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Wall Street Coup D’état

By: Ceri Shepherd, Trend Investor

-- Posted Monday, 15 December 2008 | Digg This ArticleDigg It! | Source:

The Bailouts now stand at $8.5 trillion Dollars and the vast majority of this money has been stolen by the Wall Street insiders, as I will now demonstrate beyond any reasonable doubt.


The Bailout money will be financed in three ways


1. More taxation.


2. Sale of new debt, to be added to the existing $10.6 trillion Dollars of debt.


3. The money will simply be printed therefore devaluing the purchasing power of all your existing Dollars.


So you will be taxed more, and you will have to suffer poorer government services. As far more of the government’s income via taxation is used to pay the interest on all the existing and new debt, and finally your Dollars will buy a lot less.


That is the future, and it is the future because the vast majority of the $8.5 trillion Dollars of bailout money has simply been stolen.


We were originally told that the whole problem was a sub prime mortgage problem. Unfortunately this is a LIE. The amount of all sub prime mortgages in America is $1.3 trillion Dollars. But the bailouts are already $8.5 trillion Dollars and growing daily. Why do you need $8.5 trillion to fix a $1.3 trillion problem? And that’s assuming that everybody with a sub prime mortgage goes into foreclosure and that the foreclosure sale proceeds are precisely zero, not exactly a likely outcome.


So lets look at it another way the total value of all residential mortgages in the USA prime, ALT A , and Subprime as of August 2008 according to the Federal Reserve is $10.6 trillion Dollars THAT IS EVERY MORTGAGE IN AMERICA. According to the Mortgage Bankers Association at this same time 9.2% of all mortgages were either delinquent or in foreclosure. So let’s assume that 100% of all these mortgages eventually go into foreclosure and that at auction the total proceeds for the foreclosure sales are zero. I am sure you will agree this is once again a highly unlikely outcome!


$10.6 trillion X 9.2% = $975 Billion Dollars


So a total of $975 Billlion Dollars would be required as an absolute maximum to bail out every single foreclosed mortgage in AmericaSo why do we have an $8.5 trillion Dollar solution to solve a $975 Billion Dollar problem?


If you buy a futures contract you can either buy it LONG or SHORT. If you are LONG you believe that the price of the underlying asset will rise, if you are SHORT you feel that it will fall. It is a zero sum game somebody wins and somebody loses. If the winner wins $1000 then he takes this $1000 from the loser. The amount of contracts outstanding or open interest is always in balance. All transactions and trades take place within a regulated and transparent exchange.


OTC derivative contracts are basically the same as regulated futures contracts. They are also zero sum, BUT they do not take place within an exchange. So they are not regulated and they are not transparent. What has happened is that a band of insiders have taken such huge OTC derivative bets that they have been able to push the markets, so that many of these OTC derivative contracts have triggered. Because the amount of leverage used or the notional value of these contracts is so high it takes very little movement for the outsiders to become insolvent, it is leverage gone mad. The Insiders knew that this would happen, but they also knew that the Government would not allow this corrupt system to fail.


Hence the $8.5 trillion Dollars of bailouts, this money is simply being transferred or funnelled from the taxpayers to a select band of Wall Street insiders. Remember it is a zero sum game the outsiders Bear Stearns, Wachovia, Citigroup LOST but somebody gained an equivalent amount. As Gordon Gecko stated in the film Wall Street.


“Money is not lost that’s the illusion, it is simply transferred”


The Politicians and media go on, and on, about how this is necessary to save the system, too big to fail, etc, etc. It is all rubbish they are nothing more than paid salesman for the bankers, it is a Government of the few and only for the few. The banks had huge unregulated bets amongst themselves and all kept in secret, the outsiders inevitably lost, and your money is now being funnelled directly to the bet winners. It is theft pure and simple. If you take a bet with somebody and you win BUT the loser cannot pay then that bet is worthless, and it dies. Why should American taxpayers pay for these failed bets? Surely the insiders had completed their “due diligence” on the counterparty risk? The reality was that they had not because they knew they would win, and they also knew that the government would pay the winnings via the taxpayer.


What people cannot accept is that America is in no way, shape, or form a democracy, and neither is any other western country. The politicians are bought and paid for, as are the media. With the Mcain Vs Obama election you had a simple choice you were voting for the bankers man or the bankers other man, the outcome will be the same it always will be in a bank oligarchy. .

You think I maybe wrong? Then I leave you with a very sobering thought.


$8.5 Trillion Dollars would buy exactly 80% of all the mortgages outstanding in America. So imagine for the same money that your government or is it the bankers government? have already given to the bankers they could have instead sent you a cheque for 80% of your outstanding mortgage, that would be some Christmas present. Instead they decided to send all of this money, YOUR MONEY to a select band of Wall Street insiders.


If your mortgage was now 80% paid off, would it not provide quite a “stimulus” for the real economy? And it would not cost $1 more than what they have already committed to the bankers.


It is an $8.5 Trillion Dollar and growing daily, solution to a $975 Billion Dollar problem. The surplus has simply been “transferred”. It begs the question, why are the Government paying off the gambling bets of Wall Street? These bets had no purpose, they added no value, and provided no jobs they were simply symptomatic of the unregulated and opaque casino that wall street has unfortunately become. This again is a matter of deliberate policy otherwise the thieves will be identified. Let them fail, if 80% of all the outstanding mortgages were paid, we would not need much of a credit or finance industry. New start banks and foreign banks could easily provide this facility.


So I leave you with one thought this Christmas. The bailouts if redirected could pay 80% of every mortgage in America INCLUDING YOURS.


Ironic that a few bankers have engineered the biggest robbery in history.

-- Posted Monday, 15 December 2008 | Digg This Article | Source:

Ceri Shepherd


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