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Presenting The S&P500's 50 Point Surge Courtesy Of The Illegal "Geithner Leak"

Tyler Durden's picture





 

Yesterday we broke the news of what is prima facie evidence, sourced by none other than the Federal Reserve's official August 16, 2007 conference call transcript, that then-NY Fed president and FOMC Vice Chairman Tim Geithner leaked material, non-public, and very much market moving information (the "Geithner Leak") to at least one banker, in this case then Bank of America CEO Ken Leiws, in advance of a formal Fed announcement - an act explicitly prohibited by virtually every capital markets law (and reading thereof). It was refreshing to see that at least several other mainstream outlets, including Reuters, The Hill and the NYT, carried this story which is far more significant than Season 1 of Lance Armstrong's produced theatrical confession and rating bonanza. It is notable that Richmond Fed's Jeff Lacker who made the inadvertent (or very much advertent) disclosure has not backed down from his prior allegation and told the NYT yesterday that "My understanding was that President Geithner had discussed a reduction in the discount rate with these banks in connection with these initiatives." What, however, the mainstream media has not touched upon, yet, is just how profound the market response to the Geithner Leak was, and by implication, how much money those who were aware of what the Fed was about to do made. Perhaps, it should because as we show below, the implications were staggering. But perhaps what is even more relevant, is why the Fed's previously disclosed details of Mr. Geithner's daily actions at the time, have exactly no mention of any of this.

Backstory

Before we get into the prime of today's narrative, a quick detour.

For those who may not remember, early August 2007 was a very tumultuous time in the markets. On one hand, it marked the all time highs of the S&P. On the other, August is when the cracks in the facade started to become apparent to all, even the Fed, following what is now known as the quant meltdown, in which quantitative strategies suddenly stopped working and led to a brief but notable market crash, one which caught the Fed's attention.

The immediate result of this major market swoon was not one, but two ad hoc FOMC conference calls, the first on August 10, and the second on August 16. The first one was more of a brainstorming session held at 8:45 am on Friday, in advance of a 9:15 generic market supporting statement by the Fed (full text here), whose purpose was, in the words of Chairman Bernanke, that "we’re just saying that we are here, we are going to try to maintain the fed funds rate at 5¼ percent, we will provide adequate reserves, and we’re going to try to work against any remaining stigma associated with borrowing at the discount window."

What is important about the first call is where Bernanke left it, namely with a direct preview of what was about to come next. To wit:

There is just one procedural point. Again, this is not something that we’re contemplating, but one possible thing we could do would be to lower the discount rate, reduce the 100 basis point spread between the discount rate and the federal funds rate. It’s not obvious that it is the right thing to do. There are probably some technical and logistical issues concerned with it. It’s not obvious that it would be helpful. But I just want to put it on a list of things that we might consider and to remind you that the procedure for doing it would involve requests from your boards and then approval by the Board of Governors. So should we come to that point and we begin to discuss that particular option, we would need the Presidents to get the assent of their boards so that we could go ahead and take that action. Are there any other comments or questions? All right. Well, we will keep you well apprised, and I’m sure you will be following the markets on your own.

That point came a few days later, when the disturbance in the markets continued and when the Fed felt compelled to hold yet another conference call not a week later, in which the Bernanke proposal to cut the discount rate spread to the fed funds rate was enacted, and the margin was cut in half from 100 bps to 50 bps.

The formal announcement of the decision to do this took place at 8:00 am on August 17 and was worded as follows:

To promote the restoration of orderly conditions in financial markets, the Federal Reserve Board approved temporary changes to its primary credit discount window facility. The Board approved a 50 basis point reduction in the primary credit rate to 5-3/4 percent, to narrow the spread between the primary credit rate and the Federal Open Market Committee's target federal funds rate to 50 basis points. The Board is also announcing a change to the Reserve Banks' usual practices to allow the provision of term financing for as long as 30 days, renewable by the borrower. These changes will remain in place until the Federal Reserve determines that market liquidity has improved materially. These changes are designed to provide depositories with greater assurance about the cost and availability of funding. The Federal Reserve will continue to accept a broad range of collateral for discount window loans, including home mortgages and related assets. Existing collateral margins will be maintained. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of New York and San Francisco.

The statement was the result of the previous day's (August 16, 2007) conference call deliberations which took place at 6:00 pm Eastern. And while the 37 page transcript provide much color in terms of the Fed's misreading of what was happening in the markets (in this case several computers going haywire, a faux pas that would only be matched by the January 21 2008 unprecedented and unscheduled 75 bps cut in response to Jerome Kerviel's overnight futures trading fiasco, what is particularly relevant to this story is a statement by then Fed governor Donald Kohn who said...

After this meeting is over, the Board will likely vote on two requests that we have in house to reduce the primary credit rate to 5¾ percent. We would announce this at 8:00 tomorrow morning, along with whatever statement the Committee approves, and we would expect and hope that if this goes forward as we anticipate, the other ten Reserve Banks would go to their boards after the announcement to come on board for the 5¾ percent primary rate so that we reduce any risk of leaks ahead of time.

... as well as a statement by none other than Tim Geithner who explained how the banks and other "market participant" institutions are acting and thinking at this troubled time, as follows:

...Although they had lots of clarification about what is permitted now under current policies at the discount window, they obviously don’t have any idea that we’re contemplating a change in policy or what might be possible and what we might say or not say going forward. They obviously can’t and understand that they can’t say anything about us...

What these two extracts confirm is that it was expected and well-known, after all it was "obvious", that the banks can not have advance knowledge of what the Fed would announce in just 12 short hours. Yet it is the latter that is of particular attention, and we are certain the Department of Justice and the SEC, are clearly ahead of us here, because it comes from none other than the person who it now is clear was the source of the leak.

The Geithner Leak

Those who happened to have the misfortune of trading stocks on August 16, 2007, and especially those who were short the stock market just because they saw the writing on the wall - writing that would crush the S&P to 666 in one and a half short years and lead to the failure or consolidation of half of America's banking system - remember that day very well. What happened on August 15, and continued through the 16th was an aggressive bout of selling, that took the S&P from 1390 to 1360 at the close of the prior day trading day, and subsequently sent it lower by another 30 points to 1330 at just about 2 pm Eastern. What happened next would have otherwise remained a mystery, if not for yesterday's declassification of the Fed's 2007 transcripts. Because suddenly, out of nowhere, an unprecedented bout of buying started with no news to serve as a catalyst. The buying sent the S&P soaring by some 50 points (!) in the span of an hour.

Once again - there was no market-moving news to explain this move. At least no publicly disclosed market-moving news.

Now we know whose job it was to unleash the buying spree at precisely 2:00 pm on that Thursday. His name: Timothy Franz Geithner.

And we know this because Jeffrey Lacker knows this. From the August 16 transcript:

MR. LACKER. Vice Chairman Geithner, did you say that [the banks] are unaware of what we’re considering or what we might be doing with the discount rate?

 

VICE CHAIRMAN GEITHNER. Yes.

 

MR. LACKER. Vice Chairman Geithner, I spoke with Ken Lewis, President and CEO of Bank of America, this afternoon, and he said that he appreciated what Tim Geithner was arranging by way of changes in the discount facility. So my information is different from that.

This exchange took place some time after 6:00 pm on Thursday, and some time after the 50 points ES ramp had taken place "out of nowhere." In other words, not only did the leak that many FOMC members (including, humorously, Tim Geithner) were concerned about take place, but it was none other than the Geithner Leak to at least Ken Lewis, and who knows how many other bank CEOs, which we also now know made the rounds among those bank trading desks who were privy to its confidential and illegal market moving content at just after 2:00 pm on that day.

For those who need a visual reminder of just what happened on August 16 2007, here it is:

Many shorts ended up being carted out of the front door that day, unsure what has just happened. Sure enough, the next day at 8:00 am the Fed did what it had decided the previously it would do, and announce the 50 bps cut to the discount rate to fed funds rate spread. The market response was just as blistering as the rest of the market piggy backed:

To summarize what happened for all those who were too stunned from the day's rapid events, the S&P futures moved from a low of 1320 (and 1330 at the 2:00 pm moment that the market saw a mysterious "invisible hand" pushing it higher), all the way to well over 1410 the next day: an unprecedented 90 ES point move in a few hours! The reason: the Fed's market moving announcement, as well as the Geithner Leak at just around lunch time on August 16th.

The Fed's Records

We now know what the illegal catalyst was for the massive market surge on the afternoon of August 16: Tim Geithner leaking what the Fed was about to do to the rest of his banker colleagues: a leak that breaches every possible law and rule.

So in an attempt to cement this fact with concrete official evidence, we went to the source: the New York Fed's own calendar of what Tim Geithner was supposedly doing on August 16th.

We have access to this thanks to an April 2009 FOIA request by the New York Time's Gretchen Morgensen. What the FOIA revealed to the NYT and the world, was 658 pages of daily events that Tim Geithner was engaged in, in the period from 2007 to 2009. Supposedly, this was a complete list of his daily events, and phone calls.

What the daily schedules show is that between August 8 and August 20, 2007 Tim Geithner was supposed to go on vacation to Cape Cod, from where he participated telephonically on at least the August 10 conference call.

It appears that Geithner ended his vacation prematurely, and was back in the office at 33 Liberty on August 13:

We fast forwarded to that fateful day - August 16 - when Tim was holding all these phone calls with Ken Lewis, and who knows who else, to see what, according to the Fed's official records, Tim Geithner was doing. We find...

... nothing! Actually no, we learn that at 5:30 am Geithner spoke on the telephone to then-BOJ Governor Toshihiko Fukui. And that was the only direct telephonic conversation Geithner had that day, at least according to the Fed's own internal records.

Between the 8:30 am "teleconference with Board of Governors" and the 4:00 pm "Markets Status Meeting", Tim Geithner apparently did exactly nothing. We now know that is not the case, as we know that he spoke to at least one Ken Lewis in the day(s) before the August 17th announcement. We certainly don't know who else he spoke to, to leak material, non-public and market moving information.

Perhaps it is time for a stronger FOIA request, maybe this time from someone like Bloomberg. Because we are 100% certain that if Bloomberg's Mark Pittman was still alive he would be all over this. We are confident at least one reporter at the Bloomberg newsroom is willing to carry on the Pittman legacy and find out why the New York Fed has no official records of what is arguably the most important time block of Tim Franz Geithner's daily calendar: his daily leaks of material Fed information to Bank CEOs.

Or perhaps this particular conversation was on Geithner's cell phone. Maybe it is time not for Bloomberg, but for the DOJ to step in and request Mr. Geithner's cell phone record: who knows - one just may find undisclosed conversations between the soon to be former Treasury Secretary and CEOs such as Ken Lewis, Lloyd Blankfein, Jamie Dimon, and all those others who it appears were worthy of knowing what the Fed would do almost one full day ahead of everyone else, and as a result make billions in illegal profits as a result of frontrunning the announcement of the world's most important central bank?

And perhaps it is time for all those who were short the market on the afternoon of August 16 to form a group and actually sue the Federal Reserve for not only breaching its responsibility to the US taxpayers, but for illegally enriching bank CEOs even more than it has to date?

* * *

Maybe there is a reason why the Fed has a 5 year delay in disclosing full transcripts. Because something tells us the statute of limitations on pursuing Fed inside information disclosure charges against the soon to be ex-Treasury Secretary will have just expired.

Of course, when the Fed's attempts to delay the inevitable convergence between stock markets and reality finally fails with a collapse that makes the August 2007 market moves seem like a joke, we are quite confident that the statue of limitations on that other form of justice, vigilante, will be the last thing the general public which has been betrayed by the Fed over and over and over, whose sole purpose is solely to make the rich even richer, will be the last thing on anyone's mind.

h/t Manal

 


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Sat, 01/19/2013 - 16:13 | Link to Comment mikla
mikla's picture

Libor rate fraud, central bank interest rate cartels, unpublished "guarantees" by governments, banks, and corporations using the public coffers to backstop all liability, with no reserve requirements.

How is anyone surprised by any of this?

Sat, 01/19/2013 - 16:18 | Link to Comment El Oregonian
El Oregonian's picture

"Gakk'in" Geithner, Criminal extraordinaire. Brains of a  gecko, lips like a serpent, his eyes dead like a shark...

Sat, 01/19/2013 - 16:24 | Link to Comment Enslavethechild...
EnslavethechildrenforBen's picture

Put the victims in jail.

 

Give the criminals more money.

Sat, 01/19/2013 - 16:25 | Link to Comment Xibalba
Xibalba's picture

"Try and stop me, bitchez!" - Geithner, Corzine, USA.GoV, Cia.fb, NSA, TSA...with love

Sat, 01/19/2013 - 16:32 | Link to Comment Fish Gone Bad
Fish Gone Bad's picture

The only way out of the "Chinese finger trap" that is the US money machine is to downsize and stop playing the game.  Seriously.  In the end, all that really matters is your memories, make them happy ones.  Downsize your life. 

Sat, 01/19/2013 - 17:10 | Link to Comment sunaJ
sunaJ's picture

First of all, Tyler - thanks for the investigation.  You are what Bloomberg, NYTimes et al should be. 

 

I have some doubt there will ever be an "official" investigation.  If there is (only at the slim chance of public outcry), I'm sure the man leading the investigation will be Louis Freeh or someone of that caliber of corruption.  Do not expect any charges filed, anyway.  There are rules for us and there are rules for them.

 

Sat, 01/19/2013 - 17:23 | Link to Comment nope-1004
nope-1004's picture

Tim Geithner belongs in prison.  At least Corzine paid his taxes, you fake!

 

Zero conscience.

Zero responsibility.

Zero professionalism.

Zero useful service.

100% corrupt.

100% misleading.

100% fraudster.

Shame on you, you Loser!

And this fucker will get full gov't pension?  What a farce.

 

Sat, 01/19/2013 - 17:36 | Link to Comment James_Cole
James_Cole's picture

Give it a rest. No need for a FOIA request because we all know Geithner was at his desk praying for guidance during those hours so he could continue doing God's work.   

Sat, 01/19/2013 - 17:41 | Link to Comment Careless Whisper
Careless Whisper's picture

Because we are 100% certain that if Bloomberg's Mark Pittman was still alive he would be all over this.

yeah, and if Mister Breitbart didn't step on that banana peel, he'd be all over this too.

Sat, 01/19/2013 - 22:20 | Link to Comment TheFourthStooge-ing
TheFourthStooge-ing's picture

Tyler, there appears to be a typo which could lead to some confusion. In the section The Geithner Leak it reads:

His name: Timothy Franz Geithner.

And we know this because Jeffrey Lacker knows this. From the August 17 minutes:

The minutes are from the conference call of Thursday, August 16, the evening before the Fed's Friday morning announcement. It confused me at first because, as I was reading, I was trying to keep track of the sequence of events, and this seemed to be a discontinuity. After going back and rereading, I believe the August 17 date above is a typo.

Just tryin' to help.

edit: Thanks for the quick fix.

Sat, 01/19/2013 - 22:50 | Link to Comment Harlequin001
Harlequin001's picture

Problem is that if the Fed doesn't allow them to do this then the Fed/Treasury must find the money a la TARP to prop up the banks. They can't do that, so there is no way to stop this now or it all collapses. We live in an environment now where it is not just legal but required for the banks to rip you off daily to create ever increasing 'trading profits' or they fail.

No one will stop this without some other means being in place to allow the banks to fund themselves at the public's expense being put in place first, otherwise the deficits soar beyong any recognition, because no one can, and the sums required will only grow until the thing fails under its own weight of numbers anyway.

This is the true cost of welfare people, the need for government to fund its deficits at all costs, including your liberty and your right to assets. Of course they can't lay claim to assets you own or assets owned for you in a different country, at least not without an invasion first, but then we do now have rather a lot of unemployed youths don't we, and the bill for food stamps is growing, and as we all know, there's ultimately no such thing as a free lunch...

First class effort though Tyler...

Sun, 01/20/2013 - 07:33 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

That's a sick twisted way of looking at it.

Sun, 01/20/2013 - 08:50 | Link to Comment Harlequin001
Harlequin001's picture

Alternatively I do have some rainbow dust in my pocket, but it seems a little 'contaminated' with the unicorn shit I was saving for a rainy day...

Sun, 01/20/2013 - 09:44 | Link to Comment strannick
strannick's picture

ZH is THE most significant news source in the land.

You read and watch the rest of them and you feel the worse for the experience and quesy, as though you overbought for a used car, or let yourself be suckered into eating at McDonalds.

Sun, 01/20/2013 - 10:05 | Link to Comment knukles
knukles's picture

And in other news, the National Geological Research Foundation is demanding additional funds for marijuana research.

Sun, 01/20/2013 - 10:44 | Link to Comment tbone654
tbone654's picture

didn't Martha Stewart go to jail for just slightly less than this?

Sun, 01/20/2013 - 10:13 | Link to Comment GMadScientist
GMadScientist's picture

If the banks are so "on the ropes", then what's with the mountain of reserves at the Fed?

Sat, 01/19/2013 - 22:59 | Link to Comment lewy14
lewy14's picture

[Deleted - misread some dates]

Sat, 01/19/2013 - 23:00 | Link to Comment nmewn
nmewn's picture

A greenie for honesty ;-)

Sun, 01/20/2013 - 02:21 | Link to Comment LetThemEatRand
LetThemEatRand's picture

A reddie for hypocrisy.  Remember the discussion we had about the corporate form protecting employees?  Nevermind.

Sun, 01/20/2013 - 06:41 | Link to Comment TwoShortPlanks
TwoShortPlanks's picture

Geithner will run to the BIS in Switzerland where he has complete and total immunity from all prosecution.

You people in America do know this fact...RIGHT?!

Sun, 01/20/2013 - 07:15 | Link to Comment Sambo
Sambo's picture

Untouchables they are.

Sun, 01/20/2013 - 10:07 | Link to Comment knukles
knukles's picture

Do you realize that before you can get a job with Timmah you have to french kiss him?

Sun, 01/20/2013 - 10:52 | Link to Comment New_Meat
Sun, 01/20/2013 - 10:46 | Link to Comment nmewn
nmewn's picture

"Remember the discussion we had about the corporate form protecting employees?"

I seem to recall you proclaiming yourself to be a small business owner, implying you have employees.

Did you leave that implication dangling out there to increase your "gravitas" and are, in fact, a sole proprietor? If not, you're an S-Corp.

Or is it nevermind, again?

 

Sun, 01/20/2013 - 14:38 | Link to Comment Calmyourself
Calmyourself's picture

She has employees, whom she refuses to allow a union vote as she " takes all the risk" paraphrase but accurate.  While haranguing right wingers for their lack of compassion.  Do as I say not as I do, the lefts mantra.  And by the way any wealth left to your children she would tax away as hereditary wealth is unfair, refuses to give a number as to her 100% confiscation..

Sat, 01/19/2013 - 17:39 | Link to Comment SafelyGraze
SafelyGraze's picture

"What, however, the mainstream media has not touched upon, yet, is just how profound the market response to the Geithner Leak was. "

"The media could not help itself. .. [they] envision themselves as a hard-boiled lot that warns each new crop of interns: If your mother says she loves you, get a second source. And yet little of that happened here. Instead, reporters left their skepticism at the door." - DAVID FOLKENFLIK

Sun, 01/20/2013 - 08:05 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

The media could not help itself.

 

The media has a great future in being heroin addicts.....but they'll be less believable.

Sat, 01/19/2013 - 20:40 | Link to Comment seabiscuit
seabiscuit's picture

He was just following orders.....

Sat, 01/19/2013 - 18:57 | Link to Comment Dr Benway
Dr Benway's picture

Nothing whatsoever will come of this, the criminals are immune because they control the system.

 

Also, why is everyone just focusing on Timmy here? The banksters that received the insider information and actually performed the insider trading are equally guilty. So many criminals that will never face any form of (non-street) justice.

Sat, 01/19/2013 - 19:05 | Link to Comment Cathartes Aura
Cathartes Aura's picture

choosing to jump in *under* you here sunaJ,

First of all, Tyler - thanks for the investigation.  You are what Bloomberg, NYTimes et al should be.

to echo these words, this is the ZH I most enjoy/respect, and this is my favourite "Tyler" voice, appropriately applied - the sarky, and informed voice that raises eyebrows, drops jaws. . .

that the picture chosen to represent the article is also sheer genius just adds to my kudos.  should you doubt me, gaze a few seconds at that face. . . read the full article. . . then scroll back up, and really look at him.

working. as. intended.

5*****

Sat, 01/19/2013 - 19:09 | Link to Comment palmereldritch
palmereldritch's picture

I'm thinking Timmmmay needs more fibre in his diet....wait, that'll mean more leaks

Sat, 01/19/2013 - 19:20 | Link to Comment Cathartes Aura
Cathartes Aura's picture

check yer baseboards, lil rat fink may be adding to his diet there. . .

all yer base(boards) R belong to Timmay!!

Sat, 01/19/2013 - 21:05 | Link to Comment TheFourthStooge-ing
TheFourthStooge-ing's picture

Cathartes Aura said:

check yer baseboards, lil rat fink may be adding to his diet there. . .

all yer base(boards) R belong to Timmay!!

Indeed. Your remark about the choice of photo for this article scored a bullseye. I actually did scroll back up and look at it for five seconds.

My impression? Very rodent like, and I mean as in vermin, not hamsters or guinea pigs.

Sat, 01/19/2013 - 21:50 | Link to Comment Cathartes Aura
Cathartes Aura's picture

it's sooo rodent-y, isn't it!

the angle is perfect shot just slightly from below, looking up the flared nostrils, the fake cheese-y grin. . .

the fanned lines around the eye that resemble whiskers reveal the intent of the photographer, I imagine

=^,,^=

Sat, 01/19/2013 - 19:07 | Link to Comment palmereldritch
palmereldritch's picture

 I'm sure the man leading the investigation will be Louis Freeh

Clean up on aisle Freeh!

Sat, 01/19/2013 - 20:48 | Link to Comment Stuck on Zero
Stuck on Zero's picture

Start a Whitehouse petition to arrest the bastard.  I'll sign it.

 

Sat, 01/19/2013 - 21:03 | Link to Comment Overfed
Overfed's picture

Yeah. We're going to get our faces shoved into yet another example of the rule of law only applying to the little people. Fuckers.

Sun, 01/20/2013 - 08:53 | Link to Comment BadKiTTy
BadKiTTy's picture

You know what FGB? You are spot on!! The memories I have since 2009 have predominantly been from the shocking, Matrix like, wake up call that the world I thought I lived in is not the one that actually 'IS'.  A good example for me is Armstong (he is one of many).  I had him down as a heroic character, a champion.  I admit I was taken in - fool me once!  The charade that is the theatre surrounding his 'confession' is no different than the theatre that is the political/banking crisis that we are up to are arses in.  We are led by knaves (in the archaic meaning of the word).  

Yes, only memories matter. I will work on making them happier ones.  :) 

 

Thanks 

 

K@ 

Sat, 01/19/2013 - 17:30 | Link to Comment MedTechEntrepreneur
MedTechEntrepreneur's picture

Exactly...did you catch the laugh line? "Maybe it is time not for Bloomberg, but for the DOJ to step in and request Mr. Geithner's cell phone record:"..... Hahahahahahaha  The DOJ step in?  Hahahahahha....oh my sides hurt...

Sat, 01/19/2013 - 18:25 | Link to Comment Silverhog
Silverhog's picture

Oh, you mean the "Dept. of Jokes" just what this whole administration is about. They say US Grant had a scandalous cabinet. Maybe so, but at least Grant was a true believer in America. 

Sat, 01/19/2013 - 21:15 | Link to Comment Just Ice
Just Ice's picture

What?  Expect the DOJ mob bosses to interrupt their gun and dope running plans and projects in order to look over the banks' insider theft and embezzlement of investors and other market participant's funds?

The Wall Street - Washington DC revolving door, crony fascists have become odiously corrupt.  While perhaps no longer surprising, it does not mean one should not be appalled or outraged and demand clean up of the filth.

At least there's internet free press since MSM has degenerated into propaganda arms for these same pieces of garbage that need taken out.   

Sun, 01/20/2013 - 08:40 | Link to Comment Widowmaker
Widowmaker's picture

DOJ only pursues victimless crimes against the non-violent poor.

Eric Holder is a coward, a total fucking wimp. bought and paid for.

Sat, 01/19/2013 - 19:11 | Link to Comment TWSceptic
TWSceptic's picture

+ vote the sociopaths in government and demonize the honest entrepreneurs.

Sat, 01/19/2013 - 16:28 | Link to Comment Stackers
Stackers's picture

PWND

Sat, 01/19/2013 - 16:36 | Link to Comment H E D G E H O G
H E D G E H O G's picture

I'm just very thankful that NO ZHer is advocating beating the living shit out of this fucking weasel with an aluminum baseball bat. That would be in very bad taste, and I must admit that I'm proud of my fellow blogsmen for their couthfulness.

Sat, 01/19/2013 - 16:42 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

+ 1

I feel exactly the same way.  Civilized bunch here.

Sat, 01/19/2013 - 18:16 | Link to Comment OutLookingIn
OutLookingIn's picture

Agree.

To be completely civilized,

Use an all natural, all hickory 'Louieville Slugger!'

In the words of Clint Eastwood; "Nothing like a good piece of hickory."

Sat, 01/19/2013 - 19:04 | Link to Comment Enslavethechild...
EnslavethechildrenforBen's picture

Feed him to the hogs.

Sun, 01/20/2013 - 09:01 | Link to Comment francis_sawyer
francis_sawyer's picture

Not sure if hogs eat kosher meat or not...

Sat, 01/19/2013 - 19:12 | Link to Comment knukles
knukles's picture

damn it...

Made in America all natural hickory...

Sat, 01/19/2013 - 21:08 | Link to Comment TheFourthStooge-ing
TheFourthStooge-ing's picture

Sometimes there's a lot to be said for tradition.

Sat, 01/19/2013 - 22:02 | Link to Comment infinity8
infinity8's picture

Okay so, I read the ZH piece yesterday about the leak. I was pissed off. I read this piece much earlier today and, I felt my blood pressure. Twas a beautiful day in these parts for the middle of January so I went out and about and cleared my head, so to speak. Came back here and, let me first say, I would beat that bitch with anything handy.

Second, googled and farted my way around the MSM news sites and - SURPRISE! - there is a bounty of articles inspired by the release of these transcripts. ALL of them are about how the FED just didn't see the coming crisis. NONE of them talk about this aspect. And, CNN highlights how Yellen was the only precient voice and has a companion article pimping her for the next-first "chairwoman". Fucking disgusting.

Thanks (again) Zh. (And, while I was out, I bought the latest Rolling Stone that has a long-but-good article by Tiabbi about all the LIES that are still being told about the bailouts. I'd link but I'm not a subscriber. If you buy the hard copy you get Jimmy Kimmel's butt-crack as a bonus on the cover, plumber pose).

Sat, 01/19/2013 - 22:44 | Link to Comment H E D G E H O G
H E D G E H O G's picture

go to your left and click on Jesse's Cafe American(my next fav), and you can read Tiabbi's truthfullness in full. might be archived, but it's there. also, please take your blood pressure meds before reading, or at least a couple of quaaludes & a Mickey's Malt to ease the discomfort.

Sat, 01/19/2013 - 23:08 | Link to Comment infinity8
infinity8's picture

Thanks. I don't actually have high, med-requiring BP, and don't want that. LOL on the Mickey's big-mouths - only police chase I was ever involved in was directly related to Mickey's on a Sunday. Anywho, purple diesel and scotch will get me through these days.

Sat, 01/19/2013 - 23:34 | Link to Comment H E D G E H O G
H E D G E H O G's picture

what the hell were you chasing the police on Sunday for? what's wrong with Saturdays? :)

Sat, 01/19/2013 - 23:45 | Link to Comment infinity8
infinity8's picture

Okay I just laughed out loud. Really. But, seriously - do you remember the days when cops weren't necessarily assholes and people were just trying to have fun and not kill each other?

Sat, 01/19/2013 - 23:20 | Link to Comment nmewn
nmewn's picture

+ 714

Sat, 01/19/2013 - 23:50 | Link to Comment TheFourthStooge-ing
TheFourthStooge-ing's picture

.

+ 714

RORer!

Sun, 01/20/2013 - 00:19 | Link to Comment nmewn
nmewn's picture

(For years, seconal, tuinal, valium etc)

Looking back, it was great...no need to go into the microdots, window panes, blotter & coke that I dd, I really wouldn't change a thing.

It made me what I am today, completely lucid, logical, a veritable pillar of society...ohmmmm...lol.

Or maybe, I already was from my upbringing ;-)

Sun, 01/20/2013 - 09:57 | Link to Comment sgorem
sgorem's picture

ditto here. it's part of who we are. wouldn't change anything.

Sun, 01/20/2013 - 19:44 | Link to Comment WillyGroper
WillyGroper's picture

LOL

some people showing their age here.

Sat, 01/19/2013 - 21:47 | Link to Comment scatterbrains
scatterbrains's picture

thunk thunk thunk thunk *pinkish spray everywhere*

Sun, 01/20/2013 - 10:19 | Link to Comment GMadScientist
GMadScientist's picture

Masturbation: you're doin it wrong.

Sat, 01/19/2013 - 18:40 | Link to Comment Dr Benway
Dr Benway's picture

Spear of the Nation

Sun, 01/20/2013 - 06:21 | Link to Comment hooligan2009
hooligan2009's picture

yes but..i find it extremely cathartic to imagine it happening, with sound effects

Sat, 01/19/2013 - 17:02 | Link to Comment MedTechEntrepreneur
MedTechEntrepreneur's picture

I say (in total seriousness) that we Waterboard Geithner (And Bernanke) and see how far down the Rabbit Hole goes...

Sat, 01/19/2013 - 17:19 | Link to Comment SeverinSlade
SeverinSlade's picture

It's not torture after all.  Just "enhanced interrogation."  Just as Dick Cheney.

Sun, 01/20/2013 - 06:23 | Link to Comment hooligan2009
hooligan2009's picture

need to know basis as it is a ticking time bomb

Sat, 01/19/2013 - 21:20 | Link to Comment TheFourthStooge-ing
TheFourthStooge-ing's picture

.

I say (in total seriousness) that we Waterboard Geithner (And Bernanke)

+1 That's definitely a good start.

and see how far down the Rabbit Hole goes...

Rabbit Hole? While your usage is correct, it's a bit too kind, as Ben and Timmah deserve bashing:

echo see how far down the Rabbit Hole goes | sed 's/bbi//'

(all on a single line, of course)

Just tryin' to help.

Sat, 01/19/2013 - 17:20 | Link to Comment farooq902
farooq902's picture

not surprising but he gets a 5 year window to give inside information and nothing will happen to him.

sad state when we as citizens allow all this illlegal activity to continue.

Sat, 01/19/2013 - 19:09 | Link to Comment knukles
knukles's picture

Well then why don't you just go up to the front door of his office with a flaming pitch torch, rope, tar and feathers and see how that works out for ya. 

Sat, 01/19/2013 - 21:35 | Link to Comment TheFourthStooge-ing
TheFourthStooge-ing's picture

knukles said:

Well then why don't you just go up to the front door of his office with a flaming pitch torch, rope, tar and feathers and see how that works out for ya.

The Angry Mob® Code says that if you're going to have flaming pitch torches, you should bring pichforks as well. Be advised that forged steel garden forks are acceptable substitutes and sometimes offer certain advantages. For example, should a garden fork get stuck, the handgrip at the end of the handle makes it easy to remove when placing one's foot on the thoracic cavity.

Sun, 01/20/2013 - 04:54 | Link to Comment tenpanhandle
tenpanhandle's picture

assault torches have been banned, don't you know.

Sat, 01/19/2013 - 20:47 | Link to Comment rancher from So...
rancher from South Dakota's picture

my grandpa sits inside all winter and watches fox news and he said yesterday that he wishes he was younger and that his knees and elbows still worked good ...cause hed go over to D.C. and use the ole' ought six to do some kleenin up... some of the old timers are wakin up an can't belive where we are!...he told me that it would be a suicide mission but he didn't have that long left anyway.....someones going to have to start this mess!

Sat, 01/19/2013 - 22:10 | Link to Comment willwork4food
willwork4food's picture

Yup. There's going to be a future Rosa Parks/Rodney King moment, somewhere, someplace in the US, and it will be most likely go viral on YouTube. Then all hell will break loose.

The only difference today will not be the color of your skin, but the color of your portfolio.

Sat, 01/19/2013 - 23:16 | Link to Comment rancher from So...
rancher from South Dakota's picture

when 'it' happens some of us are going to have to be ready to step up and support/defend whoever it is that starts the ball rolling......won't be easy or popular......for awhile....then the paradigms may change

Sat, 01/19/2013 - 23:32 | Link to Comment willwork4food
willwork4food's picture

It will happen, the TPTB are getting ready for it to happen & goading us.

Sat, 01/19/2013 - 22:20 | Link to Comment AllWorkedUp
AllWorkedUp's picture

Good point. It will likely have to 50-60 y/o's that get the ball rolling.

Sun, 01/20/2013 - 10:20 | Link to Comment GMadScientist
GMadScientist's picture

Forgive me for not holding my breath in the meantime; the older you are, the more of this shit is your responsibility in the first place.

Sun, 01/20/2013 - 00:29 | Link to Comment Goyim Sheep
Goyim Sheep's picture

The tribe is running the show at all levels.Jump on the train and ride it for awhile. There is nothing else you can do now, it's simply too late. Hard part is knowing exactly when to get off. Cuz if you are a few days too late your ass will be vaporized. Fun times we live in.

Sat, 01/19/2013 - 17:28 | Link to Comment dmger14
dmger14's picture

...but there's no manipulation of PM's cause they'd never do that. Cue eye roll smiley.

Sat, 01/19/2013 - 20:17 | Link to Comment zdk45
zdk45's picture

Without double checking the following numbers, they do seem to at least suggest that there were certainly extraordinary events, truly extraordinary events, taking place:

Highest volume trading day in 2007 on S & P 500: August 16th.

Number of days that had higher volume (at least in this decade) prior to August 16th, 2007: none

 

* I am trying to find the news event(s) that came out on or before the 16th that caused billions in lost capital for some, and subsequent billions upon billions to be gained by those fortunate enough to have timed things so well.  

Sun, 01/20/2013 - 09:08 | Link to Comment francis_sawyer
francis_sawyer's picture

That's EXACTLY the same date as "The FED knows NOTHING" rant [by Cramer] if my memory serves me...

Sat, 01/19/2013 - 21:06 | Link to Comment zdk45
zdk45's picture

Can't process.....August 16th, biggest trading day of year/decade.......announcement made August 17th.

No fat finger episode...I don't know, something seems off,,,I must be missing something...ahh well, back to

Cosby Show reruns....

 

Sat, 01/19/2013 - 16:13 | Link to Comment notbot
notbot's picture

It's not illegal to HAVE inside information, just illegal to TRADE on it.

Which of course they did.

Sat, 01/19/2013 - 16:29 | Link to Comment hooligan2009
hooligan2009's picture

insider information must be disclosed under fair disclosure laws at the SEC.

 

http://www.sec.gov/answers/regfd.htm

Sat, 01/19/2013 - 17:23 | Link to Comment dick cheneys ghost
dick cheneys ghost's picture

Not if one operate's the biggest PONZI known to mankind/humanity

Sat, 01/19/2013 - 23:12 | Link to Comment Orly
Orly's picture

Yeah, well you have to have a tax-stamp to sell pot in Texas.

:/

Sun, 01/20/2013 - 04:58 | Link to Comment tenpanhandle
tenpanhandle's picture

Is that you Orly?

Sun, 01/20/2013 - 06:22 | Link to Comment hooligan2009
hooligan2009's picture

you know her? :>)

Sat, 01/19/2013 - 19:12 | Link to Comment knukles
knukles's picture

It is illegal to disseminate material nonpublic inside information...

Sat, 01/19/2013 - 19:48 | Link to Comment hooligan2009
hooligan2009's picture

heh..especially if you are on the wrong side of the info...or haven't got set yet

Sun, 01/20/2013 - 10:22 | Link to Comment GMadScientist
GMadScientist's picture

It is illegal to disinform matted pubic insider insemination?

Sat, 01/19/2013 - 16:16 | Link to Comment Jake88
Jake88's picture

Statute of limitations or not. Timmy is no more likely to be prosecuted than Jon Corzine.

Sat, 01/19/2013 - 16:34 | Link to Comment Winston Churchill
Winston Churchill's picture

The Statute of Llimitations clock only starts upon discovery of the crime.

Not  the date of the offence if its hidden.

Was just checking them today,as I'm now going to sue BofA for 100k + triple damages.

Sat, 01/19/2013 - 16:59 | Link to Comment Racer
Racer's picture

So how does one go about bringing a case against lying cheating timmay? ZH? Anyone?

Sat, 01/19/2013 - 18:27 | Link to Comment Winston Churchill
Winston Churchill's picture

Depends on your state laws.Or go Federal class action.Must have suffered a provable loss .

Civil fraud,preponderance of the evidence,not beyond reasonable

doubt.A Ist year law student could win it,unless the FedRes officials have immunity,don't

see how it could being as its neither Federal or public.

Anyone actually read the amended Statute that foisted it on us ?

I know its constitutionality has never been tested,but I've never read it.

Sat, 01/19/2013 - 19:17 | Link to Comment knukles
knukles's picture

The Fed under the Patriot or NDAA (one or another, but there is one) can declare it all to be information pertaining to "national security", not divulge such and can not be held liable ....

"National Security"

(Always wanted to hear Sgt. Joe Friday tell someone it was national security and break their knees with an all natural American Made hickory Louisville Slugger...)

Sat, 01/19/2013 - 19:25 | Link to Comment Cathartes Aura
Cathartes Aura's picture

which is an excellent starting place to begin realising. . .

this is their game, you are not a player, act accordingly.

Sat, 01/19/2013 - 19:31 | Link to Comment palmereldritch
palmereldritch's picture

Puttin' the merc in mercantilist

Sun, 01/20/2013 - 00:43 | Link to Comment GNWT
GNWT's picture

One can sue the Federal Reserve, people have done it

Winning, don't know about that.

 

G

Sun, 01/20/2013 - 19:52 | Link to Comment WillyGroper
WillyGroper's picture

You could go to all of the trouble. My gut tells me that they'd get retroactive immunity just like the telco's. 

Sat, 01/19/2013 - 19:27 | Link to Comment nmewn
nmewn's picture

The law does not apply to those who make it or influence it or enforce it.

Just ask Jon Corzine, David Gregory, Justice Roberts or Big Sis.

Sun, 01/20/2013 - 00:41 | Link to Comment GNWT
GNWT's picture

Racer, 

 

I contemplated suing the Fed and major banks 

as a commodity trader class, as in anyone who 

knows what ES or NQ is, and as it turns out, 

the banks, even the Federal Reserve can be 

sued under state RICO

 

G

Sat, 01/19/2013 - 16:35 | Link to Comment Fish Gone Bad
Fish Gone Bad's picture

Corzine was on stage with Obama and Biden during their campaign 5 years ago.  Nothing will ever happen to Corzine.  Ever.

Sat, 01/19/2013 - 19:29 | Link to Comment palmereldritch
palmereldritch's picture

That's not true.  Obama's second term is pending and there are ambassadorship vacancies to be filled.

Sun, 01/20/2013 - 10:25 | Link to Comment GMadScientist
GMadScientist's picture

Send him to Benghazi!

 

Sat, 01/19/2013 - 16:57 | Link to Comment Racer
Racer's picture

Statute of limitations don't  have to apply anyway, he is so corrupt he is still lying through his teeth.

Just needs someone to actually DO something to take him to justice for even just one of his crimes

Sat, 01/19/2013 - 16:17 | Link to Comment logicalman
logicalman's picture

Time for some lamp post ornaments.

Sat, 01/19/2013 - 16:56 | Link to Comment piceridu
piceridu's picture

You're right...the Italian's knew how to take care of business...this might be too good for the lot:

http://www.custermen.com/ItalyWW2/ILDUCE/Mussolini.htm

 

Is there an Esso gas station in NY or D.C.?

 

Sat, 01/19/2013 - 23:49 | Link to Comment logically possible
logically possible's picture

@piceridu,

Thanks for sharing your fathers experience at that time in history. Great pictures.

Sun, 01/20/2013 - 00:38 | Link to Comment GNWT
GNWT's picture

nice

 

G

Sun, 01/20/2013 - 01:41 | Link to Comment willwork4food
willwork4food's picture

Thx Pi, and let's hope the same situation takes place in modern day American soon.

I would give my left nut to see a few of these political and investment frauds hung on the flag pole outside the NYSE.

Sat, 01/19/2013 - 16:18 | Link to Comment wee-weed up
wee-weed up's picture

Fuck you, Geithner!

Sat, 01/19/2013 - 16:56 | Link to Comment max2205
max2205's picture

They found the hit and run guy that crushed you but there are no cops around.   Same shit different day

Sat, 01/19/2013 - 19:36 | Link to Comment palmereldritch
palmereldritch's picture

Fucking Google bastards.  And Obama loses another supporter...

http://www.itproportal.com/2013/01/17/did-a-google-street-view-car-run-o...

Sat, 01/19/2013 - 20:55 | Link to Comment wee-weed up
wee-weed up's picture

Yeah, it's an Obama apologist lapdog, no doubt.

Sun, 01/20/2013 - 00:37 | Link to Comment GNWT
GNWT's picture

here here well said sir

 

G

Sat, 01/19/2013 - 16:22 | Link to Comment Joebloinvestor
Joebloinvestor's picture

Like I said, nothing will happen unless they connect Timmy to Steve Cohn.

Sat, 01/19/2013 - 16:23 | Link to Comment hooligan2009
hooligan2009's picture

i wonder which one had the deepest throat when engaging in the art of ....(hunts for people with initials B and J)

Sat, 01/19/2013 - 16:26 | Link to Comment Enslavethechild...
EnslavethechildrenforBen's picture

Bernanke and JoBamma

Sat, 01/19/2013 - 16:24 | Link to Comment TN Jed
TN Jed's picture

Zero Hedge, where conspiracy theory becomes collusion fact. 

Sat, 01/19/2013 - 16:24 | Link to Comment Chief_Illiniwek
Chief_Illiniwek's picture

A lot of "official" behavior is - technically - illegal.  And, therefor, what? 

The only "acts" being prosecuted on a regular basis are those which annoy the current regime.  Geithner and his kind will continue to work outside the law until held accountable by the citizens. 

And that won't happen until the citizens regain control of their country.

Sat, 01/19/2013 - 16:27 | Link to Comment Enslavethechild...
EnslavethechildrenforBen's picture

The Government never does anything illegal.

They're taking our guns away from us so that we will be free.

S/

Sat, 01/19/2013 - 16:28 | Link to Comment A Lunatic
A Lunatic's picture

First rule of Fiat Club, there ARE NO rules, bitchez............

Sat, 01/19/2013 - 21:13 | Link to Comment holdbuysell
Sat, 01/19/2013 - 16:28 | Link to Comment Cdad
Cdad's picture

Indeed, perhaps it is time for injured market participants to sue the Fed.  However, I would also suggest the obvious...it is time to End the Fed!  How much more obvious does it have to get that this is not a bank of any kind, but rather the head of the criminal syndicate known as Wall Street.

Let their be hearings now.  Let the Fed explain this stuff in a public forum on CSPAN.  Let Americans see it.  And finally...let us meet out justice to those in the Fed, and at the preferred broker dealer banks, whom have destroyed out economy with their perpetual theft.

Sat, 01/19/2013 - 16:29 | Link to Comment sgorem
sgorem's picture

shit! I thought I was on MIKE THE GLOWING FISH.COM website. sorry...........btw, Mikes going to be on Oprah next week.

Sat, 01/19/2013 - 17:00 | Link to Comment Ham-bone
Ham-bone's picture

turns out Mike is a liar and will explain to Oprah...actually a Columbia Chinook from under the Hanford site in WA state...just visiting relatives when rudely caught by Japanese fisherman...

Sat, 01/19/2013 - 16:29 | Link to Comment Al Gorerhythm
Al Gorerhythm's picture

I notice "investigative" journal...stenographers, are starting to use ZH as a source of discovery.

http://sgtreport.com/2013/01/must-watch-cnbcs-guy-adami-shares-frighteni...

These ass hats don't want to know.

Sat, 01/19/2013 - 17:16 | Link to Comment ebworthen
ebworthen's picture

They actually talked about a run on banks in the form of physical posession requests.

And...Adami said "If you own gold you want physical posession of it."

I love how SGT calls Melissa Lee the "mockingbird host".

Sat, 01/19/2013 - 17:31 | Link to Comment e_goldstein
e_goldstein's picture

Guido needs to review the first and second rules of fight club.

Good money he'll lose his first fight.

 

Sat, 01/19/2013 - 16:30 | Link to Comment bugs_
bugs_'s picture

we used to smile and joke amongst ourselves with a truism of advancement - "screw up move up".

Geithner embodies another unfortunate truism in today's America - "sell out move up"

Sat, 01/19/2013 - 16:31 | Link to Comment dick cheneys ghost
dick cheneys ghost's picture

How many lies does it take to maintain a PONZI?

Sat, 01/19/2013 - 16:36 | Link to Comment hooligan2009
hooligan2009's picture

42

Sat, 01/19/2013 - 19:20 | Link to Comment Peterus
Peterus's picture

When someone asks this question - it means that you are already 1 lie short.

Sat, 01/19/2013 - 16:35 | Link to Comment Insideher Trading
Insideher Trading's picture

Trading on material non-public informtion is THE ONLY way to trade.

Even hamsters with peanut shell sized brains like Nancy Pelosi know this.

Free Rajartnam and Rat Gupta!!!!

Sat, 01/19/2013 - 16:33 | Link to Comment doggis
doggis's picture

holy shit!   that`s IT - now i am pissed!  ENOUGH! E fucking NOUGH!

Sat, 01/19/2013 - 16:34 | Link to Comment NoDebt
NoDebt's picture

He was always referred to as "our man on the inside" by Wall St.  Now you know why.

I wish I could say I'm surprised.  I would only be surprised if it was discovered that this type of activity DIDN'T take place and it actually was just "the markets" doing their thing.

Sat, 01/19/2013 - 16:34 | Link to Comment Seasmoke
Seasmoke's picture

So now i understand why Ken Lewis was removed

Sat, 01/19/2013 - 16:35 | Link to Comment Poor Grogman
Poor Grogman's picture

They certainly took out all my stops that day.

I was on a roll too

Damn...

Sun, 01/20/2013 - 00:28 | Link to Comment GNWT
GNWT's picture

RICO

 

me too poor

Sat, 01/19/2013 - 16:36 | Link to Comment debtor of last ...
debtor of last resort's picture

It's the big monkey on top of the rock, masturbating. Don't eat what's right in front of you, lying in the sand.

Sat, 01/19/2013 - 16:37 | Link to Comment Seasmoke
Seasmoke's picture

i only like betting on the ponies, when i tell the jockeys what horse is going to win

Sat, 01/19/2013 - 16:37 | Link to Comment Dan The Man
Dan The Man's picture

I hate them all.

Sat, 01/19/2013 - 16:37 | Link to Comment LeisureSmith
LeisureSmith's picture

I'm surprised that Timmy isn't cowered in clawmarks from being attacked by various birds of pray. He really looks like one big rat.

Sat, 01/19/2013 - 16:48 | Link to Comment Tinky
Tinky's picture

If you insist on misspelling the word, at least use the correct tense: birds of prayer

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