Profiteer: one who makes what is considered an unreasonable profit especially on the sale of essential goods during times of emergency.
Global Oil Scam: 50 Times Bigger than Madoff
Where is the outrage? Where are the investigations?
Goldman Sachs (GS), Morgan Stanley (MS), BP (BP), Total (TOT), Shell (RDS.A), Deutsche Bank (DB) and Societe Generale (SCGLY.PK) founded the Intercontinental Exchange (ICE) in 2000. ICE is an online commodities and futures marketplace. It is outside the US and operates free from the constraints of US laws. The exchange was set up to facilitate “dark pool” trading in the commodities markets. Billions of dollars are being placed on oil futures contracts at the ICE and the beauty of this scam is that they NEVER take delivery, per se. They just ratchet up the price with leveraged speculation using your TARP money. This year alone they ratcheted up the global cost of oil from $40 to $80 per barrel. Seeking Alpha 11/09/2009
Bank Profits from Accounting Rules Masking Looming Loan Losses “Citigroup’s $1.6 billion in first-quarter profit would vanish if accounting were more stringent, says Martin Weiss of Weiss Research Inc. in Jupiter, Florida. “The big banks’ profits were totally bogus,” says Weiss, whose 38-year-old firm rates financial companies. “The new accounting rules, the stress tests: They’re all part of a major effort to put lipstick on a pig.” Bloomberg 6/05/09
CDS: Was it good for you, too? “The CDS market is also complicating restructuring of distressed loans, as all lenders don’t have the same interest in ensuring the survival of the firm. Different legal forms of economically similar actions can lead to entirely different outcomes under the CDS contract, complicating significantly the effects of the contract and its efficacy as a hedge.” Minyanville 3/16/09
What Cooked the World’s Economy? It wasn’t your overdue mortgage. “But Congress loved Greenspan—a/k/a “the Maestro” and “the Oracle”—and Clinton loved Rubin. The sleepy hearings received almost no public attention. The upshot was that Congress removed oversight of derivatives from the CFTC and preempted all state anti-bucket-shop laws. Born resigned shortly afterward. Soon, something odd started to happen. Legitimate big investors, often with millions of dollars to place, found that they couldn’t get into certain hedge funds, despite the fact that they were willing to pay steep fees. In retrospect, it seems as if these funds did not want fussy outsiders looking into what they were doing with derivatives.” The Village Voice 1/28/09
The Great American Ponzi Scheme: Part I “The banks had a double Ponzi scheme going. They didn’t care if the people paid or not because they sold the mortgage notes to other investors almost before the ink dried. That gave them the money to loan out to a new crop of mortgage seekers, and they just kept piling it higher and higher.” ManagingMoney.Com 12/24/08
How’d We Get Into This Mess? “I can trace the evolution of this greed, during my lifetime, back to a fateful day on May 1, 1975 – a day known as “May Day.” Until that day, stockbrokers charged a fixed commission on all transactions; there was no negotiation. In order to promote competition, the SEC ended the fixed schedule commissions, which had been in place since the signing of the Buttonwood Agreement in 1792 and the origins of the New York Stock Exchange. It is believed that over the next few weeks, commission rates dropped in half… So rather than charge commissions on individual securities, portfolios were concocted to diversify their client’s portfolios and still be able to charge fees as high as 3% per year.” Seeking Alpha 10/15/08
AIG Executives Blow $440,000 After Getting Bailout “If you’d just gotten a government bailout, you might be tempted to hold a retreat at a nice California hotel — and that’s exactly what American International Group (AIG: 2.39, -0.80, -25.07%) employees did.” Fox Business 10/7/08
FBI Investigating Companies at Heart of Meltdown
FBI Probing Fannie, Freddie, AIG, Lehman in Subprime Collapse – “Those companies are among 26 being reviewed by the Federal Bureau of Investigation for possible accounting misstatements, said the official, who asked to remain unidentified. The FBI has come under pressure to hold companies responsible as the loan crisis rocked Wall Street and led to the biggest housing slump since the Depression. Financial companies worldwide have reported more than $500 billion in losses and writedowns stemming from the subprime collapse. ” Bloomberg 9/24/08
Big Financiers Start Lobbying for Wider Aid – “Even as policy makers worked on details of a $700 billion bailout of the financial industry, Wall Street began looking for ways to profit from it. Financial firms were lobbying to have all manner of troubled investments covered, not just those related to mortgages. At the same time, investment firms were jockeying to oversee all the assets that Treasury plans to take off the books of financial institutions, a role that could earn them hundreds of millions of dollars a year in fees. Nobody wants to be left out of Treasury’s proposal to buy up bad assets of financial institutions.” NY Times 9/21/08
Privatize Profit, Socialize Loss: Commentary On The Proposed Wall Street Bailout – “Justin Quinn pointed me to this soundbite from former Rep. Newt Gingrich, echoing my headline: “You can’t be for capitalism on the way up and socialism on the way down, and you can’t be for a welfare state for the rich.” About.com: US Politics 9/22/08
Tax the Speculators – “When a CEO or employee improperly takes money from a company and is forced to pay it back, it is colorfully referred to as “disgorgement.” In 1999, managers of Compaq Computer cooked the books and gorged on bonuses based on misrepresented profits. The government forced them to pay it back.” The Nation 9/19/08
What will Candidates Say on Pay? – “Now more fodder: Taxpayers subsidize executive compensation to the tune of more than $20 billion a year, argues a report due out today from the Institute for Policy Studies and United for a Fair Economy. – Business Week 8/24/08
FinancialEndTimes.com 