December 27, 2010 at 10:53:10

FROM MIDDLE CLASS TO SLAVE CLASS - COURTESY OF THE FED, THE WHITE HOUSE, CONGRESS AND THE BANKERS.

By lila york (about the author)

opednews.com

There have long been claims that the banking crisis of 2008 was premeditated financial terrorism; a Google search turns up 215,000 references to that proposition, including Dylan Rattigan's widely viewed exposes on CNBC and elsewhere. The banks were overextended on derivatives trades that could not be met, and they had knowingly foisted "AAA-rated' toxic mortgage debt, certain to blowup, onto unsuspecting European banks and American pension funds. Moreover, the privatization of Social Security, which George W. Bush pushed hard for, was intended to pull in trillions of dollars to Wall Street investment banks that would have papered over the losses. When that failed in Congress, the writing was on the wall. Was the financial meltdown calculated to force working people to pay off the debts of the Wall Street gamblers and cover the potential bond losses of the richest one percent? Probably. Congressional investigations stopped short of accusations that would have resulted in legal prosecutions. And no wonder. Wall Street banks dump millions in campaign donations on senators and congressmen every year. Quite the gravy train. Add to this the suspicion of many traders that Lehman Brothers was allowed to go down because that firm was Goldman Sachs' chief rival on the Street and Treasury Secretary Hank Paulson was a Goldman guy, and you have a picture of likely corruption on all levels.

More shocking still is a recent revelation by Lee Adler, founder and editor of The Wall Street Examiner. His chart (see below) of the SOMA (System Open Market Account) shows that the Fed single-handedly caused the recession, and probably the global financial meltdown that preceded it. It tells us that the Fed withdrew liquidity at the precise moment that it was needed. If true, it is certainly grounds to end the Fed entirely and return currency operations to the Federal government. If true, we can only conclude that the Fed, the investment banks, The White House and the Congress are colluding to rob the middle class of what assets they have and turn them over to the wealthy. Is this class warfare? Yes, only we did not start it. They did.

The Fed Caused the Recession by Lee Adler

Albert Edwards, Head of Global Strategy at Societe Generale, maintains that the central banks of the U.S. and U.K. colluded with legislators to impoverish the middle classes and to redistribute their wealth to the richest one percent. He ponders whether "the US and UK central banks were actively complicit in an aggressive re-distributive policy benefiting the very rich. ".Did central banks, in creating housing bubbles, help distract middle class attention from this re-distributive policy by allowing them to keep consuming via equity extraction? The emergence of extreme inequality might never otherwise have been tolerated by the electorate. And now the bubbles have burst, along with central banks credibility. "

President Obama's recent deal to provide extended tax cuts to the wealthiest Americans - a deal he cut with Republicans without even consulting his own party's Congressional leaders - would seem to lend credence to Edwards' argument. We know who suffered from the banking collapse and bailout: It was the middle class, who lost jobs, homes, savings - all that they had. And we know who gained: the bondholders who lost nothing and who were, coincidentally, members of that top 1% of income earners. For a nation 14 trillion dollars in debt to tell its wealthiest taxpayers that they do not have to contribute to society, and that when they die they can keep their billions and turn their children into trillionaires is neither rational nor workable in a democratic society. We have to wonder if Obama has any interest in sustaining the republic or if he ever did. (For a macro view of what the global financial elite have to gain from staging market crashes, see Giordano Bruno's provocative article, "The purpose behind engineered market collapse". Bruno maintains that what the elite have in mind for us in shifting wealth to the top .1% looks a lot like slavery, although he also believes that they will fail to achieve their goal).

The recent scandals over foreclosure abuses in Florida and Arizona give us a clue as to just how ravenous the banks are to acquire middle class assets. Homeowners who were not even in foreclosure and some who had no mortgage at all were evicted from their homes and dispossessed of their belongings by bank-hired agents. Some major banks - notably Bank of America, Deutsche Bank and JP Morgan Chase - have taken the position that they are entitled to repossess all homes where the homeowner is delinquent, whether they hold legal title to the properties or not.

For the record, the Federal Reserve is not Federal with a capital F. It is composed of a group of private banks, notably J.P.Morgan Chase, and it loans money to the Federal government for which it charges interest. The Fed was enacted into being by a late night vote of the U.S. Senate on December 23, 1913 when 27 senators had already gone home for Christmas recess. The purchasing power of the dollar, which had remained constant for decades since the Civil War, soon began a slow and unrelenting decline, which has lasted until the present day.

The wealthiest Americans keep their savings off-shore in any case. So even the outright demise of the dollar would not affect them much. As for the rest of us, the 99% of us who struggle to stay afloat, feed our families and educate our children, we can only assume that the Federal Reserve, the President and a majority of the Congress do not give a rat's ass about any of us - except perhaps as potential slaves.

Lila York is a choreographer and activist

The views expressed in this article are the sole responsibility of the author
and do not necessarily reflect those of this website or its editors.

Published on Monday, December 27, 2010 by NPR

Foreclosures Still Dragging Down Housing, Economy

by Chris Arnold

The housing market has remained at the center of the nation's economic troubles throughout 2010. The housing market started the year flat on its back, and it's ending the year in nearly the same condition.

Debra Dahlmer has been trying to get a loan modification through Bank of America for more than a year. She’s legally blind in one eye and can barely see with the other. (Chris Arnold/NPR)

Home sales are still depressed, home-building remains near a 50-year low, and home prices are still about 30 percent below their peak.

Part of the problem this year has clearly been high unemployment. But the ongoing foreclosure crisis also keeps glutting the market with unsold homes. Meanwhile, the government's efforts to prevent foreclosures over the past year were a pretty big disappointment to many people.

A Homeowner's Struggle With The Foreclosure Prevention Program

Debra Dahlmer, 55, has lived in her home in Gloucester, Mass., for most of her life. Over the years, most of the family has worked at the nearby Gorton's frozen fish processing plant.

But back in 2008, Dahlmer's husband passed away. She never missed a mortgage payment. But she could see she was running out of money and would soon fall behind.

"I just found when the life insurance was gone, and with the medical expenses, I just couldn't do it," Dahlmer says.

She is a diabetic and is legally blind in one eye. Dahlmer also has such limited sight in the other eye that she has to read with a magnifying glass pressed tight against her face.

The prospect of losing her home was scary, especially since her 80-year-old mother lives downstairs.

"Where would my mom go?" Dahlmer says. "Where would I go?" She worried about being on the street.

But Dahlmer has guaranteed income because she's on disability, and she has a tenant living in part of the house. With the rental income, and the outstanding balance of the mortgage on the house, she appears to be a perfect candidate for President Obama's foreclosure prevention program, called the Home Affordable Modification Program (HAMP).

HAMP was supposed to help up to 4 million Americans keep their homes. But it's only assisted a small fraction of that number.

Dahlmer's situation offers a case study in the program's failures. Despite her efforts over the past year, she hasn't been able to obtain a permanent fix — in the form of a more affordable mortgage payment — approved through the program.

She's been working through her lender, Bank of America. But that has turned into a paperwork nightmare.

"I thought a big business was supposed to know what they’re doing," Dahlmer says.

A Frustrating Pattern: Banks Losing Documents

Like many other homeowners, Dahlmer says she's been tearing her hair out faxing in proof of income and tax documents, only to have the bank lose them.

For her that's especially hard because of her vision problems. Still, she takes notes about the process in huge print with a black magic marker.

Over the past year, she's repeatedly asked call center workers what's going on. She says they tell her, " 'I'm sorry, but you haven’t sent in the documentation.' "

Dahlmer says she has sent in all the documentation. But it gets lost again in a never-ending cycle. The bank then asks for something they never asked for before.

"It just goes on and on," she says.

Dahlmer says she's been getting all kinds of foreclosure-related junk mail, and that's getting her very nervous again.

After NPR contacted Bank of America, the bank says they're looking into Dahlmer's case and hope to resolve it within a few weeks.

Sharp Criticism From A Government Oversight Panel

A congressional oversight panel this year has been harshly critical of the Treasury Department for failing to enforce the agreements the major banks made to take part in the administration's HAMP program.

All of the major banks have been having similar problems — losing documents and rejecting homeowners who appear to qualify for unknown reasons. Hundreds of thousands of homeowners are now falling out of the federal program.

"The foreclosure modification effort has been a real mess," says Mark Zandi, the chief economist of Moody's Analytics. With millions of people facing foreclosure, he acknowledges that it's been a very difficult challenge for the banks. But, he says, "even considering that, it just hasn't gone well."

A Housing Bottom In 2011

Despite all these problems, Zandi thinks housing is finally approaching a turning point. He expects the market to bottom out in 2011.

"It's been a five-year road south, and it's been a complete cratering of the market," he says. "But I think 2011 marks the end of that crash."

Zandi says there are some more housing price declines ahead, as all these foreclosures continue to glut the market with millions of homes at fire-sale prices.

But by next summer, he expects prices to start stabilizing, with some price growth in 2012.

Access To Credit, Fannie And Freddie's Future

Another big issue for the housing market this year was access to credit. Interest rates have been very low by historical standards. But many people can't qualify for those low rates.

"This is one of the variables that we have to correct," says Brian Chappelle, a mortgage consultant with Potomac Partners.

He thinks the pendulum has swung too far and lenders are being too tightfisted. One problem, he says, is that Fannie Mae and Freddie Mac, the government-backed mortgage giants, have been in a wrestling match with lenders of all sizes — forcing them to buy back loans that have gone bad.

Some of this wrangling is good for taxpayers because it saves them money. But Chappelle says it's got the banks nervous and less willing to make new loans.

In 2011, Congress will debate what to do with Fannie and Freddie. Right now, the government is using them to prop up the housing market. But all sides want to see a major overhaul of the government's role in housing.

© 2010 National Public Radio

Everything is Rigged

Ever been to Las Vegas? Ever try your hand at blackjack or roulette or — pardon the expression — craps? How did you make out? Win a time or two? Good!

Be honest, now. Even if you won a few bucks once or twice — did you wind up losing more than you won? Maybe a lot more? And was that partly because you were making rash bets, trying to win back what you’d lost already?





December 27, 2010 at 11:25:29

THE U.S. STOCK MARKET IS RIGGED

By lila york (about the author)

opednews.com

Does the United States still have a stock market? Not really. In a real market, when there are more sellers than buyers, prices decline. And vice versa of course. That is called "price discovery"; or used to be. Since January of 2010 investors have withdrawn a net total of 81 billion dollars from U.S. stocks and funds, this week marking the 33rd consecutive week of outflows, while stock prices have staged a missile launch upward that started in mid-July. Floyd Norris of the New York Times confirms that outflows have remained at record high levels over the last four years. Some of the funds withdrawn resulted from industry insider selling, and much of that was re-invested in commodities and emerging markets. But a substantial amount, according to Charles Biderman, CEO of Trimtabs, was withdrawn by middle-class Americans to pay monthly bills.

In an unprecedented interview on CNBC, Biderman stated that the Federal Reserve is no longer denying the fact that it has been rigging U.S. markets nor is the Fed making any effort to hide it. An unrelenting and counter-intuitive rally has ensued, with stock prices gapping up at 4:00 AM night after night and never looking back. Even before the Fed initiated its POMO (Permanent Open Market Operations) injections of outright treasury buys in a program euphemistically titled "Quantitative Easing 2" (a.k.a printing money out of thin air) the Fed's daily zero percent loans of taxpayer money to Goldman Sachs and J.P. Morgan were used almost exclusively to buy stocks - and then sell them again within minutes or even seconds. Investment banks use high frequency trading computers (HFTs) programmed to essentially steal money, one penny at a time, from any retail investor foolish enough to believe he could make money by trading or investing in stocks. Their computers, operating at speeds no human with a laptop could match, front-run orders, ensuring a profit on every trade. Wall Street investment banks have the right, unlike everyone else, to trade in increments of 1/1000 of a penny, allowing them to deny order fills by keeping the price 1/1000 of a penny below the bid. It is one of many questionable and even illegal practices engaged in by what the internet bears cartoons refer to as the "the Goldman Sack" and "the JP Morgue". The web cartoons have gone viral, as they say, and served to educate the uninitiated in the grand-theft-stock-market game being run by the Fed and the Wall Street gangs.

The website ZeroHedge.com has, over the last year, published several articles by traders who have monitored ongoing price fixing and HFT computer games. Institutional broker, Gene Noser says that HFT trading systems threaten to destroy the entire capital market system. "[They] are unregulated, often under-capitalized, and provide no redeeming social function. As I see it, they exist to extract value from real investors one fraction of a penny at a time, over and over again."

The upshot of all of this is that while the economy has seen virtually no benefit from the Fed's massive liquidity injections, Wall Street's top bankers continue to enjoy annual bonus payments in amounts ranging from 24 to 111 million dollars.

Trading records show that "the Sack" and "the Morgue" have earned profits in almost every single trading day in the last three quarters. How can that be? It can be because those two banks are the market makers, setting the prices, and then betting on the very prices they themselves set. Las Vegas casinos are pikers next to these guys, since casino profits are limited by law. Not so for the Wall Street gang. The big money players are not buying common stocks these days in any case. They make private equity deals and trade off-market and off-hours in something known as a "dark pool", a cyberspace location I have always pictured as a black hole in space. As George Carlin famously said, "It's a club, and you ain't in it"

From a technical point of view, traders expected a washout low in stocks last August. It never happened, as that was the moment when "the Ben Bernank" fired up his printing presses and digitally created billions of fictitious US dollars with which to buy stocks and bonds. The last time that a central bank in a western democracy printed money this wantonly was in Wiemar Germany. And most of us know how that ended: hyperinflation that produced the image of a wheelbarrow full of paper money required to buy a loaf of bread. In 2010 America, commodity price rises are showing up in higher grocery bills and gas prices, higher education costs and health-care costs, but so far nothing as dramatic as Zimbabwe's multi-thousand percent inflation. Could it still happen here? It could. There is a lag of 12 to 18 months for liquidity to show up in consumer prices, so we cannot know what prices will look like a year from now. Gold prices have risen steadily throughout the Bernanke liquidity rush, with silver showing parabolic gains over the last six months. Whether those price rises reflect a loss of faith in governments or a fear of inflation, the end result is the same. Our currency is being deliberately devalued, at a time when we are dealing with record job losses and wage depreciation.

For the moment, the dollar is holding up because of Moody's serial downgrades of some European government debt, most recently Portugal's bonds. Euro problems could cause the dollar to rise by default over the next two to three months. But at some point attention will turn back to the Fed's POMO operations, and the dollar could suffer a precipitous decline with little warning.

The POMOs are scheduled to continue with money printing of between one and 19 billion dollars - that is per day - through June of 2011. Where will the U.S. economy be when QE2 ends? It will be where it is now, as the Fed's money printing, while raising the costs of essential food and energy, has had no notable effect on job numbers or salaries. What it does do, with every uptick in the Dow Jones Industrial Average, is increase the wealth of those who are already wealthy.

Lila York is a choreographer and activist

The views expressed in this article are the sole responsibility of the author
and do not necessarily reflect those of this website or its editors.

It's All About The Money

Money Is Still the Name of the Game

by Michael Parenti / December 27th, 2010

For years certain pundits and political scientists have insisted that money is not all that important in winning elections. Large sums expended on campaigns glean only an extra percentage point or two in votes, we are told, and often the candidate who spends the most ends up losing anyway.

“Other Variables”

In 2010 Republican candidate, Meg Whitman, smothered the California gubernatorial contest with $142 million of her own money but still lost to Jerry Brown who spent a mere $24 million, along with another $27 million or so put up by independent groups. Such results are seized upon by those who argue that money does not guarantee victory. They insist that other variables — such as party affiliation, incumbency, candidate’s image, and key issues — may be the deciding factors.

True, but we should remember that these “other variables”, themselves, are most likely to gather form and substance within a well-financed campaign. Feeding on large sums, a candidate can promote his image in a highly favorable light and advertise (or bury) the issues as best suit him, all the while casting mean shadows upon his financially weaker opponent.

Getting back to California’s Meg and Jerry show: candidates who win while spending less than their opponents, as Jerry Brown did, still usually have to spend quite a lot, about $50 million in his case. While never a surefire guarantor of victory, a large war chest — even if not the largest — is usually a necessary condition. In sum, money may not guarantee victory, but a serious lack of it almost always guarantees defeat.

No Money, No Game

Without large sums, there is rarely much of a campaign, as poorly funded “minor” candidates have repeatedly discovered. A candidate needs money for public relations consultants, pollsters, campaign travel, meals, canvassers, poll watchers, office space, telephones, computers, faxes, mailings, and, most of all, media advertisements.

Indeed what makes someone a “minor” candidate is the lack of a sufficient war chest — which leads to the lack of sufficient campaign visibility. Conversely, someone with a huge war chest is likely to be treated by the media as a “major” candidate. So money not only influences who wins, but who runs and who is taken seriously when running. Rich candidates sometimes are backed by party leaders explicitly because they have personal wealth and can use it to wage an effective campaign.

One of my favorite examples is Steve Forbes who ran unsuccessfully for the GOP presidential nomination in 2000. Of lackluster personality and fuzzy program, Forbes had never held public office in his life and had no close links to Republican Party regulars. But being able to spend $30 million of his personal fortune (back when $30 million was still an exceptional amount for a presidential primary), Forbes was immediately treated by the media as a serious contender. He even won Republican primaries in two states.

Money Primary, Media Primary, and Voting Primary

In all, there are three primaries not one. There is the voting primary, the one we all know about and sometimes participate in. But before that is the media primary and before that the money primary.

Decades ago, candidates used to play down how much money the private interests were pouring into their coffers. It was understood that a heavily financed candidate would owe a lot of favors to a lot of fat cats and could hardly promote himself as a champion of the ordinary voters.

Today candidates openly flaunt the size of their war chests at the early stages of a primary in the hope of taking on an appearance of invincibility, thereby discouraging other candidates. This triumphalist imaging, in turn, attracts backing from still other big contributors.

During the 2000 Republican presidential primaries, George W. Bush won the money primary by raising $50 million four months before the first voting primary in New Hampshire. That sum came from just a small number of super rich donors. Several other GOP primary opponents dropped out after they discovered that most of the fat cats had already fed their checkbooks to Bush.

By the time Bush won his party’s nomination in July 2000, he had already spent over $97 million — and the campaign against his Democratic opponent had yet to begin. Thus, well before the actual election, a handful of super rich contributors winnow the field, predetermining who will run in the primaries at what level of strength and with what plausibility. Only the very rich get to “vote” in the money primary.

The candidates who lose the money primary swiftly lose the media primary also. This is especially true if they have progressive politics. Consider the valiant campaign waged in 2008 by Representative Dennis Kucinich for the Democratic presidential nomination. His advocacy of progressive reforms left him with little access to big money. As a poorly funded candidate he was immediately labeled in the media primary as a “minor” candidate.

The media label was self-fulfilling. Defined as a minor candidate, Kucinich was accorded hardly any serious media exposure. Having lost the money primary, he would now lose the media primary. One scarcely knew he was participating in debates with “major” candidates. Deprived of media exposure, Kucinich achieved near invisibility and consequently was unable to reach many voters who otherwise might have been interested in what he had to say.

Big Spenders = Big Winners

Let’s face it, candidates who are the bigger spenders may not always win but they usually do, as has been the case over the last fifteen years in more than 80 percent of House and Senate contests. Even in “open races,” with no incumbent running, better-funded candidates won 75 percent of the time.

According to a Public Citizen report on the 2010 mid-term elections, in 58 of the 74 contests in which power changed hands, the winning candidates rode enormous waves of cash, outspending their opponents with funds from “shadowy front groups, giant corporations and the super rich.”

This does not establish a simple one-to-one causal relationship between money and victory. But given the central role money plays in launching a campaign and defining who is and who isn’t a “serious” candidate, how can we say it is without decisive impact?

The reactionary judicial activists on the Supreme Court do their best to advance the role of big money in politics. In decisions like the 2009 Citizens United case, the Court’s reactionary majority repeated its arcane contrivance that (1) rich corporations are “persons” with human rights and (2) money is a form of speech. By imposing spending limitations we supposedly are restricting free speech and violating the First Amendment. Some years ago Justice Stevens took issue with this fanciful fabrication, reminding us that “Money is property; it is not speech.”

But money is the kind of property that feeds into and mobilizes all sorts of other power resources. I haven’t mentioned the other influential roles that money plays beyond election campaigns: ownership of print and broadcast media, control of jobs, financing research institutes, recruiting and training conservative activists, bankrolling lobbyists, and the like.

Heed not the system’s apologists who treat a money-driven political process as a matter of no great moment. Truth be told: if you’re not in the money, you’re not much in the game. It’s time we faced up to the plutocracy that masquerades as democracy.

Michael Parenti’s most recent books are Contrary Notions (2007), God and His Demons (2010), Democracy for the Few (9th ed. 2010), and The Face of Imperialism (forthcoming April 2011). Read other articles by Michael, or visit Michael's website.

This article was posted on Monday, December 27th, 2010 at 7:01am and is filed under Elections, Finance.

AlterNet.org

MEDIA

AlterNet / By Joshua Holland

As Wall Street Tries to Strong-arm Consumers, Will WikiLeaks Bring One of the Biggest Banks it to Its Knees?

The banks have been going after their critics, but one big Wall Street player may meet its match in the coming weeks.

December 22, 2010 |

Wall Street has worked hard to keep its inner workings from seeing the light of day. But one of the worst offenders in the financial crisis may be about to face the kind of public disrobing that government regulators, the corporate media and transparency activists are incapable of performing. If the rumors that have been swirling around in recent months prove true, Bank of America's dirty secrets may soon be exposed for the world to see, courtesy of the whistle-blower site Wikileaks.

The banks prefer not to give out information, even when required to do so by law. Consider their potentially illegal response to a campaign by the service employees union, SEIU called, “Where's the Note?” that helps homeowners request a copy of their mortgage-holder's proof that it actually holds the note on their properties. According to SEIU – and confirmed anecdotally by others – borrowers who take advantage of SEIU's system have faced retaliation in the form of lower credit ratings: they send in the request, and see their credit scores fall. It's a likely violation of the Fair Lending Act, and as Roosevelt Institute fellow Mike Konczal noted, it's a serious threat:

In the middle of a foreclosure fraud crisis where people aren’t sure who owns their mortgage, a simple ask of “can you show me the contract I signed with you, just to make sure it is there if there is a dispute” is being used to threaten someone’s credit score.... Since credit scores impact everything else in your life, from being able to turn on your lights and electricity to renting an apartment to purchasing things, this is a serious threat, one of the more grievous ones a private company can deliver.

David Dayen at Firedoglake adds that the heavy-handed response to SEIU's campaign “is part of a broader trend, where the servicers and big banks, having been exposed by the foreclosure fraud crisis, are now lashing out at their critics.”

The St. Petersburg Times reported that one company, Nationwide Title clearing, has taken to using legal bullying tactics to stifle its critics. The company filed an injunction against Sarasota lawyer Christopher Forrest “to remove videotaped depositions he had posted of three Nationwide Title employees describing an assembly-line process of signing mortgage-related documents.” The ACLU of Florida filed an emergency appeal of the injunction, calling it a "gag order" and a restraint of free speech.

The company then sued Matthew Weidner, a St. Petersburg lawyer who defends homeowners against wrongful foreclosures, for defamation and libel after he reposted the videos and added some commentary.

Barbara Petersen, the president of Florida's First Amendment Foundation, told the Times that Weidner had played a pivotal role in exposing serious issues in the foreclosure process, “including court hearings from which the public was barred.” "I've been working with Matt on trying to open the foreclosure process and we've made great strides that have a lot to do with his activism," she said. "He's bringing a great deal of national attention to what's going on in Florida."

Nationwide Title claimed that Weidner defamed the company by including the widely used term “robo-signers” in his posts. The charge will be hard to prove, but as Naked Capitalism's Yves Smith noted, the act of suing a lawyer with a small practice “throws a wrench in their operation” as “it takes time to deal with litigation, and often money, plus the stress is also a considerable distraction.” She adds: “Of course, the hope is no doubt that this sort of risk will also deter other lawyers and critics.”

At the heart of all these efforts is the banks' imperative to avoid transparency – transparency that might offer irrefutable evidence for scholar and former regulator William Black's assertion that there was widespread “fraud at every step in the home finance food chain.” (Just this week, the attorneys general of Nevada and Arizona slapped BofA with a “blistering” lawsuit alleging various fraudulent practices on the part of the mega-bank.)

That's why execs at Bank of America must be squirming after a series of messages posted on Twitter by Wikileaks last weekend. One read, “We ask that all people who love freedom close out their accounts at Bank of America,” and a second asked, “Does your business do business with Bank of America? Our advise [sic] is to place your funds somewhere safer.”

Bank of America, following the lead of firms like PayPal, Visa Europe and Mastercard, blocked payments to Wikileaks last week, saying the move was “based upon our reasonable belief that Wikileaks may be engaged in activities that are, among other things, inconsistent with our internal policies for processing payments.”

BofA doesn't only need to worry about hackers launching attacks on its site in retaliation – as they have done to a host of other organizations that have come out against Wikileaks – because the whistleblower itself may have enough dirt on BofA to bring the supposedly too-big-to-fail bank to its knees.

The rumors date back to a 2009 interview Wikileaks founder Julian Assange gave to Computerworld, in which he claimed he was, “sitting on 5GB from Bank of America, one of the executive's hard drives." Last month, Assange told Forbes' Andy Greenberg that the anarchist media group was planning on releasing a “mega-leak” in early 2011 regarding a major U.S. bank, and more recently the Financial Times reported that Assange promised to “release information about the financial services sector in spite of facing 'attacks' by banks.”

Nobody knows what Assange may be sitting on. As Greenberg pointed out, any information Assange was talking about in 2009 is now a year old. But the import of such a release could be far-reaching. As I wrote last month, part of the reason there have been no prosecutions of senior personnel resulting from the fraud that built the mortgage bubble is that the FBI slashed the number of agents dedicated to unearthing financial crimes by some 75 percent since the 1980s, even as the complexity of the alphabet soup of Wall Street's “exotic” investments increased exponentially. Dumping a bank's inner communications on the world's consumer watchdogs, banking reformers and even bloggers would offer thousands of people the opportunity to dig through the raw material.

Another possible reason no big fish have been caught in the Justice Department's net is that senior executives may have learned a lesson or two during the Savings and Loan crisis, when over a thousand bankers were prosecuted, and are far more cautious of leaving a trail of incriminating evidence. It's conceivable that something on some exec's hard-drive might become a smoking gun implicating top management -- proof that fraud wasn't isolated to the "few bad apples" at lower levels who have been prosecuted so far.

A less dramatic revelation could also cause major damage to BofA: revealing to investors that its balance-sheet is full of hidden garbage. As I noted in November, BofA has allegedly been playing fast-and-loose with its numbers. “The problem for anyone trying to analyze Bank of America’s $2.3 trillion balance sheet,” wrote Bloomberg columnist Jonathan Weil, “is that it’s largely impenetrable.” Nobody really knows the true values of the assets these companies are holding, which has been the case ever since the collapse. But according to Weil, some of BofA’s financial statements “are so delusional that they invite laughter.”

These are just a few scenarios that could prove disastrous for the bank. And it's worth keeping in mind the context: the ostensibly 'too-big-to-fail' banks were bailed out under George Bush with the complicity of a Democratically-controlled Congress. It proved to be wildly unpopular, and was used by GOP operatives to help launch the Tea Parties. Now, with a Democrat in the White House and a Tea Party Congress, an additional bailout would be a tall order.

But BofA shouldn't be the only bank sweating over what might be revealed by Wikileaks. Assange told Greenberg that “he had unpublished, potentially damaging documents on multiple finance firms, beyond the bank 'megaleak'” he teased in the interview. It's worth noting that while Wikileaks has been propelled into the spotlight releasing U.S. government documents, its bread-and-butter has been exposing corporate malfeasance. “It is our normal business to publish information about banks,” Assange told reporters earlier this month. “We have been attacked primarily not by government … but in fact by banks: banks from Dubai, banks from Switzerland, banks from the United States, banks from the UK. So yes of course we are continuing to release material about banks.”

Again, nobody really knows what Wikileaks might yet uncover, but it could get really interesting.

Joshua Holland is an editor and senior writer at AlterNet. He is the author of The 15 Biggest Lies About the Economy (and Everything else the Right Doesn't Want You to Know About Taxes, Jobs and Corporate America). Drop him an email or follow him on Twitter.

Osama bin Laden is Dead again...

Tag(s): Intelligence; Osama Bin Laden; Security

December 25, 2010 at 08:04:19

Osama bin Laden is dead -- Maybe CIA can get confirmation from 'SNL'

By Robert Weiner (about the author)

opednews.com

THE WASHINGTON TIMES
December 24, 2010

Osama bin Laden is dead

Maybe CIA can get confirmation from 'SNL'

By Robert Weiner and James Lewis

Last week, al Qaeda issued its annual Christmas threat to the United States promising suicide bombings during the holidays. Here's a better idea for a Christmas present from al Qaeda: a video showing Osama bin Laden - or his grave.

Is bin Laden dead or alive? Nobody seems to know for sure, or, if anybody does, he isn't saying. The White House's Afghanistan-Pakistan review this month didn't even mention him despite an ongoing, decade-long manhunt.

Here's what we know. On Oct. 27, after bin Laden supposedly demanded that France withdraw troops from Afghanistan, the French Foreign Ministry said the tape "can be considered established based on initial verification." U.S. intelligence agencies gave credence to the verification, not only refusing to put out a disclaimer, but letting their staffs back the authenticity of other recent tapes. Upon release of al Qaeda's Jan. 24 tape early last year, ABC reported that intelligence officials "can't verify the authenticity of the tape, but they say there has never been a fake and there is no reason to believe this one is not real." Likewise, CNN's reporting of a June 2009 tape concluded, "A CNN analysis said the voice does indeed sound like the leader of the terrorist network that attacked the United States on Sept. 11, 2001."

CIA reports, doctors and biographers have asserted that bin Laden had (has) a range of diseases from typhoid to renal disease, Addison's disease, secondary osteoporosis and Marfan syndrome. Intelligence agencies think that in 2000, he had kidney-dialysis devices shipped to him in Afghanistan. His 1987 biography states that bin Laden was being treated with insulin for diabetes and suffered serious low blood pressure. Is it likely that the most wanted man in the world has been regularly receiving medical attention without detection for the past 10 years?

In 2008, former CIA case officer Robert Baer asserted, "Of course he's dead." In 2002 and 2009, Pakistani Presidents Pervez Musharraf and Asif Ali Zardari separately stated that bin Laden was dead. In 2002, FBI counterterrorism chief Dale Watson stated that bin Laden "probably" was dead.

Since 2004, we have seen no new bin Laden videos; we've only heard audios. One video released in 2007 could be a compilation of older videos. So why does the intelligence community continue to support the impression that he's alive?

Everyone in America knows how spot-on impersonations can be. "Saturday Night Live" ("SNL") has been doing them for years. Without the glasses, Tina Fey is herself; with them, she is Sarah Palin. Even the cast had difficult telling the difference and mixed them up when Mrs. Palin actually showed up. Amy Poehler's Hillary Clinton and Darrell Hammond's Bill Clinton have riveted late-night viewers for decades. Has Tina Fey met her match in al Qaeda?

Al Qaeda wants America and the world to believe bin Laden is still alive. His image is a specter of the horrors of Sept. 11, helping build public support for everything from troop surges a globe away to warrantless wiretaps at home.

But the image of bin Laden is getting moldy, and there's little reason for his ghost to scare anyone anymore. If al Qaeda wants America to believe bin Laden is alive, it should put up or shut up.

Here's a challenge to al Qaeda: Send a new video that can be analyzed properly. Otherwise, we'll take it all as a big scam, al Qaeda's version of "Saturday Night Live." Otherwise, you betcha, he's dead.

Robert Weiner is a former spokesman for the Clinton White House and the House Government Operations Committee. James Lewis is a national security analyst at Robert Weiner Associates.

Robert Weiner, NATIONAL PUBLIC AFFAIRS AND ISSUES STRATEGIST Bob Weiner, a national issues and public affairs strategist, has been spokesman for and directed the public affairs offices of White House Drug Czar and Four Star General Barry (more...)

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Published on Saturday, December 25, 2010 by Reuters

Fading Optimism in “New Normal” America

by Bernd Debusmann

Optimism is so deeply embedded in the American national psyche that it withstood the Great Depression in the 1930s and a string of recessions since then. But in the era some economists call “the new normal” in America, optimism is fading.

A slew of studies, surveys and reports show that a growing number of Americans – some surveys say more than half – no longer believe that their country is a land of unlimited opportunity, where all it takes to rise to success is hard work and determination.

So say public opinion polls that ask Americans how they see the future, theirs and their country’s. One recent survey, by the respected Pew Research Center, found that depression era Americans were more optimistic about economic recovery in the near future than people questioned in a Pew poll this October, when only 35 percent said they expected better economic conditions in a year’s time. In response to a similar question in 1936 and 1937, about half expected general business conditions to improve over the next six months.

The phrase “new normal” was coined by PIMCO, one of the world’s biggest investment funds, and is shorthand for an American future that includes lowered living standards, slow growth and high unemployment. Joblessness now stands at 9.8 percent, up from 9.6 percent in October. Add workers who have given up looking for jobs and people forced to work part time and the rate climbs to 17 percent, a powerful reason for declining optimism.

But it’s not the only one. A slew of studies, surveys and reports show that a growing number of Americans – some surveys say more than half – no longer believe that their country is a land of unlimited opportunity, where all it takes to rise to success is hard work and determination.

“The end of American optimism,” as a headline over an opinion piece in the Wall Street Journal proclaimed this summer, has not quite arrived. But Americans increasingly believe that the rich just get richer and the poor just get poorer. They have good reason to think so. The rich-poor gap in the United States is wider than in any other developed country.

That has rarely been a matter of concern for most Americans but the recession that began in December 2007 turned inequality into a topic of public debate, on occasion with peculiar twists.

In November, a widely-read New York Times columnist, Nicholas Kristof, compared the United States to Latin American banana republics. To see countries where the richest one percent take home more than a fifth of the national income, he said, it was no longer necessary to leave the U.S.

Two weeks later, he followed up with a column reporting that the comparison had drawn protests from readers who deemed it glib and unfair. Latin Americans thought it hurtful and invidious. After checking into the matter, he came to the conclusion that “I may have wronged the banana republics.”

Unlike in the U.S., he said, Latin America had become more equal in recent decades.

TRICKLE-DOWN THEORY

There is no reason to believe that American income inequality will shrink soon – the next Congress will be dominated by Republicans, many of whom firmly believe in “trickle-down economics,” the notion that giving tax and other financial breaks to the rich and the super-rich will result in increased profits for corporations which reinvest them, and then create new jobs. Money trickling down from the top. In theory.

This was the idea behind Republican insistence on an extension of tax cuts, introduced by George W. Bush, that included America’s wealthiest. Congress voted in favour of a two-year extension on December 17 after Republican leaders and President Barack Obama agreed on a compromise many in his own Democratic party saw as an abject surrender.

While considerable attention has been focused on the gap between rich and poor, wider than at any time since just before the Great Depression, there is perhaps an even weightier reason for Americans to lose their optimistic, can-do spirit — for many millions, the notion that they can climb up the economic ladder is more myth than reality.

Half of those starting at the bottom 20 percent never leave that level. “The…American economy tends to help those at the top stay there while making it difficult for those at the bottom to move up,” according to a study by Ron Haskins and Isabel Sawhill of the Brookings Institution, a Washington think tank.

That is true despite the rags-to-riches stories that underpin the American dream and have fired the imagination of countless immigrants. President Obama himself could be a poster child for upward mobility, a black man reaching the pinnacle of power after an unconventional childhood that included a spell of subsisting on his mother’s food stamps.

Obama’s Republican opponents portray him as a latter-day Karl Marx, intent on an economic model that distributes income from each according to his ability, to each according to his needs. That perception gained currency during Obama’s election campaign, when he used the phrase “spread the wealth around” in an exchange on his tax ideas with an Ohio voter named Joe Wurzelbacher.

Wurzelbacher became an instant hero to the American right as “Joe the Plumber.” He need not have worried. Obama never used the term again and wealth distribution looks likely to continue in one direction – upwards. In the “new normal,” there is reason for optimism for those at the top, not those in the shrinking middle or the bottom.

© 2010 Reuters