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AdirondackFund (< 20)

Audit the FED 'dangerous'? Geithner thinks so...

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31

August 26, 2009 – Comments (14) | RELATED TICKERS: GS , S

Here's the link to Karl Denninger's webpage where he posts a WSJ interview with Treasury Secretary Geithner.  Of particular interest to me was Geithner's 'expressiveness' over defending himself against the claim that he worked for Goldman Sachs.  You've been baited Mr. Secy.  No, you didn't ever work for Goldman Sachs, but what you are failing to tell the Public is that you sailed with these guys every weekend at the Larchmont YC for the past decades and know them intimately.  Starboard! 

We are witnessing the greatest example of 'regulatory capture' known in the History of man, and while Mr. Geithner never worked for GS, it didn't ever prevent him from buddying up to these folks during Race Week or any of the other bi-weekly J/24 events run at Larchmont YC or on Long Island Sound.  When Bob Rubin heard of the fun, he ran right out and got himself a boat, which he kept at City Island, just a short distance away.  Rubin has no clue how to sail, but you need a boat for this kind of thing, and at these salaries it is pretty easy to find a Captain on the cheap.  How do I know this?  Because I was standing right there watching all of this unfold...and I noticed what was going on.  This is a criminal conspiracy from top to bottom.  It is the way these characters act and behave.  They simply would never know that there is anything wrong with these conflicts of interest any more than our former Secy. of Treasury Paulson did.

It is time to remove the Banksters from our Nation's Government.  They know nothing and contribute nothing to the Nation's Economy.  It is not their right to profit at the expense of The People.  Thanks Tim for steping into the 'bear trap'.  You've incriminated yourself, as Goldman Sachs does all the time (see Goldman Wives bulldozing the line at last week's Charity Event in The Hamptons), by your expressions, your associations AND by your actions.  That's not very smart, now is it?  We do not need incompetent rubes in office ruining our financial system to make a quick buck for their friends.  That is called 'Crony Capitalism'.  Perhaps you have heard of it Mr. Secy??? 

Here's the link:

http://market-ticker.denninger.net/archives/2009/08/25.html

14 Comments – Post Your Own

#1) On August 26, 2009 at 2:07 PM, jason2713 (< 20) wrote:

And the market continues to be in the green, despite it all.

 

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#2) On August 26, 2009 at 2:24 PM, kdakota630 (29.86) wrote:

1 rec for you.

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#3) On August 26, 2009 at 2:33 PM, alstry (35.21) wrote:

Hey...why are getting censored so often...are you the new Alstry?  Is Donner filing complaints about you?

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#4) On August 26, 2009 at 2:35 PM, AdirondackFund (< 20) wrote:

LOL.  maybe.....  I think it has more to do with the danger in testimony issue.  I kinda know where all of the 'dead bodies' are burried. 

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#5) On August 26, 2009 at 2:49 PM, AdirondackFund (< 20) wrote:

@alstry

I can't believe the floor of the NYSE is putting up with this nonsense.  They have been victimized by it more than anyone else.  The Cardinal Rule is 'do what you want, but don't get caught.'   I think they've been caught at GS and at Treasury.  Somebody call a COP. 

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#6) On August 26, 2009 at 3:02 PM, silverminer (31.43) wrote:

 AdirondackFund

Great post!

 

http://www.livescience.com/culture/090826-stock-market.html

A recent analysis of the 2007 financial markets of 48 countries has revealed that the world's finances are in the hands of just a few mutual funds, banks, and corporations. This is the first clear picture of the global concentration of financial power, and point out the worldwide financial system's vulnerability as it stood on the brink of the current economic crisis.

A pair of physicists at the Swiss Federal Institute of Technology in Zurich did a physics-based analysis of the world economy as it looked in early 2007. Stefano Battiston and James Glattfelder extracted the information from the tangled yarn that links 24,877 stocks and 106,141 shareholding entities in 48 countries, revealing what they called the "backbone" of each country's financial market. These backbones represented the owners of 80 percent of a country's market capital, yet consisted of remarkably few shareholders.

"You start off with these huge national networks that are really big, quite dense," Glattfelder said. “From that you're able to ... unveil the important structure in this original big network. You then realize most of the network isn't at all important."

The most pared-down backbones exist in Anglo-Saxon countries, including the U.S., Australia, and the U.K. Paradoxically; these same countries are considered by economists to have the most widely-held stocks in the world, with ownership of companies tending to be spread out among many investors. But while each American company may link to many owners, Glattfelder and Battiston's analysis found that the owners varied little from stock to stock, meaning that comparatively few hands are holding the reins of the entire market.

“If you would look at this locally, it's always distributed,” Glattfelder said. “If you then look at who is at the end of these links, you find that it's the same guys, [which] is not something you'd expect from the local view.”

Matthew Jackson, an economist from Stanford University in Calif. who studies social and economic networks, said that Glattfelder and Battiston's approach could be used to answer more pointed questions about corporate control and how companies interact.

"It's clear, looking at financial contagion and recent crises, that understanding interrelations between companies and holdings is very important in the future,” he said. "Certainly people have some understanding of how large some of these financial institutions in the world are, there's some feeling of how intertwined they are, but there's a big difference between having an impression and actually having ... more explicit numbers to put behind it."

Based on their analysis, Glattfelder and Battiston identified the ten investment entities who are “big fish” in the most countries. The biggest fish was the Capital Group Companies, with major stakes in 36 of the 48 countries studied. In identifying these major players, the physicists accounted for secondary ownership -- owning stock in companies who then owned stock in another company -- in an attempt to quantify the potential control a given agent might have in a market.

The results raise questions of where and when a company could choose to exert this influence, but Glattfelder and Battiston are reluctant to speculate.

"In this kind of science, complex systems, you're not aiming at making predictions [like] ... where the tennis ball will be at given place in given time," Battiston said. “What you're trying to estimate is ... the potential influence that [an investor] has."

Glattfelder added that the internationalism of these powerful companies makes it difficult to gauge their economic influence. "[With] new company structures which are so big and spanning the globe, it's hard to see what they're up to and what they're doing,” he said. Large, sparse networks dominated by a few major companies could also be more vulnerable, he said. "In network speak, if those nodes fail, that has a big effect on the network."

 

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#7) On August 26, 2009 at 3:07 PM, silverminer (31.43) wrote:

And considering the source....... I wonder what the REAL number will be.

http://www.bloomberg.com/apps/news?pid=20601087&sid=awWsNf0zRkYY

Goldman’s Hatzius Says Fed Balance Sheet Could Hit $4 Trillion

Jan Hatzius, chief U.S. economist at Goldman Sachs Group Inc., said the Federal Reserve could double the size of the central bank’s balance sheet again if needed to support economic growth.

A rise in the balance sheet to $4 trillion is a “possibility,” Hatzius said in an interview on Bloomberg Radio in New York. “It is going to depend on not just what inflation does, but also on whether the economy does move back to a slower growth pace.”

Fed Chairman Ben S. Bernanke has cut the main U.S. interest rate to almost zero and more than doubled total assets on the central bank’s balance sheet to unclog credit markets and help meet banks’ demand for cash. Fed officials have started to phase out such programs, deciding this month to let a $300 billion program to purchase long-term Treasuries expire in October.

The size of the Federal Reserve’s balance sheet has increased to $2.02 trillion as the central bank purchased assets aimed at lowering interest rates, as of the week ended Aug. 12.

The Fed must now guide the world’s largest economy back to growth and reduce unemployment approaching 10 percent while shrinking the balance sheet to prevent a surge in inflation, Hatzius said.

“Rates need to stay low,” he said. The Fed “could become more aggressive in purchasing assets. They have not gotten a lot of bang for the buck on that policy so far.”

U.S. unemployment will surge to 10 percent this year and the budget deficit will widen to $1.5 trillion next year, reflecting a “deeper recession” than previously expected, the White House said today.

 

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#8) On August 26, 2009 at 3:49 PM, jesusfreakinco (29.12) wrote:

How long will the Chinese and other USD creditors allow their holdings to be devalued by the printing of money and by the unusually low interest rates?  Isn't this the $100 trillion question?

JFC

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#9) On August 26, 2009 at 4:10 PM, AdirondackFund (< 20) wrote:

You might be suprised to find that most of the Debt is held by US and British Citizens....and not by the 'chinese'.  The Chinese Myth is way overblown.  You have to keep in mind that the 'seed' was planted in the Unconditional Surrender of Japan.  It then spread to Korea, the Philippines, Indonesia and then China, once they realized the jig was up. 

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#10) On August 26, 2009 at 4:19 PM, alstry (35.21) wrote:

Ad,

All the cops with power have been bought.....any move from now on is simply part of the plan or exhaustion.

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#11) On August 26, 2009 at 4:31 PM, AdirondackFund (< 20) wrote:

I did notice that William Bratton left office as Chief-of-Police in LA.  He served in NYC and I remember him as a man of incredible integrity.  I think he's off to Indonesia or something, doing the 'secuity service' gig.  Maybe he knows something...and decided to bugout. 

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#12) On August 26, 2009 at 5:17 PM, ocsurf (< 20) wrote:

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#13) On August 26, 2009 at 5:38 PM, alstry (35.21) wrote:

I think you might see a lot of people buggin out over the near term.

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#14) On August 26, 2009 at 5:59 PM, AdirondackFund (< 20) wrote:

@ ocsurf

Excellent graphic there.  *big smile*

@ Alstry

I'm trying to actually figure this out and everything leads to dead ends.  I'm very serious about that.  Unless I read the wrong textbooks my entire life, or missed something along the way, I have no clue how any of this could possibly work without wiping out everyone's savings either through Inflation, Deflation or Taxes. 

Lying might be the only way out....at least our leaders seem to hope so.  I've just never seen, or ever heard of, an economy prospering as a result of a streak of chain blue lightning lying.        

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