Kurt Nimmo

Infowars

September 18, 2008

I knew there was a good reason not to “play” the stock market. Jim Willie writes for Kitco today:

Hidden inside the AIG bailout funding package, surely hastily cobbled together, but carefully enough to include a totally corrupt clause, was a handy dandy clause that permits raids. The conglomerate financial firms are permitted at this point to use private individual brokerage account funds to relieve their own liquidity pressures. This represents unauthorized loans of your stock account assets. So next, if the conglomerate fails, your stock account is part of the bankruptcy process. Finally the corrupt USGovt and corrupt Wall Street houses are desperate enough to put into policy, stated by the US Federal Reserve, outlining the authorized raid of your money. Beware.

In the olden days, this sort of thievery resulted in a rope, a tree, and a horse scared out from under the perpetrator. Now? The government in cahoots with the Fed actually helps the bankers steal the money.

The Financial Times admitted as much on September 14, when it wrote: “The Fed also suspended rules that prohibit banks from using deposits to fund their investment banking subsidiaries.”

As the Naked Capitalism blog notes, this is the opposite of the “narrow banking” that resulted in the wake of the savings and loan rip-off. So called “narrow banking” requires “banks to invest depositors’ funds only in the very safest assets,” but now the sky’s the limit as the bankers are going wild with your money, that is if you are stupid enough to be in the stock market.

Naked Capitalism turns to an email from a former bank regulator on the topic:

I worked as a senior supervisory analyst at the Federal Home Loan Bank of New York in the late 80s/ early 90s when the FHLB (and later the Office of Thrift Supervision) were cleaning up the S&L mess. In reading of this development, I am speechless. The whole point of our job was to minimize risk to the deposit insurance funds, and our bosses really drummed that one into our heads…. The Fed seems to be enabling the very things it should be standing against. If he felt that Treasury needed to subsidize the Merrill takeover Paulson should have asked Congress for explicit appropriations of finite funds. The 23A [Section 23A of the Federal Reserve Act] suspension will make it hard for us to know how much is being risked, at what odds, and for how long. It is a blank check issued under the table.

I’m no expert on such matters, but it seems obvious what is going on — the Fed and Paulson are opening the floodgates and taking down the hurdles — as minimal as they were — safeguarding depositors. It’s brazen thievery on steroids.

“All too often both bankers and regulators get overconfident during economic booms. However, if the regulators can’t tighten the ship even during a crisis like this one we are lost.”

Tighten the ship? Seems the ship was long ago hijacked by pirates and they are now stripping the rigging, the mizzenmast, the rudder, transom, everything down to the floorboards, the works. Soon we’ll be crammed into a dinghy and sent to face the ravages of Mother Nature.

You can almost hear the smarmy yuppies whining and gnashing teeth as their brokerage accounts are savaged.

It is short comfort to a much larger calamity.

9/11 Chronicles Part One: Truth Rising

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