Ron Paul: Stimulus Packages Will Turn Recession Into A Depression

Steve Watson
Infowars.net
Tuesday, Jan 27th, 2009

Texas Congressman Ron Paul has warned that passing the latest proposed economic stimulus package would be akin to pouring kerosene on an already raging fire.

Paul, who is also a member of the House Financial Services Committee, warned that such measures will cause a recession to turn into a full scale depression possibly worse than that of the 1930s.

During a Television interview with CNN, Paul explained why he believes stimulus funding is such a destructive policy.

“It’s because the government is spending it. If the people were spending it it would be fine, but the government never does anything productive. They have to take money from productive individuals and spend it in non productive ways, so it’s just digging a bigger hole, getting us into bigger debt, and that is the problem.” Paul said.

“This stimulus package is going to cost each and every American $6700 of more debt, so how can that be beneficial? If debt was the answer we would of never had a problem.”

“We are doing exactly what we did in the 1930s, we are taking a recession and working very hard to try and turn it into a depression.” The Congressman added.

“What we’re worried about right now, well certainly I am, is that it’s worse than the 30’s because we’re on the verge of destroying the dollar. So if you think the financial crisis is bad, and the financial system isn’t working, wait ’til you find out when the Dollar doesn’t work.”

The Congressman told viewers that only by liquidating debt, allowing the market to operate freely and allowing prices to come down will the problem be corrected.

Paul also spoke to those who have blamed the free market for the downturn and have suggested that deregulation is a primary cause of the financial crisis.

“We never had a hands off approach, that’s the fallacy, and as long as we believe that we will never correct our problem. If you blame Capitalism and free markets and sound money for this then we can’t win the intellectual fight.” Paul urged.

“If you want to regulate, regulate Government agencies, regulate the Treasury, regulate the Federal Reserve. The Federal Reserve has no oversight, they’re not even permitted to be audited by law, so that’s the kind of oversight we need. The Federal Reserve has committed trillions of dollars to individuals, corporations and banks, they don’t even have to tell us where it’s gone to.” he added.

Banksters Grab Chicago’s Public Parking Infrastructure

Kurt Nimmo
Infowars
January 13, 2008

Chicago is now like any other third world nation victimized by the banksters, as the Chicago Tribune reported yesterday. Jon Hilkevitch didn’t exactly put it that way, but he may as well have.

	Chicago Parking Meters LLC sounds like it is a homegrown business. It isn’t.

“The quadrupling of fees this year to park at most [parking] meters in Chicago marks only the beginning of changes coming to a curbside near your car,” writes Hilkevitch. “You can of course bid a nostalgic farewell to the decades-old pole-mounted meters with coin slots and expiration flags, as a result of the almost $1.2 billion deal Mayor Richard Daley announced last month to outsource parking management in the city over the next 75 years to Chicago Parking Meters LLC.”

Chicago Parking Meters LLC sounds like it is a homegrown business. It isn’t. Chicago Parking Meters LLC is a “consortium” owned and operated by Morgan Stanley, the bankster “investment” firm that managed to heist billions from the beleaguered U.S. taxpayer. Even the corporate media now tells the truth about this outrageous scam — the Treasury Department in collusion with the banksters had no intention of purchasing failed mortgage assets. Instead, they have used taxpayer money to buy preferred shares of stock in select banks, that is to say they are consolidating power and control and allowing smaller banks and institutions to die off.

The so-called “recapitalization” scam is nothing if not an effort to fleece the clueless. Bank of American Corp. squeezed $15 billion out of the taxpayers and turned around and doubled its stake in the authoritarian state-owned China Construction Bank Corp. PNC Financial Services Group Inc. took $7.7 billion of Troubled Assets Relief Program cash and promptly bought National City Corp. U.S. Bancorp grabbed $6.6 billion of “capital infusion” money and acquired two California lenders.

“One purpose of this plan is to drive consolidation,” an anonymous Treasury official told the New York Times in October. In fact, it is the primary purpose.  

In addition to scooping up lesser banks and consolidating, the international banksters are going after public infrastructure, as the residents of Chicago are learning the hard way. “Kohlberg Kravis Roberts, the Carlyle Group, Goldman Sachs, Morgan Stanley and Credit Suisse are among the investors who have amassed an estimated $250 billion war chest — much of it raised in the last two years — to finance a tidal wave of infrastructure projects in the United States and overseas,” the New York Times reported last August. “Their strategy is gaining steam in the United States as federal, state and local governments previously wary of private funds struggle under mounting deficits that have curbed their ability to improve crumbling roads, bridges and even airports with taxpayer money.”

It’s called “public-private partnerships,” but in fact is a corporate big government partnership, in other words classic fascism under the rubric of so-called “free trade” and privatization. Modern “public-private partnerships” have their roots in corporatism. “Fascism should more properly be called corporatism because it is the merger of state and corporate power,” said the grand daddy of fascism, Benito Mussolini.

“Fascist governments are favorable to the interests of enterprise, at least the interests of large-scale enterprises. Great private combines existed and were encouraged under Hitler, Tojo, and Mussolini. Fascism represents, if you will, a kind of large-scale, public-private partnership,” writes John Chuckman.

“We are seeking a broad array of stable infrastructure opportunities, and this investment represents an important step in the build-out of our infrastructure business,” Sadek Wahba, who heads up Morgan Stanley’s infrastructure investments, said in 2006.

No doubt it is an ideal “infrastructure investment” for the banksters, but a rotten deal for the people of Chicago who are now one step up from similar victims in the third world.

In 2007, Business Week told us “banks and private investment firms have fallen in love with public infrastructure. They’re smitten by the rich cash flows that roads, bridges, airports, parking garages, and shipping ports generate — and the monopolistic advantages that keep those cash flows as steady as a beating heart. Firms are so enamored, in fact, that they’re beginning to consider infrastructure a brand new asset class in itself.”

For millions of people in Africa, Latin America, and elsewhere in the third world, this predatory behavior is not “a brand new asset,” but one that has been used for decades to rob them blind and enslave them to the “monopolistic advantages” of transnational corporations and the international bankers.

It is now coming to America, symbolized by the Golden Gate and Brooklyn bridges going up on the chopping block.

Obama: Americans Will Accept Bankster Engineered Depression

Kurt Nimmo
Infowars
January 10, 2009

Less than two weeks before entering office, Barack Obama has warned that “things will get worse before they get better.” Obama said “the most serious crisis since the Great Depression gripping the United States will probably get worse before the economy starts to improve,” according to Agence France-Presse. “But he expressed confidence Americans will overcome the current difficulties.”

	It is no mistake the banksters are using the so-called bailout to gobble up smaller banks and pay off their cronies. From the get-go it was designed as a tool to further concentrate power, not buy up bad assets as advertised, that is to say toxic assets created by the scam that is fractional reserve banking.

Obama meant to say Americans will adjust to the manufactured globalist race to the bottom, as if they have any other choice short of storming the castle. “Recovery won’t happen overnight, and it’s likely that things will get worse before they get better,” Obama said in his weekly radio address. “But we have come through moments like this before … And I am confident that if we come together and summon that great American spirit once again, we will meet the challenges of our time and write the next great chapter in our American story.”

Obama did not define the “challenges of our time,” but they are relatively easy to perceive — fractional reserve banking, the debt bubble, the credit crunch, and inflation of the money supply, all designed to take down the global economy in dramatic fashion and inflict maximum misery on billions of largely clueless plebs. In response to this manufactured global economic crisis, the international banksters have offered their solution — global government and further centralization of economic power into fewer hands.

It is no mistake the banksters are using the so-called bailout to gobble up smaller banks and pay off their cronies. From the get-go it was designed as a tool to further concentrate power, not buy up bad assets as advertised, that is to say toxic assets created by the scam that is fractional reserve banking.

More so-called bailouts will be imposed, as there are more equity bubbles right around the corner. More misery and “shared sacrifice” will be required in order for the global elite to put the finishing touches on their mega-scam, the most outrageous financial crime in recorded history.

“We will be called upon to take part in a shared sacrifice and shared prosperity,” declared the selected president on February 19, 2008 in Wisconsin. In other words, imposed sacrifice for the little people and shared prosperity for the international banksters.

Obama’s CFR connected wife made mention of this during the dog and pony election campaign. “Our greatest challenge is that we have a mutual obligation to one another and we have to understand that. We have lost sight of that because we haven’t had leadership that has asked us to sacrifice and compromise for one another,” said Michelle Obama at the University of Houston last February.  

Mrs. Obama was simply telling us the government will demand we accept “sacrifice and compromise,” not for each other but for the global elite, the transnational corporations, and the criminal banksters. In the months ahead, it will be imposed sacrifice and compromise as millions of plebs lose their jobs, savings, homes, pensions, even the ability to feed their families.

But the banksters are not finished with us yet. Now we are told we need a “stimulus package” to get the economy working again. “Obama said the economic price of not launching a huge stimulus package would be far worse, despite a budget deficit forecast to top one trillion dollars this year,” AFP reports.

In fact, Obama’s stimulus package will be a putrid cherry placed atop the mother of all bubbles — the public debt bubble. If that sucker collapses, you will lose all — Social Security, infrastructure, public works, the Army, Marines, Navy, the whole kit and kaboodle.

It is a shell game, of course, because the government has no intention of putting itself out of business.

Instead, they will crank up the sacrifice and compromise mantra as they sell off everything of value at pennies on the dollar to the banksters and crew while simultaneously devaluing the dollar. It’s a tested and true method used by the banksters for decades in the third world.

It’s no mistake Bush radically increased the debt and Obama proposes to escalate the process astronomically — it is all part of the bankster plan to loot the goodies and level the playing field. If you want to know what the playing field will look like when these guys are finished, look to the slave labor gulags in Asia or the miserable condition of much of the rest of the world where billions survive on less than two dollars a day.

In order to scare you into acquiescence, Obama has “repeated the warning” that if nothing is done, “the unemployment rate could reach double digits — and they warn that our nation could lose the competitive edge that has served as a foundation for our strength and standing in the world.”

In fact, the real unemployment rate is already in double digits and the government does somersaults to hide this fact from you. As for the “competitive edge” of the nation, this is a sick joke — the banksters and transnational corporations sold this to China years ago.

Obama was “elected” to sell you the new serfdom designed by the global elite. Due to decades of political correctness, it will be impossible to oppose Obama because he is African-American and all opposition will be considered racist, same as opposing the Israeli mass murder and genocide of the Palestinians is considered anti-semitic.

That’s what Obama’s million man national security goon squad will be organized for — to take you off to the homegrown KBR constructed Gitmos now popping up around the country, that is if they do not execute you outright.

Real Letter From CEO To His Employees

This is a legitimate letter — the company actually exists.
1-7-9

To All My Valued Employees, There have been some rumblings around the office about the future of this company, and more specifically, your job. As you know, the economy has changed for the worse and presents many challenges. However, the good news is this: The economy doesn’t pose a threat to your job. What does threaten your job however, is the changing political landscape in this country. Of course, as your employer, I am forbidden to tell you whom to vote for — it is against the law to discriminate based on political affiliation, Race, creed, religion, etc. Please vote who you think will serve your Interests the best. However, let me tell you some little tidbits of fact which might help you decide what is in your best interest. First, while it is easy to spew rhetoric that casts employers against employees, you have to understand that for every business owner there is a back story. This back story is often neglected and overshadowed by what you see and hear. Sure, you see me park my Mercedes outside. You’ve seen my big home at last years Christmas party. I’m sure all these flashy icons of luxury conjure up some idealized thoughts about my life. However, what you don’t see is the back story. I started this company 12 years ago. At that time, I lived in a 300 square foot studio apartment for 3 years. My entire living space was converted into an office so I could put forth 100% effort into building a company, which by the way, would eventually employ you. My diet consisted of Ramen Pride noodles because every dollar I spent went back into this company. I drove a rusty Toyota Corolla with a defective transmission. I didn’t have time to date. Often times, I stayed home on weekends, while my friends went out drinking and partying. In fact, I was married to my business — hard work, discipline, and sacrifice. Meanwhile, my friends got jobs. They worked 40 hours a week and made a modest $50K a year and spent every dime they earned. They drove flashy cars and lived in expensive homes and wore fancy designer clothes. Instead of hitting the Nordstrom’s for the latest hot fashion item, I was trolling through the Goodwill store extracting any clothing item that didn’t look like it was birthed in the 70’s. My friends refinanced their mortgages and lived a life of luxury. I, however, did not. I put my time, my money, and my life into a business with a vision that eventually, some day, I too, will be able to afford these luxuries my friends supposedly had. So, while you physically arrive at the office at 9am, mentally check in at about noon, and then leave at 5pm, I don’t. There is no “off” button For me. When you leave the office, you are done and you have a weekend all to yourself. I unfortunately do not have the freedom. I eat, ****, and breathe this company every minute of the day. There is no rest. There is no weekend. There is no happy hour. Every day this business is attached to me like a 1 day old baby. You, of course, only see the fruits of that garden — the nice house, the Mercedes, the vacations… You never realize the back story and the sacrifices I’ve made. Now, the economy is falling apart and I, the guy that made all the right decisions and saved his money, have to bail-out all the people who didn’t. The people that overspent their paychecks suddenly feel entitled to the same luxuries that I earned and sacrificed a decade of my life for. Yes, business ownership has is benefits but the price I’ve paid is steep and not without wounds. Unfortunately, the cost of running this business, and employing you, is starting to eclipse the threshold of marginal benefit and let me tell you why: I am being taxed to death and the government thinks I don’t pay enough. I have state taxes. Federal taxes. Property taxes. Sales and use taxes. Payroll taxes. Workers compensation taxes. Unemployment taxes. Taxes on taxes. I have to hire a tax man to manage all these taxes and then guess what? I have to pay taxes for employing him. Government mandates and regulations and all the accounting that goes with it, now occupy most of my time. On Oct 15th, I wrote a check to the US Treasury for $288,000 for quarterly taxes. You know what my “stimulus” check was? Zero. Nada. Zilch. The question I have is this: Who is stimulating the economy? Me, the guy who has provided 14 people good paying jobs and serves over 2,200,000 people per year with a flourishing business? Or, the single mother sitting at home pregnant with her fourth child waiting for her next welfare check? Obviously, government feels the latter is the economic stimulus of this country. The fact is, if I deducted (Read: Stole) 50% of your paycheck you’d quit and you wouldn’t work here. I mean, why should you? That’s nuts. Who wants to get rewarded only 50% of their hard work? Well, I agree which is why your job is in jeopardy. Here is what many of you don’t understand; to stimulate the economy you need to stimulate what runs the economy. Had suddenly government mandated to me that I didn’t need to pay taxes, guess what? Instead of depositing that $288,000 into the Washington black-hole, I would have spent it, hired more employees, and generated substantial economic growth. My employees would have enjoyed the wealth of that tax cut in the form of promotions and better salaries. But you can forget it now. When you have a comatose man on the verge of death, you don’t defibrillate and shock his thumb thinking that will bring him back to life, do you? Or, do you defibrillate his heart? Business is at the heart of America and always has been. To restart it, you must stimulate it, not kill it. Suddenly, the power brokers in Washington believe the mud of America are the essential drivers of the American economic engine. Nothing could be further from the truth and this is the type of change you can keep. So where am I going with all this? It’s quite simple. If any new taxes are levied on me, or my company, my reaction will be swift and simple. I fire you. I fire your co-workers. You can then plead with the government to pay for your mortgage, your SUV, and your child’s future. Frankly, it isn’t my problem any more. Then, I will close this company down, move to another country, and retire. You see, I’m done. I’m done with a country that penalizes the productive and gives to the unproductive. My motivation to work and to provide jobs will be destroyed, and with it, will be my citizenship. While tax cuts to 95% of America sounds great on paper, don’t forget the backstory: If there is no job, there is no income to tax. A tax cut on zero dollars is zero. So, when you make decision to vote, ask yourself, who understands the economics of business ownership and who doesn’t? Whose policies will endanger your job? Answer those questions and you should know who might be the one capable of saving your job. While the media wants to tell you “It’s the economy Stupid” I’m telling you it isn’t. If you lose your job, it won’t be at the hands of the economy; it will be at the hands of a political hurricane that swept through this country, steamrolled the Constitution, and will have changed its landscape forever. If that happens, you can find me in South Caribbean sitting on a beach, retired, and with no employees to worry about. Signed, Your boss, Michael A. Crowley, PE Crowley, Crisp & Associates, Inc. Professional Engineers 1 906 South Main Street, Suite 122 Wake Forest, NC 27587

Globalism – A Gigantic Ponzi Scheme

National Journal, first published: 01/01/09
From Iceland to New York: Globalism, A Gigantic Ponzi Scheme
The National Journal
1-1-9

 

The EU recommended in a study, published in August 2009, that all European citizens and European Banks should invest with Icelandic banks. The concept was that the Icelandic banks would transfer these funds, grabbed from gullible and deceived Europeans, to Jewish Wall Street Banksters, such as Lehman Brothers and fraudster Madoff. Iceland’s banks collapsed only four weeks after the EU had published the Commission’s study and investment recommendation. Thousands of people lost their savings and pensions to fraudsters like Richard Fuld from Lehman and Bernie Madoff – via the Iceland concept.   This gigantic fraud was promoted by Israel’s Icelandic puppet, president Ólsfur Ragnar Grímsson as ”a distinct Icelandic entrepreneurial spirit”.   Surprise, surprise, Grímsson is married to Hebrew business magnate Dorrit Moussaeiff.   http://en.wikipedia.org/wiki/Dorrit_Moussaieff   Dorrit Moussaieff, (born 12 January 1950) is the Israeli-born British-Icelandic First Lady of Iceland, jewelry designer, editor, businesswoman, and socialite.   Early life   Moussaieff was born in Jerusalem, Israel, to a wealthy devout Sephardic-observant Bukharian Jewish family from Bukhara, Uzbekistan, part of the Emirate of Bukhara. The Moussaieff family is part of a long dynasty of jewelers. She is the great granddaughter of Shlomo Moussaieff and her cousins are pianist James Raphael and author Jeffrey Moussaieff Masson [1]. It is said that Dorrit’s family, the Moussaieffs, wove the robe of Genghis Khan. [2] Her great grandmother, Esther Gaonoff, was from Bukhara but had some Moroccan Jewish ancestry and was the descendant of Yosef Maimon. Her father, Shlomo Moussaieff, is a Bukharian Jew but her mother, Aliza, is an Austrian Jew of Ashkenazi heritage. Moussaieff says, “As far as I’m concerned, the difference between Ashkenazim and Sephardim is that at my first grandmother’s place there was good food and at my Ashkenazi grandmother’s place the food was bad.” [2] Moussaieff was born and raised in the Bukharian Jewish Quarter, Jerusalem but when she was thirteen, she and her family moved to London. She suffered from dyslexia and didn’t attend ordinary schools but was taught at home. In addition to English and Hebrew, she also speaks German, French, and Icelandic.

Madoff’s Victims

The fallout from Bernard Madoff’s alleged Ponzi scheme reverberated around the world as the list of investors facing losses widened. Among the biggest losers were charities, hedge funds, and banks in Europe and Asia. Below, see some of the most exposed investors and sort by the amount of potential losses. –Updated 12/26/08

 

Investor	Description	Amount of Exposure	Comment

Investor	Description	Amount of Exposure	Comment
Fairfield Greenwich Advisors	An investment management firm	$7,500,000,000	More than half of Fairfield Greenwich’s $14.1 billion in assets under management, or about $7.5 billion was connected to Madoff.
Tremont Group Holdings	Asset management firm	$3,300,000,000	The investment firm is owned by OppenheimerFunds and Massachusetts Mutual Life Insurance Co. Tremont’s Rye Investment Management business had $3.1 billion invested, and its fund of funds group invested another $200 million.
Banco Santander	Spanish bank	$2,870,000,000	In euros, the figure is 2.33 billion.Of that, 2.01 billion euros belongs to institutional investors, Optimal Strategic hedge fund investors (international private banking customers); 320 mllion euros belongs to other private banking customers.
Bank Medici	Austrian bank	$2,100,000,000	The bank had two funds with $2.1 billion (1.5 billion euros) invested with Madoff. Bank Medici is 25% owned by Unicredit SpA and 75% owned by chairwoman Sonja Kohn.
Ascot Partners	A hedge fund founded by billionaire investor, philanthropist and GMAC chief J. Ezra Merkin	$1,800,000,000	The hedge fund had $1.8 billion under management as of Sept. 30, had substantially all of its assets invested with Mr. Madoff.
Access International Advisors	A New York-based investment firm	$1,400,000,000	The investment-advisory firm’s co-founder Thierry Magon de La Villehuchet, 65, was found dead in his Manhattan office on Dec. 24, 2008, in an apparent suicide.
Fortis	Dutch bank	$1,350,000,000	Fortis Bank and its subsidiaries have no direct exposure to Bernard Madoff Investment Securities LLC, but parts of the group do have a risk exposure to certain funds it provides collateralized lending to. If, as a result of the alleged fraud, the value of the assets of these funds is nil and the respective clients cannot meet their obligations, Fortis Bank Nederland (Holding) N.V.’s loss could amount to around EUR 850 million to EUR 1 billion. The continuity of Fortis Bank Nederland (Holding) N.V.and its subsidiaries is not at stake in any way.
Union Bancaire Privee	Swiss bank	$1,000,000,000	The bank’s exposure to Madoff — less than 1.26 billion Swiss francs — is less than 1% of overall bank assets.
HSBC	British bank	$1,000,000,000	HSBC provided financing to a small number of institutional clients who invested in funds with Madoff; some clients in its global custody business have invested with Madoff, but the company doesn’t believe these arrangements should be a source of exposure to the group.
Natixis SA	A French investment bank	$554,400,000	The company says it didn’t make direct investment in Madoff-managed funds; some investments made on behalf of customers could have ended up being managed by Madoff. Exposure is about 450 million euros.
Carl Shapiro	The founder and former chairman of apparel company Kay Windsor Inc., and his wife	$545,000,000	Mr. Shapiro, a 95-year-old apparel entrepreneur and investor, had $545 million with Mr. Madoff, creating what could become the largest personal loss yet in the scandal. A spokeswoman for the family confirmed that Mr. Shapiro’s charitable foundation, the Carl and Ruth Shapiro Family Foundation, invested $145 million with Mr. Madoff. Mr. Shapiro and his family had an additional $400 million or more invested with Mr. Madoff. Mr. Shapiro, a widely respected philanthropist, was one of Mr. Madoff’s earliest and largest investors.
Royal Bank of Scotland Group PLC	British bank	$492,760,000	The bank had exposure of about 400 million pounds to Madoff through trading, collateralized lending.
BNP Paribas	French bank	$431,170,000	The company said it has no investment of its own in Madoff-managed hedge fund but it does have risk exposure (up to 350 million euros) through its trading business and collateralized lending to funds of hedge funds.
BBVA	Spanish bank	$369,570,000	The company reiterated it doesn’t have direct exposure to Madoff but would face losses of 300 million euros if Madoff funds were found not to exist.
Man Group PLC	A U.K. hedge fund	$360,000,000	Invested in funds directly/indirectly sub-advised by Madoff Securities
Reichmuth & Co.	A Swiss private bank	$327,000,000	The Lucerne-based private bank warned investors that around 385 million Swiss francs, or 3.5% of its assets under management, were affected.
Nomura Holdings	Japanese brokerage firm	$304,000,000	The 27.5 billion yen exposure is through Fairfield Sentry; That amount represents 0.2% of assets under management.
Maxam Capital Management	A fund of funds based in Darien, Connecticut	$280,000,000	The fund reported a combined loss of $280 million on funds they had invested.
EIM SA	A European investment manager with about $11 billion in assets	$230,000,000	The European investment manager with about $11 billion in assets. Overall, EIM assets at risk are less than 2% of what it manages.
AXA SA	French insurance giant	$123,200,000	Exposure is well below 100 million euros.
UniCredit SpA	Italian Bank	$92,390,000	The company’s total exposure is about 75 million euros. Dublin-based Pioneer Alternative Investments is indirectly exposed to Madoff via feeders; Italian clients have zero exposure.
Nordea Bank AB	Swedish Bank	$59,130,000	The amount of exposure is about 48 million euros.
Hyposwiss	A Swiss private bank owned by St. Galler Kantonalbank	$50,000,000	Hyposwiss said roughly 0.1% of its overall assets was invested in Madoff products through managed accounts. Another $100 million is exposed through clients who chose to invest in Madoff funds. St. Galler Kantonalbank said its financial situation and liquidity aren’t hurt by Hyposwiss’ exposure.
Banque Benedict Hentsch & Cie. SA	A Swiss-based private bank	$48,800,000	Banque Benedict Hentsch said its clients have 56 million Swiss francs at risk. Benedict Hentsch had also recently agreed to merge with Fairfield Greenwich Group, a major Madoff distributor. When the news of Mr. Madoff’s arrest broke, it scrambled to undo that deal.
Fairfield, Conn.	town pension fund	$42,000,000	The town’s employees board and police and fire board, which cover 971 workers, had $41.9 million invested with Madoff, said Paul Hiller, Fairfield’s chief fiscal officer.
Bramdean Alternatives	An asset manager	$31,200,000	The exposure is about 9.5% of assets.
Jewish Community Foundation of Los Angeles	The largest manager of charitable gift assets for Los Angeles Jewish philanthropists	$18,000,000	The amount invested with Madoff represented less than 5% of the Foundation’s assets.
Harel Insurance Investments & Financial Services Ltd.	Israel-based insurance firm	$14,200,000	N/A
Baloise Holding AG	Swiss insurer	$13,000,000	N/A
Societe Generale	French Bank	$12,320,000	The company says its exposure, which is less than 10 million euros, is “negligible.”
Groupama SA	French insurer	$12,320,000	Exposure is around 10 million euros.
Credit Agricole SA	French bank	$12,320,000	Exposure is less than 10 million euros.
Richard Spring	individual investor	$11,000,000	A Boca Raton resident and former securities analyst, says he had about 95% of his net worth invested with Mr. Madoff. Mr. Spring said he was also one of the unofficial agents who connected Mr. Madoff with dozens of investors, from a teacher who put in $50,000 to entrepreneurs and executives who would put in millions.
RAB Capital	hedge fund	$10,000,000	N/A
Banco Popolare	Italian bank	$9,860,000	The company says it had indirect exposure of up to 8 million euros; maximum lost on funds distributed to institutional, private clients is about 60 million euros.
Korea Teachers Pension	A 10 trillion won Korean pension fund	$9,100,000	N/A
Swiss Life Holding	Swiss insurer	$78,900,000	Swiss Life said it has indirectly invested assets worth around 90 million Swiss francs through funds of funds managed by Madoff Investment Securities.
North Shore-Long Island Jewish Health System	health system	$5,700,000	Exposure represents less than 1% of the health system’s investment portfolio. A donor agreed to reimburse the system for any losses.
Neue Privat Bank	Swiss bank	$5,000,000	The bank invested in a certificate based on a hedge fund with exposure to Madoff
Clal Insurance Enterprise Holdings	An Israel-based financial services company	$3,100,000	N/A
Ira Roth	individual investor	$1,000,000	Mr. Roth, a New Jersey resident, says his family has about $1 million invested through Mr. Madoff’s firm.
Mediobanca SpA	via its subsidiary Compagnie Monegasque de Banque.	$671,000	Limited to $671,000 via its Compagnie Monegasque de Banque. via its subsidiary Compagnie Monegasque de Banque.
Fred Wilpon	owner of New York Mets	N/A	N/A
Steven Spielberg	The Spielberg charity — the Wunderkinder Foundation	N/A	N/A
JEHT Foundation	A New York foundation focused on electoral and criminal justice reform	N/A	The foundation, which stands for Justice, Equality, Human dignity and Tolerance, will close its doors at the end of January 2009. Major donors Jeanne Levy-Church and Kenneth Levy-Church had all their funds managed through Madoff.
Mortimer B. Zuckerman Charitable Remainder Trust	The charitable trust of real-estate magnate, who owns the Daily News and U.S. News & World Report	N/A	Funds exposed represented 11% of the value of that charitable trust.
Robert I. Lappin Charitable Foundation	A Massachusetts-based Jewish charity	N/A	The group, which financed trips for Jewish youth to Israel, was forced to close on Friday because the money that supported its programs was invested with Madoff.
Chais Family Foundation	A charity that gives away about $12.5 million annually to Jewish causes	N/A	The California-based charity group invested entirely with Madoff, and was forced to shut down operations on Sunday after years of donating some $12.5 million annually to Jewish causes in Israel and Eastern Europe.
KBC Group NV	Belgian banking and insurance group	N/A	No direct exposure; some indirect exposure through collateralized loans, but the exposure is very limited and immaterial to KBC’s earnings. KBC has also made some loan advances to institutional customers who have invested in funds managed by Madoff Investment Securities, but this shouldn’t have any material impact either, the company said.
Barclays PLC	British bank	N/A	The bank says it has “minimal” exposure” and is “fully collateralized”
Dexia	French bank	N/A	No direct investments in funds managed by Madoff,; private banking clients have total exposure of EUR78 million to funds primarily invested in Madoff funds. Indirectly, Dexia is exposed through partially collateralized lending operations to funds exposed to Madoff funds for a gross amount of EUR164 million. If the assets managed by Madoff Investment Securities were nil, the above mentioned lending operations could trigger an after tax loss of about EUR85 million for Dexia.
Allianz Global Investors	The asset management unit of German insurer Allianz SE	N/A	The unit says exposure “is not significant.”
Banco Espanol de Credito SA (Banesto)	A Spanish bank contolled by Banco Santander	N/A	Its clients have a total 2 million euro exposure; The amount is included in the 2.33 billion euros already disclosed by parent company Banco Santander.
CNP Assurances	French insurer	N/A	No direct exposure. Indirect exposure of 3 million euros via a fund of funds
UBS AG	Swiss bank	N/A	The bank says is has “no material exposure.” It declined to comment on press reports that its funds-of-funds for clients had $1.4 billion in exposure
Yeshiva University	A New York-based private university	$110,000,000	Although the university had “no direct investments” in Madoff’s firm, a portion of its endowment had been invested for 15 years with Ascot Partners, which had “substantially all its assets invested with Madoff.” Yeshiva’s investment represents about 8% of its endowment. J. Ezra Merkin had been a University trustee but has resigned in the wake of the scandal.
The Elie Wiesel Foundation for Humanity	The charitable foundation of Nobel laureate	$15,200,000	The foundation said it invested “substantially all” of its assets.
Leonard Feinstein	The co-founder of retailer Bed Bath & Beyond	N/A	N/A
Sen. Frank Lautenberg	The charitable foundation of the New Jersey Senator’s family	N/A	N/A
Norman Braman	former owner of Philadelphia Eagles	N/A	N/A
Jeffrey Katzenberg	The chief executive of DreamWorks Animation SKG Inc.	N/A	Mr. Katzenberg’s financial affairs along with those of Mr. Spielberg were managed by Mr. Breslauer, Mr. Katzenberg has suffered millions in Madoff-connected losses, say people familiar with the matter.
Gerald Breslauer	The Hollywood financial advisor to Steven Spielberg and Jeffrey Katzenberg	N/A	Along Messrs Katzenberg and Spielberg, Mr. Breslauer himself has likely sustained heavy losses in the Madoff affair. He customarily invests alongside his clients, say these people, and has sometimes been a larger investor than the people he represented
Kingate Management	hedge fund	N/A	Kingate’s $2.8 billion hedge fund Kiingate Global Fund reportedly invested heavily with Madoff
Julian J. Levitt Foundation	Texas-based charity	N/A	N/A
Loeb family	N/A	N/A	N/A
Lawrence Velvel	individual investor	N/A	Mr. Velvel is dean of the Massachusetts School of Law
Fix Asset Management.	hedge fund	N/A	reportedly invested heavily in Madoff’s portfolios
Genevalor, Benbassat & Cie.	money manager in Geneva	N/A	Members of the Benbassat family, which run the firm, have long known Mr. Madoff. In a statement on its Web site, Genevalor said it “has been reviewing the potential damages caused to its clients” by the alleged Madoff fraud. A statement from the Thema fund said it had assets with Madoff that were now frozen, but did not elaborate.
Banco Espirito Santo	Portugese bank	$21,400,000	The amount represents about 0.1% of assets under management.
Great Eastern Holding	Singapore insurer	$44,266,000	Great Eastern said S$7.7 million of its S$64 million exposure is invested from its Life Fund. Great Eastern is 87% owned ny Oversea-Chinese Banking Corp.
M&B Capital Advisers	Spanish brokerage	$52,800,000	The firm is run by the son and son-in-law of the chairman of Banco Santander. Through M&B, private and institutional investors bought more than $214 million in Madoff’s funds.
Royal Dutch Shell pension fund	Global energy and petrochemical company	N/A	The pension fund fund has an indirect investment that may be affected. The fund originally invested $45 million. The alleged fraud won’t affect the financial position and funding status of the fund.
Phoenix Holdings	Israeli financial services company	$12,600,000	Phoenix’s insurance unit invested $15 million over the last three years in funds managed by Thema, which made investments through Madoff. In November, the company requested to redeem $10 million. The payment was due Dec. 12 but Phoenix hasn’t received it.
Credicorp	Peruvian financial services company	$4,500,000	Credicorp’s Atlantic Security Bank unit has $1 million in direct exposure and up to $3.5 million in potential contingencies “related to transactions secured by these investments.”
Fukoku Mutual Life Co.	Japanese insurer	N/A	The company said it holds similar investments trusts to those held by Sumitomo Life Insurance Co. but declined to specify the balance. Sumitomo disclosed that it has about 2 billion yen, or about $22 million, exposed via trusts.
New York Law School	law school in New York City	$300,000	The school invested the money through its endowment entity. The school filed an investor lawsuit against J. Ezra Merkin, Ascot Partners and BDO Seidman.
Nipponkoa Insurance	Japanese insurer	N/A	The company said it holds similar investments trusts to those held by Sumitomo Life Insurance Co. but declined to specify the balance. Sumitomo disclosed that it has about Y2 billion exposed via trusts.
Sumitomo Life Insurance Co.	Japanese insurer	$22,000,000	Sumitomo Life didn’t invest directly in the Madoff fund but part of its investment trust holdings were linked to it.
Swiss Reinsurance Co.	Swiss insurer	$300,000	Indirect exposure, less than $3 million, is through hedge fund investments; no direct exposure.
Aozora Bank Ltd	Japanese lender	$137,000,000	Aozora entrusted 12.4 billion yen to investment funds, which invested with Madoff. Cerberus Capital Management LP owns a majority stake in Aozora.
UBI Banca	Italian bank	$86,000,000	The bank said the exposure is linked to proprietary investments. UBI Pramerica and Capitalgest Alternative Investments, the assets-under-management units, have no exposure.
Taiyo Life Insurance Co.	Japanese insurer	$221,000	Taiyo Life didn’t invest directly in the Madoff fund.
Caisse d’Epargne	French bank	$11,100,000	Caisse d’Epargne said EUR1 million was for Caisse Nationale des Caisses d’Epargne, the central hub, and “under EUR7 million” was from its regional level. Natixis reported exposure around EUR450 million on Dec. 15.
J. Gurwin Foundation	Charity	N/A	$28 million charity invested heavily in Madoff funds. Gurwin said, “We got a body blow. We did not get killed.”
EFG International	Swiss private bank	N/A	EFG clients have $130 million invested in Madoff through third-party funds sold by EFG. In addition, 0.3% of the bank’s total invested assets, held in custody, are invested in Madoff.
Fire and Police Pension Association of Colorado	Pension fund	N/A	Fund, with $2.5 billion under management, had $60 million invested with Fairfield Greenwich until six months ago
International Olympic Committee	Olympic organizer	$4,800,000	The IOC’s exposure represents about 1% of its total investment portfolio. Organizing committee confirmed they will be able to meet their obligations.
Support Organization for the Madison Cultural Arts District	Wisconsin cultural organization	N/A	$18 million invested with Fairfield Greenwich until September. A spokesman for the Overture Center in Madison, Wis., built with SOMCAD funds, said, “Speculation that SOMCAD could be on the hook is not outlandish.”
Credit Industrial et Commercial	French financial-services group	$125,400,000	The bank has no direct exposure to Madoff but could be affected through an intermediary.
Hadassah	U.S. women’s zionist organization	$90,000,000	N/A
United Association Plumbers & Steamfitters Local 267 in Syracuse	Local union pension and health care funds	N/A	The union is still trying to determine the extent of its losses. Its investments with Mr. Madoff go back 15 years.
Ramaz School	A Jewish school in New York	$6,000,000	N/A
Congregation Kehilath Jeshurun	A synagogue in New York	$3,500,000	N/A
The Maimonides School	A Jewish day school in Brookline, Mass.	$3,000,000	The school did not directly invest with Madoff, but the school was the sole beneficiary of a trust that lost about $3 million.
Yad Sarah	An Israeli nonprofit	$1,500,000	With a $21 million budget in 2008, Yad Sarah likely won’t expand operations or develop any new services or projects in 2009.
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Sources: WSJ reporting; Associated Press; the companies and charities

Wages, It all gets down to wages

Mike Whitney
Global Research
December 26, 2008

A strong economy must be built on a solid foundation of steadily rising wages. If wages don’t keep pace with production, the only way the economy can grow is through the expansion of debt, which leads to disaster.

	From Bernanke and Greenspan’s perspective, any small gain by workers is tantamount to communism. They will continue to do everything in their power to preserve the current labor-debasing system which keeps workers just one paycheck away from the homeless shelter.

Consider this: the US economy is 72 percent consumer spending. That means the Gross Domestic Product (GDP) cannot grow if salaries don’t keep up with the price of living. Low Income Families (LOF)–that is, any couple making less than $80,000–represent 50 percent of all consumer spending. These LOF’s spend everything they earn just to maintain their present standard of living. So, how can these families help to grow the economy if they’re already spending every last farthing they earn?

They can’t! Which is why wages have to go up. The cost to short-term profits is miniscule compared to the turmoil of a deep recession which is what the world is facing right now. The present crisis could have been avoided if there was a better balance between management and labor. But the unions are weak, so salaries have languished while Wall Street has grown more powerful, stretching its tentacles into the government and spreading its anti-labor dogma wherever it goes.

The investor class has rejiggered the system to meet their particular needs. Financial wizardry has replaced factories, capital formation and hard assets while real wealth has been replaced by chopped up bits of mortgage paper, stitched together by Ivy League MBAs, and sold to investors as priceless gemstones. This is the system that Bernanke is trying to resuscitate with his multi-trillion dollar injections; a system that shifts a larger and larger amount of the nation’s wealth to a smaller and smaller group of elites.

When Alan Greenspan appeared before Congress a few months ago, he admitted that he had discovered a “flaw” in his theory of how markets operate. The former Fed chief was referring to his belief that investment bankers could be trusted to regulate themselves. Whether one believes Greenspan was telling the truth or not is irrelevant. What really matters is that the wily Maestro managed to skirt the larger issues and stick to his script. Congress never challenged Greenspan’s discredited, trickle-down economic theories which guided his policymaking from the get-go. Nor was he asked to explain how a consumer-driven economy can thrive when salaries stay flat for 30 years. An answer to that question might have exposed Greenspan’s penchant for low interest rates and deregulation, the two fuel-sources for the massive speculative bubbles which emerged on Greenspan’s watch. These are the tools the Fed chief used for 18 years to enrich his buddies at the big brokerage houses while workers slipped further and further into debt.

There’s no “flaw” in Greenspan’s thinking; his views perfectly reflect his unwavering commitment to the rich and powerful. That’s never changed. Since retiring, he has continued to ingratiate himself to his Wall Street paymasters while fattening his bank account with royalties from his best seller. Unfortunately, his success has come at great cost to the country.

Millions of homeowners are now facing eviction, consumers are tapped out, and the job market is in a shambles. When equity bubbles unwind, it’s never pretty and the Greenspan implosion has been particularly nasty. Assets are being sold at fire sale prices and there’s a frantic rush to the safety of US Treasurys. It’s a catastrophe.

That said, it may seem like a bad time to boost workers’ pay, but that’s not the case. Crisis creates opportunities for change—real structural change. And that’s what’s needed.

The bottom line is that this whole mess could have been avoided if demand was predicated on wage increases instead of asset inflation. Of course, that precludes the Fed’s traditional remedies for economic malaise–easy money and massive leveraging. Just last week, Bernanke announced a plan to buy $800 billion of securities backed by mortgages and credit card debt in an effort to stimulate more borrowing. The Fed chairman would rather drown the country in red ink than support pay raises for workers. Go figure? This just illustrates the class bias that underscores the Fed’s policies, which is why pointless to debate the issue or try to find common ground. The only way to effect real change is with political power.

From Bernanke and Greenspan’s perspective, any small gain by workers is tantamount to communism. They will continue to do everything in their power to preserve the current labor-debasing system which keeps workers just one paycheck away from the homeless shelter. This type of hostility is neither good for the economy nor the country. It just intensifies class animosities by accentuating the chasm between rich and poor. The only way to overcome these differences is by narrowing the wealth gap and rewarding hard work with fair pay.

John Bellamy Foster and Fred Magdoff explain how establishment economists and their corporate patrons developed their ideas of how to use equity bubbles to grow the economy and shift wealth from workers to elites. In their Monthly Review article “Financial Implosion and Stagnation”:

“It was the reality of economic stagnation beginning in the 1970s, as heterodox economists Riccardo Bellofiore and Joseph Halevi have recently emphasized, that led to the emergence of “the new financialized capitalist regime,” a kind of “paradoxical financial Keynesianism” whereby demand in the economy was stimulated primarily “thanks to asset-bubbles.” Moreover, it was the leading role of the United States in generating such bubbles—despite (and also because of) the weakening of capital accumulation proper—together with the dollar’s reserve currency status, that made U.S. monopoly-finance capital the “catalyst of world effective demand.”

Greenspan figured out how to strengthen the grip of the banking sector by creating asset bubbles. That was his great contribution during the Clinton years. The leveraging of complex financial products and the surge in real estate prices gave the impression of prosperity, but it was all smoke and mirrors. The “wealth effect” vanished as soon as the interest payments on mortgages could no longer be paid. That’s when Maestro’s bubble blew up and Greenspan retired to write his memoirs.

So far, world stock indexes have lost over $30 trillion and there will probably be another bloody leg down in 2009. As the underlying economy contracts, there’s no need for a lumbering, oversized financial system. Institutions will have to be shut down and their assets will have to be sold at auction. That means prices will continue to fall, business activity will falter, and GDP will shrivel. The mismatch between output and falling demand presages a painful correction. When credit gets scarce, business activity slows, and nervous investors head for the exits. That forces businesses to lay off workers which causes prices to fall even further, accelerating the pace of deflation. Economist Henry Liu made these observations in his article “China and the Global financial Crisis”:

“US neoliberal trade globalization, having promised a primrose garden of economic growth, has instead led the global economy into a jungle of poison reed, resulting in the worst financial disaster in a century, setting the whole world ablaze with a financial firestorm. This unhappy fate was finally acknowledged as having been policy-induced by Alan Greenspan, the former Chairman of the US Federal Reserve who was largely responsible for the monetary indulgence that had caused this hundred-year financial perfect storm….The Federal Reserve under Greenspan repeatedly created money faster than the global economy could profitably absorb, creating serial bubbles denominated in fiat dollars. Greenspan insisted that it was not possible, nor desirable, to identify an economic bubble in the making as he was inflating it with easy money, lest economic growth should be prematurely cut short. It was a perfect example of the rule that intoxication begins when a drinker becomes unable to know its time to stop drinking.” (Henry C.K. Liu China and the Global Financial Crisis”, Asia Times)

The Fed wants to stimulate demand by slashing the price of money to 0% while pumping trillions of dollars into the financial system (quantitative easing). But the millions of foreclosures, credit card and student loan defaults, indicate that the underlying economy is rapidly contracting and cannot support such an oversized system. Something’s gotta’ give. Homeowners and consumers are poorer than they were a year ago. They’re focused on paying down their debts not creating new ones. Attitudes towards spending have changed; people are hunkering down. That’s why Bernanke’s radical liquidity experiment is doomed. There’s no way to reflate a bubble if consumers refuse to spend.

If the Fed is serious about fulfilling its mandate, it should abandon its serial bubblemaking altogether and return to basics; productivity, good wages and sound money. The country’s future rests on its workers. They don’t need a bailout, just a raise.

Lord Mandelson slopes off with Nat Rothschild

Clearly unabashed by my revelations about his eventful holiday as a guest of Nat Rothschild in Corfu during the summer, Lord Mandelson is to spend Christmas at the financier’s chalet in Klosters.

 

Tim Walker
Last Updated: 3:56PM GMT 23 Dec 2008

“Peter will be coming out for Christmas,” I am told. “He is becoming something of a regular at his chalet.”

The Business Secretary’s stays with Lord Rothschild’s son and heir at the fashionable Austrian ski resort are always lavish occasions. When he stayed in August another member of the house party, Yulia Wegg-Prosser, claimed in her blog that their host had urged his friends to make good use of his expensive fleet of cars, which include a Porsche and a Ferrari. Mandelson’s relationship with Rothschild became a major talking point when I disclosed on October 6 that the former European trade commissioner had, while staying with Nat in Corfu, been entertained aboard the yacht of Oleg Deripaska, the aluminium tycoon, whose businesses benefited from tariffs the commission set.

It is not known whether the pair will be joined over Christmas by Deripaska, who bought a chalet in Davos, in the Swiss Alps.

One trusts Mandelson will offer better value on Christmas Day than he did when he stayed with Nat in August. Then, Mrs Wegg-Prosser noted on her blog how he spent some time “snoring on the sofa”. That entry was allowed to stand, but it appears she was prevailed upon to remove the one about Nat’s relaxed attitude to the use of his cars.

Madoff in 2007: “I’m very close with the regulators.”

The Dollar’s Future? – Zimbabwe introduces 10 billion dollar banknote

Zimbabwe’s central bank has introduced a 10 billion Zimbabwe dollar banknote, worth $20 on the black market, to try to ease desperate cash shortages, state-run media said on Friday.

 

Last Updated: 10:19PM GMT 19 Dec 2008

Prices are doubling every day and food and fuel are in short supply in Zimbabwe. A cholera epidemic has killed more than 1,100 people and a deadlock between President Robert Mugabe and the opposition has put hopes of ending the crisis on hold.

Hyper-inflation has forced the central bank to continue to unveil new banknotes which quickly become almost worthless.

New Z$1 billion and Z$5 billion notes were also put into circulation and the monthly cash withdrawal limit was increased fivefold to Z$10 billion.

“The increase in cash withdrawal limits is set to go a long way in improving workers’ access to their money,” the Herald said.

But previous issues of new banknotes have done little to curb the cash crunch faced by Zimbabweans, who often line up for hours outside banks to withdraw barely enough to buy a loaf of bread.

Critics blame the economic meltdown on mismanagement by Mugabe’s government, including the seizure and redistribution of thousands of white-owned farms. The once thriving agricultural sector has fallen into ruin.

The veteran Zimbabwean leader, in power since independence from Britain in 1980, says Western sanctions are the main cause of the economic crisis.

Political analysts say the establishment of a unity government between Mugabe’s ZANU-PF party and the opposition Movement for Democratic Change is the best hope of reversing the economic slide and worsening humanitarian crisis.

But power-sharing talks have reached deadlock over the control of key ministries in the government. Tsvangirai accuses Mugabe of trying to assign the MDC a junior role.