Just Another Day In Our (Corrupt) Paradise

“When you see that trading is done, not by consent, but by compulsion – when you see that in order to produce, you need to obtain permission from men who produce nothing – when you see money flowing to those who deal, not in goods, but in favors – when you see that men get richer by graft and pull than by work, and your laws don’t protect you against them, but protect them against you – when you see corruption being rewarded and honesty becoming a self sacrifice - you may know that your society is doomed.” (Francisco D'Anconia, "Atlas Shrugged")

I use that quote quite frequently but every molecule of thought embedded in it describes the state of condition of our economic and political system with 100% precision.

Hopefully, if there is a hell, Jon Corzine will burn there.  A good friend of mine back in NY who is plugged into the Wall Street "whisper" news affirmed that the scuttlebutt about the real number in the MF Global missing funds case is $1.5 billion, not $700 million.  Not only that, but that the internal control systems had been designed to prevent regulators from detecting the illegal activity.  This means that both Corzine and the CFO should go down hard.  Unfortunately for the CFO, he was never CEO of Goldman Sachs or Governor of New Jersey, so he will likely go down in flames while Corzine skates away in shame because of this hidden code in our system:  "when you see money flowing to those who deal, not in goods, but in favors."

The Wall Street Journal ran an article questioning the CFTC in the MF Global abortion.  Here's the LINK  Here's what they don't question and examine:  What is the link between CFTC Chairman Gary Gensler and Jon Corzine?   I'll tell you what the link is.  Corzine became the CEO of Goldman Sachs in 1994 and it was in the mid-90's that Gensler, a Goldman partner, was elevated to the head of fixed income and currency trading in Japan and then co-head of finance, the second highest position in the firm after CEO.  Corzine worked his way up through Goldman as a fixed income guy.  If you don't think there was a very close relationship between the two of them then you are either naive or a moron.  Given the way Goldman's culture operates, it's possible they even happily slept with each other's wives.  They are both obviously highly placed in the Democratic party.  It's pretty clear to me that Gensler was tied tightly to Corzine because Gensler's  path to being CEO was clearly derailed when Henry Paulson shoved Corzine out of power.  With this trail of evidence, there is no question in my mind that Corzine was able to use his relationship with Gensler to deflect any scrutiny of MF's books:  "when you see money flowing to those who deal, not in goods, but in favors."

It will be interesting to see how all of this unfolds.  Unfortunately, I believe that Corzine will be able to wield enough influence with the key people in the Obama administration, specifically with Eric Holder - the scumbag who wrote the pardon letter for tax-evader Marc Rich - in order to facilitate the burial of the real paper trail that leads to proving the facts of this tragedy.  As I mentioned earlier this week, the Taxpayers will be handed the bill for the cost of replacing customer funds that were illegally used by MF and likely most of JP Morgan's counterparty exposure, which is in the billions.
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Update on the ongoing wealth transfer in housing:  Freddie Mac just reported a huge loss and has asked for ANOTHER $6 billion from the Taxpayers LINK .  That the Government allows this to continue is completely appalling.  There is no question in my mind that this money is ultimately bailing the big banks out of their billions in losses on mortgage paper (see the deal Bank of America cut with Fannie Mae, with the help of Geithner).