(Greek Morality Solve Coming Home to Roost?) Not Cleaning Out Stables So Latest Deutsche Bank Insolvency Trickles Down (Wall Street Secrets Gang Up/Zombie Bank Debts Rising) UNC's Coach Dean Smith's Integrity Questioned (Dirty Word Shock Shock Shocking to Americans!)

Almost funny, isn't it?

After you read about how much money the Clintons took from Wall Street financiers that you really don't need to think too hard about how dumb they must view the American voter.

The Deutsche Bank low was reached today.

Insolvency. Commodity prices crashing (just like 2008). Yield chasers funding crashing frackers.

Bank of Italy runs out of credit (no longer able to pay debts or make loans).

And so many toxic assets still festering, flowing/trickling down over us all.

Yes, they were never magically disappeared (as the 2008 Recovery Program was sold as guaranteeing that permanently low interest rates for banks with no strings would mysteriously do). No matter the desperate (and despicable) financial manipulations.

Rotten derivatives transferred between balance sheets (but never dealt with/written off/owned up to).

Bogus asset-backed securities. Low and now negative interest rates as a savior has failed to stop the insolvency drift. (But it certainly enriched the bankers and their owners.)

Deutsche Bank is now worse off than JPMorgan Chase - and you know what a nightmare that has been before the forgivenesses, right? (75 trillion on derivatives book).

The Deutsche Bank all-time low occurring today is lower than 2008's (when they demanded the first bailouts).

Don't miss Max and Stacy raising their eyebrows at bail-ins and today's charts (even more than usual).

They go cuckoo for CoCo bonds (the latest way to mask insolvency). No - not in a good way.

Hybrid capital? (Foie gras!)

Dead bank walking!

Lots of dark laughter at obvious, perpetual fools!

Watch it.

In self defense.

(Hint:  Head for the ramparts or the hills?)

Posted on February 13, 2016   by Stacy Herbert —  Comments

We discuss what Uncle Fester might say about the fact that the bad, toxic, complicated and hybrid debts, having been allowed to fester and rot for the past five years, are now rising from the dead to shrink the economy. In the second half, Max continues his conversation with Ellen Brown, author of Web of Debt, about bail-ins being more dangerous than ISIS, the war on cash and which nations’ financial system might hold an example for others.

Wall Street On Parade has the details:

Banks Tank:  Wall Street Is Keeping Too Many Secrets for Its Own Good

By Pam Martens and Russ Martens
February 12, 2016

The Trading Desk at the New York Fed Has Speed Dials to Wall Street Firms and Bloomberg Terminals

Starting last July, the share prices of the biggest banks on Wall Street have been on a steady downward trajectory. That trend heated up yesterday with Citigroup and Bank of America both dropping over 6 percent by the close of trading. Goldman Sachs and Morgan Stanley were down by over 4 percent. All four of the banks set new 12-month lows in intraday trading.

A strong argument can be made that much of the public’s lack of confidence in these complex banking and gambling behemoths is a result of the dark curtain that has been drawn around their operations. Evidence is piling up that government regulators of Wall Street no longer see themselves as the protectors of the people but as the protectors of Wall Street’s secrets.

The American historian, Henry Steele Commager, once wrote that “The generation that made the nation thought secrecy in government one of the instruments of old world tyranny and committed itself to the principle that a democracy cannot function unless people are permitted to know what their government is up to.”

In that vein, on his very first day in office, January 21, 2009, as the U.S. economy was in tatters from the greatest era of Wall Street corruption in the history of the nation, President Obama promised the American people a new era of transparency. Two months later, under the President’s orders, the U.S. Attorney General’s office issued detailed guidelines on how government agencies were to respond to public and press requests for documents under the Freedom of Information Act (FOIA).

We’ve been living in a dark hole ever since when it comes to Wall Street.

Yesterday,  we reported on the Federal Reserve defying a Congressional subpoena over a Federal Reserve leak of market-moving information to a company whose business model involves sniffing out tidbits of information from government sources and selling it to hedge funds and Wall Street banks. The Fed has stonewalled this House committee for a year.

Making chumps out of elected representatives of Congress is just the new low in how the Federal Reserve and other Wall Street regulators have been treating the press for years.

On November 25, 2009, at age 52, Mark Pittman, a reporter for "Bloomberg News," died while still waiting for the Fed to release details of its emergency lending programs during the financial crisis that he had sought under a FOIA and then through the courts. The case, "Bloomberg v. Board of Governors" of the Federal Reserve System, was decided in Bloomberg’s favor on March 19, 2010 by the Second Circuit Court of Appeals. Even then, the stonewalling continued as a Wall Street consortium of the big banks tried to get the U.S. Supreme Court to hear the case. They failed in that effort.

Pittman and "Bloomberg News" wanted information that should have already been made public:  how much emergency lending was taking place and what were the names of the banks receiving it.

The public has every right to be cynical about why the Fed withheld this information for so long. President Obama signed the tepid financial reform measure known as Dodd-Frank on July 21, 2010. The Fed did not comply with the court order until 2011. Had the public known the dire financial circumstances of the banking system during the crisis, there might have been greater demands to restore the Glass-Steagall Act. It had been repealed in 1999, which had allowed the mass speculation with insured bank deposits to happen and created the too-big-to-fail banks.

Once the Fed data was released, the public learned that the $700 billion TARP program approved by Congress was a drop in the bucket compared to what had actually been doled out behind a black curtain.

Bloomberg’s data showed the Fed had opened its spigots to the tune of $1.2 trillion. The Government Accountability Office (GAO) came up with $16 trillion in “total transaction amounts” that were cumulatively sluiced to Wall Street banks and foreign banks in revolving loans.

The U.S. Treasury department also stonewalled Pittman and Bloomberg in what, in hindsight, now clearly appears to have been an effort to intentionally withhold from the public the fact that Citigroup was insolvent at the time the government was using hundreds of billions of dollars of taxpayer funds to shore it up.

On Jan. 28, 2009, Pittman filed a FOIA with the U.S. Treasury asking it to identify the $301 billion in securities owned by Citigroup that the government had agreed to guarantee. He also requested details of any contracts the Treasury had with outside firms hired to calculate the assets’ values. It took the Treasury over 20 months to respond, after allowing Citigroup to have input into what would be disclosed.

The level of sophistry in the response had all the hallmarks of Citigroup’s legal team. Bob Ivry, writing at "Bloomberg News" in 2010, explained the outcome:

“Treasury officials responded with 560 pages of printed-out e-mails — none of which Pittman requested. They were so heavily redacted that most of what’s left are everyday messages such as ‘Did you just try to call me?’ and ‘Monday will be a busy day!’ ”

Making chumps out of FOIA requesters seems to have been honed to an art form thanks to the gold-plated revolving door between Washington and Wall Street.

In April 2015, "Wall Street On Parade" attempted to get one piece of very basic information from the Fed. We inquired if JPMorgan Chase, a Wall Street bank which at that time was operating under a deferred prosecution agreement for two felony counts in the Bernie Madoff Ponzi scheme, was still the custodian of $1.7 trillion of mortgage backed securities owned by the Federal Reserve, as we had reported on November 3, 2014. We were stonewalled from receiving this information that the public had every right to know. JPMorgan Chase, as of May 20, 2015, is now an admitted felon for its role in rigging foreign currency markets.

Even trying to find out who the second most powerful person in government is meeting with during office hours is repeatedly stymied. Greg Ip wrote in the "Wall Street Journal" in 2006 that the Federal Reserve would not provide the appointment calendar of Alan Greenspan, the former Fed Chairman, for his last seven months in office. The Fed used the bogus logic that “his personal calendar wasn’t an agency record and, therefore, according to court interpretations, not subject to the FOIA.”

Greenspan had been one of the key cheerleaders of the mass deregulation of Wall Street and the repeal of the Glass-Steagall Act. After he stepped down from the Fed, Ben Bernanke would take the helm and sluice trillions of dollars into the bankrupt or nearly bankrupt carcasses on Wall Street that had used the deregulation to embark on an orgy of greed and corruption.

In December of 2013, "Wall Street On Parade" asked the communications office of the Fed for Bernanke’s 2007 and 2008 appointment calendars. We were told we would have to file a Freedom of Information Act (FOIA) request for them.

When we finally received the appointment calendars, there were redactions of 84 meetings that occurred between January 1, 2007 and the pivotal collapse of Bear Stearns on the weekend of March 15-16, 2008. The calendar for March 7, 2008 shows a full day of appointments blacked out. The calendar for Monday, March 10 shows that Bernanke held a meeting in his office from 11:00 a.m. to 12 noon but the names of whom he met with are redacted. This was clearly a meeting on the taxpayer’s dime but the public is denied basic facts about the parties or the topic.

In 2013, "Wall Street On Parade" attempted to obtain a simple photograph of the trading floor of the New York Fed – the only regional Fed bank to have a trading floor and speed dials to Wall Street while simultaneously serving as its regulator.

No photo was forthcoming. Instead, we had to spend endless weeks researching the matter in order to show the public the level of sophisticated trading occurring daily at the New York Fed.

President Obama has failed miserably in his promise for transparency. Now Hillary Clinton wants to take his seat in the Oval Office on the premise that she’s for the little guy. She makes this claim after she and Bill Clinton have personally accepted at least $7.7 million in speaking fees from Wall Street banks according to CNN. Now the media is asking her to release the transcripts of these speeches. Behind closed doors, did she really tell Wall Street to “cut it out,” or, as "Politico" reports, did she sound like a Managing Director at Goldman Sachs.

Last night, the "Wall Street Journal" posted the following report on its web site:

“In the two years between resigning as secretary of state and launching her presidential campaign, Hillary Clinton personally received $4.1 million in fees from financial institutions for closed-door talks that attendees described as friendly and light.”

It’s long past the time to demand better of our government and those who profess to serve us.

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I graduated from UNC and was a big fan of Coach Smith's integrity.

No kidding. "Integrity" was the first adjective any of my friends or I thought of when the Dean's name came up in conversation. He was an outstanding coach and a university icon who made one feel great pride in the UNC sports system as a place that never suffered the scandals that befell so many other pay-for-play college sports teams.

When news of the scandal broke, and that it had been going on since the 90's, most of the people I know discounted it as an event that would not possibly have been allowed to happen when Coach Smith was at the helm. The mystery of how it must have is now ripe for solving.

Joe Nocera of the "New York Times" visited Chapel Hill to do some research and find out why this scandal has been continuing for over 20 years.

I can't wait for them to clear up the corruption and get back to Smith's level of moral  heft in Carolina ball.

And then there’s the N.C.A.A. Last summer, the association issued a lengthy notice of allegations, which included the dreaded “loss of institutional control.” Days before the deadline for North Carolina to respond, the university told the N.C.A.A. that it had found evidence of additional wrongdoing. The N.C.A.A. is said to be preparing a new set of allegations, which it has yet to deliver. Serious sanctions seem inevitable. Several members of the women’s basketball team have transferred, including its leading scorer, Allisha Gray. “It has hurt recruiting,” acknowledged Bubba Cunningham, the athletic director, who took the post just before the paper-class scandal broke and has spent much of his tenure involved in the reform effort.

What does Dean Smith have to do with any of this? Nothing — and everything. Although Smith retired in 1997, four years after the paper classes began, rare is the person in North Carolina who thinks he knew about them, or that he would have looked the other way if he had. Smith was widely admired for his integrity and for the way he cared about his players, taking an interest in them as human beings, not just as basketball players, and pushing them to graduate and better their lives. Smith coined the phrase “The Carolina Way.” It stood for the idea that the University of North Carolina was a place where athletic excellence and academic excellence could exist side by side — and where the former did not necessarily corrupt the latter.

The paper-class scandal has shattered that illusion. On the one hand, younger alumni and current students view the scandal as “more an irritant than a source of shame,” Dylan Howlett, a former sportswriter for The "Daily Tar Heel," told me. It also wasn’t all that big a shock. “Our generation grew up in a celebrity-oriented sports culture where winning trumps all,” he said. There is also a substantial percentage of the faculty that believes the problems revealed by Willingham’s whistle-blowing — which they deeply resent — have been adequately dealt with by the Folt administration. They just want the whole thing to go away.

But there is another, smaller group of faculty members, along with a large number of older alumni, people who were around during the Dean Smith era, who harbor a tremendous feeling of betrayal, a deep hurt that Smith’s Carolina Way devolved into a fraud. Let’s be honest:  There are many big-time sports colleges where athletes are given a pass academically — and nobody cares. But Tar Heels fans always believed that North Carolina was better than that. Discovering that it wasn’t has hit them hard.

“Dean Smith was a great man,” said Jonathan Yardley, the longtime book critic for "The Washington Post." A 1961 graduate, Yardley received a distinguished alumni award in 1989. (He retired from "The Post" at the end of 2015.) “It’s pretty obvious now that he was an anomaly.”

Yardley continued:  “Chapel Hill always basked in a reputation for being a place where big-time athletics was more or less in its proper place.” Decrying the school’s huge athletic complex — it is planning to build an indoor practice facility for the football team that is likely to cost around $25 million — he said, “It’s not the place I knew.” He now roots for the Tar Heels to lose.

Rudi Colloredo-Mansfeld, the chair of the anthropology department, also a Carolina graduate, told me that the sense of personal loss many people feel is so profound that they have difficulty even talking about it.

He cited several instances in which alumni or professors, speaking in a public forum, veered into the scandal — and then just stopped talking, unable to articulate what they felt. “It’s as if there is no place to take the conversation,” he said. Some professors come to him now, wondering what they are supposed to do when athletes miss classes because of their travel requirements.

How do they accommodate athletes while maintaining appropriate academic standards? “I have concerns for the welfare of the athletes,” Colloredo-Mansfeld said — that is, finding a way to ensure they receive a real education despite the demands on their time, and the fact that more than a few are unprepared for college-level work.

“Sports are the lifeblood of our relationships,” he added. “Our family relationships and our relationships on our campus. By harming sports, it is not as much fun to talk to your father about the football team.

Colloredo-Mansfeld told me that for all the reforms instituted by the administration, it has been unwilling to address the larger, tougher questions surrounding the relationship between academics and athletics. And he’s hardly the only one who feels that way.

“We entice these players to entertain the public and enrich their coaches by performing a vast amount of arduous, dangerous and unpaid work, with the opportunity for free education and the distant chance to ‘go pro’ as their only compensation,” Harry Watson, a history professor, has written. “Then we set up conditions which make the ‘education’ either meaningless or nearly unattainable. To me, this situation is fundamentally immoral.”

Jay M. Smith, who teaches European history — and last year wrote Cheated, a book about the scandal, with Willingham — has led a small group of faculty members seeking reforms that would address these larger issues. Every resolution he and his group have proposed has been shot down by the faculty council.

He, too, has been dismayed that the paper-class scandal has not led to a national conversation about how the needs of athletic departments corrupt academics — and how athletes can be better served by the institutions of higher learning they attend. “I naïvely believed that if enough attention were paid to the corruption, it would lead people to call for a change to the system,” he said. Instead, the system is treating the scandal at North Carolina as a one-off. As it always does.

“I knew Dean Smith quite well,” Kenneth S. Broun, a retired dean of the law school, told me in an email. “Dean would carefully advise his players who had an interest in professional or graduate school. He would frequently refer them to me (and to other friends around campus) for counseling as to what they needed to do to be able to make it outside the world of basketball.” He added, “Dean was an unusual guy, but it can be done.”

Starting that national conversation might be the best way to honor Dean Smith’s legacy.

I'm shocked. Shocked!

Which dirty word shocks the American populace?

Actually, not so much as you might think:

 Rather than undermine his campaign, Bernie Sanders has made a virtue of the label ‘socialist’ and is riding a wave of opposition to economic inequality that began with the "Occupy Wall Street" movement.

Bernie Sanders proud proclamation of himself as a ‘socialist’ is a daring gambit in a country where it has been a dirty word for half a century. Critics of the 74-year-old junior senator from Vermont expected him to fade quickly from the limelight, but Sanders has surprised everyone – not least himself – in garnering huge support for his left-wing campaign in the Democrat Party presidential candidates. A few weeks ago, Sanders surpassed 2.3 million donations, breaking the Democrat record held by Barack Obama.

Although he trailed Hillary Clinton by 25 points in a recent NBC News/Wall Street Journal poll.

“To have a person not shying away from the label ‘socialist’ to be up there contending for President is so remarkable that you have to stand up and cheer, or there is something wrong with you,” said Professor Richard D. Wolff, who teaches economics at New York University and broadcasts to 50 radio stations in the US. 

Wolff added “In the US the word ‘socialist’ carries overtones of being ‘beyond the pale’ and raises questions of whether you are a Soviet agent. Even in educated circles, if I say anything positive about socialism – even something namby pamby such as ‘you know, the socialists aren’t wrong about everything’ – the conversation comes to a halt as if you have just dropped your pants. We’re talking about a society that has been traumatised by these things for half a century.”

Rather than undermining his campaign, however, Sanders’ acceptance of the label ‘socialist’ is central to his appeal. “It has given him a reputation for being courageous and honest because any American politician would have to be a complete lunatic to call himself a socialist otherwise,” said Professor Wolff. 

Sanders’ apparent political ingenuousness has caused the media to underestimate him. They assumed wrongly that he was no threat and would quickly fade from view.  However, Sanders possesses an acute understanding of the political game honed over decades during his rise from obscurity in Vermont to become the first independent in Congress in 40 years, and then a candidate for the US Presidency.

“Sanders realised early on that honesty was his best strategy. If he had started looking, smelling or tasting like a male version of Mrs Clinton, he would have vanished without trace and become the Democratic equivalent of Ben Carson, or Jed Bush, who has more money than God, but was swimming against a huge current that drowned him,” said Professor Wolff.

However, Sanders is also a man whose time has come. If it were not for the 2011 "Occupy Wall Street" movement, which used powerful slogans about the dominance of “the 1%” to raise awareness of economic inequality, Sanders would have remained in relative obscurity. "Occupy Wall Street" began on September 17, 2011 in New York, and spread to more than 100 cities in the US and 1,500 cities globally. 

Many of the protesters who cut their teeth in the Occupy encampments are now running grassroots campaigns for Sanders. For example, Stan Williams, a prominent "Occupy Wall Street" activist, is co-organiser of African Americans for Bernie.

“Occupy Wall Street" deserves a lot more respect from thinking people. It was a precedent-breaking liberation as the first modern left-wing movement that did not shy away from economics. It made it possible for Sanders, and others, to advance leftist criticisms without being afraid of forcing economic issues into everyone’s face,” said Professor Wolff.

He went on to say “My own radio career has exploded as a result. I started out on one station in New York and now I’m on 50 stations nationwide. I’ve done nothing to solicit it. Stations came to me because listeners were demanding a critical perspective on economics.”

For a socialist economist, it is a liberating sensation after years of being considered irrelevant. For two decades after Bill Clinton’s accommodation with big business, a declining number on the left were open to criticisms of the prevailing economic orthodoxy.

“The left became lost in the kind of leftism in which Karl Marx became more and more irrelevant and the "New York Times" became more and more relevant. The definition of ‘left’ was being concerned about ethnic minorities, or gender discrimination. It was the kind of socialism that was trying to be socially acceptable because everything to do with economics is set aside. What you get is a sanitised version of socialism.”

The growing awareness of inequality is behind the openness to socialist points of view. Even as Barack Obama’s Democrats boasted of recovery from the 2008 economic crisis, most of the spoils went to the top tier. Emmanuel Saez, at the University of California, Berkeley, analysed average inflation-adjusted income per family for the first years of the economic recovery between 2009 and 2012. He found that, although average income climbed 6%, the top 1% saw a 31.4% rise – 95% of the total gain – whereas the bottom 99% saw growth of 0.4%. 

“The newspapers have been full of recovery stories, but the vast majority have had no share in it. This creates psychic distress. They are telling these people, ‘you are a three-time loser. You lost in the crash, you lost because you weren’t bailed out after the crash and you lost because now you can’t climb your way onto the recovery process. You are done. Just go and slink away’,” said Professor Wolff.

Read the whole essay here.

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We don't mind the gays and lesbians.
But don't be bringing no one from North Wales around here!
- "Pride"

Yes, you guessed it.

I'm Welsh.

And I loved that movie!