$10 Trillion in Wall Street Aid and No Investigations?

While arrogant Wall Street executives are once again beating their chests, bragging about the bonuses they plan on paying themselves, and proclaiming how they “don't need government help”, these are clearly people with memories almost as short as that of their victims, whom they scammed for trillions of dollars.

They have already forgotten the $10 TRILLION in hand-outs, loans, and guarantees bestowed upon them by their servants in government. Perhaps that's part of the reason they have “forgotten” their assistance. How many rich people remember the actions of their servants?

Of course, there could be another reason why the worst corporate criminals in history (see “U.S. bank-fraud SYSTEMIC and INTENTIONAL – William Black”) have already forgotten a mountain of aid which is roughly equivalent to the entire U.S. national debt. In what could be the biggest non-event in history, well over a year after the U.S. government showered Wall Street with the largest corporate hand-outs in history (as “punishment” for their misdeeds) there have been NO government investigations.

While we are told that the FBI has many criminal investigations which it is working on, none of the U.S.'s plethora of government regulators has investigated any of the Wall Street fraud-factories. At the same time that the Obama regime is pondering consolidating regulatory authority into a smaller circle of regulators, not one of those regulators are investigating a multi-trillion dollar Ponzi scheme which occurred on “their watch”.

I was prompted to write this piece after reading a Vanity Fair article on AIG, which provided a very sympathetic account of one of the too-big-to-fail Wall Street gamblers who had, in fact, failed – and in spectacular fashion. The government hand-outs which were required to keep AIG afloat (and funnel tens of billions of dollars into other fraud-factories) currently total over $180 BILLION (and counting).

Yet, as Vanity Fair writer Michale Lewis observed, “At no point did anyone from the U.S. Treasury or the U.S. Congress, or any of the various New York State authorities that had gotten involved, call them up, much less visit A.I.G.F.P. [the unit which was the focal point of the AIG collapse] – as, say, someone might who was genuinely curious to know what, exactly, had happened there.”

This is not the first time I've heard this refrain. As an aside in a number of Wall Street news articles from the various members of the corporate media, the story is the same: none of the regulators in the U.S. federal government are investigating any of the members of the U.S. financial crime syndicate.

All that has been done is to “summon” the CEO's to Congress, make them squirm for a few hours – with lots of cameras and microphones present – allow all the politicians to engage in extreme, rhetorical posturing, and then send them all back to Wall Street with their jobs intact (the ONE exception being the CEO of AIG, itself). If the goal of the U.S. government was to encourage Wall Street to engage in even more reckless gambling, and even bigger scams in the future, then “mission accomplished”.

The collective “punishment” for the utter failure of the “Wizards of Wall Street” was to provide them with $10 TRILLION in government assistance (on very generous terms) – and even allow all the executive-scammers of this crime syndicate to keep their jobs. Could this have anything to do with the fact that former, senior bank-regulator William Black has unequivocally stated that government regulators, senior officials in the Treasury Department, and (of course) the Federal Reserve were all “accomplices” in Wall Street's crime-spree?

Who wants to launch an investigation which could very quickly and easily boomerang into an investigation of their own complicity? The natural question to ask is: if all of the perpetrators and accomplices of Wall Street's crime-spree remain in control, how could any American possibly believe that anything has been fixed?

Indeed, the pitiful “reforms” proposed by the Obama regime (“Obama's finance-reforms: let the Fox guard the Hen-house”) center on giving the “regulator” who was most responsible for monitoring the excesses of Wall Street – the Federal Reserve – even more power and authority. This is occurring despite the fact that the Federal Reserve is a cabal of private bankers totally outside the U.S. government, which is accountable to no one!

The final outrages are yet to come. Judging by hints from the corporate propaganda-machine, and Obama himself, the U.S. President is about to reappoint Ben Bernanke (“Bernanke's reappointment: rewarding failure”), who first claimed there was no housing bubble, and then (after that bubble burst) claimed it would do no harm to the U.S. economy. He has since been “predicting” a U.S. “recovery” every 6 months since the U.S. began its “Greater Depression”.

On top of this, the Fed is fighting to retain its authority over “consumer protection” (“The Fed struggles to Maintain Powers and Independence”). The same bankster-cabal who turned a “blind eye” to the largest wave of mortgage-fraud in global history (which continues to this day), claims they are the best entity to “protect” U.S. consumers. These arrogant oligarchs even have the audacity to claim that if the U.S. government actually gained some small degree of influence over its own central bank that this would be a “loss of independence”.

This was much the same argument as was used by England's kings – when England's democracy was in its infancy, and “Parliament” was trying to gain some small degree of real authority for itself. How could any self-respecting King do a good job of “governing” his country, if he was continually being pestered with the concerns and desires of “the little people”?

Meanwhile, ordinary Americans are once again ignoring Wall Street, in order to to spend all their time on their favorite hobby – partisan finger-pointing. Surely, when one political party spent eight years allowing these crimes to be perpetrated, and then the other political party doesn't even investigate any of this wrong-doing, when they gained power, the message should be clear.

The U.S. has a two-party dictatorship. The incessant, partisan bickering between Republicans and Democrats is nothing but political theater. It makes no difference which political party is officially in power when both serve Wall Street – and neither have the slightest concern about what is best for Americans (the people they supposedly serve).

At one time, this delusion of having a real “democracy” could be described as “living in a Fool's Paradise.” What is crystal-clear today is that the “paradise” is gone, but the self-delusion remains.

Comments

[Warm_Paw:]

This is exactly how the sub prime mess should be viewed.
It's almost two years of financial collapse and no one's written such an article.
Geithner deludes himself thinking sideline money is just going to come poring in. People have turned their backs on Wall Street.
Better odds in Vegas. More honest people too!

Jul 13 04:57 AM

[twotraps:]

Anyone remember the gentleman that tried to bring down Madoff for years...then testified to the govt. that the SEC was full of lawyers and people that did not understand the rules/people/products they were supposed to be regulating?? What got me was when the banking crisis started, they sent the govt to negotiate with Goldmans Sachs, JPM and others!!!! Honestly, speaking to JPM about taking over another firm....Congress on one side of the table.....Lawyers/Quan... on the other?? Kinda like a knife to a gun fight. Shmillions and Shmillions of money, out the door just like that. Staggering.

Jul 13 07:09 AM

[twotraps:]

Actually that should read ...Congress on one side and Lawyers/Quants/Account... on the other...not exactly a fair fight. Buffet at least asked Goldman for preferred shares, a guaranteed rate of return and the right to cash in his position.......and got it. The govt. seemed to ask for nothing...and got it!!

Jul 13 07:12 AM

[Jim Benham:]

Thank-you again "Mr. Cheerful!" I needed that. Seriously though, the body-politic needs to figure out what has been happening.

Jul 13 08:07 AM

[fireball:]

jeff
it is a tightrope for those that see this problem. it appears to be a complicated, delicate, difficult situation. in reality every provision is in our founding documents. there is a mountain of unconstitutional manure on top of the legal republic. there is the fed scam controlling our money, there is the irs scam (the federalis are limited to import/export taxes to keep power and growth in check) which does not appear to have been properly ratified and would still be unconstitutional even if it was. there is the nea. there is the non-media or government press. then there are politicians and the oligarchs who own them. all of this could easily be corrected by simple adherence to the law of the constitutional republic.
a week or so back i said all peaceful means must be exhausted first. this is a matter of conscience. i am not deluded enough to think that power will be surrendered peacefully and law will rule. it is simply the requirement of a standard. for now one productive course is to point out to reasonable men that what we have is a mutated, parasitic beast in place of what we should have. your efforts are appreciated.

Jul 13 08:58 AM

[john s. gordon:]

it's a national scandal, no question of that.
> jack

Jul 13 09:08 AM

[Perry B:]

I love the pesky little people who still believe we can make a difference and we can. By writing and warning other unsuspecting traders and investors. Here is my AIG story. I bought 5000 shares @ 2.00 per share. ten grand So much to my surprise after watching my 2.00 fall to 1.08 I figured eventually my efforts would be rewarded. Based somewhat on the media hype of to big to fail. I was amazed when I turned on my screen and saw the shares were now worth roughly $20 pershare. I should have been a profit taker. Instead I found the reverse split left me with a twenty to one take down. Meaning I now owned 250 shares @ roughly $20 per share or $5000. Mathematically in the same sorry position. Then the added insult of watching that beating turn more brutal. One cannot say this was not a conspiricy which included all the players mentioned in the above article. Setting the ground work for more ponzi type market manipulation schemes. Stealing money from pesky believing retail traders who have no say in the stock they purchase in good faith. AIG is the best at bilking the system others will soon follow. One more financial thought on a portion of the sideline money, is many retail traders who have money in brokeraged trading accounts. These brokerage firms leverage your accounts as well. Weather your money is in play or not. This leveraging also stacks the deck for the powers mentioned above to be successful in their greedy scheming ways.We need the uptick rule back. Or trading is always going to be similar to catching a falling dagger. With everyone in power manipulating your cash.

Jul 13 09:14 AM

[Leftfield:]

Actually, we're living in a "Fool's Paradise" where it's the fools (us) that remain, given the state of our "democracy."
This article points out well how DC and Wall St. are mainly a huge crime scene now. If our "public servants" can't venture over to AIG, we see whose "servants" they really are, as you helpfully point out.
Note also the lack of investigative reporting by the mainstream media. Hello? Anyone home?

Jul 13 09:15 AM

[Perry B:]

to fireball you are right on time good comment.

Jul 13 09:25 AM

[Pat C:]

Keep it up Jeff, I watched Geitner on CNN yesterday and I was furious. When the topic of AIG and the direct Godman Sach's bailout came up he basically said that the regulators (we the sheeple) were powerless. I guess we know who is in charge.

Jul 13 10:04 AM

[TeresaE:]

Great article, now get the sheep to care. They either CAN'T understand it or don't want to.

The only thing I would change is the partisan Red vs. Blue.

The Democrats have controlled Congress, and the committees since 2006.

Bush only met 3 bills he didn't like in 8 years.

The Democrats, going back to Clinton's sign off on Glass-Steagall repeal, are as guilty as the Republicans.

More so when you look at which politicians get the biggest Wall St/Bank campaign funds.

Jul 13 10:05 AM

[swaps:]

Excellent rant that comprehensively summarizes the Ponzi scheme pulled off by the Fed, Wall Street and a money-geased Congress and White House.
However there was at least one investigation. The feds pounced on Elliot Spitzer and destroyed him after he publicly complained the federal government would not let the states pursue fraud investigations into what was happening.
I agree with Perry B the uptick rule should have been restored the moment Wall Street began massively short selling the financials and everything else, which accelerated and deepened the damage. And the abolishing of the uptick rule after the "most lexhaustive study" in history should especially be investigated.
If they won't abolish the failed Fed, they should fire Bernanke for not knowing what he is doing, or worse, knowing what he and Greenspan were doing to engineeer this.
I find it interesting that Conde Nast Portfolio did some very insightful reporting of what led to the collapse - and that publication has been closed. But the WSJ goes on, aiding and assisting..
Entire departments in the federal government should be fired for incompetence or complicity and restaffed with people who realize there are consequences.
Bonuses should stop being paid to failed companies that had to be rescued with public money.
Two depressions should have given The Fed enough rope to hang itself.
And if it comes to martial law the Republicrat party should do the honorable thing and step down. Instead, they will likely vote themselves lots of walking money and golden parachutes.
Back to that uptick rule. It will absolutely be maintained even though Enzioi von Pfeil - noting how crashes always seem to happen in October - warns that the investment banking houses - how few are left - have wrung about all the money they can from the current run up and will likely stage massive short selling in autumn because that is the only option left for them to make even more outrageous bonus money. Make that GS, Soros and the more nimble hedge funds.
If they dismantle the U. S. in the process, Wall Street doesn't seem to care. The goose they kill will have already given them quite a few golden (Goldman) eggs..
If only this rant by Nielson could go mainstream and stay on center stage day after day until true reform is accomplished.

Jul 13 10:38 AM

[Perry B:]

I have been watching AIG today lets look at the 20 to 1 split. AIG was trading at 1.08 they split that meant that it took twenty inflated dollars of stock to equal your one dollar investment. So the stock fell to $10 your share that looked like it was worth $10 dollars, in reality is only worth fifty cents. Is AIG over leveraged? In any free market this would be considered junk stock and removed from the trading floor. AIG however is to big to fail until the powers mentioned in the above article say it can fail. AIG is now trading with no shorts available. ( Because everyone just cant wait to get in on this rising market star.) at $14.53 and climbing because of market manipulation. But be aware this stock is junk and at $14.53 is still only worth .60 cents. Putting it in the junk stock bin. AIG has steadily been selling its liquid gold and replacing it with worthless paper.

Jul 13 11:13 AM

[basehitz:]

Jeff, an informative article. If the villains are prosecuted, the market will sell off. Recall when Worldcom was exposed. It is clear from the last 3 months, that the controlling powers will say or do anything to try to prop up asset values. While the fair thing would be to prosecute the villains, cover-up seems preferred and healing the system is delayed. So the public remains skeptical as shown by anemic trading volume, much of which is just HFT by Da Boyz who caused this implosion. BTW, now that Government Sach's trading program got swiped, is that the equivalent of them having a lobotomy? It seems the success of the "smartest guys in the room" may be more attributable to being a parasite on the market rather than trading acumen. Disgraceful.

Jul 13 11:59 AM

[Shawn Wang/...:]

can you elaborate on what exactly is the breakdown of the 10 trillion number? i'm bemused. the fed + treasury balance sheet combined is nowhere near that. are you using FDIC figures? thats just plain wrong.

Jul 13 12:31 PM

[Hot Richard:]

The $10 trillion did nothing other than prove to everyone in Congress/Executive that there is no limit to their power or ability to transfer wealth to anyone they choose.

The sooner intelligent investors (who also have a keen political knowledge) admit that the US Constitution is meaningless in controlling Congress/Executive the better off you'll be. Guys, it means NOTHING. Today the Bill of Rights wouldn't even pass in the House. The US is continuing the transformation into a Euro-style socialism.

Jul 13 01:10 PM

[Jeff Nielson:]

Swaps, GREAT point!

Yes, wasn't Spitzer's "bust" just about the most-convenient event ever, for Wall Street? You don't suppose some of these co-conspirators could have set-up this one-man, fraud-posse?

Shawn Wang, you need to read a little more closely. The "$10 trillion" figure is the combination of hand-outs, loans AND "guarantees". The "guarantees" being the largest component, which U.S. taxpayers haven't even BEGUN to pay for yet (much like they haven't BEGUN to pay for the U.S.'s government's $70 - $100 trillion in "unfunded liabilities").

If not for the accounting rules being changed to allow openly fraudulent bookkeeping by Wall Street, they would have ALREADY begun drawing on those other $8 trillions (or so). Instead, that will start NEXT year.


On Jul 13 10:38 AM swaps wrote:

> Excellent rant that comprehensively summarizes the Ponzi scheme pulled
> off by the Fed, Wall Street and a money-geased Congress and White
> House.
> However there was at least one investigation. The feds pounced on
> Elliot Spitzer and destroyed him after he publicly complained the
> federal government would not let the states pursue fraud investigations
> into what was happening.
> I agree with Perry B the uptick rule should have been restored the
> moment Wall Street began massively short selling the financials and
> everything else, which accelerated and deepened the damage. And the
> abolishing of the uptick rule after the "most lexhaustive study"
> in history should especially be investigated.
> If they won't abolish the failed Fed, they should fire Bernanke for
> not knowing what he is doing, or worse, knowing what he and Greenspan
> were doing to engineeer this.
> I find it interesting that Conde Nast Portfolio did some very insightful
> reporting of what led to the collapse - and that publication has
> been closed. But the WSJ goes on, aiding and assisting..
> Entire departments in the federal government should be fired for
> incompetence or complicity and restaffed with people who realize
> there are consequences.
> Bonuses should stop being paid to failed companies that had to be
> rescued with public money.
> Two depressions should have given The Fed enough rope to hang itself.
>
> And if it comes to martial law the Republicrat party should do the
> honorable thing and step down. Instead, they will likely vote themselves
> lots of walking money and golden parachutes.
> Back to that uptick rule. It will absolutely be maintained even though
> Enzioi von Pfeil - noting how crashes always seem to happen in October
> - warns that the investment banking houses - how few are left -
> have wrung about all the money they can from the current run up and
> will likely stage massive short selling in autumn because that is
> the only option left for them to make even more outrageous bonus
> money. Make that GS, Soros and the more nimble hedge funds.
> If they dismantle the U. S. in the process, Wall Street doesn't seem
> to care. The goose they kill will have already given them quite
> a few golden (Goldman) eggs..
> If only this rant by Nielson could go mainstream and stay on center
> stage day after day until true reform is accomplished.

Jul 13 02:25 PM

[awake09:]

If there really was an up and coming politician who could take them on, do you think they'd let him/her win? Maybe not even let him/her LIVE? IF they are that powerful, what true reformer can survive any election? It's like running against the mob.

Jul 13 02:28 PM

[5142152-337:]

Choice writings! Thanks Jeff.

Hey Jeff, what the hell is going on at the Canadian Mint? Are they skimming off the top? Some skim...15M in gold. Wow!

Jul 13 03:28 PM

[Marv J:]

As a small business owner for many years my lessons are many. As I walk through the great cow pasture of life I've learnt where not to step. And Wall St is one of them. Wall Street Is like Las Vegas. You must have a few winners to bring in the many losers. Which is the heart of Wall Streets game. And you are right, the government is in this up to their ears. Yet we continue to elect these low life's to office. Organized crime at it's finest.

Thank you Mr Nielson for a very refreshing article. Please don't stop.

Jul 13 05:41 PM

[Jeff Nielson:]

I've held off writing anything until there is some definitive word. Surely it can't take much longer to say one way or another if bullion was stolen. For now, I have no more idea than you what could possibly have happened.


On Jul 13 03:28 PM 5142152-337 wrote:

> Choice writings! Thanks Jeff.
>
> Hey Jeff, what the hell is going on at the Canadian Mint? Are they
> skimming off the top? Some skim...15M in gold. Wow!

Jul 13 08:58 PM