into that regulatory black hole – and removed the ability of the accursed supervisors to criticize the largest banks.

How to Protect Predatory Lenders

Finally, we come to the mortgage meltdown of 2008, when the entire housing industry went into freefall. Central to this crisis is the story of the liar's loan — mortgage-industry slang for a mortgage that a lender gives without checking tax returns, employment history, or anything else that might reliably indicate that the borrower can make the payments.

The Fed, and only the Fed, had authority under the Home Ownership and Equity Protection Act (HOEPA) to ban liar’s loans by all lenders. At a series of hearings mandated by Congress, dozens of witnesses representing home mortgage borrowers and state and local criminal investigators urged the Fed to do this. The testimony included a study that found a 90 percent incidence of fraud in liar’s loans.

What did Greenspan and Bernanke do? Exactly nothing. They consistently refused to act.

Greenspan went so far as to refuse pleas to send Fed examiners into bank holding company affiliates to find the facts and collect data on liar’s loans. Simultaneously, the Fed’s economists dismissed the warnings from progressives about fraudulent liar’s loans as “merely anecdotal.” In 2005, the desperate Fed regulators, blocked by Greenspan from sending in the examiners to get data from the banks, resorted to simply sending a letter to the largest banks requesting information. The Fed supervisor who received the banks’ response to that letter termed the data “very alarming.”

If you suspect that the banks would typically respond to such requests by understating their problem assets significantly, then you have the right instincts to be a financial regulator.

By 2003, loan quality was so bad that it could only be explained as the inevitable product of endemic accounting control fraud and it continued to collapse through 2007 until the bubble burst. By 2006, over two million fraudulent liar’s loans were originated annually. We know that it was overwhelmingly lenders and their agents who put the lies in liar’s loans. Liar’s loans make the perfect “natural experiment” because no governmental entity ever required a lender or a purchaser (and that includes Fannie and Freddie) to make or purchase a liar’s loan. Banks made, and purchased, trillions of dollars in liar’s loans because doing so lined the pockets of their controlling officers.

The Fed’s leadership, dominated by economists devoted to false theory, was enraged when the Fed’s supervisors presented evidence of endemic control fraud by the most elite lenders, particularly in the making of fraudulent liar’s loans. How dare the supervisors criticize our most reputable bank CEOs by showing that they were making hundreds of thousands through scams?

Bernanke finally acted under Congressional pressure on July 14, 2008 to ban liar’s loans. He cited evidence of endemic fraud available since early 2006 – evidence which would have been available way back in 2001 had Greenspan moved to require examiners to study liar’s loans. Even in the face of overwhelming evidence, Bernanke delayed the ban for 18 months — one would not wish to inconvenience a fraudulent lender, after all.

We did not have to suffer this crisis. Economists who were not blinded by neoclassical theory, like George Akerlof (who won the Nobel Prize in 2001) and Christina Romer (adviser to President Obama from 2008-2010), had warned their colleagues about accounting control fraud and liar’s loans, as did criminologists and regulators like me. But Greenspan (and Timothy Geithner) refused to see the obvious truth.

Alan Greenspan had no excuse for assuming fraud out of existence, and his exceptionally immoral position on fraud and regulation proved catastrophic to America and much of the world. We cannot afford the price, measured in many trillions of dollars, over 10 million jobs, and endless suffering, of unethical economists.
0 Comments

March 01st, 2014

3/1/2014

0 Comments

 
THERE IS A FREE-FOR-ALL ALL OVER THE WORLD WITH THE PUBLIC'S MONEY BEING STOLEN AND CARTED TO OFF-SHORE ACCOUNTS AND THE MOMENTUM COMES FROM THE US AND NEO-LIBERALS.  THE CRASH IN 2008 SET THE STAGE FOR A VISIGOTH RAIDING OF ALL PUBLIC ASSETS.

WHEN A GOVERNMENT SUSPENDS RULE OF LAW IT SUSPENDS STATUTES OF LIMITATION!


DO YOU HEAR ANY OF THE MARYLAND CANDIDATES FOR GOVERNOR SHOUTING ANY OF THIS

Regarding the organized theft of public pensions in Maryland:

Private pensions were shed over a few decades mainly by Bains Capital attacks on healthy businesses that gut all of the assets from a corporation and then leave the shell with all of labor contracts to sink into bankruptcy.....we saw Hostess do that just last year. Is it legal to gut a corporation of assets and walk away from any obligations of sending it into bankruptcy-----ALL ON PURPOSE! OF COURSE NOT. NO AMOUNT OF LEGALESE WILL MAKE IT LEGAL TO DELIBERATELY SEND A HEALTHY CORPORATION INTO BANKRUPTCY TO SHED LABOR/DEBT OBLIGATIONS. IT IS PREMEDITATED.


Corporations Are Stealing Pension Funds
- Dylan Ratigan Show - 9/15/2011
keithmsnbcer keithmsnbcer·

Uploaded on Sep 16, 2011

On The Dylan Ratigan Show, Ellen Schultz reports on how corporations are pillaging and plundering employees' pension funds. 9/15/2011
***************


Well, what we see now with public pensions is the same Bain's Capital process only done on government coffers. Corporations gutted all levels of government with massive fraud....left them a shell and now want to shed all labor/debt obligations as they zoom in on the rest of the assets.

MARYLAND IS GROUND ZERO FOR THIS PROCESS. IF YOU LOOK AT STATE AND CITY PENSIONS....THEY WERE ALL SENT FROM THE THEN SAFETY OF THE BOND MARKET TO STOCK MARKET JUST AS THE MARKET WAS TO CRASH IN 2007 JUST TO BUOY THE COLLAPSING BIG BANKS. THIS IS PUBLIC MALFEASANCE AND FRAUD.

So, the 1/2 value in public and private pension losses needs to come back as recovered fraud and the gains from the BULL market of these few years need to be damages claimed. PUBLIC PENSIONS ARE FLUSH WITH MONEY THAT WE ARE WAITING FOR PUBLIC JUSTICE TO RECOVER!

Below you see the source of all of this pension-raiding policy------the neo-liberal Brookings Institute. You know, the group that says....NOW THAT SOCIAL SECURITY AND MEDICARE TRUSTS HAVE BEEN RAIDED WITH FRAUD WE NEED TO REFORM THESE PROGRAMS! See the pattern? This group of people are much like the Oracle of Delphi. In other words they are out of touch and full of themselves.

'Delphi is best known as the home of the Delphic Oracle or the Pythia, a priestess of Apollo. The traditional picture is of the Delphic Oracle, in an altered state, muttering words inspired by the god, which male priests transcribed. The Delphic oracle sat on a great bronze tripod in a spot above a crevice in rocks from which vapors rose. Before sitting, she burned laurel leaves and barley meal on the altar. She also wore a laurel wreath and carried a sprig'....or just plain sociopaths

Pensions are fine.....we simply need to recover the fraud and reform a little of the over-zealous deals unions made for their members. What these reforms do is take away health care by sending these plans into the same co-pay/deductible system as Affordable Care Act that keep people from affording to access the care. UNION LAWYERS SHOULD BE IN COURT DEFENDING THESE PENSIONS FROM THIS BAD PENSION REFORM POLICY! This next thing neo-liberals want to do is get those pensions into the stock market to be used as fodder by Wall Street. 401Ks are more easily made fodder than managed pensions funds, although pension funds are corrupt as well. 401k is worse.

YET THAT IS JUST WHAT MARYLAND/BALTIMORE IS DOING WITH PUBLIC PENSIONS-----SENDING THEM TO LOCALITIES WHERE THEY ARE THEN SENT TO WALL STREET.
Remember, Wall Street is ready to crash from the same conditions as 2007 only super-sized and it is again all illegal....look where your pension funds are this time......sovereign and municipal debt.

HERE IS THE POLICY BEING PUSHED BY NEO-LIBERALS AND FROM OBAMA, TO O'MALLEY, TO RAWLINGS-BLAKE.......ALL ARE FOLLOWING ORDERS!


Paper | February 26, 2014
Public Pension Reform Series

By: Patrick McGuinn, Patten Priestley Mahler, Matthew M. Chingos and Grover J. "Russ" Whitehurst

In their June 2013 paper, Are Public Pensions Keeping Up with the Times?, Matthew M. Chingos, Grover J. Whitehurst, and Richard W. Johnson reported a $2.7 trillion nationwide funding gap in states’ public pension systems. In two new follow-up papers, Chingos, Whitehurst and colleagues seek to answer the inevitable question provoked by their initial work: What can be done about the rampant underfunding of public pension systems?

Improving Public Pensions: Balancing Competing Priorities by Patten Priestley Mahler, Chingos, and Whitehurst makes a significant contribution to the public pension discourse by providing policymakers and stakeholders with a framework for evaluating proposed reforms to pension systems – even in light of the frequently competing objectives of such systems. The authors begin by defining three essential goals of a pension system: to provide adequate retirement security; to ensure fiscal sustainability; and to maintain/improve public-sector workforce productivity. By analyzing the performance of various pension system designs against these three goals, the authors conclude that a collective defined-contribution plan is best suited to meet the complex objectives of a pension system.

The collective defined-contribution approach to pension reform combines many of the advantages of the defined-benefit plan currently favored in the public sector with those of the defined-contribution plan prevalent in the private sector.

Whereas Improving Public Pensions provides a means by which to evaluate proposed reforms, and identifies an ideal pension plan, Pension Politics: Public Employee Retirement System Reform in Four States by Patrick McGuinn provides actionable policy recommendations for those states that are looking to enact such reforms. McGuinn examines recent pension reform efforts in four states with diverse political climates. Two of the states (Utah and Rhode Island) succeeded in passing significant structural changes to their pension systems, while the others (New Jersey and Illinois) enacted more limited, less innovative changes. McGuinn highlights what activities have and have not been successful in producing meaningful reform, and details a number of recommendations for other states seeking to successfully improve their underfunded pension systems. Key recommendations include:

Avoid turning pension reform into an ideological issue

Enlist a credible and visible reform champion (having a Democrat lead the effort goes a long way towards countering the charge that reforms are merely a conservative attack on labor)

Clearly communicate the reality of their state’s pension liability and demonstrate pensions’ impact on taxes and other state spending priorities, such as education

Sell the benefits of pension reform to state workers (as ultimately in the best interests of pension participants, relative to a system that can’t meet its obligations)

Sell the benefits of pension reform to school reformers

Anticipate and plan for legal challenges

________________________________________________

Chicago has a strong labor and justice system of activists and they know a scam when they see it! Maryland needs to recruit these labor lawyers to come in and get our state back on track with pension accountability and government reform! THOSE ARE THE REFORMS NEEDED FOR HEALTHY PENSIONS!

Look at neo-liberals pretending that pensions are the crisis of our time. These are people running as democrats with the sole goal of dismantling all of New Deal and labor gains knowing it will impoverish the very people who elected them. They are doing it only for corporate gain.


Illinois teachers sue to overturn state pension reform
– Blogs On Politics – Crain’s Chicago Business
27 Dec

Two groups representing educators today filed suit against the state\’s new pension-reform law late today, contending that it violates provisions of the Illinois Constitution.

In an action filed in Cook County Circuit Court, the Illinois Retired Teachers Association and the School Administrators Association contend that, by recently voting to reduce cost-of-living hikes and other benefits without the permission of workers and retirees, the General Assembly acted counter to mandates in the constitution that specifically protect pension benefits once someone is hired.

The new measure, which lawmakers said would save $160 billion over the next 30 years, will not take effect until June 30. \”But the law will be in effect\” then, said Chicago attorney Gino DiVito, the attorney for the plaintiffs.

Worker unions have threatened to sue since even before the bill was approved last month, arguing that their members paid what was required toward their retirement and that the state dropped the ball. Even before the suit, the retired-teachers group on its website had been appealing for funds to pay for it.

Both Gov. Pat Quinn and House Speaker Michael Madigan have expressed confidence that the new law is \”constitutionally sound,\” as Mr. Quinn put it in a statement this evening. \”This historic law squarely addresses the most pressing fiscal crisis of our time.\”

But Senate President John Cullerton has been skeptical and has said he\’s prepared to move forward with a more modest proposal if need be.

The case is assigned to Circuit Court Judge Sophia Hall. But whatever she does, the case eventually is certain to be decided by the Illinois Supreme Court.

Illinois Teachers Lawsuit — Heaton v. Quinn

via Illinois teachers sue to overturn state pension reform – Blogs On Politics – Crain’s Chicago Business.

_______________________________________

Below we see Zuckerberg doing just as Brookings Institute outlines above. If we check back on these officers in Tennessee to see how it ends for them....I bet they will be shouting loudly at the results. The spin on these reforms does not allow people to know how all benefits will be lost in the coming years.

So, you see a labor leader who reasons that all across the country these pension reforms are happening.....So cost of living increases down by half and worker contributions up by double that amount AND TALKS THE MEMBERS INTO CONCEDING following the Brookings Institute guide to pension reform.

AND THIS IS DESCRIBED AS A COMPROMISE WHEN IT IS A GREAT BIG LOSS FOR LABOR. THIS DOESN'T EVEN INCLUDE THE HEALTH CARE CUTS. THIS IS EXACTLY WHAT HAPPENED IN BALTIMORE. Public pensions are now heading to the in same place as private pensions lost in bankruptcy.

Look at next article to see why what is being said below is not true!


*****************

Facebook Helps Chattanooga Earn Employees' Trust on Pension Reform

A Facebook page created to enlighten people about the mayor's "attack" on the public safety pension fund helped change the tone of the conversation and got some employees to actually support reform.

by LIZ FARMER / February 20, 2014 1

Lack of trust from employees is one of the hardest barriers to overcome for those attempting pension reform but in Chattanooga, Tenn., officials think they have found the answer.

It started off with all the animosity one would expect. Last summer, as talk of rising pension costs escalated, an anonymous group connected to the local police and firefighter union chapters created the Facebook page Chattanooga Fire & Police Pension Enlightener in order to educate people about Mayor Andy Berke’s “attack” on the public safety pension fund. As the mission states, the page’s “hope is to dispel myths and half-truths that the mayor's office is perpetrating against the fund.”

At the time, the city administration had started working with a financial consultant to establish a task force made up of public safety employees, retirees, members of the business community and other city representatives to find a solution to the city’s increasing pension costs. The fund has a roughly $150 million unfunded liability and is 61 percent funded according to actuarial figures (80 percent is considered healthy.) In the 2014 fiscal year, Chattanooga’s public safety pension payments took up about 7 percent of its $215 million budget. In five years, costs were projected to rise to $20 million, or 10 percent of the budget with no relief in sight.

Among the Enlightener’s first posts was an invite to interested groups, including “...the [pension task force members] we trust” to request administrative and posting approval. Another early post asked seasoned fire and police members “what are some of the tactics from past fights” used by politicians to get what they wanted?

“There was a lot of misunderstanding on behalf of employees and taxpayers,” recalls Vijay Kapoor, the consultant from Public Finance Management Inc. who helped guide the task force through the process. “There was a lot of concern that the mayor was trying to come in there and gut the pension fund – that we had some fixed plan from the start and that we were going to railroad it through. And that’s just not the case.”

By the beginning of this year, the Enlightener’s posts had begun to take on a different tone. One in January described the plan proposed by the task force as a “good alternative” to what Mayor Berke was expected to push for. Another commentor reasoned that “all across the country have conceded to pay cuts to prevent layoffs and other deep cuts to their benefits.” Individuals have also posted their support for the task force's proposal.

The plan proposed by the task force that will be voted on by the Fire and Police Pension Board Thursday includes an average reduction in pension cost-of-living adjustments (COLA) to 1.5 percent from 3 percent. (Those with smaller pensions see a higher-than-average COLA and those with larger pensions will get a lower COLA.) It also phases in a 3 percent increase in current employee contributions over three years. Those two changes would help immediately reduce the city’s unfunded liability, boosting the pension’s status to about 71 percent funded.

On the labor side, some benefits would actually increase: Widows of retirees would see increased benefits and beneficiaries of those killed in the line of duty would get nearly double their current pension. The Deferred Retirement Option Program, which allows employees to increase their pensions by deferring retirement and continuing to work, was kept largely intact.

The proposed plan is an alternative to sending a more drastic plan out to voter approval. In California in 2012, San Jose and San Diego both sought and won voter-approved pension reforms that immediately brought on lawsuits from public safety unions.

By no means is anyone under the illusion that the proposal has made everyone happy. There are still angry posts by commenters on the Enlightener’s Facebook page and a group of retirees and some active employees has reportedly hired a Nashville law firm to contest the reduction in COLAs.

But with pension reform, there simply is no appeasing everyone. And a history of bad blood between the union and previous administrations didn’t help the city’s case. But what Chattanooga and public safety employees aimed to do is make the most people happy while keeping the plan sustainable for the city.

“We had to earn the trust in particular of the constituency groups who didn’t necessarily trust…what we were trying to achieve,” says Berke. “Their first response was that we were trying to kill the pension fund and take it over because there had been numerous attempts before.”

If the pension board approves the proposal, it goes to the city council for a vote. Berke says the process has been so open and debated he doesn’t foresee any problems with the proposal making its way to his desk for approval.

Officials here believe the process can easily be replicated for other cities considering a more mediated approach to pension changes. After all, Chattanooga got the idea after PFM helped Lexington, Ky. form a similar task force in 2012 that helped reduce that city’s roughly $296 million unfunded pension liability by nearly half.

“This is a tough process and difficult decision for any mayor,” Berke says. You’re talking about benefit issues for people who risk a lot for the city. By same token you have to be responsible knowing that a [61] percent-funded pension plan is not sustainable. Getting that through to people took a while.”

______________________________________

REMEMBER----THE PROBLEM WITH PUBLIC BUDGETS IS MASSIVE CORPORATE FRAUD AND NOT PUBLIC BENEFITS!

Families impoverished by this massive fraud should have received compensation by now, instead they are being left desperate and forced into pensions and Social Security disability schemes that limit what they get for later. ALL OF THIS NEEDS TO BE REVERSED AS RULE OF LAW SHOWS THAT THESE FAMILIES WERE DAMAGED BY MASSIVE AND DELIBERATE FRAUD.


Sun Apr 28, 2013 at 03:11 PM PDT

Latest Financial "Services" Scam: Stealing Your Pension


by blue memeFollow

You think that after they took your house, and your job, and your personal savings, you've been squeezed dry? You think milking your meager IRA for fees, which nets Wall Street billions every year, would keep the monster fat and happy? You think manipulating every market metric and stacking the deck in every way imaginable would be enough?

Sorry, folks.

Now they're after your pensions, and it ain't pretty.

The financial services industry is wolfing down an ever-larger share of our economy. As a percentage of GDP, they are north of 8%, which may not sound like much, but in a world where interest rates on savings are counted in fractions of one percent, that's a helluva drag on the rest of us. Their take has been rising steadily since the 1950's, when it was around 2%. But the really telling statistic is that they account for nearly a third of all profits.

How do they do it?

Well, there's the scam by which defined benefit pensions got swapped out for IRAs and 401(k)s. There's the mortgage-backed security scam. The MERS scam. The LIBOR scam. And now the ICAP scam (see Matt Taibi's latest, and weep.) You probably know and can recite the litany.

It has all put the average family under tremendous pressure. That pressure has made many people vulnerable. And now comes a new scam specifically designed to separate the vulnerable from their last remaining assets.

A stunning piece in the NYT by Jessica Silver Greenberg lays bare a new outrage:

To retirees, the offers can sound like the answer to every money worry: convert tomorrow's pension checks into today's hard cash.

But these offers, known as pension advances, are having devastating financial consequences for a growing number of older Americans, threatening their retirement savings and plunging them further into debt.

The advances, federal and state authorities say, are not advances at all, but carefully disguised loans that require borrowers to sign over all or part of their monthly pension checks. They carry interest rates that are often many times higher than those on credit cards.

If you are inclined to give the benefit of the doubt, you might say that there are circumstances where such lenders might actually provide a useful service. But then there's this:

A review by The New York Times of more than two dozen contracts for pension-based loans found that after factoring in various fees, the effective interest rates ranged from 27 percent to 106 percent — information not disclosed in the ads or in the contracts themselves. Furthermore, to qualify for one of the loans, borrowers are sometimes required to take out a life insurance policy that names the lender as the sole beneficiary.

I'm long past wondering how these jackals sleep at night.

What will they take when there is nothing left to steal?
__________________________________

LOOK BELOW AT WHAT THE FEDERAL GOVERNMENT IS DOING TO FEDERAL POST OFFICE PENSION FUNDING AND YOU SEE WHAT WAS DONE ON STATE AND LOCAL LEVELS WITH PUBLIC PENSIONS.....IT ALL INVOLVES PUBLIC MALFEASANCE AND FRAUD.

The US Treasury is empty----that is why they keep saying the government will shut down in debt ceiling debates. Yet, $4 trillion in Social Security and Medicare has been sent to the Treasury and as we see below the Post Office Pensions are there and gone with the wind.

NEO-LIBERALS ARE WORKING AS HARD AS REPUBLICANS TO MOVE PENSION WEALTH TO CORPORATE PROFIT....IN THE POST OFFICE CASE...THEY ARE BUILDING THE HOMELAND SECURITY/NSA NETWORK ALL RUN BY WALL STREET.

This started with Bush but as we know by the empty Treasury....neo-liberals are raiding this public trust as well.

***************

'Congress needed a way to ensure that $4.5 billion kept making its way from the Postal Service to the Treasury. That’s essentially why Congress came up with a plan to frontload the fund with an aggressive ten-year schedule of annual payments of about $5.5 billion. Mandating those huge payments wasn’t simply about ensuring that the Postal Service covered its retiree health care liability (a liability that wouldn’t come due for decades), and the size of the payments wasn’t based on actuarial calculations. The payments were all about making sure that the billions the Postal Service was overpaying into its pension fund would continue to help out the bottom line of the unified federal budget'.

******************
Washington
Politicians Raid Postal Service Revenue
October 7, 2011 politicol

October 7, 2011 Updated: Sept 28, 2012

Another raid on government workers even the Post Office is in jeopardy of a major shutdown even though politicians are responsible for raiding their revenues.

The story you hear in mainstream media is that the US Postal Services in running at a loss, losing billions of dollars, needs a bailout, has to fire workers, cannot honor pensions that were paid for by workers and so on.

Politicians Raid Postal Service Revenue

By raiding the Post Office coffers, transferring funds to make the deficit appear somewhat smaller, the accounting just doesn’t add up. We seem to understand who is behind the attacks on government workers since the 2010 mid-terms and that is an all out assault on unionized workers by the Republican Party.

Their aim for two years has been to destroy union jobs, government workers salary, pensions, healthcare benefits and any dues that have been earned by American government workers. The newest negative effect of all this is that now, US postal workers must “Pre Pay” their health benefits in advance? An outrageous policy not replicated in other industrialized countries.

The pre-payment of health care benefits was set up under George Bush in 2006 known as the

Postal Accountability and Enhancement Act

Basically it makes postal workers prepay their own health care costs presumably because in 2006 the post office revenues were already hacked by the Bush administration.

Postal workers have rallied against these new austerity measures and vow to keep fighting this faked financial crisis.There is not one fact that the post office is in trouble financially only it is due to the government raiding the piggy bank. Clearly the aim of this attack is to completely privatize the post office into corporate hands like UPS, or other major mail carriers.

Politicians Raid Postal Service Revenue

If Congress did not keep moving revenues through underhanded accounting procedures back in 2002 again under George Bush, they would have found that the US Postal Service overpaid into the US government pension plan by 80 billion dollars. That was 9 years ago. If the post office was self-sufficient in providing it’s operating revenues, pensions, healthcare prior to 2002 the and that 80 billion dollars was returned to their balance sheet the repair to the health care prepayments would be solved.

Congress has created the problems of the post office by emphasizing a negative campaign that has been fabricated for the goal of scrapping the US Postal Services by privatization for corporate lobbyists.


0 Comments

February 12th, 2014

2/12/2014

0 Comments

 
Regarding Ruppersberger and Fort Meade policy:

Here we go down the rabbit hole with Alice in Wonderland as MR NSA HIMSELF.....MR. PRIVATIZE ALL MILITARY AND END PUBLIC MILITARY FACILITIES TO THE DETRIMENT OF ALL MILITARY PERSONNEL......cries foul over legislation designed to protect American civil liberties and end DEATH TO AMERICA chanting as the NSA and Wall Street enrage the world with its illegal activities that undermine sovereignty including the US.  Nothing makes the US more prone to attack from enemies than the actions of Wall Street and their NSA!

Here we are with republicans being the protector of US Constitutional rights and public justice. Meanwhile, it is MD neo-liberals making the Ft Meade NSA central. Remember, it was George Bush and neo-liberals who started this and are the face of the hedge funds running it. So, this is a neo-con/neo-liberal problem.

DO NOT ALLOW REPUBLICANS SHOUT THAT DEMOCRATS ARE THE PROBLEM.....NEO-LIBERALS ARE NOT DEMOCRATS!



BREAKING: Maryland Legislators Move To Kill NSA Headquarters
benswann.com
ANNAPOLIS, Md., February 10, 2014-- It's lights our for the National Security Agency (NSA). State lawmakers in Maryland have filed...


____________________________________

As Dutch Ruppersberger knows the US lost trillions of dollars over just a few decades to defense industry fraud, billions each year.  Much of it is used to bribe, used to promote fraudulent development abroad, to buy alliances that later fall apart and amount to nothing.  Profiteering in the defense industry is rampant and it is public malfeasance and duplicity when politicians charged with serving the public allow all of this to happen without public justice.  What Ruppersberger supports is an NSA run by Wall Street and not a system designed to oversee Wall Street and stop the fleecing of American taxpayers with defense industry fraud.

Dutch doesn't want to stop there.....he wants to privatize all that is public support of Veterans at bases like Fort Meade and reduce the Veteran's Administration to private corporate non-profits with no oversight and known not to be doing the business of aiding Vets.  

NOTICE ALL THE CHARITY ORGANIZATIONS CREATED TO BEG FOR MONEY FOR VETERANS?  THAT IS WHAT RUPPERSBERGER HAS WORKED TO DO FOR VETERANS BY PRIVATIZING ALL PUBLIC SERVICES FOR VETS!  WHAT A GUY!!!!!!!

But wait, Dutch is fighting against cuts to veterans benefits you say!!!  Recovering defense industry fraud would pay off much of the national debt and remove this fake deficit and debt!  DO YOU HEAR DUTCH SHOUTING FOR THIS??????  No, Dutch is busy passing laws that allow the US military to expand its mercenary military to non-citizens overseas because we have to protect US global corporate interests while these corporations are fleecing Americans and ignoring all Rule of Law.  HOW DOES RUPPERSBERGER KEEP GETTING RE-ELECTED YOU SAY!  

RUN AND VOTE FOR LABOR AND JUSTICE IN ALL PRIMARIES TO SHAKE THE NEO-LIBERAL BUGS FROM THE RUG!!!!!

 Do you know that Manning downloaded and gave to Wikileaks defense industry data on just these defense industry expenditures just so international investigative journalists could do the research that shows where all this defense industry fraud is and where it is going?  See why Manning was tried as aiding the enemy------WHO ARE OBVIOUSLY YOU AND I!




Encyclopedia of White-Collar & Corporate Crime


Lawrence M. Salinger, Ph.D.

Pub. date: 2005 | Online Pub. Date: September 15, 2007 | DOI:http://dx.doi.org/10.4135/9781412914260 | Print ISBN: 9780761930044 | Online ISBN: 9781412914260 | Publisher:SAGE Publications, Inc.

Defense Industry Fraud

John Walsh Ph.D.

THE DEFENSE INDUSTRY comprises the development, production and sale of weapons and weapons-support systems. In some cases, components or substances that are not themselves weapons may be classified as being part of the defense industry if it is believed that they may be used in the creation of weapons. The defense industry is characterized by oligopolistic conditions, in which a small number of large firms compete for a small number of orders from governments. Success in the industry relies upon, to a considerable extent, economies of scale from research and development departments, large-scale production facilities and good network contacts with relevant government officials, both domestically and internationally. Many overseas sales are characterized by corruption and bribery and Transparency International has listed defense, along with the public works and construction industry, as being the sectors in which bribery is most rife. The very high value of products also provides an incentive ...

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There's Bernie Sanders shouting loudly to use defense industry fraud to pay down the national debt.  The trillions recovered from a few decades of fraud would end all cuts to public services and programs tied to the military.  

As Bernie says......IT IS THE PRIVATIZATION OF PUBLIC MILITARY WORK THAT MAKES GOVERNMENT COFFERS FEEDING TROUGHS FOR CORPORATE FRAUD!  You won't hear Dutch shouting this!




Lawmakers push Defense fraud, waste report to influence supercommittee cuts

By John T. Bennett - 10/23/11 06:53 PM EDT  The Hill Blog

Liberal lawmakers will soon send the congressional deficit panel the details of a Pentagon report that shows defense firms over the last decade ripped off the military to the tune of $1.1 trillion, Democratic sources told The Hill.

Pro-military lawmakers from both parties have warned the supercommittee to avoid Pentagon spending cuts beyond the $350 billion ordered by the August debt deal.

But several Senate Democrats want the panel to keep in mind that dollars sent to the Pentagon are often lost to fraud and waste, even as some conservatives raise the possibility of retroactively exempting the Pentagon from the $600 billion cut that will be triggered if the supercommittee fails.


Sen. Bernie Sanders (I-Vt.) last week highlighted what he called a “shocking” internal Pentagon report that concluded defense companies defrauded the military by $1.1 trillion.

“The ugly truth is that virtually all of the major defense contractors in this country for years have been engaged in systemic fraudulent behavior, while receiving hundreds of billions of dollars of taxpayer money,” Sanders said in a statement. “With the country running a nearly $15 trillion national debt, my goal is to provide as much transparency as possible about what is happening with taxpayer money.”

More than $250 million “went to 54 contractors convicted of hard-core criminal fraud in the same period,” Sanders said, summarizing tables included with the DoD report. “Of that total, $33 million was paid to companies after they were convicted of crimes.”

The Pentagon revealed defense behemoth Lockheed Martin paid $10.5 million in 2008 to settle fraud charges related to the Titan IV rocket program. Northrop Grumman paid $62 million three years prior to settle allegations it was involved in a fraud scheme.

And the list of contractors linked to waste goes on, the DoD tables show, ranging from the other largest defense firms to smaller companies.

Yet most continued to receive massive contracts.

And that does not sit well with Sanders and several other liberal lawmakers, Democratic sources say.

Sanders “believes numbers like these are very relevant for the supercommittee when some are talking about cutting social programs,” an aide to the Vermont liberal told The Hill on Friday.

“The supercommittee also should see the extent to which these companies committed fraud on behalf of the government,” the Sanders aide said. “We will get this to the supercommittee, at least at the staff level.”

Another Democratic aide said his boss intends to highlight the DoD fraud report as the special panel ramps up its search for $1.5 trillion in federal cuts. It must finish its work by Nov. 23 or automatic triggers will be enacted, including $600 billion in cuts to security spending.

“As debate goes forward, I’m sure you’ll see a number of Democrats on the left use that report and others like it. There’s a movement on the right to go back and exempt defense spending from the trigger if the supercommittee fails,” the Democratic aide said Friday. “That’s going to be unacceptable to [liberals who are] likely to use reports like this as proof that there is room to cut Defense spending without harming security.”

The Aerospace Industries Association, a leading defense industrial lobbying organization, declined to comment on the report.

But one prominent defense analyst and industry consultant blasted the Pentagon’s findings.

“Sen. Sanders is correct in stating the report is shocking — it's shockingly wrong. The report confuses isolated cases of wrongdoing with the dominant culture in the defense industry, which is the most heavily regulated and audited industry in the nation,” said Loren Thompson of the Lexington Institute.

“Critics of Defense spending like Sen. Sanders routinely make sweeping allegations of malfeasance in military contracting while ignoring far worse behavior in major entitlement programs like Medicaid,” he said.

What’s more, the yearly waste within the military largely comes from “decisions by legislators and policymakers that disburse funds to unnecessary projects” and mandate “superfluous tests, reports and contracting procedures,” Thompson told The Hill. “That's where the real waste occurs in military contracting, but Sen. Sanders would prefer to focus on the handful of cases of malfeasance that more closely match his ideological leanings.”

But one government watchdog group called the findings “mind-boggling.”

“The amount of money given to these companies is staggering, but what is really mind-boggling is the willingness of the DoD to provide additional taxpayer dollars to the same bad actors again and again,” Scott Amey, general counsel for the Project on Government Oversight (POGO) said in a Friday statement.

“Despite the report’s findings, the DoD’s over-reliance on contractors may hinder reform,” Amey said. “Taxpayers are unlikely to see any changes until DoD holds contractors more accountable, especially those defrauding the government.”

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George Bush sent trillions in profit to all of Cheney's Halliburton and hedge funds became Blackwater USA as our public troops were ghettoized with the super-sized wages these private military contractors paid private employees with the same US taxpayer money.  The intent was to move the best public troops over to private contractors as the public military structures were dismantled.  On came Obama and Hillary who as neo-liberals placed this process on steroids with the movement of troops and war to Afghanistan.  Now, government watchdogs say that over 70% of US military is private contractors and the fraud and corruption is rampant.  US private military behave so illegally that nations do not want them in their countries.  Human rights abuse is systemic.

What we are seeing in the build-up of the US police state is the coming home of these private military contractors and employees to become city and state police.  We in Baltimore know what this police state will look like.  Police here act with impunity here just as they do overseas.  SEE WHY PEOPLE AROUND THE WORLD ARE SHOUTING 'DEATH TO AMERICA"?

DO YOU HEAR MARYLAND POLS TALKING ABOUT THIS?????  THEY ARE NEO-LIBERALS WORKING FOR WEALTH AND PROFITS!



Christian Science Monitor
Opinion

A lesson from Iraq war: How to outsource war to private contractors

During the Iraq war, private defense contractors providing security and support outnumbered troops on the ground at points. Contractors can enhance US military capacity but also entail risks. US experience with private security contractors holds several key lessons.

By Molly Dunigan / March 19, 2013

A helicopter owned by Blackwater USA, a private security contractor, flies over central Baghdad, Iraq, Feb. 7, 2007. Op-ed contributor Molly Dunigan says 'the United States must protect its interests and ensure that the contractors it employs are carefully vetted and well trained. It should also continue to work toward a commonly accepted means of holding contractors accountable for their behavior.'

Ten years after it began, the Iraq war might best be remembered as America’s most privatized military engagement to date, with contractors hired by the Pentagon actually outnumbering troops on the ground at various points.

This might come as a surprise to many, since the sheer number of contractors used in Iraq was often overshadowed by events. By 2008, the US Department of Defense employed 155,826 private contractors in Iraq – and 152,275 troops. This degree of privatization is unprecedented in modern warfare.

One of the most important lessons of the Iraq war is that this military privatization is likely to continue in future conflicts. This could be a good thing, as contractors can enhance US military capacity. But any large-scale use of private military contractors also entails risks. Recent US experience with private security contractors, in particular, holds several critical lessons for the future.

OPINION: After US withdrawal from Iraq, a tallying of the balance sheet

Of course, private contractors are not new to war zones. They supported all the major US conflicts of the late 20th century, including in Vietnam, the Balkans, and Operation Desert Storm in Iraq. But in these cases, they mainly provided logistical and base support.

Now, the US military has developed a growing dependence on private contractors – and for a wide range of functions traditionally handled by military personnel. The Army spent roughly $815 million ($163 million per year, or about $200 million per year in 2012 dollars) to employ contractors under its Logistics Civil Augmentation Program between 1992 and 1997. But between 2001 and 2010, that expenditure grew to nearly $5 billion per year. Of course, this latter cost coincides with US involvement in Afghanistan as well as Iraq.

A more pertinent question – and what truly sets the Iraq war apart – concerns the role of these private civilian contractors. Throughout the war, the majority (61 percent) of contracted jobs continued to be base-support functions. The next-largest group (18 percent) of Department of Defense contractors were security contractors. They provided security services, such as guarding installations, protecting convoys, or acting as bodyguards.

Moreover, this outsourcing trend continued in Afghanistan, where there were 94,413 contractors in 2010, compared with 91,600 US troops.

Military outsourcing in this vein developed as a result of an increased supply of private military services combined with increased demand. The boom in supply was borne out of larger privatization trends in both the US and Britain in the 1980s and 1990s, which spread over into the military arena. The increased demand was due to the strains that the wars in Iraq and Afghanistan placed on the US military.

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As I wrote before....Maryland was sighted as having the worse VA services with a failing grade for the Baltimore VA center because all of it has been privatized to private non-profits taking the taxpayer money under the guise of running programs that VETs will tell you are not happening.  Indeed, talk was to get rid of the VA building itself.  THAT'S DUTCH FOR YOU.....WORKING FOR DEFENSE INDUSTRY AND CORPORATE PROFITS AT THE EXPENSE OF THE CITIZENS WHO VOTE FOR HIM!!!

SHAKE THE NEO-LIBERAL BUGS FROM THE RUG BY RUNNING AND VOTING FOR LABOR AND JUSTICE IN ALL PRIMARIES!



    
Friday, January 28th, 2011 | Posted by Dale R. Suiter


VA / Privatization = Loss for Vets

Don't give up on these guys!
New folks in the House of Representatives say they are looking to “cut spending” and reduce the size of government. There is a movement to repeal the Affordable Care Act.

There is mention to of privatizing some government health care services. What’s all this mean for Vets?

If you love what Halliburton did for the trrops, yuo’ll love what privatization will do for veterans.

October 15, 2010 (rushlimbaugh.com) then candidate Sharron Angle was critical of Senator Reid. Senator Reid reportedly said: “She (Ms. Angle) wants to privatize the Veterans Administration.” Mr. Linbaugh continues: “What’s wrong with privatizing the VA…? Somebody tell me where its working. Somebody tell me where anything the federal government is running is working… Privatize the Veterans Administration.!”

Including the military:
1. 10th mountain Division – great outfit
2. 1 Bn 119th FA MIARNG – excellent – well trained cannoneers
3. United States Marine Corp (especially 3/9 and 1/3)*
4. United States Air Force
5. United States Army
6. United States Coast Guard
7. Centers for Disease Control and Prevention
8. Departments of Motor Vehicles in 50 states and all the territories
9. Local, state and federal judicial systems – that due process item we kinda like and wanna keep
10. Open meeting acts around the country

Privatization come with a heavy price tag. Many traditional military mainenance and support roles have been privatized. Many line grunts report few hot meals “… at the front …” (O.K. no hot food up front is as old as warfare). Military units are challgenged to repair and maintain vehicles, equipment, aircraft and weapons systems. (In one case – an Army 88M’s Dad – sent his son a needed tool kit so he and his truck partner could repair the trucks they were assigned to. Also as old as the history of warfare. Key point is the troops could not get the support they needed in theater.)

FACT SHEET
GAO Issues Report on Hlliburton Troops Support Contract In Iraq (Minority Staff Committe On Government Reform U.S. House of Representatives Juy 21, 2004)

This GAO report documented serious shortfalls with the government contract with Halliburton. Problems included:
* Planning for troops delayed until “Afther the Fall of Baghadad.”
* Planning for Support Services “Ineffective”
* Halliburton’s uncontrolled costs (Halliburton costs grew from $5.8 billion to $8.6 billion between September 2003 and January 2004.)

The report “higlights a pattern of contractor management problems. Including:
* Inadequate cost control
* Difficulties meeting schedules – Halliburton did not provide some services required, including “water production”
* Inadequate control over purchases
* Inadequate control over subcontractors

The report notes too inadequate control and oversight of Halliburton as follows: “… essentially military officials do not understand their role … regarding their roles and responsibilities.”

Dana Hedgpath, Washington Post (3011098) wrote: “KBR Faulted on Water Provided to Soldiers”. The article includes: “U.S. Soldiers at a military base in Iraq … provided with … untested water for … two years by KBR … and may have suffered health problems … KBR inappropriately distributed chlorinated wastewater to 5,000 U.S. troops at Camp Q-West … north of Baghdad… KBR disagreed with the report.”

Many Vets depend on the VA. Privatizing it will turn Vets worlds upside down. One thing our government can not do well is track massive contracts with private industry and contractors. There many examples of troops running into wall after wall after wall trying to get day to day military tasks completed – and being frustrated with civilians who do not respond to the military. The so called reduction of the military dating from the 1990′s is a myth. The funds and tasks have been redirected into private industry – at a loss to the military and increased danger to our troops. Privatization of the VA would be another disaster.

Regards

Dale R. Suiter

* Corp as in Marine Corp – the Corp is pronounced – core – folks. Often mispronounced by those who have not had the honor of Marine Corp service.

Note: Author does not support or approve of the Affordable Care Act. It is (my opinion) of something the government can not do well. Read the act and determine for yourself the many implications for the VA.
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This is what neo-liberals have reduced all public services to....charity.  Rather than have Medicare and Medicaid or VET health programs.....we will see if corporations and other will donate to charities for even more tax write-offs rather than simply pay taxes!

DUTCH------I DO NOT HEAR YOU SHOUTING AGAINST ALL OF THIS....BUT YOU LOVE YOUR NSA COMPLEX DON'T YOU?????



Veterans Charities Ratings


The American Institute of Philanthropy recently released a report rating various veterans charities on how well they support the causes they were created to support.

We were surprised at some of the ratings in this report; not at others. Before you donate your hard-earned dollars to any charitable organization, check it out to see how much of its revenues actually go to support its charitable purpose, and how much goes to administrative expenses, salaries, and fundraising. You may be surprised!

Letter grades were based largely on the charities' fundraising costs and the percentage of money raised that was spent on its charitable activities.

The charities that received failing grades are in red type.

The charities that received grades of A or better are in bold blue type.

Here are the December 2007 veterans charities ratings, by the AIP:


Veterans Charities Ratings

Air Force Aid Society (A+)

American Ex-Prisoners of War Service Foundation (F)

American Veterans Coalition (F)

American Veterans Relief Foundation (F)

AMVETS National Service Foundation (F)

Armed Services YMCA of the USA (A-)

Army Emergency Relief (A+)

Blinded Veterans Association (D)

Coalition to Support America's Heroes (F)

Disabled American Veterans (D)

Disabled Veterans Association (F)
Notice the similarity of the name to Disabled American Veterans

Fisher House Foundation (A+)

Freedom Alliance (F)

Help Hospitalized Veterans/Coalition to Salute America's Heroes (F)

Intrepid Fallen Heroes Fund (A+)

Military Order of the Purple Heart Service Foundation (F)

National Military Family Association (A)

National Veterans Services Fund (F)

National Vietnam Veterans Committee (D)

Navy-Marine Corps Relief Society (A+)

NCOA National Defense Foundation (F)

Paralyzed Veterans of America (F)

Soldiers' Angels (D)

United Spinal Association's Wounded Warrior Project (D)*
     * See update on Wounded Warrior Project

USO (United Service Organization) (C+)

Veterans of Foreign Wars and Foundation (C-)

Veterans of the Vietnam War & the Veterans Coalition (D)

Vietnam Veterans Memorial Fund (D)

VietNow National Headquarters (F)

World War II Veterans Committee (D)


Read the complete AIP veterans charity watchdog report and veterans charities ratings.

Do you have questions about specific veterans charities?

First, check the list of veterans charities reviewed by Military-Money-Matters.com. If the charity you're interested in is not listed there, then check the references listed below the stars & stripes bar to look up information.

If you can't find the answer to your question in any of those sources, ask your questions about specific veterans charities. For ease of answering your questions, please make a separate submission for each different charity you wish to inquire about, and make the title of your submission the name of the charity. Thanks.

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    Author

    Cindy Walsh is a lifelong political activist and academic living in Baltimore, Maryland.

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