by Jeff Nielson
11 July 2012
On the same morning we hear that
¼ of Wall Street executives think that
fraud is a necessary part of “doing business” in the financial sector,
we hear of a
second “MF Global”.
The U.S.’s so-called regulators are now
reporting that somewhere around $220 million in customer funds is “missing”
at a financial institution known as
PFGBest; once again closing the barn
door after all the cows have run off.
With at least one out of every four bankers at U.S. Big Banks (that’s how
many admitted to being crooks in the survey) thinking that stealing is part
of their job descriptions, it’s very important for people to realize how
little protection there now is between these thieves and your bank accounts.
Based on the writing of a number of other
individuals with more expertise in these markets, it is apparently an
inherently fraudulent banking process known as “rehypothecation”
which is allowing the mass-plundering of accounts at U.S. financial
institutions, with other Western financial regulatory authorities also
rubber-stamping this relatively new form of bankster crime.
Rehypothecation is a heinous practice permitted by the pretend-regulators of
Western markets, where financial institutions are allowed to pledge their
clients’ funds as collateral to cover their own gambling debts.
I say “inherently fraudulent” since few of the
clients of these financial institutions would ever knowingly enter into
contracts with these gambling-addicts where their cash could be used to
cover their bankers’ gambling debts.
Instead, what is happening here is that the rehypothecation clauses are
being buried in the “small print” of these contracts and (obviously) never
properly explained to these clients: seemingly textbook fraudulent
misrepresentation. The only “advantage” to a client into entering into such
a contract is a slight reduction in fees, or slightly improved interest rate
- certainly not near enough to entice people into risking some near-100%
loss insuring someone else’s gambling debts.
So we have our “regulators” (i.e. the only protectors of our funds in the
hands of these admitted thieves) giving these fraud-factories the green
light to enter into these inherently fraudulent contracts, putting any/all
funds of these clients in permanent jeopardy.
Thus it’s important to outline how this could
happen with ordinary bank accounts.
First it must be noted that
the Corporate Media (loyal friends of the Big
Banks) are referring to this as a “brokerage” problem. Understand that a
brokerage is nothing but a legal “bookie”, an entity which takes (and makes)
bets, and which must hold the funds of its “customers” in order to do
business. Apparently the principal difference now between a “legal” bookie
and an “illegal” bookie is that an illegal bookie is much less likely to use
his customers’ funds to cover his own bad bets.
What people must also understand is that the world’s biggest bookies,
indeed, the biggest bookies in the history of the world are the Big Banks
themselves (specifically U.S. Big Banks). Most of their gambling is done in
their own, rigged casino: the $1.5 quadrillion
Note that you won’t see that number quoted by the Corporate Media (any
As concern about the size of the bankers’
mountain of bets grew; the bankers asked the Master Bookie - the
Bank for International Settlements - to
change the “definition” of this market, and instantly the derivatives market
shrunk to 1/3rd its former size.
As many know, the BIS is known as,
“the central bank for central banks”.
What a smaller number of people know is that
this is the
world’s great money-laundering vehicle, an
entity created just before World War II specifically to allow Western
industrialists to continue to do a vast amount of business with Adolph
Hitler. In other words, it’s not exactly a reliable source for information.
So I choose to use the same numbers that the
banksters previously used themselves, before they started getting defensive
about the insane amounts of their gambling.
We are being led to believe by the Corporate Media (another unreliable
source) that this problem is only a risk for all individuals with
“brokerage” accounts, however as we piece together all the pieces of the
puzzle (already revealed) this is what we see before us:
Our banking regulators knowingly allow
financial institutions to engage in recklessly misleading (if not
outright fraudulent) contracts with their clients, through the use
of complex “small print” in their account contracts with clients.
The three largest U.S. “banks” by
deposit (JP Morgan, Bank of America, Citigroup) have made bets in
their own rigged casino, which total well in excess of $100
trillion, an amount which completely dwarfs their total, combined
deposits (and assets).
A large portion of those bets occur in
the $60+ trillion credit default swap market. Pay-outs in these
markets can (and do) exceed
300 times the amount of the
original bet. It is bets in this market
which “blew up” AIG, requiring more
than $150 billion in immediate government aid.
Following the Crash of ’08; these same
banks mooched a package of hand-outs, tax-breaks and “guarantees”
(i.e. future hand-outs) from the Bush regime in excess of $15
trillion, the last time their gambling debts went bad on them - and
all of these banks have been allowed to dramatically increase the
total amount of their gambling since then.
It would take only a minor change in the
gambling contracts in which these bankers engage to allow their
creditors to seize funds out of ordinary bank accounts.
The existing language for the bank
accounts of these U.S. banks is possibly already so vague (and
prejudicial to clients) that it would allow these banks to
reinterpret the terms of these bank accounts - and allow
rehypothecation to be used to rob the holders of ordinary bank
accounts, people who themselves make no “bets” in markets
Alternately, customers could be blitzed
with an offer for “new and improved” bank accounts, where terms
allowing rehypothecation are slipped into the contract, with the
banks knowing that the “regulators” will do nothing to warn
account-holders of the gigantic risk they are taking.
The same media apologists who would scoff at
this suggestion are the same shills who claimed,
“there could never be another MF Global”.
Meanwhile we have the biggest gambler of them
all, JP Morgan, just confessing to having made
more of these bad bets - which continue
growing larger by the $billion.
When we add-in the fact that the U.S.’s
mark-to-fraud accounting rules mean that
these banks are easily able to hide the level of their insolvency, the
pretend-regulators apparently don’t have the slightest idea of the level of
risk to which account-holders are being exposed. This is the charitable
explanation for these facts. The alternative interpretation is that these
“regulators” are direct accomplices of the criminal banking cabal.
I have consistently referred to the U.S. financial sector as a “crime
syndicate” for several years now, often drawing considerable
criticism for supposedly hyperbolic rhetoric. Obviously I have been
completely vindicated here.
One quarter of these bankers are now
The pretend-regulators (notably the SEC and CFTC)
on a daily basis rubber-stamp the banksters’ acts of fraud (where they are
caught red-handed) - handing out totally trivial fines, and not even
requiring these thieves to admit their guilt.
If there are any substantive differences between how the U.S. financial
sector is allowed to operate versus any generic definition of a “crime
syndicate”, it would be enlightening to hear what those (supposed)
differences are. And now these thieves are closer than ever to simply
reaching into peoples’ bank accounts and grabbing every dollar they can
The principal reason why I and others have urged people to convert their
gold and silver in the past was the 1,000
year track-record of these bankers’ paper, fiat currencies always going to
zero (through the bankers recklessly diluting these currencies via
over-printing). However, we can add to that a much more basic reason: every
ounce of gold and silver which you purchase (and store in your own home
“safe” or other secure location) is wealth which cannot be stolen by the
banking crime syndicate.
This is what commentators are really referring
to when they speak of “counterparty risk”: placing your future financial
security in someone else’s hands.
What the large financial institutions of the 21st century have taught us
(through the cruel “lessons” of their serial crimes) is that there is no one
in the world whom you can trust less with your money than a banker.