To Wreck America: The Plot from Within

Op-Ed Columnist

The Other Plot to Wreck America

By FRANK RICH

THERE may not be a person in America without a strong opinion about what coulda, shoulda been done to prevent the underwear bomber from boarding that Christmas flight to Detroit. In the years since 9/11, we’ve all become counterterrorists. But in the 16 months since that other calamity in downtown New York — the crash precipitated by the 9/15 failure of Lehman Brothers — most of us are still ignorant about what Warren Buffett called the “financial weapons of mass destruction” that wrecked our economy. Fluent as we are in Al Qaeda and body scanners, when it comes to synthetic C.D.O.’s and credit-default swaps, not so much.

For the full NYT OpED: http://www.nytimes.com/2010/01/10/opinion/10rich.html

Geithner’s Role in AIG Cover Ups; Geithner Should Not Be at the Helm of the Treasury

Geithner’s New York Fed Told AIG to Limit Swaps Disclosure

Jan. 7 (Bloomberg) — The Federal Reserve Bank of New York, then led by Timothy Geithner, told American International Group Inc. to withhold details from the public about the bailed-out insurer’s payments to banks during the depths of the financial crisis, e-mails between the company and its regulator show.

AIG said in a draft of a regulatory filing that the insurer paid banks, which included Goldman Sachs Group Inc. and Societe Generale SA, 100 cents on the dollar for credit-default swaps they bought from the firm. The New York Fed crossed out the reference, according to the e-mails, and AIG excluded the language when the filing was made public on Dec. 24, 2008. The e-mails were obtained by Representative Darrell Issa, ranking member of the House Oversight and Government Reform Committee.

The New York Fed took over negotiations between AIG and the banks in November 2008 as losses on the swaps, which were contracts tied to subprime home loans, threatened to swamp the insurer weeks after its taxpayer-funded rescue. The regulator decided that Goldman Sachs and more than a dozen banks would be fully repaid for $62.1 billion of the swaps, prompting lawmakers to call the AIG rescue a “backdoor bailout” of financial firms.

For Bloomberg’s full story: http://news.yahoo.com/s/bloomberg/20100107/pl_bloomberg/axivw4igkv38

Goldman Sachs/ TARP Director Escapes from Dc and “Rat Race”

     Neel Kashkari was the Goldman Scach “golden boy” who was handpicked by Treasury Secretary Hank Paulson to head up the bank bailout TARP program. After his meteoric rise in the big dollar world of Wall Street, and in the halls of the Treasury and politics, Kashkari and his wife, Minal, have taken their two Newfoundlands and “escaped”.

Check the photo journal from the Washington Post:

http://www.washingtonpost.com/wp-dyn/content/gallery/2009/12/04/GA2009120402127.html?sid=ST2009120402037

Now we all should be able to escape like this………………..

CIT Bankruptcy: 6 Reasons to be Angry

Six reasons to be outraged about CIT

Six very real reasons to be outraged about CIT (and Goldman and the Govt) and its role in the bailouts:

See Cody Willard’s blog: http://cody.blogs.foxbusiness.com/2009/11/02/six-reasons-to-be-outraged-about-cit/

“Zero Hedge” Financial Blog Gains Respect

“Last spring, in a far corner of the Internet, an unknown blogger began to piece together a conspiracy theory: The investment bank Goldman Sachs was using sophisticated, high-speed computers to siphon hundreds of millions of dollars in illegitimate trading profits from the New York Stock Exchange, invisibly undercutting the market and sidestepping the regulatory reach of the Securities and Exchange Commission.”

“Only a few loyal readers paid attention to the blog called Zero Hedge, a no-frills site full of arcane analysis decipherable only by finance professionals. But when a former Goldman Sachs computer programmer was arrested for allegedly stealing software codes used for the firm’s electronic trading arm, and a federal prosecutor was quoted saying the codes could be used to “manipulate markets in unfair ways,” the once-obscure blog ignited a chain reaction.”

 

“On July 24, the Times published a front-page article on so-called high-frequency trading and its potential abuses, which in turn prompted Chuck Schumer, a member of the Senate Finance Committee, to draft a letter to the SEC that same day. Twelve days later, the SEC signaled that it was considering a ban on the very computerized trading that Zero Hedge had attacked. “

“Suddenly, the shadowy figure behind Zero Hedge was a full-blown cult hero—a blogger with a bullet. His readership of angry traders and anti-government malcontents celebrated his newfound power. “Welcome to the party pal!!!” declared one of his fans in the comments section.”

http://nymag.com/guides/money/2009/59457/

Goldman Sachs, Bank of America, GM: Be aware of how China deals with Corruption

Former Beijing airport boss executed in China

BEIJING – Leaders of China’s elite state industries are renowned for their power, influence, and — in several recent cases — corruption. Increasingly, they are paying the price.

On Friday, the former head of the company that runs airports in Beijing and more than 30 other Chinese cities was put to death after the People’s Supreme Court upheld his sentence in a $16 million bribery and embezzlement case.

Li Peiying’s execution came two days after word emerged that the head of China‘s nuclear power program was under investigation for alleged corruption. Just last month, the former chairman of China’s second-biggest oil company, Sinopec, was also convicted of taking $29 million in bribes and given a suspended death sentence.

The heads of state-owned enterprises “possess power and money, making it easy to give rise to corruption,” Wang Yukai of the China National School of Administration was quoted Friday in the Communist Party newspaper Global Times as saying.

See the Associated Press story: http://news.yahoo.com/s/ap/20090807/ap_on_re_as/as_china_corruption

Paulson Defends StrongArm Tactics with Bank of America

Paulson Justifies Threatening BofA’s CEO

Former Treasury Secretary says he was justified in suggesting that BofA’s CEO could lose his job if the bank backed out of plans to buy troubled Merrill Lynch.

See the article at: http://www.foxnews.com/politics/2009/07/16/paulson-says-justified-threatening-bofa-ceo/

Goldman Sachs is tied to Every Economic Bubble since the Depression

     An article in Rolling Stones magazine, there is drawn a link between Goldman Sachs and the economic bubbles that have occurred since the Depression, in an “engineering manner”.

For full Article: http://zerohedge.blogspot.com/2009/06/goldman-sachs-engineering-every-major.html

The FED, The Treasury, Goldman Sachs: The Web of Deception?

Wednesday, April 15, 2009

Martin Armstrong on Goldman Sachs

Martin Armstrong takes a break from his usual cyclical talk to give us his description of what he has seen “behind the curtain”. With nothing left to lose, sitting in prison, Martin is one who claims to have glimpsed behind the curtain, and who is able to talk about it.

You will likely find some of the things Martin says to be shocking. But I have noticed a consistency in his recollections that flows through his various articles. He often mentions different parts of the same stories from his past in his many articles. This makes me think that at least he is not making these things up. They are true recollections.

I believe that to Martin, this may be his most important article written while in prison. It is his “tell all”. The following is a text version of his typewritten and scanned pdf which is available here.

Sincerely,
FOFOA
___________________________________________________

Looking Behind The Curtain

The “Real” Conspiracy

April 9, 2009
by Martin A. Armstrong
former Chairman of Princeton Economics Int’l, Ltd.
and the Chairman of the Foundation for the Study of Cycles

Many people have written asking about Goldman Sachs and its conspiracy to control the Financial Markets. I have even been asked whether I believe that the attempt to assassinate me of May 10th, 2007, was connected to Goldman Sachs? Let me explain this subject very carefully. I realize that there is a storm cloud brewing with conspiracy stories with Goldman Sachs at the center. These theories are not perhaps absolutely correct, but they are not far off either.

The Full Post: http://fofoa.blogspot.com/2009/04/martin-armstrong-on-goldman-sachs.html

http://www.portfolio.com/executives/features/2009/01/07/Goldman-Conspiracy-Theories

 

New York Federal Reserve Chairman Resigns amid Stock Purchase Controversies

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

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

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

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

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

Some of the regional directors are appointed by the Washington-based board. Those directors are not allowed to own shares of bank holding companies, a status that Goldman Sachs won in September to secure access to Fed lending facilities.

Friedman bought Goldman shares in December 2008 and in January of this year, which became public with a Wall Street Journal report on Monday.

Friedman obtained a waiver of the bank stock ownership rules, which the Journal said was granted just before he bought stock in January, that allowed him to hold them until the end of this year. Last week, he said he would resign by then.

DEFENDERS AND DETRACTORS

The top lawyer at the New York Fed said Friedman had done nothing wrong.

“It is my view that these purchases did not violate any Federal Reserve statute, rule or policy,” the bank’s general counsel, Thomas Baxter, said in a statement.

Denis Hughes, the deputy chair of the New York Fed’s board and president of the New York State AFL-CIO, will now be the acting chair, the New York Fed said.

While the Fed was deciding whether or not to grant Friedman a waiver, he bought 37,300 Goldman shares on December 17, for an average price of $80.78, according to regulatory filings.

On January 22, he bought 15,300 more shares for average prices of $66.19 and $67.12, according to filings with the U.S. Securities and Exchange Commission. The January purchase brought his total holdings to 98,600 shares.

Goldman shares closed on Thursday at $133.73, meaning Friedman has profited handsomely, earning more than $3 million in total on the two purchases.

“Clearly he should not have done that (bought more Goldman shares), and probably even before he did that, he should have gotten off the board,” said Alfred Broaddus, former president of the Federal Reserve Bank of Richmond.

John Dunbar, a senior fellow at the Center for Public Integrity, a nonprofit watchdog group in Washington, said the stock purchases were a “complete conflict of interest.”

“It is almost comical. If you tried to do that in a more traditional Washington bureaucracy, there is no way on earth you would get away with that,” he said.

Fed insiders were also troubled over the situation, which they felt cast a question mark over ethical standards at the central bank.

“All the other banks are furious. No one else would have let this happen,” said one official at another regional Fed bank. “We’ve always made people leave (to avoid a conflict),” said the official, who requested anonymity given the delicacy of the situation.

NEW YORK FED BOARD RANKS THIN

Of all the other regional Fed banks, only Minneapolis said that one of its directors had to apply for a waiver for bank shares he held last fall when a number of former non-bank financial firms sought banking holding company status.

Minneapolis Fed board Deputy Chairman John Marvin, chief executive of Marvin Windows and Doors of Warroad, Minnesota, was granted a waiver for stock he held in Morgan Stanley and Goldman Sachs, a Minneapolis Fed spokeswoman said.

Several regional Fed banks said that their internal practices would have prevented the problem cropping up in the first place. “It is our policy to ask them to divest or resign,” said a spokeswoman for the Kansas City Fed said.

With Friedman’s resignation, the New York Fed’s board now has three vacancies. Indra Nooyi, chairman and CEO of PepsiCo, is no longer on the board and former Lehman Brothers chief executive Dick Fuld left in September.

It is rare to have more than one vacancy at any given time.

(Reporting by Kristina Cooke; Additional reporting by Alister Bull in Washington and Ros Krasny in Chicago; Editing by Toni Reinhold)