Zombie Love, True Sales and Why “Too Big To Fail” is Really Dead

rcwhalen's picture

Give me
Your dirty love
Like you might surrender
To some dragon in your dreams

Give me
Your dirty love
Like a pink donation
To the dragon in your dreams

I don't need your sweet devotion
I don't want your cheap emotion
Just whip me up some dragon lotion
For your dirty love

“Dirty Love”
Overnight Sensation (1973)
Frank Zappa


Updated -- A number of commentators argue that the tendency of government to bail out large banks, the institutions we lovingly refer to as the “zombie dance queens,” remains intact, this despite legislation such as the 2010 Dodd-Frank law.  But such views may not adequately take into consideration why the zombie girls got so big in the first place.  This comment is based on a paper on the “Shadow Banking System” to be published later this year by Indiana State University. -- Chris

Simply stated, the largest commercial banks became “too big to fail” in large part because they used non-bank vehicles to increase leverage without disclosure or capital backing.  Their intent was to reduce the apparent capital needs of banks.  Banks’ abuse of non-bank vehicles to issue subprime securities and hide capital deficits was facilitated by legal counsel, auditors, rating agencies and regulators, who all pretended that four centuries of legal precedent regarding financial fraud had somehow never occurred.  Until 2011, FDIC rules did not preclude that abuse and even sheltered banks from need to disclose it to auditors and investors.

The failure of Lehman Brothers, Bear Stearns and most notably Citigroup all were largely attributable to deliberate acts of securities fraud whereby assets were “sold” to investors via non-bank financial vehicles.  These transactions were styled as “sales” in an effort to meet applicable accounting rules, but were in fact bank frauds that must, by GAAP and law applicable to non-banks since 1997, be reported as secured borrowings.  Under legal tests stretching from 16th Century UK law to the Uniform Fraudulent Transfer Act of the 1980s, virtually none of the mortgage backed securities deals of the 2000s met the test of a true sale.  Under the UFTA standard, for example, any transfer which is intended to leave the transferor with insufficient capital is a fraud which converts a “sale” into a “secured borrowing” by the transferor.

Since the purpose of most bank asset "sales" via securitization was always "capital relief," no honest lawyer could say that the transfers met the UFTA standard applied to non-banks.  Banks avoided balance sheet treatment for securitizations merely by "purporting to sell" loans to trusts.  Bank regulators allowed theses “off-balance sheet” vehicles to be excluded for the purposes of determining regulatory capital requirements.  When the crisis hit, it suddenly became clear that the banks’ capital was insufficient. 

Today much of the “shadow banking” system with respect to residential real estate has run off or is in the process of doing so, but hundreds of billions in claims against banks arising from these purported “sales” of assets remain pending before the courts.  Perhaps more important than prosecuting past acts of fraud connected to the creation and sale of bad securities, we need to clarify, going forward, what it really means to create a “sale” in the context of transfers made in an ABS transaction.  Unless and until we do that, the ability of banks to generate “off balance sheet liabilities” that de-stabilize financial markets and cause crises will just morph to new forms.  TBTF will remain alive and well for the zombie banks.

As noted earlier, bank abuses of non-bank vehicles to pretend to sell assets and thereby lower required capital levels was a major cause of the subprime financial crisis.  It now appears that a major catalyst for this came in the wake of accounting changes that took effect in 1997.  That’s when the FDIC adopted a “safe harbor” for bank securitizations to assure certain asset sales would comply with the new accounting principles. 

Thus, most of the securitizations done by banks over the past two decades were in fact secured borrowings, not true sales, and thus potential frauds on insured depositories.  In 2008, the Institutional Risk Analyst ran an interview with Professor Joseph Mason of Louisiana State University about the “good sale” issue.  He noted:

“The subprime crisis results from a growing arbitrage of regulations and accounting rules that got out of hand. Right now the situation is that regulators don't want to acknowledge the problems in the market because to do so is to admit that they missed these same problems, in some cases going back 30 plus years now… When I joined the OCC in 1995, I focused on securitization as an area of research. Securitization was growing by leaps and bounds and clearly had safety and soundness implications. Nobody was collecting information on it. The general view of securitization was "loans are sold" and this process was viewed as a good thing. But I began to look at the fact that securitization was a funding mechanism for banks. It is the liability side, the funding side of banks, where you really are running into risk. Incidentally, the liability side is where mark-to-market accounting and fair value is getting into trouble, posting paper gains when liability values plummet in distress. We allow banks to fund themselves by selling securitizations into an illiquid market. If that illiquid market breaks down, then your entire bank intermediation system gets a hiccup.”

Mason’s comments in 2008 were entirely on target regarding the threat from securitization and how the zombie banks used off-balance sheet finance to grow their leverage and risk to several times their actual balance sheets.  Mason’s comments also document the indifference of regulators like the Office of the Comptroller of the Currency to the problems created by badly constructed bank securitizations:

“Back in 1995 I was looking at this rapid growth in securitization and I began to suggest to my colleagues at OCC that we should start to monitor the phenomenon. I got tremendous indifference. This was around the time of the Advanta failure. I knew that there were some things going on within the agency because this failed bank did not have any deposits and there was some uncertainty whether the FDIC would liquidate the bank or just leave it to the OCC. But more than the question of the receiver, the Advanta portfolio was so securitized and so heavily levered that nobody knew how to value the business. When the bank was sold to Fleet, it was transferred as a whole business securitization where the buyer simply bought a majority share of the trust.”

Mason’s comments about the Advanta transaction illustrate the serious issues created when a bank sponsor creates hidden liabilities via a securitization:

“As I researched Advanta and other early examples of securitization it became clear that while we publicly toed the line about the validity of "true sales" when it came to securitizations, the reality was that these were anything but. Deals would sometimes run into legal problems - things like deals not accumulating sufficient reserves in the early stages to provide a buffer - which would be grounds for the deal to be called off entirely. While an intervention is a violation of the regulatory interpretation of true sale, nearly every time a securitization deal got into trouble the regulators would allow the banks to make collateral changes to these deals on the fly to make them work. This type of implicit recourse, especially in the world of credit cards and other types of consumer collateral, was the basis for much of my early academic research in the field.”

A year before our interview, Professor Mason and my friend Josh Rosner authored a prescient paper which illustrated the legal uncertainties in the legal definition of a “true sale” entitled “Where Did the Risk Go? How Misapplied Bond Ratings Cause Mortgage Backed Securities and Collateralized Debt Obligation Market Disruptions.”  Those of you who are big fans of S&P, Moodys and the other ratings agencies involved in fomenting the sub-prime crisis will especially appreciate this excerpt:

“In December 2000, LTV Steel filed for voluntary Bankruptcy protection under Chapter 11 in the US Bankruptcy Court of Northern Ohio120. In their filing the Company asked the court to grant an emergency motion to allow them to use the collections from the securitizations and claimed that the transactions were not “true sales” but rather “disguised financings”. The Court granted the Company’s motion though it did not rule whether or not the securitizations were “true sales”.  Although this case could have caused the rating agencies to take the same position as the Georgia law, of ambiguity making it difficult to rate the risks to noteholders they chose not to. In fact, one of the agencies appeared to pressure attorneys to avoid commenting on the matter in legal opinions. Standard & Poor's insisted that attorneys submitting true-sale opinions to the rating agency stop referring to LTV, noting that the court never made a final decision and that such citations inappropriately cast doubt on the opinion. Seven months later, in a delicately worded press release, S&P withdrew that prohibition—apparently because lawyers refused to ignore such an obvious legal land mine.”

Under GAAP rules, after 1996 any transfer of a financial asset that could be unwound by a bankruptcy trustee or a receiver was required to be accounted for “on balance sheet,” as a secured borrowing.  That had a particularly large impact on banks.  By its governing law, FDIC as a receiver has arguable power to unwind any contract, and FDIC had never enacted a rule limiting that right. 

So, FDIC found itself faced with a choice of precluding all financial asset sales by banks or defining limits on its rights in receivership.  FDIC debated and adopted a “safe harbor” that gave assured sale treatment for certain transactions.  With post-crisis hindsight, many such transactions by banks would, without that safe harbor, be deemed fraudulent.  And now you know why non-banks such as Lehman Brothers used FDIC insured depositories as the conduits for selling residential mortgage backed securities (RMBS) to investors.

Until FDIC’s safe harbor rule was changed in September 2011, therefore, it can be argued that the FDIC waived a right to challenge certain fraudulent transfers by banks.  During that period, the rule gave bank lawyers a safe harbor by which to provide opinions that securitizations were “true sales” even though we now know that was fiction. 

The process of changing GAAP began when an earlier accumulation of “off balance sheet liabilities” by banks contributed to the real estate crisis in 1989-1992.  That led the Financial Accounting Standards Board to adopt SFAS 125 which created a mechanism requiring lawyers to provide “true sale” opinions in the context of a securitization.  The primary example FASB looked to was a requirement for opinions on "fraudulent transfer" law that major rating agencies demanded before they would rate any securitization higher than the rating of its sponsor/originator. 

The reason FASB adopted the standard is simple:  Failure to comply with fraudulent transfer law converts a financial asset “sale” into a “secured borrowing” to the extent that the transferee, in good faith, compensates the transferor.  Rating firms such as S&P wanted comfort from the lawyers that the assets in an RMBS, for example, were beyond the reach of the bankruptcy court in the case of non-banks and FDIC, as receiver, in the case of a failed bank.   

With this as FASB’s standard, auditors gained a benchmark that is not subject to manipulation.  The line is set by law.  Failure to comply with fraudulent transfer law creates a secured loan and compliance creates a sale.  By the FDIC safe harbor adopted in 1997, however, banks were not required to meet the same test as non-banks, creating an imbalance of competition favoring the largest banks.  The zombie dance queens exploited this legal loophole and thereby grew their risk profiles many times over.  TBTF became inevitable. 

After extensive review, in September 2011 (effective November 2011), the FDIC abandoned its former safe harbor and enacted a new rule that corresponds with the treatment FASB accords non-banks.  That change finally establishes the “level playing field” which economists and experts have sought for US financial markets since at least 1969.  To be “sales” of assets, all future securitizations will require analysis of whether a fraudulent transfer has occurred.  Few observers have taken note of this development.  Auditors will, it appears, follow suit and adopt new guidance which will effectively end the ability of banks to assert that a fraudulent transfer of assets can be accounted for as a “sale,” as has been the case for all non-banks since 1997. 

The upshot of the rule change by the FDIC in 2011 is that banks will either have to change practices or they may not be able to meet the test for a “true sale.”  If they fail the test, banks may instead need to keep mortgage or other exposures on balance sheet, supported by whatever capital regulators establish for those transactions.  Good luck getting lawyers to opine in writing regarding a “true sale” transaction by zombie bank.  This development could mean less finance available from banks for the mortgage industry, but it may also herald the end of “too big to fail” with respect to the largest banks.  More important, it may lead to renewed growth of non-bank participation in a “true” and more stable shadow banking system.  And that will be a good thing.

Endnote: In the sevice of the Bair kitchen cabinet, i conveyed a message to the supporters of covered bond legislation that 102% "OC" or overcollateralization was all that the agency could tolerate for these secured borrowings.  If the House adopted legislation sponsored by NJ republican Scott Garrett, the FDIC official told me, the agency would oppose the bill and kill it in the Senate.  Now I understand why.  Anything above 2% capital buffer, absent the safe harbor would have violated the pre-1997 "true sale" rule.  And we must note that FDIC, of all the regulatory agencies, has been the most attentive to the true sale issue and, now, finally got it right. 


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rsnoble's picture

TBTF is dead, they are on life support and we're getting huge ass bills for it.  Just wait till you see the funeral expense!

IamtheREALmario's picture

Or banks and bankers can just continue to lie, defraud and steal. There are plenty of existing laws that they could be prosecuted under. Howevern they just prefer to ignore them because they ARE STILL too big to jail ... or fail.

If push comes to shove they will be bailed out again to the detriment of the long-term health of the country and its people. Just like before. I feel sorry for the ignorant who have put their trust in the media and government. However, if blame is to be passed around, I blame the criminal cronies that conspire to keep the ignornat in the dark and feed off their lives and souls.

q99x2's picture

Arrest Bankfeind and his demons. Spray them with holy water. Let Jehova know about their herd of golden calves. Where are the aliens when you need them. Castro is too old now but when he was younger he was going to go after them until they agreed to leave him alone. Somebody do something.

tradewithdave's picture

Also feels good to believe that "real cash money" can be paid...

williambanzai7's picture

Wishful thinking my friend.

The notion of TBTF is something that is systemic and not tied to the nature of the specific fraud. Moral hazard is the poison permeating the entire financial system.

Until they dismantle the zombie queens and let everyone know in jail terms that fraud will not be tolerated, we can expect a new and improved version of "trust us."

And while they are at it, they can chuck 16 page "reasoned" legal opinions into the can. When you ask a lawyer to opine on a simple question and you get a 16 page answer, get ready to have a drone "true saled" up your ass.

rcwhalen's picture

Yes but this is an important piece.  And I am on the record volunteering to serve as receiver for BAC as and when.  -- Chris

Jack Sheet's picture

agree on relevance of your post, but why has there not been a rash of prosecutions since the FDIC rule change in Nov 2011?

IamtheREALmario's picture

You are dreaming. It means nothing until it is put to the test. I have no confidence in the bankers, government, media ... and now I am questioning your sincerity or sanity.

swani's picture

Exactly. In a Banana Republic, the rules may change but the game stays the same.

billsykes's picture

Fantasy island post. Just like how they investigated HSBC an how they "audited" the gold and found nothing out of the ordinary. 

Pascal1967's picture

The gov't will ALWAYS bail out the banks.  ALWAYS.  To believe otherwise is to be naive and foolish.

slightlyskeptical's picture

Jesus Christ already! All this back and forth over legalese. We all know that all the mortgages have been illegally conveyed and thus should just be ripped up. Instead let's have, say the FHA, buy every outstanding primary mortgage, refinance on decent terms and put this whole damn mortgage episode behind us already.


Imminent Crucible's picture

let's have, say the FHA, buy every outstanding primary mortgage

The FHA? Buy $6 trillion in mortgages? Uh, there's going to be a little problem with that: The FHA doesn't have any money. What they do have is enough foreclosed houses to last 17 years at the current rate the FHA hopes to sell them at.

Oh, and there's another little problem; it's called MERS. That hasn't been settled yet. In 1995 the same banks that Whalen is talking about created the MERS system to facilitate mortgage reassignments without all that tedious and expensive courthouse business, so they could stock REMIC trusts and make mortgage bonds from pools of loans sold to people who had no idea how to balance a checkbook.

As the law currently stands, you could have Ben the Printer counterfeit $6 trillion and give it to the FHA to buy up every residential mortgage in the country. But in 60% of the cases, if the homebuyer stopped making his payments the FHA couldn't foreclose because MERS did not transfer the note along with the mortgage service rights.

Nothing has been settled yet, because so far all the proposed means of unwinding the MERS fraud have the effect of destroying several hundred years of property law.

Whiner's picture

With the Fed buying $45 Bil a month in ABSs, who could care less? One!

WTF2's picture

TBTF is a business model that will never fail. 

jimmytorpedo's picture

Not as long as sheeple keep paying off the bad bets.

How do you kill a zombie bank?

With ninjas?

rookie's picture

Chris - are you saying they sold the rmbs or cmbs to affiliates because the trusts are held by affiliates?  Isn't is a true sale because third-parties are buying the securities?  I must be missing something...

Winston Churchill's picture

Unfortunately the writer,who is getting paid for this tripe,has no understanding of

what really happened ,and cannot/will not   see the wood for the trees.

Its not about bankruptcy remoteness,it about outright theft of the RMBS

investors money.Multiple sales of the same loan,and then the TBTF banks stealing

the CDS proceeds due to those investors when the SHTF.

TBTF stole $8-16tn from investors,homeowners,and the US taxpayer.

Lets invade the Caymans, and get it back.One act of imperial aggression I would

agree with.

tony bonn's picture

this article is one of the best appearing on zh in quite some time...the more interesting question to me is why the banks felt such a need to resort to organized crime to succeed....was competition from non-banks too much? surely they had the clout to obtain regulatory and or legislative relief in a legal manner but they chose crime instead as enabled by their regulators which is proof of regulatory capture....

this article only covered the criminal aspects of the banks, yet there is the equally putrid layer of making mortgages for ninjas and all types of credit unworthy souls which in turn were rated as golden rock solid investment grade securities - a criminal farce if ever there were one.

the evolution of the criminal state will be a topic for some time until said state shuts down all such inquiry....

Diogenes's picture

My guess is they wanted the money. In order to justify $50,000,000 bonuses they had to show some big ass profits and it's a lot easier to make shit up than earn it.

Piranhanoia's picture

"Perhaps more important than prosecuting past acts of fraud connected to the creation and sale of bad securities, we need to clarify, going forward, what it really means to create a “sale” in the context of transfers made in an ABS transaction."

lost me right there.  There will be no going forward without prosecution for fraud so that we can remove the scum from the bathwater without tossing the baby. You just can't conceive of the crimes that have been committed having a punishment to all the nice crooks you run with.

Panafrican Funktron Robot's picture

To echo earlier comments, an enforcement mechanism is necessary for this to actually mean anything.  Really, there are a number of laws presently on the books that could be used to take down the TBTF banks.  RICO Act, for example.  

OldPhart's picture

Maye we should reserve RICO for when we go after Congress.

bunnyswanson's picture

Peace And Conflict Resolution says:

February 25, 2013 at 4:32 pm

 I should rather discover that we be a nation focused instead on a path of retrieval of information and then a spiritual healing process through a carefully considered national amnesty program for those caught up in the complex and confusing entanglements of the dark side.


9-11:  Conspiracy to commit murder, conspiracy to overthrow a government.  Insurance Fraud.  Aiding and Betting during a felony.  Failure to report a crime in progress.


10 minutes of coincidences too numerous to mention.


http://thewebfairy.com/911/edna/liberty.htm  Woman waving for help - WTC impact site

Burn this into your memory.  This is a human being who lived and loved.  She did not have to die this way.  The orchestraters of 9-11 are free today.  They are alive.  Who are dying are the witnesses.  Pretend witnesses seem to stay in place, however, to lead the story in the right direction.  This is a psychological thriller movie in a sane world.  You have better believe that if we hand this planet over to these people, it will be the end of all of us.  They are incompetent, arrogant, self righteous and sociopathic in their disregard for human life.  Greed rules in their game.  They will finish each other off and madness will reign in the land as groups of tribes break off and spend centuries attempting to restructure a world one can live a life that isn't filled with fear and great despair.

Personally - I say, offer plea bargains, allow book deals to those who come forward with sound information to expedite the process of "draining the swamp" and "sequestering the vermin."

vermin plural of ver·min (Noun)

Tad Ghostal's picture

I'd love to see Chris comment on FAS 140-3 and the implications to officers who signed off on bank financials that booked loans as true sales despite being universally covered by repurchase agreements.  How those entries could be justified has never made any sense to me.

dontgoforit's picture

Corruption at it's very core is rotten!  Or, better said, "When the whale shit hits the ocean floor, the smuddgies come along and eat it."  We, my friends, are the smuddgies.  Gag, cough... 'this whale shit stuff is deep.'

tradewithdave's picture

Whether you're talking Absalon or Absalom, if you ask me you're still talking George Soros and the giant poison Danish.


kraschenbern's picture

We're all in Wonderland now where:  "When I use a word, it is paid extra to mean exactly what I want."

dontgoforit's picture

Or, if you're like the prez, you say exactly the opposite of what you mean; therefore, I am cause I exist.

illyia's picture

Holy smokes. This is incredibly dense but enormously important analysis.

Thanks for posting it.

Fuh Querada's picture

You lost me after the 2nd paragraph.

Can someone please translate this post into English, with a glossary of terms.

Sorry, I only have a Chemistry PhD. Obviously not intelligent enough.

williambanzai7's picture

This is a lesson how a horse becomes a cow because they tell you it is so.

ebworthen's picture

"Can someone please translate this post into English, with a glossary of terms"

Accounting standards and the rule-of-law have been corrupted to allow the shadow banking "privatized gains/socialized losses" theft of the assets and future of generations of regular people to continue unabated.


Winning - bankers, Wall Street, Politicians

Losing - real people who work for a living

Kayman's picture

Fuh Querada

You "sell" your house to your brother-in-law, wait 6 months then file bankruptcy. You technically are outside of the fraudulant preference laws. But the transaction likely would be overturned because it was not arm's length and  founded in fraud.

A TBTF bank sells a security to a direct, indirect or nominee controlled company. Said controlled company has no money so TBTF finances the "sale".  Now the security no longer requires the bank to hold capital in reserves for the security. You would call it fraud, the TBTF's call it business as usual.

Fuh Querada's picture

Thanks, appreciated, that give me an inkling.

disabledvet's picture

Then you include a "put back provision" whereby though unwritten you have this "Central Banker Patsy guy" who while protesting to the nines in public about "sound money this" and "no benefits that" is in actuality telling all parties "the fraud is good because I'm the intermediary" thereby "taking it to the man" Ye olde fashioned way...by BEING The Man. "rinse, repeat...call it Your Govenment."

Schmuck Raker's picture

TBTF dead?

Let me just hold my breath a bit, while we wait to see how this pans out...

sitenine's picture

Right. It is hard to believe that DOJ will start prosecutions of any kind anytime soon, or that tax dollars will stop flowing to them, or that savers will garner interest, or that investing activity will be separated from deposits again, or CDS will be reigned in, or that the Fed will stop purchasing toxic MBS from them, or PM suppression will stop, or etc. etc. . TBTF is just a substitute word for fascism, so let's try to keep it real, and stay focused on bringing these SOB mother fuckers to account for what they have done to us.

Bandit und Buster's picture


"It is hard to believe that DOJ will start prosecutions of any kind anytime soon"

No kidding! d'ya think?  These Zionist criminals are not going to prosecute their own jew criminals!

They have been hard at work setting this all up for a long time!

"Use the courts, use the judges, use the constitution

of the country, use its medical  societies and its laws to

further our ends. Do not stint in your labor in this direction.

And when  you have succeeded you will discover that you can now

effect your own legislation at will and  you can, by careful

organization, by constant campaigns about the terrors of

society, by pretense  as to your effectiveness, make the

capitalist himself, by his own appropriation, finance a large

portion of the quiet Communist conquest of that nation."

(Address of the Jew Laventria Beria,  The Communist Textbook on

Psychopolitics, page 8).


NoDebt's picture

I gotta tell you, I think this is a good article.  It takes the undecipherable BS of current insanity and brings it right back to a centuries-old understanding of what something simple as a "sale" means.

This is right, I believe, and should be required reading.

It does not "fix" TBTF, nor does it purport to.  It is just an explanation.  A simple one at it's core:  when you sell something you're done with it after that.  If you're still tied to events that may arise in the future, you didn't really sell it, you just transferred it off balance sheet and pretended it couldn't hurt you when it clearly still can.

It also does not fix the problem of doing all this over again near-immediately, but merely "morphing" it into a new form.  Something I think we have all suspected or at least believe is happening (again) right now.  But, again, it does give some explanation of the phenomenon (commit to the lie or suffer the immediate consequences).  Hint: only possible with at least the tacit approval of government, if not it's outright support.

You're not going to find a "fix" in this article.  Just the explanation of (one of the) the perversions that is infecting the system, laid bare and foot-noted back to centuries-old understandings of why things work (or don't work) like they should.

Being a recovering economist myself, I'm a sucker for articles like this, but you don't need to be like me to appreciate it and see the truth in it.  You can down-arrow the crap outta me if you like, but this is GOOD fundamental and expository reading.  I read it end-to-end twice before posting.

As for his conclusion that some relatively-recent FASB rule is going to herald the slow end of the TBTF phenomenon.... well, I wish it was that simple.  I really do.  I would pay real cash money if it could ever be that simple.  But it feels good to believe tha this fundamental lie could be so easy to overcome.


sitenine's picture

Meh. I found the article so-so. Not once did it mention Repo 105 http://www.youtube.com/watch?v=Tr8qPmyW5Yw , and neither did it mention Sarbanes-Oxley http://www.soxlaw.com/ which was supposed to change the world and hold CEOs accountable (people like John Corzine http://www.zerohedge.com/news/2012-10-31/case-against-corzine ). Laws are fucking meaningless to banks - that is what TBTF means - it's not a moral hazard, it is the DEATH of morals - they are above the law. Period. Just ask former Assistant Attorney General Breuer http://www.zerohedge.com/news/2013-01-23/assistant-attorney-general-breu...

g speed's picture

death and rightous mutulations on the perps--let the show begin.

NoTTD's picture

I don"t believe you've never seen his book before...

NoWayJose's picture

Banks will either change the wording, or pay off Congress to write in a loophole.  Regulating banks is like stabbing a knife into fog - the knife goes in, but the regulation never hits anything because the bank finds a way to slip around it.

eatthebanksters's picture

Stop stabbing the fog...go after some of the criminals at the top...the rest will open their eyes when the guys and gals at the top suffer some justice, whether its at the hands of the Justice Department or Vigilantes.  They just need to know they aren't untouchable.

espirit's picture

Like trying to kill a giant vampire squid with a knife?  Would be lucky to knick a tenicle before it sucks the like out of you.

LawsofPhysics's picture

Correct.  With the U.S. gov fully captured, nothing changes until the supply lines break and heads roll.  Some things never change.

Bandit und Buster's picture


"It is hard to believe that DOJ will start prosecutions of any kind anytime soon"

No kidding! d'ya think? These Zionist criminals are not going to prosecute their own jew criminals!

They have been hard at work setting this all up for a long time!

"Use the courts, use the judges, use the constitution

of the country, use its medical societies and its laws to

further our ends. Do not stint in your labor in this direction.

And when you have succeeded you will discover that you can now

effect your own legislation at will and you can, by careful

organization, by constant campaigns about the terrors of

society, by pretense as to your effectiveness, make the

capitalist himself, by his own appropriation, finance a large

portion of the quiet Communist conquest of that nation."

(Address of the Jew Laventria Beria, The Communist Textbook on

Psychopolitics, page 8).