Monday, August 22, 2011

The Devil Is In The Details...Speaking Of The Devil (per my earlier post)

"Nobody lawyers up like this unless they are in deep shit" - my anonymous Wall Street source

There's no honor among thieves and when rats are trapped in the corner, they fight back.  Lloyd Blankfein just removed from "services available" one of the best DC-insider-connected defense attorneys, indicating some real shit could be hitting the fan at Goldman Sachs.  This particular lawyer - who must be a serious piece of work if he's willing to prostitute his services defending servants of the devil - worked out deals for some real beauts:  Bernie Ebbers of WorldCom, Enron's chief accountant and Roman Polanski. The speculation ranges from Justice Department inquiries into Goldman's highly fraudulent role in the mortgage market meltdown to likelihood that Blankfein and Goldman are both under heavy legal siege on both the civil and criminal fronts.  Goldman stock plunged another 2.5% after the close, when that news report was released (conveniently) and is down roughly 40% year-to-date.

Not only that, but an analyst report on Bank of America was circulated today that speculated that BAC needs to raise $40-50 billion in capital to remain solvent.  If that report has merit, it will be interesting to see how BAC pulls that off because it's current market cap is around $65 billion.  Short of Obama borrowing from Michelle's travel fund and using Taxpayer largess to fund BAC, I don't see smart money lending that kind of jake to BAC unless it were on a "super" senior secured DIP basis - Debtor-In-Possession bankruptcy financing.

The above two events are marquee indicators of the disaster coming our way from the financial system...


  1. Did you hear maria after 4pm?...she was trying to sell jeans on the air...

    The Times' Andrew Ross Sorkin Gives Goldman a Rubdown
    Now I’m bummed to see that Sorkin has written an elaborate defense of
    Goldman in the New York Times "Dealbook" section, arguing among other
    things that Lloyd Blankfein probably did not commit perjury and that
    the bank did not have a huge directional bet against mortgages in
    2007. As evidence, Sorkin cites unsubstantiated Goldman documents and
    Goldman sources who claim, among other things, that the bank had $5
    billion worth of long bets on MBS "in other parts of the company,"
    offsetting the now-notorious "Big Short."

    The Sorkin piece reads like it was written by the bank's marketing
    department, which may not be an accident.

    But now? This looks like a joke. In Russia in the Yeltsin years,
    reporters had a term for selling editorial print content to mobsters.
    They called it "selling jeans," a play on the old Soviet-era
    black-marketeer practice of trading rabbit hats to tourists for their
    Levi's. This Sorkin piece has the unmistakable look of a brand-new set
    of 501s to me. Pieces like this undermine the great work that
    reporters like Gretchen Morgenson have done in the paper in recent

    At the very least, Dealbook, if it was determined to take startup
    money from Goldman, should have stayed agnostic about the great
    scandals swarming round the company for a good long while.

  2. (Dave)

    I know for a fact Maria is or used to be a huge coke-head. She's a lot more fat than brains.

    All the big Wall Street banks are guilty of fraud with mortgages and derivatives and Goldman is probably the most guilty. It's picture-perfect that Obama has a lot of ex-Goldman people in his Administration and acting as one of his "advisors." It's also no coincidence whatsoever that Henry Paulson was put in as Secy of Treasury for the first collapse and it's no coincidence that an ex-Goldman guy heads the CFTC. And it's no coincidence that Robert Rubin's butt-boy, Geithner, is current Sec'y of Treasury. Obama is more of dirty little puppet than W was.

  3. hmmm...maybe the geniuses lose their genius if they can't track positioning?

    Rickards - Chavez’s Gold Leased to JP Morgan, Barclays, HSBC?

    Taking that altogether, what does it all mean? Well, the reserve part of it, moving the dollars out of BIS and moving it into Russian and Chinese banks tells me that he’s worried about a freeze. He’s worried about some kind of confrontation with the United States number one, but he’s probably worried the dollar itself.

    Meaning, once he gets the dollars into Russian banks, he can then tell the Russian banks, his new custodians, ‘I want you to sell the dollars, buy the euro, buy more gold, buy Chinese yuan. But it’s a way for him to diversify in ways that are not very easy to track.

    Right now if he is doing it in BIS, the Fed is going to know and other people are going to know, but if he’s doing it through a Russian bank and Russia is sort of fronting for Venezuela, you’re not going to know who’s behind it. So it’s a way to first of all get out of the US system so he’s not subject to a freeze, number two get out of the dollar so he is not subject to a dollar collapse.,_Barclays,_HSBC.html

  4. why own gold?!

    I don't trust anyone!

    forget inflation/ is the anti-fraud trade.

  5. nice hit job in gold...remember why you bought it...ANTI FRAUD TRADE...and the fraud run'eth over..refresh your memory!


    Covering Up Wall Street Crimes: Matt Taibbi Exposes How SEC Shredded Thousands of Investigations
    An explosive new report in Rolling Stone magazine exposes how the U.S. Securities and Exchange Commission destroyed records of thousands of investigations, whitewashing the files of some of the nation’s largest banks and hedge funds, including AIG, Wells Fargo, Lehman Brothers, Goldman Sachs, Bank of America and top Wall Street broker Bernard Madoff. Last week, Republican Sen. Chuck Grassley of Iowa said an agency whistleblower had sent him a letter detailing the unlawful destruction of records detailing more than 9,000 information investigations. We speak with Matt Taibbi, the political reporter for Rolling Stone magazine who broke this story in his latest article, "Is the SEC Covering Up Wall Street Crimes?"

  6. Marc Faber Explains How Even The "Greatest Bear On Earth" Gets It Wrong

    "To some extent we are in midst of QE3 already, because by announcing the Fed will keep zero interest rates until the middle of 2013, they basically encourage financial institutions to borrow short-term and to buy 10-year Treasuries" on a contrarian outlook on stocks: "I am the greatest bear on earth, but if you compare Treasury bond yields and equities, equities look reasonably attractive", on why Insider "buying" just as we have said repeatedly, is far too much ado about nothing: "Compared to all the selling in the last six months the buying is relatively muted" and lastly, like a gracious loser, Faber admits he was wrong and Rosenberg was right "David Rosenberg was right and I was wrong. The 30-Year has not made a new low. The low in December 2008 was 2.53%. Now we're around 3.4%"... although with a caveat: "Basically we have an artificial market."

  7. They Still Don't Get It

    By Eliot Spitzer, Slate Magazine

    22 August 11

    Some people on Wall Street, and at the Wall Street Journal, speak as if the financial crisis never happened.

    At stake is much more than the particular cases at issue. By trying to rewrite the narrative of the economic cataclysm we have lived through, the deniers are attempting to challenge the common-sense conclusions that flow from an accurate understanding of history. They are desperately trying to protect a particularly rabid, and ultimately damaging, anti-regulatory philosophy that has dominated the past 30 years. They are trying to protect a broken and misguided understanding of how markets really function, a view now openly rejected even by such staunch free-market advocates as Judge Richard Posner and former Fed Chairman Alan Greenspan. Acknowledging the propriety of any government prosecutions of corporate wrongdoing would make impossible their current effort to push back against even the government's minimal responses to the financial crisis.

  8. Could Blankfein Face Prison?
    Aug 23, 2011 12:34 AM EDT
    The Goldman Sachs CEO didn’t get a big-time criminal-defense lawyer because he’s worried about an SEC wrist slap—there’s a real possibility of doing time, says former Goldman managing director Nomi Prins.

  9. Forward to friends and family...

    Harry Markopolos

    The whistleblower whose book on the Bernie Madoff scheme, No One Would Listen, is the basis for the new film Chasing Madoff, discusses his 10-year journey and explains why the fraud was obvious to anybody who cared to look.

    For years, Harry Markopolos tried to tip off the U.S. Securities and Exchange Commission to what turned out to be the largest Ponzi scheme of all time. The former securities industry exec turned independent financial fraud investigator was working for a Boston investment firm, when he discovered Bernie Madoff’s house of cards and gives an account of the scandal in the new book No One Would Listen. Markopolos has a master’s degree in finance from Boston College and is past president of Boston Security Analysts Society, Inc.

  10. Satan meet Lucifer...

    Rothschild Is Now In TBTF Plunge Protection Business

    Following the already failed attempt by captured pan-European regulators to stop the local bank Friend-o treatment by instituting a short-selling ban, whose effectiveness as we pointed out lasted, oh, about 7 days, we find just what Plan B is. And, yes, Rothschild is involved. From the WSJ: "Societe Generale SA, whose shares have come under severe pressure in recent weeks, said Tuesday that it had signed a liquidity contract with Rothschild & Cie. to prevent excessive volatility in its stock price." That's right: Rothschild is now in the Plunge Protection business. And they all have the ECB to thank for it: after years of not learning from the New York Fed-Citadel Joint Venture, which "never" steps in at precisely the right time (wink wink), they have opened the market for third party PPT incursions. It only seems fitting that the bank that started it all, would step in and fill the void. Because after all if SocGen falls, Rothschild will sooner or later follow. That said, the official explanation is worth its weight in laughter: "The idea is not to keep the stock price high, but rather to keep it steady" a representative for Societe Generale said. After hearing such... brilliance... what really is there to say?

  11. Great Article, Keep up the good work

  12. Thanks for your comments always.

    This is a great chance now to get out of miners and back into the metals. I am sick and tired of miners stress. And such a lovely fall back in metals needs to be bought.

    Absolutely every precious metal bull has been wrong that miners will go even if gold falls back. It seems that gold miners need a stable gold price and a stable stock market. Miners will never go it alone - they always need one or the other companion.

    Ontop of that miners are a target by all governments in the future. Its just not worth the aggravation.

    And this metal attack is just the right moment to do the switch.

    *é£$ the miners