Trickle Up Poverty (14 page)
The time of day is significant. Why? If the drop had occurred before that time, the size of the drop would have triggered a halt in trading. Any further potential damage that the continuation of such a drop might have caused could have been contained. Since it occurred immediately after that time, no protections were in place.
That in itself points the finger directly at short sellers.
In fact, the May 6 drop was the quite possibly the work of hedge fund traders raiding the market with the intent to send a message that they could still do whatever they wanted, despite the fact that only days earlier a new, “alternative” uptick rule had been put in place. They demonstrated clearly that the new rule had no teeth whatsoever; that traders who staged the raid were free to do what they would for the remainder of the afternoon.
In fact, before it closed for the day, the market had gained back more than half of what it had lost. Short sellers first drove down the price of many stocks dramatically; what’s more, the value of a number of issues dropped to a penny a share, making them worthless. The raiders then bought them back, driving the market back up, although not before they pocketed somewhere in the neighborhood of half a trillion to a trillion dollars. Short sellers had what they sought: significant profits and a trial run to prove that they were still in control of the market, despite the new rule supposedly protecting investors from precisely the kind of raid that had just been staged.
The “alternative” uptick rule, just implemented, halts the trading of a stock whose price declines by 10 percent in a single day, but after 2:30 in the afternoon, the rule doesn’t apply. The incident demonstrates that the SEC is essentially still a toothless entity headed by someone who’s in the bag for hedge fund traders. It may well mean that things haven’t changed significantly, that the market is still at the mercy of the MFA.
In an important sense, the hedge fund traders of the MFA hold power over the economy. Until they determine again that there’s a need for them to step in and resume control of the economy and political policy by staging yet another raid of the capital markets, the uncertainty that accompanies this threat is likely to stall a return to a full economic recovery at pre-2008 levels. Banks will continue to be wary about lending to businesses and homeowners, fearing sudden policy changes like a resumption of mark to market accounting that might again jeopardize their balance sheets. And middle Americans’ investment portfolios will once again be hog-tied by what may well be a shadow government.
This is un-American on the face of it.
What has occurred over the past several years is a power grab of epic proportions, and no one in Congress is even close to understanding what happened and what a dangerous position we’re in. From a high of more than fourteen thousand in October, 2007, the Dow Jones Average had lost nearly half of its value by the time of the 2008 election.7 Much of the lost money went into the pockets of the hedge fund raiders who, thanks to changes permitted by the SEC, were able to sell short with no limits, further driving down asset values. SEC’s giving in to those lobbying on behalf of the MFA cost millions of average Americans invested in the stock market and in money market funds through their 401K plans as much as half the value of the assets they had planned to retire on. The raid made Bernie Madoff look like a piker. By the way, SEC also looked the other way where Madoff was concerned.
By the time John McCain correctly called for Cox’s resignation as part of his bumbling response to the financial meltdown that cost him the election, it was already too late. In his response to McCain, Cox disingenuously said, “we have no tolerance for naked short selling,” despite the fact that under his leadership, that’s precisely what the SEC enabled.8 The uptick rule was reinstated (February, 2010) and the mark-to-market accounting relaxed (March, 2009) only after potentially irreparable damage to the economy and to millions of Americans’ savings and retirement accounts had been done.
But there’s another disturbing layer of alleged treachery behind this story. There are those who have claimed that the financial meltdown—ostensibly engineered by the MFA—may well be a part of an even larger movement to both manipulate and reduce the United States (as well as other powerful world economies) into mere pawns of a shadow world government. Some assert that is the goal of the Bilderberg Group. You may wonder, What’s that? After all, most people don’t know the difference between Bilderberg and Pittsburgh.
The Bilderberg Group is a secretive organization whose activities, from its inception in 1954, remain hidden from both press and public scrutiny. While little is known about their inner workings, we do know that the Bilderberg Group is an international consortium of politically and economically powerful people who envision a New World Order—with them at the top pulling the strings. They’re dyed-in-the-wool pan-Leninists. They’re egotists of the lowest order who want to effectively erase national boundaries and control the world economy.
And they have the connections to pull if off.
After all, the Bilderberg Group isn’t a bunch of average blue collar guys working the night shift at a bowling alley. Far from it. The membership list from past attendees reads like a Who’s Who of United States and international politics, finance, and communications, including former U.S. President Bill Clinton; Fox News owner and media mogul Rupert Murdoch; George Soros; U.S. Treasury Secretary Timothy Geithner; Richard Holbrooke, U.S. Special Envoy to Pakistan; EU Bank President Jean-Claude Trichet; Fed Chairman Ben Bernanke; and U.S. Senators Chris Dodd and Dianne Feinstein, among others.
Those attending from the U.S. in 2010 included Roger Altman, Chairman, Evercore Partners; Sonia Arrison, Author and policy analyst; Timothy C. Collins, Senior Managing Director and CEO, Ripplewood Holdings; Martin Feldstein, George Baker Professor of Economics, Harvard University; Niall Ferguson, Laurence A. Tisch Professor of History, Harvard University; William Gates, Co-chair, Bill & Linda Gates Foundation and Chairman, Microsoft Corporation; Philip H. Gordon, Assistant Secretary of State for European and Eurasian Affairs; Donald Graham, Chairman and CEO, The Washington Post; Richard Holbrooke, Special Representative for Afghanistan and Pakistan; Robert Hormats, Under Secretary for Economic, Energy and Agricultural Affairs; James Johnson, Vice Chairman, Perseus; John Keane, Senior Partner, SCP Partners; Henry Kissinger, Chairman, Kissinger Associates; Klaus Kleinfeld, Chairman and CEO, Alcoa; Henry Kravis, Kohlberg Kravis Roberts & Co.; Marie-Josée Kravis, Senior Fellow, Hudson Institute; Eric Lander, President and Director, Broad Institute of Harvard and MIT; Jessica Mathews, President, Carnegie Endowment for International Peace; Craig Mundie, Chief Research and Strategy Officer, Microsoft Corporation; Moisés Naím, Editor-in-Chief, Foreign Policy; Peter Orszag, Director, Office of Management and Budget; Sean Parker, Managing Partner, Founders Fund; Frank Pearl, Chairman and CEO, Perseus; Richard Perle, Resident Fellow, American Enterprise Institute for Public Policy Research; Charlie Rose, Rose Communications; Robert Rubin, Co-Chairman, Council on Foreign Relations, Former Secretary of the Treasury; Eric Schmidt, CEO and Chairman of the Board, Google; James Steinberg, Deputy Secretary of State; Lawrence Summers, Director, National Economic Council; Peter Thiel, President Clarium Capital Management; Christine Varney, Assistant Attorney General for Antitrust; Paul Volcker, Chairman, Economic Recovery Advisory Board; F.J. Bing West, Author; and James Wolfensohn, Chairman, Wolfensohn & Company.
That’s just a list of those who are coming from the U.S. that we know of. Many who attend choose to be anonymous and, as such, are not included in this list. We also know that the annual meeting of these elitists is a heavily guarded affair—complete with armed sentinels. Why the secrecy? What are these heads of states, financial tycoons, and world leaders saying and doing behind closed doors? Let’s be clear. I’m not a conspiracy thrill seeker. The fact of the matter is that where there’s smoke there’s fire. Once in a while a picture of their aspirations for world control emerges.
Take, for example, this statement made by Bilderberg member David Rockefeller. In his 2002 book entitled, Memoirs, Rockefeller wrote:
Some even believe we are part of a secret cabal working against the best interests of the United States, characterizing my family and me as ‘internationalists’ and of conspiring with others around the world to build a more integrated global political and economic structure—one world, if you will. If that’s the charge, I stand guilty, and I am proud of it.9
One investigative reporter described the group’s charter as coming to an “agreement on questions of policy, economics, and strategy in jointly ruling the world.”10 And Former NATO Secretary-General, Willy Claes, who attended the Bilderberg meetings twice thus far, made this astonishing disclosure during a radio interview following the 2010 meeting. He explained each participant is given ten minutes to speak to the group. These comments are summarized and form the basis for a report. In turn, Claes went on, according to this translation of the interview, to state: “The participants are then obviously considered to use this report in setting their policies in the environments in which they affect.”11 In other words, he’s admitting that the Bilderbergers set global policy based upon the exchange of views shared in secret and, in turn, return to their sphere of influence to carry out the plan.
Another pundit claims the Bilderberg Group’s overall objective is the elimination of the middle class and the creation of a world order comprised only of “rulers and servants,” and using such tactics as the establishment of such instruments as “green taxes” (including “cap and trade” legislation) in order to control the world energy market and to subjugate the world’s citizens in the interest of combating the now proven-fraudulent notion of man-made global warming.12
What does all of this have to do with the financial crisis that sent Wall Street reeling out of control? Plenty. It validates the idea that the run on the American economy was ultimately a conspiracy designed to elect a leftist, globalist president of the United States. How else do you explain the actions of Barack Obama and Hillary Clinton in June, 2008, during the campaign, when they ditched members of the press and disappeared?
According to one report, during their absence the two candidates were meeting secretly with members of the Bilderberg Group in a northern Virginia hotel to discuss Obama’s and Clinton’s involvement with the group after the election. It is also reported that powerful businessman James A. Johnson, a Bilderberg Group member, selected Obama’s running mate after the Democratic primary.13
Which is why investigating the abuses on Wall Street is the furthest thing from Barack Obama’s mind. In my opinion, Mr. Obama would rather conspire with the members of the Bilderberg Group to control the world. And, what better way could Obama endear himself to this inner circle of globalists than to keep Wall Street vulnerable to outside manipulation in the future?
The Housing Crisis and TARP Bailouts
Two thousand eight marked a perfect leftist storm of financial conditions ensuring that the shadow government would be able to engineer the election of Barack Obama through their raid on U.S. markets. Among the most important contributors to the financial meltdown was a housing bubble that began in the 1990s, during the Clinton administration, as part of the left’s entitlement mentality.
Using taxpayer-funded mortgage guarantees through two quasigovernmental organizations, the Federal National Mortgage (FNMA), better known as Fannie Mae, and the Federal Home Loan Mortgage Corporation (FHLMC), better known as Freddie Mac, policies were enacted that federally guaranteed home loans and encouraged giving mortgages to people who were unqualified to receive them. This, of course, perpetuated the left’s strategy of expanding entitlements in order to create widespread dependency.
One of the leaders of this expansion of entitlements was über-leftist Massachusetts Soviet-Democratic Congressman Barney Frank. Although Democrats, with the collusion of the mainstream media, managed to convince Americans that the financial crisis was overwhelmingly the result of “capitalist greed,” the fact is that the triggers for the crisis included both anti-capitalist hedge fund short sellers and corrupt Democratic policy-driven governmental agencies Fannie Mae and Freddie Mac. In fact, Allan H. Meltzer, writing in the Wall Street Journal, declared that “without the policies followed by Fannie Mae and Freddie Mac—and the destructive changes in housing and mortgage policies, like authorizing sub-prime and Alt-A mortgages for impecunious borrowers—the crisis would not have happened.”14
Corruption surrounding Fannie and Freddie was rife.
In the late ‘90s, Barney Frank seems to have “been in bed” with Fannie Mae’s Director of Project Development, Herb Moses, as he (Frank) made decisions that benefited Fannie and its principals enormously. During that period, for instance, Clinton crony and Fannie Mae CEO Franklin Raines absconded with $90 million in “bonuses.” At the same time, directives from Democrats to loosen the standards on mortgages so that people previously unable to obtain them meant that the system was overweighted with bad credit risks. When the subsequent over-leveraging of the mortgage market through highly suspect mortgage-backed securities came home to roost, the rout was on.
Among many other things, the rout led to the failure of Lehman Brothers, the largest financial institution failure in American history. In addition to its extensive sub-prime mortgage holdings and its inability to meet demands for collateral against loans it was seeking to help it avoid bankruptcy, the 158-year-old company hid some $50 billion in distressed assets just before its collapse.15 Richard S. “Dick” Fuld, then Lehman CEO, had guided the company deep into the business of making sub-prime loans and then repackaging them and reselling the resulting bonds. Fuld was just getting started.
He then approved hiding these and other toxic assets from public scrutiny, all while raking in more than $500 million in compensation.16 Fuld, having sold his $13 million mansion in Florida to his wife for $100,17 remains a free man, although he is being sued for fraud and misrepresentation. He’s currently working for (what else?) a New York–based hedge fund firm, Matrix Associates.18