Federal Reserve Initiates End Game As Trump Heads To White House

Greenspan was the head of the Federal Reserve and as such he had the views and leanings of the committee. He spoke for the Federal Reserve. Greenspan did not act alone.

Wasn’t it you that said that investment banks didn’t come under the purview of the Federal Reserve until Bear-Stearns failed in 2008? And I had to correct you that investment banks were already blending with commercial banks from 1999 onwards.

Wall St. sold the fraudulent bonds, had them highly rated by the leading bond rating agencies who were documented to go along because otherwise, they would lose clients to other ratings agencies. That is all in testimony before Congress. It was all over the media.

Wall St. created CDOs, CDOs Squared, Credit Default Swaps, and other assorted defective fraudulent crap. All of their instruments were bought, offset against other instruments with other assets filling the gaps, or financed in the carry trade that allowed a return on the spread between the borrowed funds and the interest paid out on the defective and fraudulent bonds. The Federal Reserve played along in the financing because the banking system was reconfiguring under the repeal of Glass-Steagall. But they didn’t have to play along and over the years they had enough data to know to stop it.

The Fed allowed mortgages to be financed by Wall St. Bonds instead of deposit accounts. Mortgages had been a product of commercial banks. Wall St. had to purchase banks to get at the mortgages and they proceeded to rape banks while the Fed watched. There were tens of millions of people stuffed into those Wall St. mortgage schemes and the vast majority of them were good people, not deadbeats or ghetto dwellers. The Fed could have stopped all this at anytime because of their regulatory power in the commercial banking industry. They could have ordered an immediate halt to exotic bond financing of mortgages. The entire crime scene could have been roped off and shutdown. The Fed could have sent scores of bank examiners to audit the books but they did nothing.

So Wall St. investment banks became owners and partners with commercial banks starting from 1999 and they proceeded to melt down the banking system didn’t they? It only took 8 to 9 years. What does that tell you about the effectiveness of Glass-Steagall which protected homebuyers for nearly seven decades?

Still want to blame it on poor people? Clinton? What did the 2016 election teach about the Clintons and Wall St.? Did poor people design and execute this horror show? If so, what was so special about the 2000s and poor people that was not present say in the 1960s with poor people? Are the poor people of the 2000s somehow distinguished from poor people of history?

No, it wasn’t caused by poor people. It was caused by repealing Glass-Steagall, a derelict Fed and Wall St. wolves getting inside the chicken coops. It wasn’t poor people. As much as many might like to look down on poor people and blame them for everything, it wasn’t them that produced this horror show.

Greenspan and the Fed could have said no. They didn’t. The Forbes writer is merely repeating what’s already on record. It’s a convenient link to show a short summary of what went down. He infers the Federal Reserve was dysfunctional and that is the truth, they were and are dysfunctional.

I’ve seen groups of Fed lovers cluster on these threads for years now trying to defend the indefensible. The truth is that the Fed middle management people are not genius’s. They are in many cases thick-headed mouth breathers who try to rebut and threaten anyone exposing their upper echelon, like Islamic followers for Muhammed.

Brooksley Born said it all in the video documentary. Everything she said is backed up by public record and the testimonies made before Congress support her statements.

The Federal Reserve needs to be taken down several notches because they manage things so poorly and cause untold numbers of people to suffer. The Fed people are screw-ups with a lot of jargon. The President-Elect has stated that something like Glass-Steagall will be brought back to replace Dodd-Frank which is bad for business. And Congress will follow the President-Elect because people are still on fire with rage about the sh*t that Congress, Wall St., and the Fed have been throwing out everywhere.

The Federal Reserve could easily have said to Wall St. you will not sell those mortgage-related instruments because they are highly susceptible to fraud, they don’t make sense economically, and they expose the commercial banking system to highly volatile risk. But they did nothing to stop it even though there were plenty of red flags. For example, the Fed could have simply said to commercial banks “you will not broker money for mortgages”. All mortgages must originate and aggregate from depositor’s accounts subject to our reserve requirements. That would have stopped the entire meltdown in one swoop.

They could have told the investment bank CEOs who had waded into commercial banking waters to stay away from doing their Wall St. thing on mortgages. The Fed had that power. Brooksley Born and the CFTC had lost the power to regulate because Sen. Gramm had slipped in a provision to strip them of that power in the bill that repealed Glass-Steagall. You’ll note that Gramm has scarcely shown his face after the financial collapse. He’s now 74 and healthy. He knows he screwed up. He knows the power brokers that pushed him to do it ended up causing a generation of Americans to lose their equity.

When Wall St. and the banks they owned hired their army of unscrupulous ‘mortgage brokers’ to sign up anything that moved, it was to cover bonds they had already sold forward fraudulently. They actually filled the spreadsheets after the fact. All the mortgages listed in a bond that were sold were fictitious and then were backfilled as the brokers brought in the suckers after the suckers had been duped.

What did that activity do to housing prices? It blew them sky high so that a middle-class family could not buy at those prices unless there was no down payment required, no credit check or thin credit checks by self-professed statements, or a paystub or two. People with scruples repelled away from buying a home at bubble prices with crazy mortgage ARM, LIBOR, Balloon, etc. terms. So they fell back on applying to rent but the rents were going through the roof. Yeah, a whole generation of good Americans were offered a horror show just so some sleazy Wall St. types could rake in the millions while the Fed stood by and let it happen. The Fed had the power to stop it. The only thing they did manage to do was raise interest rates 17 quarters in a row which had the effect of blowing up mortgage payments on adjustables. The Fed is incompetent. And then LIBOR was found to have been rigged. Anything wrong with this picture? Fed innocent? BS.

Is all this hindsight? No. The red flags were everywhere. The Fed saw them and did nothing. They didn’t sound the alarm for the public to see. They didn’t call for any special meetings of urgency that the public would know about. Their silence and lack of appropriate action were telltale signs that they were not going to do anything about it. The actions they did take only made it worse.

And the Fed could have made that decision anytime after Glass-Steagall was repealed. There were ominous signs everywhere and the Fed did nothing. In fact, they went along and enabled the Too-Big-To-Fail liquidity programs that doled out money from nowhere in the trillions to investment banks. They could have said no on that too, but they didn’t and effectively gave the greenlight to bank fraud everywhere.

We will revisit these issues after the President-Elect is sworn in and has his banking reform proposals presented to Congress. To your pro-Fed sentiment, you can be filled with warm spit watching the Fed survive to screw up again but don’t get too comfortable with your image of ‘The Holy Fed’ as they are due to get their share of butthurt. You can take that to the bank.

> “I can’t imagine why and how the BIS found itself bossing the Fed around but I’m sure it’s entertaining.”

Because the banks are people.

Just because they have hired help doesn’t make them inhuman. They are people with names and clubs they go to.

JP Morgan is a person heading up other people. That person has his people found all around Europe and that person runs the large Euroclear Trading Platform clearing transactions using people under control at BIS.

The Fed is over in Europe now. It’s no longer just an American thing. It’s now international, yeah that’s true. Just like the FBI.

You see the bank punks think they control the world, and that America is just another country. They don’t need to hang out in Manhattan. They can operate from anywhere now.

The fact that the Fed set up liquidity programs for their investment banks, liquidity in the trillions at ridiculously low interest or zero interest, created from nothing is an in-your-face clue to its international scope. Why? Because who are these investment banks that get so much from the Fed?

They are people. They are people who control brands like JP Morgan, Citibank, Bank of America, etc. And these brands are now international multinational banks.

Banks (persons) of non-American origin are allowed reciprocation to operate in America. For example, ING Bank, Deutsche Bank, HSBC, etc. It’s all global now and central banks are no exception.

America is only relevant now because it has so many weapons. But as Donald Trump says, there are potholes on the runway in La Guardia whereas the airport being replaced by a new airport in Dubai is orders of magnitude grander and of far better quality than any American airport. America has been in decline and a lot of that decline can be rightfully attributed to international banking ‘persons’.

There is indeed a hierarchy of authority in banking but this exists to control the hired help. Most banking is robotic and run according to coded procedures. But when it comes to policy, the matters fall to the ‘persons’ who are the banks or to their masters. JP Morgan is one of the master banks. Deutsche Bank follows them.

You don’t see this because you’re not in a position to see it. The people that are the banks are only revealed to those that see them in exclusive settings.

The Jockey club in Hong Kong or the one in Singapore are exclusive clubs that the first tier help can be found for the bank ‘persons’. This level of help will be involved in billions of transfers in ways that are not always known except to the person that is the bank. But you won’t see this because you won’t be able to get inside these clubs.

The central banker of the UAE lives in a gated section of Abu Dhabi. He’s there because a bank (a person) in Zurich put him there. The person in Zurich is not a CEO, or a board member, or anything to do with an organization chart for any bank. He is a bank. He is a person with close confidants that all the others working inside his facilities respond to. And he has agreements with the Fed. And the Fed has agreements with him.

That’s how it works.

The retired CIA boys who are aiming to double-dip by working for the Fed in the Fed’s global campgrounds are there to make sure the Fed approval for large trade and currency swaps are following the script.

The Fed is everywhere. You and the other Fed worshippers on this thread wouldn’t know that.

So Hillbilly is merely drawing attention to the fact that the Fed is no longer an exclusive American franchise. And he’s right about that.

“Wasn’t it you that said that investment banks didn’t come under the purview of the Federal Reserve until Bear-Stearns failed in 2008? And I had to correct you that investment banks were already blending with commercial banks from 1999 onwards.”

It’s hard to “correct” something I wasn’t addressing, other than apparently in your imagination. IBs and commercial banks that had merged prior to 2008 became bank holding companies, regulated through their commercial side. Investment banks were still just investment banks, unregulated by the Fed until a number of them converted into bank holding companies in 2008 to gain access to funding.

“Wall St. sold the fraudulent bonds...”

Bonds are securities. Being securities they come under the SEC, the Securities Exchange Commission, and not the Fed.

“had them highly rated by the leading bond rating agencies”

The rating agencies, NRSROs, have special standing under law and are connected with the SEC, not the Fed. The Fed does banking, not securities.

“Wall St. created CDOs, CDOs Squared, Credit Default Swaps, and other assorted defective fraudulent crap...”

CDOs and CMOs are bundles of mortgages sold as securities. They’ve been around since the 1980s. Securities, SEC, not Fed.

Credit Default Swaps are options that Congress saw fit to keep from being regulated via the CFMA 2000. The other derivatives you mention are similarly unregulated, but if they were they would come under the SEC and not the Fed.

“The Fed allowed mortgages to be financed by Wall St. Bonds instead of deposit accounts. Mortgages had been a product of commercial banks. Wall St. had to purchase banks to get at the mortgages and they proceeded to rape banks while the Fed watched. “

Wall St bonds... again that’s the SEC, not the Fed.

And there has never been any law restricting who finances mortgages anyway. The Fed has zero say in how mortgages get financed.

“The Fed could have stopped all this at anytime because of their regulatory power in the commercial banking industry.”

No, especially since the majority of lending during the bubble came from sources outside of commercial banking.

“They could have ordered an immediate halt to exotic bond financing of mortgages.”

I have no idea what you mean by “exotic bond financing” despite once having passed the Series 7 exam. But again bonds are securities, and securities are SEC not Fed.

“What does that tell you about the effectiveness of Glass-Steagall which protected homebuyers for nearly seven decades?”

Nothing, since Glass Steagall was the Emergency Banking Act of 1933 and had nothing at all to say about mortgages. Glass Steagall was intended to protect the banking system by keeping commercial, deposit-taker banking separate from investment banking.

“I’ve seen groups of Fed lovers cluster on these threads for years now trying to defend the indefensible.”

Considering your confusion over the role of the SEC versus the Fed it’s possible that you haven’t much of an idea of what they are saying. And the Fed is just one of a plethora of federal banking regulators.

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