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Fed Appeals Decision To Disclose Recipients Of Bailout Loans, Threatens With "Run By Depositors"

Tyler Durden's picture




 

It has been about a month since the Fed last threatened with mass extinction events if it were forced to disclose whose crony interests it had been propping with taxpayer money, as it was ordered to do in the Bloomberg (Mark Pittman) v Federal Reserve case (08-cv-9595) on August 24. Today, the Chairman is out, guns blazing, and is appealing the decision.

From Bloomberg:

The Federal Reserve is appealing a
judge’s order requiring the central bank to identify the
financial institutions that benefited from its emergency loans,
according to a lawyer representing Bloomberg LP.

The central bank refused to divulge details about the
companies participating in its 10 remaining lending programs,
saying that doing so might set off a run by depositors.
The Fed
had until today to seek a reversal of the Aug. 24 decision by
Manhattan Chief U.S. District Judge Loretta Preska, who ruled
the Fed must release the identities, as well as disclose loan
amounts and the assets put up as collateral.

And as the second circuit already showed its true colors in the Chrysler fiasco some months ago, it is likely that this case will once again reach the Supreme Court, probably about a month from now. October will thus likely be a very critical month for the Chairman, who will be besieged on two front - the legislative and the judicial, as Congress will be pushing for passage of HR 1207 at about the same time that the Supreme Court does it best to pretend that it is the last bastion of non-corrupted, Wall Street uninfiltrated interests, yet, as is always the case, only to show its true colors at the end of the day, once again confirming just which firms run the United States of America.

 

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Wed, 09/30/2009 - 14:20 | 84013 naiverealist
naiverealist's picture

I see significant precedent being set in this all important decision.

Wed, 09/30/2009 - 14:58 | 84091 MyKillK
MyKillK's picture

I agree. If they validate the Fed's claims, wouldn't that pre-empt any any Congressionally mandated audit?

Wed, 09/30/2009 - 15:20 | 84129 Joe Sixpack
Joe Sixpack's picture

There's always the nuclear option:

 

Proclamation on the Federal Reserve System of the United States of America

 

 

www.RevokeTheFed.com

 

March 2008

WHEREAS, Article I, Section 8 of the Constitution of the United States of America authorizes Congress "To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures";

WHEREAS, on December 13th, 1913 the US Congress enacted the Federal Reserve System;

WHEREAS, the Federal Reserve System is considered an independent agency within the federal government, with oversight of Congress and containing appointed public officials on its board of directors;

WHEREAS, the Federal Reserve System Controls the Federal Reserve Note, the official currency of the great nation of the United States of America;

WHEREAS, there may be controversies regarding the legality and constitutionality of the Federal Reserve System, it is recognized that the said system has operated continuously as the central banking system of the United States since the inception of the Federal Reserve Act of 1913;

WHEREAS, the Constitution of the United States of America granted Congress the authority to create the current Federal Reserve System, it also does grant Congress the authority to modify or revoke the Federal Reserve System;

WHEREAS, the actions of the Fedreral Reserve System represent the credit and currency of the United Stated of America to the citizens of this great nation and to the world;

WHEREAS, the Federal Reserve System, acting independently within the federal government allowed, supported, and even promoted parasitical and non-productive uses of the money and credit of the United States of America;

WHEREAS, the United States and likely the entire world's financial system is undergoing massive de-leveraging of the said parasitical and non-productive uses of the credit and money of the United States of America (as well as other nations' currencies);

WHEREAS, the US dollar, the "Federal Reserve Note" is declining in value due to these parasitical activites, as well as potentially other causes;

WHEREAS, it is recognized that the citizens of the United States and other nations did willingly participate at some level in the creation and propogation of said parasitical activities;

WHEREAS, it is also recognized that the United States of America, a sovereign nation, has the legal, moral, and God given authority to take actions to benefit its citizens and to protect its good name, credit and money in times of difficulty;

WHEREAS, it is recognized that the current time is such a time of great difficulty;

WHEREAS, it is recognized the parasitical financial institutions and their activities are at odds with citizens of the United States of America and the good credit and money thereof;

WHEREAS, the current indications are that the Federal Reserve System is acting to preserve the financial system currently flooded with the parasitical activities;

WHEREAS, the current indications are that the neither the Federal Reserve System, nor the Congress of the United States, nor the people of the United States have access to the books of the institutions being preserved by the Federal Reserve, and therefor the degree of inter-connectivity and risk associated with the institutions and other entities cannot be determined;

WHEREAS, the Federal Reserve System is accepting non-performing assets as collateral for credit with ultimate taxpayer responibility to entities not under its legislative mandate;

IT MUST BE CONCLUDED, that the Federal Reserve System is not acting to the benefit of the people of the United States of America, its credit, money, and good name;

WHEREAS, it is recognized that the political will and capability of the government of the United States of America may not be up to the task of prosecuting this proclamation ; It is also recognized that this may be the only hope for the continued survival of the United States of America as the great nation as it has historically existed.

NOW THEREFORE, it is PROCLAIMED by those supporting this Proclamation that the Congress of the United States of America FULLY NATIONALIZE the Federal Reserve System, and take full control of the credit and money of our great nation; The Congress must take whatever action necessary to seperate out, sequester, disown, or otherwise neutralize the effect of the parasitical financial activities which led to the current crisis; The Congress of the United States of America must reorganize, replace, or terminate the Federal Reserve System as appropriate; or otherwise devise a system for creation of the national currency.

IT IS FURTHER PROCLAIMED, that the Congress of the United States of America in cooperation with the Executive of the United States of America contact allied nations and any other nation willing to participate in the overhaul of the failing and parastical financial sytem currently in operation and create new treaties and alliances as necessary to create a sane and productive system of finance with the express goal of supporting a productive national, and by extension and through voluntary cooperation, world economy;

FURTHERMORE, it is PROCLAIMED that it should be the goal of such an international effort to maintain fair international trading practices allowing for protection in national interest of labor, resources, and productive capabilities;

WHEREAS, it is recognized that such a move on the part of the United States of America may result in the necessity of an isolationist policy IF the other developed nations do not follow our lead; If such occurs, so be it.

SO HELP US GOD!

Wed, 09/30/2009 - 15:44 | 84187 Pure Evil
Pure Evil's picture

Uh huh....and then the Vampire Squid pulls all the lynch pins out from under its craftily built spiders web only to watch the whole thing collapse into one humongous slag heap.

And, good luck with the Congressional Clowns being able to pull those chestnuts out of the fire in time.

But, don't worry those Fed boyz will know exactly what to do when the time comes.

Because, undoubtedly our esteemed Congress Critters in all probability have more skeletons in more closets than fingers and toes.

And anybody with a conscience may find that a .22 cal salve will help ease any moral pain.

Let's face boys and girls we have morphed into the evil empire.

Wed, 09/30/2009 - 16:32 | 84246 Anonymous
Anonymous's picture

That's funny. We have slipped unwittingly to the dark side.

Wed, 09/30/2009 - 19:43 | 84457 Anonymous
Anonymous's picture

Good luck with the likes of Bachman and Grayson scrambling for money...

Wed, 09/30/2009 - 15:54 | 84201 Divided States ...
Divided States of America's picture

The only way, it seems, to get the Federal Reserve to speak up the truth is to kidnap Chopper Benny or Wonder Kid Timmy then forced them into the chinese torture chamber. Thats the only way because from pass congressional hearings, you can tell they aint afraid of congress and like a lot of Jews, have a knack to bullshit like they know everything and we dont.

Wed, 09/30/2009 - 19:41 | 84455 Anonymous
Anonymous's picture

Too bad the founding fathers and Constitution never authorized a Federal Reserve Central Bank.

BB stalling for time more than Iran with nukes.

Any decision at all may tank the markets...

JubileeProsperity.com

Wed, 09/30/2009 - 19:44 | 84462 Anonymous
Anonymous's picture

Interesting to see BB shouting FIRE in a crowded marketplace...

Wed, 09/30/2009 - 14:23 | 84014 Veteran
Veteran's picture

I'm at a loss for words

 

check that, run on banks?  what the feck?  I thought the banks were sound?  Double speak just reinforces the LIE.  A+B= Bullshit

Wed, 09/30/2009 - 15:36 | 84169 Medic
Medic's picture

Good thing we have the FDIC.  Oh, wait.  Scratch that.......

Wed, 09/30/2009 - 14:23 | 84017 Jim in MN
Jim in MN's picture

I wonder which jurisdiction's special forces will be needed to get the files and how long the firefight will last.

A 'Yeltsin on the Potomac' moment?  Oh, to dream....

Wed, 09/30/2009 - 16:10 | 84229 Cognitive Dissonance
Cognitive Dissonance's picture

That would be amazing.

Ya think CNBC might actually use the green "Breaking News" banner to informs us its happening? They use it for everything else, including Presidential hang nails.

Wed, 09/30/2009 - 14:23 | 84019 Bankster T Cubed
Bankster T Cubed's picture

If that is what they fear - a run by depositors - then shouldn't we all withdraw our money from banks?  They're admitting insolvency exists at major banks; if they don't tell us which ones, why take a chance?

Wed, 09/30/2009 - 14:25 | 84024 Veteran
Veteran's picture

Exactly

Wed, 09/30/2009 - 14:35 | 84039 SWRichmond
SWRichmond's picture

Run on the banks?  Did someone say "run on the banks"?  The only reason for a run on the banks would be bank insolvency.  Does Sheila's Gambit have any bearing on this fear of a run on the banks?

Wed, 09/30/2009 - 14:40 | 84049 Cognitive Dissonance
Cognitive Dissonance's picture

I can't wait until bank failure Friday to see who went toes up this week. Oh......... wait a minute. No money in the FDIC till. What's a girl to do when she's out of cash?

Of course. Extend and pretend.

Wed, 09/30/2009 - 14:48 | 84066 SWRichmond
SWRichmond's picture

Debt ceiling currently at $12.1 Trillion, debt at $18.8T.  Apparently the House passed a $13T limit but the senate has not yet acted on it.  Next time they up the limit, let's have a REAL tea party.

Wed, 09/30/2009 - 20:29 | 84508 Gilgamesh
Gilgamesh's picture

While Ben refers to "Depositors," what he really means is a Run On The Banks by Investors and Traders.  That is what has to be avoided by all means/at all costs.  Literally.

Wed, 09/30/2009 - 14:39 | 84047 Anonymous
Anonymous's picture

I already moved my money to a local, financially sound credit union. People and businesses should move their deposit base away from the big commercial banks anyway in principal!

Wed, 09/30/2009 - 18:52 | 84389 Anonymous
Anonymous's picture

+1

Wed, 09/30/2009 - 14:59 | 84094 johnnyBoy
johnnyBoy's picture

No need to run.  Each account is covered to $250K.  Right???  Keep those $$ presses rolling!

Wed, 09/30/2009 - 19:50 | 84471 Anonymous
Anonymous's picture

$250,000 hardly begins to cover most businesses....

That's why safes were invented...

JubileeProsperity.com

Wed, 09/30/2009 - 14:23 | 84020 Divided States ...
Divided States of America's picture

Obama called for change, I dont see change, I just see a red pill and a blue pill but both ends up with the same result.

Wed, 09/30/2009 - 14:30 | 84028 Anonymous
Anonymous's picture

Correct, either way, "we the people" get Polanski'd.

Wed, 09/30/2009 - 14:42 | 84053 Cognitive Dissonance
Cognitive Dissonance's picture

LOL

Is Polanski'd a verb or a noun? Or just a lowly adjective.

Anyone for conjunction junction?

Wed, 09/30/2009 - 14:43 | 84058 docj
docj's picture

And without the aide of 'ludes and soft jazz music, no less.

Wed, 09/30/2009 - 14:29 | 84026 Mos
Mos's picture

Somehow more transparency is a bad thing; what sort of logic is this?

Also, it seems our judicial system is our last line of defense.  Lets hope it does not fail us.  Where is an Earl Warren when you need one?

Wed, 09/30/2009 - 14:49 | 84070 Anonymous
Anonymous's picture

This follows the sage advice of being commanded to not look directly at someone, like Hilary Clinton commanded.

Another example is the Sun. You need filters to look at, transparency would blind you.

The FED believes that their light is too bright for us ordinary mortals' eyes to behold.

It's for our own good that they remain, like, in the dark, like mushrooms.

Wed, 09/30/2009 - 14:30 | 84027 buzzsaw99
buzzsaw99's picture

I don't have to point out the absurdity of that argument do I?

Wed, 09/30/2009 - 14:30 | 84029 Careless Whisper
Careless Whisper's picture

Why isn't the National Enquirer on this story? You know they can get the secret shit, no problem. So let them publish the names and it's done. It's not like its an official Top Secret document or something.

Wed, 09/30/2009 - 14:31 | 84033 Bankster T Cubed
Bankster T Cubed's picture

They really expect us to accept their arguement that THEY LIE TO US TO PROTECT US ?

There is only one correct response to Benzimbabwanke on that sort of bullshit:   FUCK YOU ASSHOLE

 

Wed, 09/30/2009 - 14:41 | 84052 gmrpeabody
gmrpeabody's picture

I don't know why, but I laughed. (must I always click those links?)

Wed, 09/30/2009 - 16:22 | 84242 ZerOhead
ZerOhead's picture

Downright un-patriotic...

Wed, 09/30/2009 - 14:31 | 84034 TwoJacks
TwoJacks's picture

The banking establishment has already succeeded in framing the debate about inflation, that it's about rising prices and not printing more money.  Now they, the banks, are framing the argument about what exactly constitutes a "run."  Sure, there might be a run on the stocks of these banks if their identity is known, but an actual run for deposits? Unlikely.  In any event, the argument is being framed so that they get to win their argument.  We're fvcked.

Wed, 09/30/2009 - 14:51 | 84076 SWRichmond
SWRichmond's picture

Bankers whose banks failed to survive runs were dragged from their banks and hung.  A fine American tradition.

Wed, 09/30/2009 - 14:57 | 84085 TwoJacks
TwoJacks's picture

I'm a traditional guy, let's hear it for tradition.

Wed, 09/30/2009 - 14:35 | 84040 ShankyS
ShankyS's picture

Wow TD, so there is no HOPE I guess?

Wed, 09/30/2009 - 14:36 | 84041 Cognitive Dissonance
Cognitive Dissonance's picture

Sounds like the recipe for a engineered stock market crash to show EVERYONE who's boss.

All the technicals look supportive of a move like this, including the dollar sitting on support and ready to move higher, Gold at highs and ready to drop, 6 months of market rise and running on fumes, an already announced end to QE as an excuse to begin the removal of liquidity and so on.

Yes I understand that this is all tin foil hat conspiracy stuff. But if you were Ben and you were being assaulted on all sides (don't forget the audit the Fed bill) what would you do?

Desperate men do desperate things. You want to scare the natives into shutting up and getting back in line? Prove to them why they need you. A little run back to the air raid shelter would prove most beneficial for the Fed.

Wed, 09/30/2009 - 14:43 | 84057 gmrpeabody
gmrpeabody's picture

+10  (foil or no foil)

Wed, 09/30/2009 - 20:01 | 84487 Anonymous
Anonymous's picture

+1000

Wed, 09/30/2009 - 14:52 | 84078 SWRichmond
SWRichmond's picture

I'm expecting it, too.

Wed, 09/30/2009 - 16:26 | 84244 ZerOhead
ZerOhead's picture

You'd have to muddy-the-shit out of the water to obfuscate the obvious... a little help from our Israeli friends and voila!

Who farted? Even I don't know.

Wed, 09/30/2009 - 16:40 | 84252 Cognitive Dissonance
Cognitive Dissonance's picture

I agree. It's been done before. Our Israeli "friends" are just dying to try out all that new military hardware of theirs. All they need is a little help from their friends.

Please, please Uncle Sam, let me kick the crap out of Iran.

Pleeeeeeeeease.

Wed, 09/30/2009 - 16:43 | 84253 DaddyWarbucks
DaddyWarbucks's picture

The really terrifying thought for the FED/Wall St./establishment is that they push the panic button and after the smoke clears everyone realizes that they're still OK and the boogie man has just pulled his own mask off. Kind of like one guy pulling a six shooter on a crowd of thirty, after the sixth shot the remaining 24 are going to get ugly.

Seriously, if congress calls the bluff by backing all the small savings/checking deposits these cowboys are going to be f*cked, proper f*cked.

Wed, 09/30/2009 - 21:30 | 84583 Miles Kendig
Miles Kendig's picture

Been there long.. long time. +1

Wed, 09/30/2009 - 14:37 | 84042 Anonymous
Anonymous's picture

Last time I checked....full disclosure is one of the most
prominent and basic SEC rules....

Seems to me that the FED is in violation with respect to the
basic premise of the SEC....

.....................................

Also...

What happened to anti-trust and competition rules....

The Fed has made the big..... bigger ....and has made their
competition somewhat nonexistent....

So this means that some have to play by the rules....and some do not....

................................

Is it not clear that the FED is in violation from
many fronts ?

Nothing like American Style Fascism....

Wed, 09/30/2009 - 14:37 | 84043 Hondo
Hondo's picture

What nonsense......where's Jesse James when you need him

Wed, 09/30/2009 - 14:38 | 84046 Hansel
Hansel's picture

Shouldn't they have appealed this decision a couple weeks ago?  Why do they automatically get more time since they appealed on the day of the deadline?  Good thing I'm not the judge because I'd tell them tough shit, too late, gimme the names or go to jail.

Wed, 09/30/2009 - 14:54 | 84080 Cognitive Dissonance
Cognitive Dissonance's picture

Because the court always assumes they are dealing with honorable people and not malicious criminals. Thus, the court extends deference and affords them the benefit of the doubt.

Law school 101, first day of class, professor said always show respect to those who wear the three piece suit. Extra time always allotted for pocket watches and breast pocket handkerchief. 

Dude, it's right there in the law book. :>)

Wed, 09/30/2009 - 14:40 | 84050 Assetman
Assetman's picture

If a financial institution were functionally insolvent, why should its depsitors be kept in the dark of such developments?

Well, the Fed is telling you that you don't have a right to know-- well, because it may cause a run on those institutions.  Hello!  Most of us with right minds have no desire to place their money in functionally insolvent institutions for obvious reasons.  In the long run, it's probably much better for these banks to die their natural (capitalistic) deaths, than to deceive millions of depositors that their bank has turned into a financial zombie.

While this appeal move isn't at all that surprising-- it still is upsetting on way too many levels to even count.  The Federal Reserve is an insitiution that has abosolutely no accountability, and appearently, has a whole lot to hide from the American public.  And why?  To protect those they obviously serve (the oligarchy).

My only wish is that Judge Rakoff were in the appeals circuit hearing this particular case.

I say, lets pass Audit the Fed as fast as possible, and peel off these stinky layers.

I'll get the popcorn.

Wed, 09/30/2009 - 14:48 | 84068 Whatta
Whatta's picture

I say, lets pass Audit the Fed as fast as possible, and peel off these stinky layers.

 

Let's assume that actually gets passed. Do you think whatever is reported to us will be believable? I say, hardly. At best we will get some head-nodding flack saying, "By gosh, things look legit, carry on". Does anyone expect Ron Paul to waltz out and pronounce all the findings of criminal dealings to the world?

Wed, 09/30/2009 - 14:54 | 84081 Assetman
Assetman's picture

I'll put my response this way-- if the GAO were allowed to do a full audit, they will no doubt report some things that are "unbelievable". 

And it may get a few people thrown in the slammer as a result.

Wed, 09/30/2009 - 15:02 | 84104 I am a Man I am...
I am a Man I am Forty's picture

I'm still predicting that this will become a "matter of national security" and everyone will have to f-off.

Wed, 09/30/2009 - 15:49 | 84198 Jim B
Jim B's picture

+1

Wed, 09/30/2009 - 14:42 | 84054 BennyBoy
BennyBoy's picture

The end of the world will happen if we reveal who's ass we're saving.

Wait a sec, Blankfein's calling....gotta run.

Wed, 09/30/2009 - 14:54 | 84079 SWRichmond
SWRichmond's picture

It's all about who will lose the most when the status quo dies.

Wed, 09/30/2009 - 15:13 | 84124 MountainHawk
MountainHawk's picture

+1

Wed, 09/30/2009 - 14:43 | 84055 Whatta
Whatta's picture

"central bank refused to divulge details about the companies participating in its 10 remaining lending programs, saying that doing so might set off a run by depositors.

huh? we all already know they are pretty much all busted. so telling us is providing what else in the way of news? And, if you are backstopping them all...who the heck cares.

I played musical banks for weeks trying to stay ahead of Bank Failure Friday...*pow* down goes Strategic Cap Bank...*BOOM* down goes my deposits at WaMu, *Kerbloooey* there goes my CD's at Countrywide. My deposits are still there though...new TBTF Bank and all.

Wed, 09/30/2009 - 14:43 | 84056 Anonymous
Anonymous's picture

This is the same "stigma" argument they've always used although its surely less effective now that before. GS and others are making billions by prop-trading with taxpayers money. Meanwhile nobody can get a student or home loan and people are plain off pissed about the economy and deficit. Its time for Bernanke and the Fed to come down from their perch but it sure won't be pretty.

Wed, 09/30/2009 - 14:45 | 84060 Anonymous
Anonymous's picture

Mortals, if thou seest my countenance, surely you shall perish. Thus transparency requires godhood; and opacity saves mere mortals from insanity:)

40muleteam borax

Wed, 09/30/2009 - 14:59 | 84096 IE
IE's picture

Dear Supreme Court:

When someone asks you if you're a god, you say 'YES'!

- Winston Zeddemore

Thu, 10/01/2009 - 09:29 | 85065 Anonymous
Anonymous's picture

Anyone on the Supreme Court named "Ray?"

Wed, 09/30/2009 - 14:48 | 84067 Anonymous
Anonymous's picture

The Fed's never mentioned speculative gaming, have they? Does the Federal Reserve Act state that the Fed has a confidentiality agreement?

Wed, 09/30/2009 - 14:49 | 84069 economicmorphine
economicmorphine's picture

Finally, I get something I can use from the Fed.  I'm off to the bank to get my money BEFORE the run.  Thank you, Uncle Ben.

Wed, 09/30/2009 - 14:49 | 84071 ghostfaceinvestah
ghostfaceinvestah's picture

Nothing to say about this but:

END THE FED

Wed, 09/30/2009 - 14:51 | 84074 Crab Cake
Crab Cake's picture

Fuck the Fed

http://www.youtube.com/watch?v=DiTikduJ15Y

Sit back little children, as I tell the tale of how freedom and democracy bit the dust....

Wed, 09/30/2009 - 14:51 | 84077 buzzsaw99
buzzsaw99's picture

I can tell you who they are for a fee.

Wed, 09/30/2009 - 14:58 | 84089 Anonymous
Anonymous's picture

gee i wonder how the supreme court will rule on that one? maybe we can get a 2 for 1 and have hr 1207 ruled unconstitutional as well.

Wed, 09/30/2009 - 14:59 | 84092 Anonymous
Anonymous's picture

Dear FED,

So be it, I still want the audit!

Will we have the courage to choose the potential of poverty over the certainty of slavery?

Wed, 09/30/2009 - 15:12 | 84095 waterdog
waterdog's picture

Given the number of criminal investigations ordered by other federal judges and state AGs during September related to financial misconduct, I would be surprised if any second circuit judge would stand in the way of something that will most likely be exposed by another case. I believe the second circuit will require proof of a possible run on a bank that cannot be bailed out, after, Bernanke proves that all recipients of the money were indeed depository banks. The decloaking has begun. Bernanke is not sleeping well. All Obama has to say is, Ben, tell them what they want to know, or, clean out your desk. I can remove you for cause.

The reason why Bernanke waited until the last day was to give the recipients time to run. He knew last week that the appeal would be turned down.

Wed, 09/30/2009 - 15:00 | 84099 digalert
digalert's picture

It's not the disclosure of banks that uncle Ben is worried about, it's the "friends of the FED" group that must not be disclosed.

Wed, 09/30/2009 - 15:11 | 84118 ghostfaceinvestah
ghostfaceinvestah's picture

I agree, it is clearly not about a few banks.  Surely the market knows who they are: C, BAC, GMAC, GE Capital, etc.

It is not WHO they are dealing with, it is WHAT they are dealing with.  They are lending against "assets" with no collateral that they shouldn't be taking in.

Wed, 09/30/2009 - 15:02 | 84107 Anonymous
Anonymous's picture

I have to say I prefer living in Canada, where our current government is hopelessly captured by fossil fuel interests. At least they make better cartoon villains!

Wed, 09/30/2009 - 15:04 | 84110 Margin Call
Margin Call's picture

I have to say I prefer living in Canada, where our current government is hopelessly captured by fossil fuel interests. At least they make better cartoon villains!

(PS: Sorry about the duplicate Anon post, that was me, I just forgot to sign in!)

Wed, 09/30/2009 - 15:08 | 84115 ghostfaceinvestah
ghostfaceinvestah's picture

Plus you have commodities that people want to buy.

Wed, 09/30/2009 - 15:33 | 84165 Assetman
Assetman's picture

Yeah... real stuff.

Wed, 09/30/2009 - 16:47 | 84255 Tesla
Tesla's picture

I think you should take a look at the books of Canadian banks. I see nothing to be optimistic about up here, either.

Wed, 09/30/2009 - 18:19 | 84352 Divided States ...
Divided States of America's picture

I am from Canada but work in the States...and although Canada is a cleaner, safer, and overall better environment for a relaxing life, its too lax and too democratic that we let everyone from all parts of the world in, from queers, terrorists, pedofiles, criminals...the list goes on.

Wed, 09/30/2009 - 15:07 | 84114 Anonymous
Anonymous's picture

anyone else find it ominous that the FDIC is calling for an additional 30B on top of the original 70B to backstop the financial fallout, all the while asking for 45B in prepaid premiums for FDIC membership? Seems like they're picking up their water bottles and canned food before the storm

Wed, 09/30/2009 - 15:41 | 84183 OrganicGeorge
OrganicGeorge's picture

Our new Supream Court Justice will love hearing this case.

http://en.wikipedia.org/wiki/Sonia_Sotomayor

 

Sotomayor generally handed out longer sentences than her colleagues, especially when white-collar crime was involved.[86] Fellow district judge Miriam Goldman Cedarbaum was an influence upon Sotomayor in adopting a narrow, "just the facts" approach to judicial decision-making.[51]

Wed, 09/30/2009 - 15:59 | 84212 waterdog
waterdog's picture

That is very encouraging.

Wed, 09/30/2009 - 16:06 | 84225 Bankster T Cubed
Bankster T Cubed's picture

HAL9000 dictated every wiggle in the markets today

END THE FED

Wed, 09/30/2009 - 16:10 | 84230 chindit13
chindit13's picture

Have we no right as citizens and taxpayers to know what we and our children and grandchildren bought with our hard earned money?  The American Revolution was fought over an issue equally or less significant than this.

The time has come to lock and load.

Wed, 09/30/2009 - 16:12 | 84232 Takingbets
Takingbets's picture

Somebody has gone junk happy on this thread. I counted 5 so far and that's unusual too me.

Did someone accidentally let BB have an account here???

Wed, 09/30/2009 - 16:13 | 84236 Anonymous
Anonymous's picture

Hopefullly ,
the strategic timing is important, hopefully the legislators wait for the supreme court to announce if they will here the case. even if they announce they will hear it, it could take a long time before the case gets before the court.

should the supreme court except the case and it gets pushed forward on an accelerated time table, the legislators like paul and grayson should at least recognize that it is to their benefit to wait for a decision from the supreme court, should one be imminently ofrthcoming. that way, any push for legislation can take into account any legislative obstacles that might be laid out (incidentally or directly) in the opinion of the courts decision. Not to mention the obviously more important consideration of how to alternately tweak the political strategy of getting legislation passed in light of a rejection or approval of the appeal. Either way, it is only to the legislators' advantage to wait for the court to act first.

however, there is always the possibility that as 1207 is expected to be shot down summarily in the senate, that , such a quick rejection, having occurred prior to a court decision, would provide the supreme court motivation in rejecting the appeal; the argument that transparency is absent would resonate that much more if the senate refused to pass 1207 ( alternatively, and in my opinion more likley , they might see a rejection of 1207 as legislative action , backed up with executive power, favoring the government approach of saving the banks, and thus, be pushed toward accepting the appeal, for fear of againting agains the ----- ) other 2 branches [assuming the supreme court is not bought and sold or under co-ercion ]

Wed, 09/30/2009 - 16:22 | 84243 Fish Gone Bad
Fish Gone Bad's picture

Why would there be a run on the banks?  Everything is fine. 

Wed, 09/30/2009 - 16:28 | 84245 stoverny
stoverny's picture

The Fed's defense boils down to "If we tell you how broke they really are... people will know how broke they really are."

 

Can't have that, can we!

Wed, 09/30/2009 - 16:40 | 84251 Bearish Spirits
Bearish Spirits's picture

Why did Grayson have to involve himself in the healthcare debate in such an inflammatory manner, basically saying Repubs "want sick people to die???"  Cavuto is talking about it right now.

Grayson has made it easier for everyone to target him and isolate him as a moonbat.  ::shakes head::  Watch for Fox News to tear him a new one.

Way to make the Fed's smear job on you easier to pull off, buddy.

Wed, 09/30/2009 - 17:14 | 84289 Miles Kendig
Miles Kendig's picture

Grayson would not be doing what he is doing unless there was a future in it for him...  I rather suspect he could care less what folks like Cavuto, FOX news or FED news have to say about him.

Remember, for the 1207 to get legs it needs supporters from all places of the spectrum.

Wed, 09/30/2009 - 17:21 | 84298 Bearish Spirits
Bearish Spirits's picture

I know...it's just that saying Repubs want people to die and comparing the health care crisis to the Holocaust isn't going to win you ANY fans.  There's even talk about the possibility of censuring him.  I would just like him to pull back to focus on the Fed.

By the way, are you "Layne?"  And if so, did you change your name because the new AIC album came out yesterday?

Wed, 09/30/2009 - 17:35 | 84308 Miles Kendig
Miles Kendig's picture

I am willing to wager he got more than 50K through Act Blue today and probably will get more than a million when it is all said & done. After all, it is called congress for a reason.

I am Layne, but the reason I changed my name is that my history much more closely resembles this character while I simply desire that I had the voice & amplitude that Layne conveyed. If you ever see Hopscotch you would understand.  I am Miles Kendig and would never go back for any amount of money.

Wed, 09/30/2009 - 22:01 | 84624 earnyermoney
earnyermoney's picture

Grayson is an opportunist. He's hijacked Ron Paul's agenda to raise campaign cash. Ahole sent me a form letter asking for contributions. Rip the head of your party a new a$$hole on the floor of the House before you ask me for a contribution. H.R. 1207 and S. 604 were nuked by Obama's Solicitor General today.

Wed, 09/30/2009 - 19:01 | 84398 Anonymous
Anonymous's picture

SOMEONE had to respond to Joe Wilson. Grayson is doing what has to be done to accomplish what he was elected to accomplish.

Wed, 09/30/2009 - 16:52 | 84261 Anonymous
Anonymous's picture

Maybe I can sell my domain to the FDIC
www.runonthebanks.com

Wed, 09/30/2009 - 16:53 | 84262 Anonymous
Anonymous's picture

What's this "there WILL be a run" crap?

Someone still has money in the Federal Reserve System?

Who, exactly, is suffering from that kind of retardation?

Mine left with the FDIC funds.

Yo, Bennie!! Call me when you're not worthless, babe!!

Wed, 09/30/2009 - 17:01 | 84272 Anonymous
Anonymous's picture

A friend of mine told me a very satisfying, yet soothing remedy of facing the unfortunate truths that will unfold once fundamentals ground themselves.

STACK YOUR CHIPS, AND PACK YOUR CLIPS! Too-da-loo mothaf**kas

Wed, 09/30/2009 - 17:21 | 84294 Miles Kendig
Miles Kendig's picture

http://www.youtube.com/watch?v=5j2F4VcBmeo

The sad fact is that folks like Ben Bernanke actually believe that they are standing post rather than riding the post.

Wed, 09/30/2009 - 17:38 | 84314 Anonymous
Anonymous's picture

a run? running is good for you.....when and where is the race?

Wed, 09/30/2009 - 19:18 | 84421 Miles Kendig
Miles Kendig's picture

Ask Dean Corso

Wed, 09/30/2009 - 19:40 | 84451 straightershooter
straightershooter's picture

Transparency?

The Fed has spoken: All banks are insolvent. If we reveal the information, then sheeple will  know for sure and a run will cause the collapse of all banks, especially those 19 TBTF banks.

Better move ahead and hide your money in mattress. Once the run starts, there won't be enough greenbacks to support the withdrawl.

Wed, 09/30/2009 - 19:54 | 84476 geopol
geopol's picture

The Second Wave Of The Depression - Hyperinflation Likely
By Webster Tarpley
August 6, 2009
Washington DC – The second wave of the world economic depression is coming soon. Larry
Summers, the economics czar of the Wall Street puppet regime currently in power in Washington,
recently confessed to the Financial Times in an unguarded moment: “I don't think the worst is over
....” A few weeks earlier, Jacques Attali, who served in the 1980s as the main economics adviser to
French President Mitterrand, told an audience at the International Economic and Financial Forum
(FIEF) in Paris that the world might well soon face a “planetary Weimar” in the form of a
hyperinflationary depression similar to the German events of 1922 to 1923.
During the last world economic depression, the first wave came in the form of the famous New
York Stock market crash of October 1929. But this was only the beginning, and hardly the main
event. The world depression of the 1930s was made irreversible by the British bankruptcy of
September 1931, when the Bank of England ceased gold payment. At that time, the vast majority of
international trade was financed by pounds sterling bills of exchange drawn on London. When the
British Pound began to float through a series of competitive devaluations, the lack of a stable
reserve currency – and not the US Hawley-Smoot tariff – strangled world trade, thus making that
depression as severe as it was. British default in turn undermined the US banking system, setting the
stage for the banking panic which ravaged the United States in 1932 and 1933, to the point that not
a single bank in the country was still operating by the time Franklin D. Roosevelt assumed the
presidency in March of 1933. The United States would almost certainly have been lashed by
additional waves of depression had it not been for the banking triage implemented by the Roosevelt
administration during the bank holiday, and for other New Deal measures which succeeded in
mitigating the Depression. Other countries, notably Germany, went into a permanent depression
which was expressed in a series of military campaigns which aimed at the economic looting of the
other countries of Europe. Whatever the ideological fanatics of the discredited Austria and Chicago
schools of economic analysis may claim, there is no automatic business cycle capable of lifting the
modern world out of serious economic disintegration. The depression will end when adequate New
Deal style policies are implemented, and not before, as I show in my new book, the second edition
of Surviving the Cataclysm.
TODAY: BETWEEN 1929 AND 1931
Today, therefore, we are so to speak in the trough between the October 1929 wave (which
corresponds to the derivatives crisis and banking panic of 2008) in the September 1931 wave, which
this time around is highly likely to take the form of a hyperinflationary dollar crisis, or in other
words a hyper stagflation and depression of the world economy radiating out from Wall Street and
the City of London. What then might be the leading characteristics of the next wave of the current
world economic breakdown crisis?
The next wave is likely to involve a worldwide dollar panic. Using ballpark figures, we can say that
there are about $4 to $5 trillion sloshing around the world in the form of hot money, US Treasury
securities, Euro dollars, and various forms of zeno-dollars. Japan has about a trillion, China almost
$2 trillion, and so forth. It is naturally very unwise for a developing country like China to hold so
many dollars rather than using them to purchase needed infrastructure and capital goods, and the
Chinese leaders are now very uncomfortable with their own foolish decision, which was of course
taken under heavy US pressure. But the point is that this $4.5 trillion overhang is by its very nature
exceedingly unstable. Every country that holds large sums of dollars or US treasury bonds is
nervously eyeing every other such country to see if they show signs of bolting for the exit. Up to
now, so far as we know, no large holder of dollars has attempted to reduce its exposure to the
battered greenback by dumping these dollars on the international market. If anyone did so, would
cause a true universal financial panic which would create chaos and mayhem not just in the United
States and Great Britain, but in the vast areas of the rest of the world as well. This is concretely how
hyperinflation could now very well arise: if one or more US creditor nations attempts to abruptly
lighten up on dollars, the value of the US currency could undergo a catastrophic collapse, and that
would spell runaway hyperinflation on the US domestic front.
WORLD DOLLAR PANIC IMMINENT?
We need to recall that the value of a modern currency is not determined inside the country, but
rather on the international foreign exchange markets. This is where the fatal vulnerability of the US
dollar is located. In the ruined form of the Bretton Woods system which has prevailed for almost 40
years since Nixon's colossal historical vandalism of August 15, 1971, the US has emerged as the
only country with a permanent license to finance imports by simply printing more of its own
currency and sending those banknotes overseas. Every other country has to manufacture and export
something that others want to buy in order to earn the necessary foreign exchange to pay for its own
imports. The US license to print has made this country the buyer of last resort and the dumping
ground for the unsold junk of the world, leading in the process to high permanent unemployment
here. There are many signs that this inherently unworkable arrangement has now reached the
breaking point.
INTERNATIONAL CURRENCY RELATIONS, NOT MONEY SUPPLY, ARE THE KEY
Ms. Ellen Brown, who apparently supports the doctrines of the social credit movement of the 1930s,
has recently argued that deflation is now on the agenda, and that hyperinflation can be ruled out.
She bases this analysis on the fact that the private credit markets in this country have largely
collapsed, and on the contention that the M1 and M2 money parameters have either declined or
increased only slightly. But all of this is beside the point. The Federal Reserve and the Treasury
have so far provided almost $13 trillion of new loans to banks, insurance companies, credit card
companies, and other purely financial institutions. This is being done in an effort to bail out the $1.5
quadrillion world derivatives bubble, of which something like two thirds or more, meaning one
quadrillion dollars, can be located inside the dollar zone. The world depression started when this
derivatives bubble went into reverse leverage, meaning that super losses instead of super profits
were generated at the apex of the speculative pyramid, as seen in the case of $3 trillion AIG hedge
fund located in London. The Obama regime is engaged in an hysterical attempt to restart derivatives
production in the form of securitization, i.e. the creation of more and better asset backed securities
derivatives. At the same time, the Obama regime has cynically and deliberately driven the Detroit
automakers into bankruptcy, destroying hundreds of thousands of the few remaining industrial jobs
here in the United States. This means that US industrial production continues in drastic decline. The
mere mention of production reminds us that the assorted Austrian, Chicago, and social credit
schools are predominantly or exclusively concerned with money and banking, and pay little or no
attention to industrial, agricultural, and infrastructural production, meaning of course that they
neglect the creation of those tangible physical use values, capital goods, and related forms of real
wealth upon which human existence depends. With bailouts increasing and all forms of commodity
production declining, we have the classic situation of far too much money chasing too few
goods. Internal pressure towards hyperinflation comes from the fact that the bailout and public debt
lending, on top of the bloated, fictitious, and exponentially growing mass of kited derivatives, are
all charges which must be added to the prices of commodity production. Add this to the more
important factor of looming dollar panic in the international exchanges, and the preponderance of
the evidence points towards hyperinflation. Helicopter Ben Bernanke got his name from his famous
recipe of throwing bales of dollars out of helicopters onto the lawns of bankers to stimulate the
economy out of a depression, and this reminds us that the profile of the Anglo-American financial
leadership from Gordon Brown, Alistair Darling, and Mervyn King to Summers, Geithner, and
Bernanke is decidedly hyperinflationary. Ms. Brown's belief that hyperinflation is impossible is
therefore mistaken.
The German 1923 hyperinflation was generated internationally, not within Germany, as a campaign
of economic warfare by Britain and France against theior defeated rival. Germany had signed the
Rapallo agreements with Soviet Russia, creating an economic combination which was more than a
match for the Anglo-French. To abort the potential of Rapallo by creating chaos in the German
economy, the Anglo-French systematically destroyed the value of the German Reichsmark on the
international exchanges, taking advantage of the Versailles reparations system and the French
occupation of the industrialized Ruhr area. The mark went down every day when the London
exchange rate was announced. Today, it is the enormous international dollar overhang which
threatens to annihilate the US greenback.
The one way deflation might actually come about is if someone like the self-professed Austrian
school ideologue Ron Paul were to take power. Ron Paul’s “libertarian” alternative to Obama’s
continued bailouts of Wall Street is evidently an immediate deflationary crash, which he asserts will
be followed by an automatic recovery. Ron Paul is a modern representative of the so-called
liquidationist school to which 1920s Treasury Secretary Andrew Mellon belonged. Mellon
demanded the liquidation of stocks, bonds, real estate, and labor. German Chancellor Heinrich
Brüning, another liquidationist, savagely cut German unemployment benefits (Ron Paul’s “nanny
state”) at the height of the Depression, helping to bring on the debacle of January
1933. Liquidationists tend to be people who have money and who believe they will continue to have
money even after an all-out crash, when they will be able to buy up distressed assets and desperate
unemployed workers for rock-bottom prices and cash in. But liquidationism obviously cannot be a
solution to depression of the entire society. The recent meetings of the leaders of the expanded G-8
countries in L’Aquila, Italy were marked by a growing awareness that the US dollar, because of the
criminally irresponsible policies of the Wall Street financiers who have dominated the Bush and
Obama administrations, can no longer play the role of the single world reserve currency. Russian
President Medvedev showed off a sort of future world coin to try to prod the Obama regime in the
direction of serious world monetary reform, which is of course the urgent task before everyone.
Naturally, finance oligarchs like Summers, Geithner, and Bernanke want to continue to play the role
of world currency dictators, and not be forced to negotiate the end of Anglo-American hegemonism.
The world needs to go towards a new pro-growth world monetary system in which the euro, the
yen, the dollar, the ruble, the Chinese currency, a possible Latin American monetary unit, and a
possible Arab monetary unit would all be included. It will be important to make the transition
toward such a new system as orderly as possible, since a catastrophic collapse of the dollar in the
short term would be to no one’s advantage, and would rather represent a sure path to universal ruin.
World economic growth rates under the 1944 to 1971 Bretton Woods system were the highest in
recorded history before or since. This was accomplished through statism and dirigism in the form of
narrow bands of isolation among the currencies, combined with gold settlements of surpluses and
deficits among the nations, which provided an indispensable reality principle to restrain the
hyperinflationary tendencies of the Anglo-Americans. The new world monetary system should
include the abolition of the International Monetary Fund and the World Bank in their current forms,
since these institutions have strangled the economic progress of the developing sector. Rather, the
goal of the new monetary system should be to restart the export of high technology capital goods of
the most modern type from Europe, Japan, and the United States towards the impoverished
countries of Africa, South Asia, and certain parts of Latin America.
THE FEDERAL GOVERNMENT SHOULD STOP BORROWING AND START LENDING
Here in the United States, we need to wipe out the derivatives bubble with the help of a 1% Tobin
tax or securities transfer tax, on all speculative financial transactions, including futures, options,
stocks, bonds, commodities, foreign exchange, and so forth. A California Tobin tax would solve the
state budget crisis. The top 16 Wall Street banks are zombie institutions that need to be seized and
liquidated under Chapter 7 bankruptcy at once, with all of their derivatives going into the shredder.
Foreclosures on homes, farms, and businesses should be banned outright for five years or for the
duration of the depression, which ever lasts longer. To provide a credit supply, the Federal Reserve
should be seized and nationalized, and used as a vehicle to issue 0% Federal credit for productive
activities only, not for speculation. To revive credit demand, state and local governments could then
take out 0% Federal loans for such long overdue projects as the construction of 1,000 hospitals, the
building of 50,000 miles of modern maglev rail systems, and 100 fourth-generation, high
temperature, pebble bed nuclear reactors, plus the rebuilding of water systems and the interstate
highway network. Idled auto plants should be reconverted for these purposes. Science drivers in the
fields of space exploration and colonization, high energy physics, and biomedical research should
also be fully funded in this way to provide technological modernization. The social safety net needs
to be expanded and developed, with larger Social Security pensions for a generation whose 401(k)s
and IRAs have been largely destroyed, along with increased Medicare and Medicaid benefits for
those whose insurance companies are insolvent, like AIG and The Hartford, which have been
devastated by derivatives speculation. These are quite simply the requirements for the maintenance
of human civilization in this part of the world. Until measures like these are carried out, the United
States and the world will continue to sink deeper into the bottomless pit of economic depression.
###
Webster G. Tarpley is author of Surviving the Cataclysm: Your Guide Through the Greatest
Financial Crisis in Human History (2nd ed. 2009) available from ProgressivePress.com.

Wed, 09/30/2009 - 23:24 | 84729 Anonymous
Anonymous's picture

Webster, in a word, deflation, not inflation.
We did the inflation last time....

Wed, 09/30/2009 - 20:07 | 84496 Anonymous
Anonymous's picture

The run on the banks argument is kinda weak in this age of fdic backed deposits.

Everyone would have already ran to the banks were it not for the fdic.

The investors might run for the sell button on their zombie bank stocks, or might not, because Uncle Sam will prop them up anyway.

I dont trust the Congress much more than the fed, unfortunately.

Wed, 09/30/2009 - 20:20 | 84503 geopol
geopol's picture

FDIC is broke

Wed, 09/30/2009 - 20:22 | 84504 geopol
geopol's picture

Sit back in you beach chair and stuff a lime down the neck of a Corona and watch the American Empire go down the sink..

Wed, 09/30/2009 - 20:37 | 84512 CB
CB's picture

Doesn't it seem ironic that the sheeple aren't making runs on the banks based on the fact that the Fed chairman believes there would be runs on the banks if they disclosed recipients?  It's so weird!  Hello out there???  Wake up!

I'm curious ZH readers, what's your insurance for the next leg down in this mess?  I'm thinking guns, whiskey, gold...what else do I need?

Wed, 09/30/2009 - 20:42 | 84519 Anonymous
Anonymous's picture

How about a free supply of water om your land (sic), arable soil, a fiberglass 20,000 gallon tank of diesel buried on the property and 500 cords of wood, short wave radio with hydro crank no batteries.

Wed, 09/30/2009 - 21:17 | 84563 Gilgamesh
Gilgamesh's picture

Seeds and water.

Thu, 10/01/2009 - 06:07 | 84945 Anonymous
Anonymous's picture

Pole dancers

Wed, 09/30/2009 - 20:50 | 84527 geopol
geopol's picture

Try the following,

20,000 gallon fiberglass tank buried on the property filled with diesel. Arable soil and a 500 foot artisan well. I'ts no good to have guns without ammo, 6000 round and more if you can get it.

This sound ridiculous to the educated man, but lest us not forget it was the ivy league that sunk this fucking ship, so much foe educated idiots..

 

 

Wed, 09/30/2009 - 21:25 | 84573 Anonymous
Anonymous's picture

"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." Henry Ford

Wed, 09/30/2009 - 21:34 | 84586 Anonymous
Anonymous's picture

Harvard, Yale, princeton, NYU, Columbia, Penn have been shown to be absolute frauds. Their graduates have destroyed the western world. I think the Ivy League "institutions" should shut-down and investigated.

Wed, 09/30/2009 - 22:00 | 84623 ahab
ahab's picture

the fed is our friend- a tragedy- they know what's best

Wed, 09/30/2009 - 23:33 | 84747 Anonymous
Anonymous's picture

So the question of the year is:

Who's in FAZ?

I think now may finally be the time. Let's get rich, boys.

Thu, 10/01/2009 - 01:22 | 84862 Anonymous
Anonymous's picture

Hatred clouds your judgement boys and girls.

Thu, 10/01/2009 - 08:15 | 85001 Anonymous
Anonymous's picture

I went to the bank yesterday to pull out some more cash. $10,000 is all they would let me have without making an appointment. They told me to come in on Friday 10am if I need more. Didn't make me feel warm and fuzzy....

Thu, 10/01/2009 - 10:35 | 85134 geopol
geopol's picture

#84862

 

And truth liberates and focuses it.

 

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