Archive for December, 2014

How Wall Street Wins Its No-Lose Trades

8 | By Shah Gilani

The madness of the manipulation machinery on Wall Street knows no bounds.

Remember credit default swaps (CDS)? They’re the risky financial derivatives traded among Federal Deposit Insurance Corp. (FDIC)-insured banks that, during the 2007-’08 financial crisis, took down Lehman Bros. and almost bankrupted giant insurer AIG Inc. (NYSE: AIG).

Well, they never went away. And now they’re making a comeback, and Wall Street is using them in ever more maniacal ways.

They’re back partly because the recently passed federal spending bill reversed a Dodd-Frank rule that said big gambling banks had to separate CDS into units not guaranteed by the FDIC (aka taxpayers).

While I may come back to that, I’m not writing about Congress‘ latest gift to Wall Street today.

Today, I’m going to show you how Wall Street manipulators are using CDS and a false front of “activism” to make huge profits from troubled companies – and why that’s becoming routine.

What’s Really Going on Inside the Latest GDP Number

14 | By Shah Gilani

Sit down before you read this.

It’s going to make your head spin and, worse, change the way you think about what’s real in America.

Christmas came early this year, for the market that is, by way of a gift from the U.S. Bureau of Economic Analysis.

However, this branch of the U.S. Department of Commerce, didn’t put its gift under anybody’s tree. They put it over all of us.

The gift was headline news that the “third revision” of third-quarter gross domestic product (GDP) showed the U.S. economy grew at a whopping 5% annualized rate, not the 3.9% rate posted in the “second revision.”

That sounds like good news, right?

Well, here’s what’s scary…

How Goldman and D.C. Hosed AIG – and the Taxpayers

11 | By Shah Gilani

The truth about crony capitalism, at the highest level, is being laid bare right before our eyes.

I’m talking here about Goldman Sachs Group Inc. (NYSE: GS) as the husband of global investment banking prowess with the U.S. government as its mistress puppet.

Maybe there is hope that the Goldman Government can be brought down.

Okay, I was pushing it there. That’s not going to happen in this century.

But here’s what is happening…

Wall Street’s Big Boys Bulldoze Through the Spending Bill They Want

6 | By Shah Gilani

We’ve got a spending bill, folks!

The government of the United States will remain open for business thanks to the usual suspects in Congress being open to being bought.

Sometimes it only takes a few phone calls from a deep-pocketed giant bank CEO to remind legislators who butters their bread.

According to Sunday’s Financial Times, bread-butterer par excellence Jamie Dimon, chairman and CEO of mega-fat JPMorgan Chase & Co. (NYSE: JPM), worked the phones hard last week. He called on his legion of congressional peeps and perps to pass the $1.1 trillion spending bill as written.

Why did this patriot risk getting calluses on his fingertips for some pipsqueak legislation?

Read on and I’ll tell you what I think – and I’ll show you what it means for all of us going forward…

How Wall Street “Jihadists” Are Engineering a Government Shutdown

18 | By Shah Gilani

WASHINGTON, D.C. – A tense battle between warring political parties erupted in Washington yesterday when Wall Street-backed Jihadist demands surfaced in the 1,600-page omnibus spending bill – threatening to first take the U.S. House of Representatives hostage, then all of America.

Intelligence services (obviously not Washington-based) initially identified the financial terrorists as Beltway lobbyists, but later revealed them to be a Big-Bank sleeper cell embedded in God-hating Dodd-Frank legislation, universally decried by the faithful as blasphemous.

In what was meant to be a stealth operation, the plastique-laden provision inserted into the bill aiming to roll-back certain Dodd-Frank rules, instead exploded prematurely.

And it shows us how financial terrorism continues to escalate…

Yet Another Washington “Watchdog” Is Nothing But a Beltway Pussycat

9 | By Shah Gilani

In Monday’s Wall Street Insights and Indictments column What Happens When There’s Nowhere Left to Run,” I detailed the dangers posed by the scary move the U.S. Treasury bond market made back on Oct. 15.

My cautionary tale was totally justified.

Indeed, in yesterday’s Wall Street Journal, the lead article in the Global Finance portion of the “Money & Investing” section was “Watchdog Warns of Risk in Markets.”

Apparently the Office of Financial Research, the watchdog team created out of Dodd-Frank legislation under the “watchful” eye of the U.S. Treasury Department, observed the same move that I did – and found it just as rattling.

According to The Journal, the OFR warned that “the system is vulnerable to repeats of what occurred in October when tumult in the trading of U.S. Treasury securities spread broadly to futures, swaps and options markets.”

The watchdog group’s just-released third annual report soberly noted that “although the dislocation that peaked in mid-October was fleeting, we believe there is a risk of a repeat occurrence,” and further warned that resulting volatility “raises a host of financial stability questions.”

That’s not what you want to hear. Let me tell you why…