UNDERSTANDING THE GREAT
WALL STREET FRAUD (summarized)
*(12-30-07) The best and easiest to
understand analogy, though not perfect, to the wall street markets is the
kiting of checks at lightning computerized trading speed on which commissions are
taken although there is nothing of real value underlying their fraudulent
scheme. (10-10-08) Now to bring this analogy closer to the current crisis,
assume as is the case of the worthless sub-prime securities, there is no charge
off/debit as is ordinarily the case with a cleared check and the worthless
'collateralized sub-prime security' is (rehypothecated), repackaged, resold, recommissioned based
upon as collateral the original worthless security which is in turn
(rehypothecated), repackaged, resold,
recommissioned based upon as collateral the subsequent worthless security, and
so on to the tune of (hundreds of) trillions of this worthless, fraudulent
paper (blatent securities fraud which must be prosecuted and fraudulently
derived profits disgorged).
*(12-31-07) The ubiquitous
computerization of wall street functions, the enhancement/advance/integration
of the said computer equipment/peripherals in terms of computing power and
speed, along with the concomitant advance/sophistication of the programming
concerning same has enhanced the ability of the frauds on wall street to effect
their frauds with blinding speed vis-à-vis the funds entrusted to their care by
way of programmed trades, ie., buy, sell, stop limits, etc.. An example (though
not perfect) is illustrative: Dow drops
200 points as programmed sell orders kick in with some not so fudged negative
news. Nothing changes but the following day the market rises 205 points on
programmed buy orders (a little higher despite the absence of any positive
news). Hence, the huge swings which have become ever so more prevalent. Though
nothing has changed, hundreds of millions of dollars without relation to any
value added (in economic terms, service, etc.) is taken in commissions
(percentages, points, spreads) by the frauds on wall street on huge
computerized trading volume (hence, the multi-billion dollar bonuses on top of
huge salaries, etc.). The fact is that these funds entrusted to them are so
large that such computerized “buys” can simulate other than rational demand
causing prices to rise solely to generate huge commissions to them and new
funds coming in (as in a ponzi scheme). The corrupt government has been
complicit in terms of false economic reports, legislation protecting the fraud
(ie., exemption from RICO accountability, etc.), while the courts are also
corrupt facilitators (ie., new york, new jersey, california, etc., and
similarly don’t count on arbitration panels).
There was a time when transaction costs mattered in financial investment
decisions. The trades/commissions are not a net positive for the economy but
are indeed of great benefit to the recipients of same (who like termites eat
away at other peoples’ money, and whose marginal propensity to consume is less
than those allocating their monies/pensions/401ks/savings etc.; hence, the mess
to follow). Finally, the NASDAQ/tech has become the “safe haven” but in reality
as in the dot.com bust days are just the great story without much fundamental
understanding that keeps the fraudulent ball rolling.
(1-01-08) Remember:
more contrived wasteful commissions to the wall street frauds, the level and
percentage of which should be examined in light of computerization and
decreased costs attendant to same especially since only A Very Small Fraction Of
What wall street Does Is A Net Positive For The Economy (New Investment Capital
via, ie., ipo’S), The Rest Is Tantamount To A
(Economically) "Wasteful Tax" (On The Economy) via 'churn and earn'
computerized programmed trades.
*(1-3-08) $14 billion ($21 billion in 2006) in bonuses to the
lunatic/frauds on wall street for a commissionable (sub prime bundled) fraud
well done, inflation up, dollar down, oil prices up, manufacturing down; one
analyst/reporter/journalist from inside sources pegs the sub-prime dollar value
of the shilled worthless paper at $516 TRILLION (even a percentage of same
renders the problem unfixable-hence, culpable parties must be held accountable
and disgorge their ill-gotten gains from, ie., commissioning worthless paper,
taking a point here or there and fraudulently passing same on, ad infinitum,
etc.). Of course there are also a plethora of garden-variety frauds as always,
ie., 10-B-5, insider trading, etc..
*(10-10-08) Now to bring the
initial check-kiting analogy closer to the current crisis, realize as is the
case of the worthless sub-prime securities, there is no charge-off/debit as is
ordinarily the case with a cleared check and the worthless 'collateralized
sub-prime security' is repackaged, resold, recommissioned based upon
(collateralized by) as collateral the original worthless security which is in
turn repackaged, resold, recommissioned based upon as collateral the subsequent
worthless security, and so on (a geometric progression) to the tune of (hundreds of) trillions of
this worthless, fraudulent paper (blatent/flagrant securities fraud which must be prosecuted and fraudulently
derived profits disgorged).
THE
BAILOUT FRAUD/SCAM
This is
not brain surgery and the fraud, bonuses/compensation (mortgages, subprime and
otherwise, are only a relatively small portion of the fraud/scam providing
“cover/collateral” for the worthless but heavily commissioned paper over and
over again in a multiplicity of different forms of worthless paper) in the
mega-billions should first be disgorged before taxpayers are forced to pony up
and pay the frauds again for their fraud which caused the problem in the first
instance, must be prosecuted. It should also be noted that despite the rhetoric,
the wall street bailout will NOT solve the crisis or eliminate the economic
pain except to make permanent the fraudulent wealth transfer to the most well
healed heals/frauds/criminals in the nation who caused the so-called crisis by
their greed/corruption/fraud.
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