Transparency

When it comes to corruption, cronyism and general muppetry in Washington D.C., the only real question is 'where does one start?' Yet one has to start somewhere to conclude with a list of the ten most corrupt and despicable marionettes in D.C. Which is precisely what JudicialWatch has done in its annual compilation of the "Top 10 Most Corrupt Politicians in Washington D.C." for 2011. And confirming what everyone knows, that both the left and right are merely irrelevant names for the same general social affliction, or should we call it by its true name - wealth pillage - the split is even between democrats and republicans. In no particular order, the winners of 2011 are...

For the first time since 1949, when the Communist Party took power, China will open the regional authority debt markets (muni markets) to the public. Much is being made of the fact that this first issuance - for Shanghai no less - enabled it to dramatically cut its interest expense - as investors were clearly comforted by the increasingly transparent documentation. However, we worry that that this will cause a multi-tier market to evolve very rapidly between the haves and have-nots as we suspect the more than 6000 companies set up by local governments will bifurcate just as the Chinese IPO market did in the US. Color us even more skeptical but when we read the Wall Street Journal's story on Wenzhou's Annus Horribilis this evening, even vibrant thriving (over-stretched and over-levered) city-states are feeling the recoupling pain of a European recession, US residential construction depression, and European bank deleveraging impacting credit conditions in Asia. The bottom-line is more openness is better, more transparency is better, and meeting the demands of yield hungry money managers is reasonable but we hope they go in with eyes wide open as we suspect this move is much more about $1.7tn risk transfer from the public central planner's balance sheet and on to the private capital markets of the world.

The name Judd Gregg is not new to Zero Hedge readers. Back in the 2009-2010 battle for Fed transparency, which continues to be only fractionally on the way to being won, Gregg, who then served as the top Republican on the Budget Committee and a member of the Banking Committee, said that "opponents of Federal Reserve Chairman Ben Bernanke's second term are
guilty of "pandering populism"." Odd that these populism panderers, of which Zero Hedge was a proud member, ultimately succeeded in not only getting a one time Fed audit, but also won the legal case initiated by Mark Pittman to expose the Fed's dirty laundry, without which we would not know that not only did the Fed bail out primarily foreign investment banks during the financial crisis, but also that the biggest user of the Fed's somewhat secret Short Term Open Market Operations facility, also known as a 0.01% subsidy, was none other than Goldman Sachs, contrary to the firm's sworn statements that it did not really need bailing out. Gregg continued: "There's a lot of populism going on in this country right now, and I'm tired of it." Gregg warned that the growing tide of populism would threaten some of the most central institutions to the economy's recovery. "What it's going to do is burn down some of the institutions which are critical to us as a nation and as an economy to recover and create jobs," he warned." It was therefore only a matter of time that Gregg, following the end of his political career, has decided to step down, and work for one of these "central institutions to the economy's recovery" - Goldman Sachs. As such we present the list of companies that courtesy of their "top contributor" status with the senator over the years, are about to get preferential treatment from Goldman's sell side analysts, and see a prompt upgrade to Buy and/or Conviction Buy list in the near term. After all there is no such thing as squid-pro-zero in a world controlled by Wall Street's institutions "central to the economy's recovery."

SigTarp Neil Barofsky has just released the most scathing critique of all the idiots in the administration, with a particular soft spot for Tim Geithner. If after all this disclosure Geithner does not resign, well, America truly will have the Treasury Secretary, not to mention administration, it deserves.

Just because being the most corrupt organization in the world was not enough, the SEC decided, courtesy of Donk (aka Frankendodd), that it is beyond accountability to anyone, even the constitution, after it was recently made public that the world's most incompetent and bribed regulators will continue watching kiddie porn, instead of regulatoring, only do so in complete opacity from now on, as in the future the SEC would be exempt from FOIA responses. And with retail investors saying "no more" to trading stocks in a rigged casino that shares the same level of integrity as its regulator, and is programmed to generate profits for the house and the computers on 99.9% of trades (except of course for those newsletter and subscription peddlers who catch every single inflection point ever, and can predict what the market will do not only tomorrow but a week, a month and a year from now) the market will soon be a ghost town. Recent attempts by Senator Kaufman to bring some honesty to stocks have so far been met with failure as theSisyphean task is far too great for any one individual. Which is why we are glad to learn that Ron Paul has joined those few who still hold the long-forgotten dream that the market should be fair and impartial for all (and yes, that means eliminating discount window access for the chosen few Bank Holding Company hedge funds out there) and has introduced the SEC Transparency Act of 2010 (HR 5970), a bill designed to force greater transparency in the Securities and Exchange Commission. Little by little, every single "intervention" by the world's two most corruptpoliticians is being overturned: first the rating agency accountability provision which nearly destroyed the shadow market with a complete lockup of all new ABS issuance, and now the SEC's exclusion from that simple concept known as "checks and balances." Soon FinReg will finally be exposed for the fraud it has been since its inception - the much touted Obama financial regulatory reform is nothing but a scam designed to allow Wall Street to steel what middle class wealth remains faster, bolder and in ever greater amounts, as the point where the system breaks is now months away, and the Wall Street-DC joint venture is all too aware. As a result all must be done to allow theft to be bigger than ever, all the while the "regulator" is no longer held responsible for looking the other way.

Enough with the Federal Reserve mafia syndicate and its endless array of bailouts, under the table deals, cronyism, politicized monetary decisions, and rampant theft of America's wealth already. We endorse the Sanders-Feingold-DeMint-Leahy-McCain-Vitter-Brownback Federal Reserve Transparency Amendment to the Financial Reform Bill. If the Fed's clowns won't end their endless rape of America, it should at least be fully transparent for all to see.

In this oldie but a goodie, Ron Paul hammers home the point of why the Federal Reserve needs to finally be accountable and transparent, despite the desires of Barney Frank, Wall Street, Ben Bernanke and all the current failed system's apparatchicks who will stop at nothing to perpetuate the broken status quo. For regular readers none of this should be news. For everyone else, this 1 hour program is a must watch. Clip courtesy of Fora TV and the Cato Institute.

With the media finally waking up to the risk of recurring "systemic threats", aka Goldman not paying $20 billion in bonuses, courtesy of finding out just how much shit is really held by the Fed's discount window, everyone is suddenly interested in hearing it direct from the man at Ground Zero - Ron Paul... Even Steve Liesman, who no matter how hard he tries to spin "Audit the Fed" into "Control the Fed" will fail miserably every time he is not stuck in a patented blathering, factless monologue mode.

After the historic defeat of Fed anti-transparency amendments, and the most recent disclosure that despite all his posturing Barney Frank is, as expected, deep in the pockets of the Wall Street and Fed kleptocracy, here are some post-mortem observations from Grayson, Spitzer and Ratigan.

"The now familiar argument from Government officials about the dire consequences of basic transparency, as advocated by the Federal Reserve in connection with Maiden Lane III once again simply does not withstand scrutiny. Federal Reserve officials initially refused to disclose the identities of the counterparties or the details of the payments, warning that disclosure of the names would undermine AIG's stability, the privacy and business interests of the counterparties, and the stability of the markets. After public and Congressional pressure, AIG disclosed the identities. Notwithstanding the Federal Reserve warnings, the sky did not fall; there is no indication that AIG's disclosure undermined the stability of AIG or the market or damaged legitimate interested of the counterparties. The lesson that should be learned - one that has been made apparent time after time in the Government's response to the financial crisis - is that the default position, whenever Government funds are deployed in a crisis to support markets or institutions, should be that the public is entitled to know what is being done with Government funds. While SIGTARP acknowledges that there might be circumstances in which the public's right to know what its Government is doing should be circumscribed, those instances should be very few and very far between."

- Neil Barofsky

Chief executive officer and president of the Federal Reserve Bank of New York (and ex-Goldmanite), William Dudley, delivered a speech this afternoon that contains, with supreme gall and irony, a subsection called “Transparency.” The title of the speech was thoughtfully crafted to allow a redirect. So here we go…

The gig may be up for what was to many a sure thing. Cover a position. Get a few extra points, do a favor and make a deal. The once very lucrative area and niche player known as Securities Lending may be changed forever.

The rules of the game have changed. After the disaster of 2008, pension funds will be scrutinizing their investments a lot more carefully, especially their investments in alternatives like hedge funds, private equity, real estate and commodity funds. Those funds who refuse to adapt will find it extremely difficult to raise the money they need to compete.

P&I's article “Renaissance to open up a bit”, discusses the firm’s quest for institutional money and reads very much like a marketing piece. Yes, RIEF performance this year is just awful and assets have “plummeted 81% to $5 billion as of June 30, down from a peak of $27 billion” but, after "massaging" these numbers, P&I was able to find something positive.

With the IMF bailing out every failed European country (click the link for a useful map), it has now set a useful precedent of how to obtain full clarity into the operations of Central Banks of "organization wards." Latvia's most recent near death experience has translated into a requirement by the country to provide the IMF with daily data on virtually every action that the country's central bankers perform. Since the US, absent Bernanke's printing press, would be in far more dire financial shape than even the small Baltic country, could Congressmen pass a vote to shut down the press, and have the IMF bail out Bernanke as well, thus forcing him to provide the same kind of disclosure that every "developing country" is now forced to give to its bankster overlords?