Probe of Wall Street Banks Expands

May 14, 2010 (LPAC)—The Wall Street Journal reported yesterday that Federal prosecutors, working with securities regulators, are conducting a preliminary criminal probe into whether several major Wall Street banks misled investors about their roles in mortgage-bond deals.

The banks under early-stage criminal scrutiny, J.P. Morgan Chase, Citigroup, Deutsche Bank and UBS, have also received civil subpoenas from the SEC as part of a sweeping investigating of banks' selling and trading of mortgage-related deals. Under similar criminal scrutiny are Goldman Sachs and Morgan Stanley.

The Manhattan U.S. Attorney's office and SEC are collaborating in the investigation. As part of the joint probe, the SEC has asked the banks for a range of documents, including final and draft prospectuses, final and draft offering documents, and investor lists associated with mortgage-related deals.

Among the deals being investigated are a series of mortgage CDOs created by Citigroup, Deutsche Bank, and UBS. These CDOs were named after constellations such as Cetus, Carina, and Virgo at the request of a hedge-fund client, Magnetar Capital. Magnetar bought a risky piece of the deals and placed bearish bets against other parts of the same CDOs or similar deals. Those bets enabled the fund to profit in a housing downturn.

In the few years before the housing downturn, Morgan Stanley designed, created, and sold CDOs that its own traders sometimes bet against. Among the CDOs the firm created and bet against were deals called ABSpoke and Baldwin 2006-1. A feature of the Morgan Stanley deals was a structure that could increase bullish investors' exposures to the underlying mortgage bonds. This made it more likely that such investors could lose money if the bonds performed poorly. Morgan Stanley took the bearish side of these transactions.

.**Flash** Glass-Steagall Amendment Could Be Voted on Next Week; Time to Escalate!

May 13, 2010 (LPAC)—11:00PM Eastern OTC FLASH UPDATE—Senate Chamber debate as of about 8 pm: Senator Chris Dodd presented a kind of order of business for the ongoing Dodd bill amendment discussion, in which the Glass Steagall amendment has been pushed up in rank to about 7th to be debated tomorrow.

But all voting has ended this week and will not resume until Monday. This means that we, the American people have THIS WEEKEND to go into an escalated mobilization for getting the Glass Steagall amendment rammed through the Senate over any opposition, especially that of the White house. The LaRouchePAC organizing has been building steam and garnering support all across the nation, but now is the time to take this mobilization to unprecedented levels. As Lyndon LaRouche commented, the fact remains: you can kiss civilization goodbye as we have known it. It has come to an end if we don't pass Glass-Steagall. Don't take a chance, make sure it wins.

• Click Here to Read the LPAC Press Release: Ram Glass-Steagall through, Now!
• Watch LPAC Spokesman Harley Schlanger's comments on Glass-Steagall

 

Harley Schlanger Interviewed on the Glass-Steagall Act

Harley Schlanger Interviewed on the Glass-Steagall Act

 

Fed Scrambles to Ram Through "Weimar II;" Opposition Begins

May 13, 2010 (LPAC)—Fed Chairman Ben Bernanke has gone into overdrive, to try to convince the U.S. Congress not to oppose the decisions of the Obama Administration to provide untold sums of U.S. dollars, to bail out the European banks. Bernanke held a behind-closed-doors session with Senators on Tuesday the 11th, during which, according to Senator Richard Shelby, he warned that the "European" problem" had "ramifications probably on a lot of our banks and banking system if there was no intervention."

While forced to admit that the opening of the Fed swap lines for Europe, which the Fed offered Sunday night, will increase the Fed's balance sheet, the Obama Administration is at pains to convey that there will be "limited," if any risk. Administration spokesmen were quoted on CNBC May 11, saying that the ECB would be guaranteeing the (unlimited) swaps, while the monies being provided as part of the IMF package ($54 billion) would be paid back because "no one ever defaults on the IMF." This formulation provoked quite some skepticism by CNBC commentator Kudlow, as indeed it should.

On Capitol Hill, The Hill reports that Congressman Mike Pence is preparing legislation to try to block Treasury Secretary Geithner from approving the IMF package. Sen. David Vitter, in his presentation of the original Ron Paul amendment for auditing the Fed on May 11, cited the Fed swap agreements as one reason that the Congress should have the capability of auditing Fed actions in the future, not just for the period of the 2007-now crisis period. According to the Financial Times, Vitter said, "Although Chairman Bernanke assured Congress in recent testimony that 'we have no plans to be involved in any foreign bail-out...,' very recently in the last few days the Fed has announced the opening of very significant facilities to central banks in Europe."

In moves described as attempts to placate anti-Fed sentiment, the Fed pledged to publish information on the swap deals on its website immediately. Today there were already three: with the Swiss Central Bank, the European Central Bank, and the Bank of England. It's not going to work....

Your Enemy: George Soros

 

 Your Enemy: George Soros.

Soros on the Economy!

Bill Moyers talks with one of the world's most "successful" investors George Soros about the global capital meltdown, how he saw it coming, and what can be done now. Watch THIS. 

THIS IS A CITY OF LONDON UK AGENT.

FIREWALL IN DEFENSE OF THE NATION STATE

FIREWALL IN DEFENSE OF THE NATION STATE

 

 

May 12, 2010 (LPAC)-- The documentary featured here was released in early 2008, just months after Lyndon LaRouche forecast the blowout of the financial derivative infested housing bubble, triggering the blowout of the entire U.S. financial system as a whole. That same week the blowout occurred.

Soon after, Lyndon LaRouche was the only person to demand the one thing that could solve the crisis: the Homeowner's and Bank Protection Act. Calling a for a freeze on foreclosures for homeowners, and a firewall to separate commercial banking practices like the selling of mortgages from the parasitical practices of investment banks, hedge funds, and other criminal enterprises that speculated on those mortgages, this speculation threatened to put millions of homeowners out on the streets with a Weimar1923-style hyperinflationary blowout of the whole system. This firewall, the Homeowner’s and Bank Protection Act, would be the first step to a larger, general bankruptcy reorganization of the entire U.S. financial system, where commercial banks would be made solvent again through the clean-out of fake money, like mortgage backed securities and other derivatives, and given, instead, credit uttered by the Federal government for the purpose of launching the needed recovery of the U.S. economy, beginning with the funding of large-scale capital intensive infrastructure projects.

The "Firewall" documentary, which traces the history of the hyperinflationary blowout of 1923 Weimar Germany, was released during a nationwide LaRouchePAC mobilization which garnered the support of hundreds of local city, and state governments across the country for the LaRouche's firewall legislation, but despite the cries of the American people, the U.S. government under President George W. Bush, Nancy Pelosi, and Barney Frank, then, and President Barack Obama, Nancy Pelosi, and Barney Frank, now, have committed themselves to rewarding criminal banking institutions through unconstitutional bail outs, and in doing so, have committed the United States to its own destruction. This can no longer be tolerated.

Today we have reached a critical point in the world system, like that of 1923 Germany, with the recent blowout of the European financial system. The world cannot survive the collapse of the current British-run world financial system. LaRouche's recent call for a return to the Glass Steagall Act, a firewall, will solve the problem. As we speak the Glass-Steagall Act exists as an amendment to the Financial Stability Act sponsored by Sen. John McCain and Sen. Maria Cantwell, now sitting in the Senate waiting for a vote. We must not wait. We must come out in droves to support this revival of the Glass-Steagall Act, it is the only piece of legislation that will protect our United States from the chaos of the imminent global collapse. So, call your Senator, mobilize your neighbors, and move rapidly with a deeper understanding of what we face and what we must do to win this fight, provided here by LaRouchePAC’s "Firewall" documentary.

Some Traitors in the Senate, as Obama Tries To Kill Glass-Steagall

May 12, 2010 (LPAC) — The discredited Sen. Christopher Dodd, retiring and rejected by Connecticut voters, is continuing to try to control the "financial regulation" debate in the Senate, and as the Obama White House's agent to stop the Senate from passing the Glass-Steagall amendment the American public's majority wants.

On May 11 Dodd managed debate and voting on only four of the 100 amendments to the bill, and is continuing to feed the media accounts of the "important" amendments, which do not include Glass-Steagall. Yesterday's debate was dominated by the Sanders amendment to compel a GAO audit of the actions of the Federal Reserve in the great bank bailout since 2007. Sanders' is a somewhat weakened version of the Ron Paul amendment which overwhelmingly passed the House in January, which would have legislated continuing, annual GAO audits of the Fed and its money-printing binges. The weakening was insisted on by Obama and Bernanke, as Dodd made clear in the debate on Tuesday. Sen. David Vitter (R-LA) then independently introduced the original Sanders amendment — identical to the Ron Paul amendment in the House — and what were really the "two Sanders amendments" were debated together.

Sanders' weakened amendment, which the Fed is still fighting, passed 96-0 after the debate. Vitter's amendment failed, 37-62, with Democrats under White House pressure to fall in line against it; but a significant Democratic "resistance vote" for Vitter included Sens. Maria Cantwell (WA), Ron Wyden (OR), Blanche Lincoln (ARK), Russ Feingold (WI), Byron Dorgan (ND), and James Webb (VA). Cantwell, along with Sen. John McCain (R-AZ), is sponsoring the Glass-Steagall restoration amendment, which has a national groundswell of support, but just the opposite in the White House. Feingold is a co-sponsor. Cantwell says she will not vote for closure on Dodd's entire financial regulation bill, unless Glass-Steagall is debated and voted.

One of the handful of Republicans against Vitter's amendment, the budget-cut-obsessed Judd Gregg (NH), gave a virtually treasonous speech on the floor. Gregg claimed a great principle of American history was "No government creation of currency and credit. The [Federal Reserve] Open Market Committee must decide!" Gregg made a lengthy and completely incompetent "historical review," claiming that Woodrow Wilson was right to insist on creating a central bank [the Fed] completely independent of elected officials [but not of bankers!]; and that William Jennings Bryan was completely wrong to demand that the government control currency and credit creation. Gregg attacked Bryan, but his treasonous speech was aimed, whether he fully realized it or not, against Abraham Lincoln's Greenback policy and the founding American System policy of 17th-Century Massachusetts.

Roubini Endorses Glass-Steagall

May 12, 2010 (LPAC)—Der Spiegel runs an interview with Nouriel Roubini, who, they note, has acquired the moniker "Dr. Doom," for predicting the onset of the financial collapse. Roubini declares that his notions of "financial reform" are much more radical than Obama's. "What I am proposing goes back to Glass-Steagall Act types of restrictions between commercial and investment banking, regulations that already existed until about 10 years ago," he says, adding, "They worked well." He says the idea of the "financial supermarket model" has failed, that, "this all has to be broken into pieces."

Earlier in the interview, Roubini says that Greece is "only the tip of the iceberg," pointing to Ireland and the UK, as well as noting the disaster facing state budgets of California, New York, and Florida, in the US. Roubini has recently consulted with director Oliver Stone, who is making a sequel to his movie "Wall Street."

Retired Indian Ambassador Cites LaRouche vs. Brutish

May 12, 2010 (LPAC)—A prominent retired Indian ambassador, K. Gajendra Singh, has published a lengthy article on the European debt crisis, prominently quoting from Lyndon LaRouche's May 10 statement, "The Brutish Bastards Are At It Again." Under the appropriate headline, "The Mother of All Economic and Social Crisis," Ambassador Singh described the global financial meltdown as the result of the world financial system being turned into one vast casino. When he addressed the onrushing European sovereign debt blowout, he wrote:

"The austerity plans and the bailout packet for Greece which have adversely dented the ruling coalition of Chancellor Angela Merkel's party in the just concluded regional elections in Germany, because Berlin has to foot the bill, would spread around Europe and beyond. It believed that the debt of five EU members Portugal, Ireland, Greece and Spain (PIGS) totals around $3.9 trillion. Britain's debt is larger than any one of them.

"Well-known US economist and political activist Lyndon H. LaRouche, Jr. voiced strong condemnation that the British swine have once again imposed a 1923-style hyperinflationary collapse on modern Germany, with the trillions-dollar bailout scheme imposed on the Euro zone this past weekend. Only the immediate enactment of a Glass-Steagall law could prevent the United States itself from falling into the same fate now destined for continental European victims such as, above all other targets for total destruction, the Federal Republic of Germany."

Ambassador Singh's article appeared on the Internet magazine website, Media with Conscience. Other regular columnists for the site include Francis Boyle, Greg Palast and Uri Avnery. The article was prominently featured on Google News Alerts on Glass Steagall—along with a half-dozen recent statements by Lyndon LaRouche and EIR coverage.

Soros, Frantic To Protect Derivatives, Runs Arkansas Primary Campaign vs Sen. Lincoln

May 12, 2010 (LPAC)—The apparatus of British Empire mega- speculator George Soros originally set in motion, and is now funding, the campaign to unseat U.S. Senator Blanche Lincoln, author of the pending bill to bar banks from trading in derivatives. The Soros mob is sponsoring Arkansas Lieutenant Governor Bill Halter in the May 18 Democratic primary race against Lincoln.

Soros-slave Andy Stern, president of Service Employees International Union (SEIU), got the ball rolling late last year.

Associated Press reported December 18 that SEIU would "help retire the 2006 campaign debt of Arkansas Lt. Gov. Bill Halter, a Democrat who's been touted as a potential primary challenger to U.S. Sen. Blanche Lincoln next year."

SEIU announced that it would raise $440,000 to repay, to the millionaire Halter, the money he himself had loaned his previous campaign for Lieutenant Governor. The unpaid campaign debt was seen as an obstacle to Halter's future candidacy. Six weeks after the SEIU announcement, Halter declared himself a candidate against Sen. Lincoln.

At that time, Stern and the Soros-funded Moveon.org were attacking and threatening to unseat Sen. Lincoln and other Democrats in Congress for listening to their constituents' anger and hatred of the Obama deathcare legislation.

Last month Blanche Lincoln introduced a bill to rein in derivatives. Now SEIU and Moveon are funding Halter's campaign against Lincoln.

Andy Stern has stepped up the Soros vendetta against Sen. Lincoln, using the dues money paid into SEIU by its members, who are overwhelmingly low-wage workers — this despite Stern having just been just repudiated by the SEIU, which selected another union official to replace him as president, over his own choice of successor.