Analysis of News—www.analysis-news.com
Of Interest to Investors, Survivalists and Others Concerned
About Their
Economic and
Financial Futures
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With
a focus on the Plutocrats, Goldsmiths, Super-Rich Insiders, and their Allies
and
what they are conspiratorially doing to
manipulate the financial markets, make more
profits, rip us off and install a world government under
their control
The Goldsmiths—Part XCII
By R. D. Bradshaw
In the 1930s,
Hollywood talkies were still in their infancy.
Many stars and directors in the silent film days of the 1920s found it
hard to adjust to talking pictures. One
who did make the transition was director John Ford. Ford was in his prime in the 1930s. He was at the top of the heap—a success in
Hollywood where so many other persons struck out. In those days, Ford met a young, aspiring,
prop man in 1928 who was hoping to make it big in the movies. Marion Morrison was the name of the would-be
actor. Ford befriended the young man and
suggested that he change his name.
In the meantime,
in 1937, Collier’s magazine published a short story by Ernest Haycox on the
“Stage to Lordsburg.” Ford bought the
filming rights and was ready to shoot it in Monument Valley, Arizona in late
1938 under the title Stagecoach. For the
male lead, Ford selected Morrison who had played in some 80 cheap B Westerns
and serials in the 1930s, using the stage name John Wayne.
Stagecoach was
the first talking Western for Ford. It
was an adult film which departed from many of the cheap B westerns shot in
those days. With the expert hand of
Ford, Stagecoach was a fantastic success when it was released in 1939. It made an absolute star of Wayne and earned
Thomas Mitchell an Academy Award as best supporting actor. Ford himself picked up the New York Film
Critics Award for Best Director.
But
the character in the story that really epitomized the question of arrogance, pride,
meanness and dishonesty was a fat cat banker named Ellsworth Henry Gatewood
(played by Berton Churchill). Often,
when watching Stagecoach, I want to equate Gatewood with the modern Bernie
Madoff and the bankers’ Cabal, both of which have successfully stolen and
plundered the wealth of the people of the United States. Gatewood, too, was a crook who swindled the
people of Tonto, Arizona out of $50,000 (which was big money in the film days
of the 1880s).
This
mythological Gatewood had some very revealing one liners. For example, just before he decided to take
the stage from Tonto to Lordsburg, a local company brought in their $50,000
payroll to deposit in his bank. Gatewood
appropriately reacted with a couple of choice statements. He said that it was a good practice for local
Tonto businesses to deposit their payroll funds in his bank six months in
advance of the payroll dates. And then,
in a state of banker brilliance, he said that what’s good for the banks is good
for the country (this linkage of the banks to the nation is still the practice
today as it is hard to say where one ends and the other begins).
Once
the $50,000 was in his greedy hands, Gatewood proceeded to steal it, abandon
his wife, and leave the country with the money.
He caught the stagecoach to Lordsburg and planned on getting away with
the loot. At this point, Gatewood was in
total harmony with the modern financial market manipulators in the Cabal who
have successfully stolen trillions of dollars from would be investors over the
years—all with the tacit approval of the controlled media and government
regulators who always conveniently look the other way when the Cabal players
are busy ripping off the markets.
And
next, in this story we come to Gatewood’s similarities with Bernie Madoff. Geronimo had been on the loose and the
telegraph line was down from Tonto to Lordsburg. By the time that the stage got to Lordsburg,
the telegraph line had been fixed; and the people in Tonto had discovered the
Gatewood theft and flight, and had wired ahead.
The Sheriff in Lordsburg arrested him.
It’s too bad there is no way to arrest and try the banker crooks today
who have been stealing from the people since 1913.
The Banks and the Bad Paper They are Holding
Almost daily, the
controlled media bombards us with reports about how bad the banks have it with
their bad loans and paper. Real estate
mortgage foreclosures continue.
Furthermore, there is the derivative problem which was laid out in the
Goldsmiths, Part XCI, with a note on the possibility of a meltdown and especially
with Credit Default Swaps. This
Goldsmiths will now address the meltdown option more carefully.
In order to
address the situation with the banks, please note that the US banks’ balance
sheets have turned to using an accounting valuation called “fair” value in our
time whereas historically such paper and current assets have been valued at
cost or market value, whichever is lower.
In the previous
presentation on derivatives, the common reference to value was often in the
context of this “fair” value concept.
The abandonment of the historic basis of cost or market, whichever is
lower, came about in early April 2009 with a decision of the Financial Accounting
Standards Board. Here, this concept of
“fair” value crept into the definition.
And what is fair?
Bloomberg of Apr
2, 2009 had this statement by Ian Katz on the change to using fair value by
banks to value their loan portfolios. “The
Financial Accounting Standards Board, pressured by U.S. lawmakers and financial
companies, voted to relax fair-value accounting rules… Changes to fair-value,
or mark-to-market accounting, approved by FASB today allow companies to use
‘significant’ judgment in gauging prices of some investments on their books,
including mortgage-backed securities. Analysts
say the measure may reduce banks’ write downs and boost net income.”
So what is fair
value? Well, apparently, it is a
subjective, judgmental value which is about whatever the banks want it to be in
order to manipulate their balance sheets and income statements (if the banks
are acquiring paper from another bank, they want fair to be low; if they are
reporting values for their balance sheets, they want fair to be high). In the sense of fair, whatever that is, it is
clear that the banks are holding huge sums of bad paper on their balance sheets
which are often valued at very inflated figures.
There is another
slight of hand trick the banks are using to increase their profits without
justification. On Jul 17, 2009, Money
Morning had a report by Jason Simpkins which addressed the recent earnings
report of profits from JP Morgan-Chase.
Per Simpson, these profits were made possible because of a trick used by
Morgan to book profits on loans before they are actually earned.
Simpson says: “the Financial Accounting Standards Board has
made it possible for the biggest U.S. banks to book profits on loans that have
not been fully repaid.” These profits
are called accretable yield, whereby mega banks book income on loans that have
reduced credit quality by recognizing the value of the bonds on their balance
sheets and the cash flow those securities are expected to earn.
On
this, Money Morning says “please understand, we’re not talking about cash
that’s already been earned, and not cash in the bank … we’re talking about cash
flow those banks are expected
to earn. In JPMorgan’s case, the firm
took on $118.2 billion in toxic debt when it acquired Washington Mutual Inc.
last year. As a receiver of that debt, JPMorgan was allowed to mark that debt
down to fair value, or $88.65 billion. But now, the bank says that those same
debts may appreciate by some $29.1 billion over the life of the loans. And as those loans are paid back, that money
is booked as profit. Of course, this
distorts banks’ earnings and camouflages the deterioration in other banking
segments.”
This
cited trick occurs when a bank can acquire so-called worthless or bad loans/bonds
at a discount from their face value and then proceed to start collecting the
loans on the premise that they will be fully paid off. Thus, when Morgan took over Washington
Mutual, they took over the outstanding loans at pennies on the dollar on the
premise that they were bad (with the Washington Mutual stock holders losing the
discount amounts of the loans). Once
Morgan gained these loans, Morgan commenced collecting them on the basis of the
full amount due without regard to the discounted amounts which Morgan
effectively paid for them.
The
Rothschild Cabal players have followed this scam for ages where they buy up
so-called worthless bonds at a big discount and impose on governments and
politicians to make the bonds good and payable in full (for information on how
the Cabal has worked this scam in history, see Understanding Money and War VI
at www.analysis-news.com
and what happened with the Continentals and recently the old Iraqi bonds).
Clearly,
Morgan is doing this same trick with the loan portfolios of companies going
broke and being absorbed by Morgan.
Along with trying to collect them in full, Morgan has added the trick of
booking profits on them with each collection in order to boost Morgan’s current
income statement (yet, you can bank on it that Morgan is not paying taxes on a
current basis for this unrealized income).
By
the way, here, let me note that this exact same situation prevailed in the
1930s when the Cabal agents in the Fed brought on the great depression which
forced thousands of small town banks out of business to be absorbed by bigger
and more powerful banks. This same scam was
launched in 2007 to bring on another depression and the forcing of smaller
banks out of business with larger banks absorbing their business. Every week, we hear something about another
bank or financial institution closing and its business being taken over by a succeeding
larger bank (the FDIC arranges this from one to ten times each week).
You
can bank on it that the assets of the closing banks are acquired by the succeeding
banks at pennies on the dollars (with the stockholders of the closing banks
losing in the deal). Once the successor banks
get the loans and other assets at sharp discounts, they go to work to make the
borrowers pay off the full face amounts.
If this doesn’t work, these big gaining banks turn to the taxpayers at
the Fed and Treasury to dole out trillions to them in order to cover their
losses on loans. Whichever way it turns
out, the big Cabal banks win.
More on the Valuation Problem
As a matter of
information, I have written about the valuation problem in previous Goldsmiths
80, 82 and 91, as well as other writings.
Back in May, I noted the derivatives problem of $200 trillion, the
pledge of $13 trillion by the Fed and Treasury to bail out the banks and more
coming losses in the trillions.
On May 21, 2009,
Goldsmiths 82 said: “The most obvious
thing of all is that the trillions now given the bankers or in the pipeline to
the bankers is not enough. If the Cabal
banks could be faced with losses of $100 trillion, they will be asking for or
demanding more money from the US, Europe and other developed states. The payments made so far are only small down
payments with much of the principal still to be paid. I’m not altogether sure of what turn the
Cabal will take now. But someway or
somehow, more of the Western wealth will end up in the hands of the
Cabal.” And, on Jul 20, 2009, a news
report said that the latest estimate of government bail-out costs has reached
$23.7 trillion. So the costs keep going
up.
Besides the $200
trillion in derivatives (with the US banks holding some $14.6 trillion in
Credit Default Swaps, as discussed in the Goldsmiths 91), there is the general
debt situation of the nation. Michael
Hodges’ Grandfather Economy Reports put the total at $57 trillion with some $10.6
trillion owed by government at the end of 2008 ($3.2 trillion by the Federal
government which is understated since the government lies to us about the US
debt). Foreigners own some $13.6 trillion
of that $57 trillion. US banks and
financial institutions appear to own much of the rest of the $57 trillion.
Per Wikipedia,
outstanding residential mortgages were $10.6 trillion at the end of 2008. Another trillion dollars is owed on credit
cards. Here, creditcard.com shows that
Chase leads the pack with $183.32 billion; Bank of America is next with $166.32
billion; and Citibank is third with $106.74 billion. Part of these receivables the banks carry has
been financed by foreigners. The
Treasury gives the foreign deposit/note figures at $4.664 trillion with just
the US National Banks at the end of 2008 (by the way, the subsequent figures
from the Treasury suggest that foreigners are slowly withdrawing their funds
from US banks. The figure was at $4.532
trillion in March).
I unsuccessfully
tried to find data on the total loans and receivables now on the books of the
banks and financial institutions. From
the above, one could guess something well over $12 trillion. When we add that to the $200 trillion in
derivatives, it is easy to see that America’s banks and lending institutions
are setting on a ticking time bomb which could cause the greatest financial
collapse in history if it ever starts coming apart. If the Cabal keeps on with its present
deflationary fall, this thing could evolve into a soon catastrophe.
Besides the staggering
totals involved, the problem is compounded because there are serious questions
about both the totals and valuation of the data being reported. Our government lies so much that it’s hard to
be sure of how much government debt there is.
As for as data from the banks, it is clear that they too are in no mood
to tell the truth about their situations.
On the valuation problems, the above remarks outline the stupidity of
valuing loan portfolios on the basis of something called fair which is a
subjective term based on judgment.
There is still
one more valuation issue. Frankly, I
long ago suggested in the Goldsmiths (particularly 80 and 82) the presence of legitimate
questions of how toxic is the debt being carried by the banks. Market Ticker recently had two excellent
articles which addressed this problem by suggesting that the banks are intentionally
hiding their losses on their balance sheets (and income statements).
Ticker’s address
was prompted by the Administration efforts to force the banks to modify the
terms of existing loans. But the banks
so far are not interested in modifying loans.
By the same token, it is clear that the banks are not really pursuing
the foreclosure options one would suppose. Ticker gave an example of the bank balance
sheet problem by citing a mortgage loan of $500,000 where the home had lost 75%
of its value to $125,000 and asked if the bank
would modify that loan (when they know the debtor still can't pay, and will
re-default) or will they foreclose? The
answer is no way on any modification.
But,
per Ticker, the banks are also reluctant to foreclose which will make them have
to recognize the losses in their financial statements. The banks have been carrying loans that have
turned delinquent but which have not been foreclosed or modified at or near
their full principal balance. This is an
outright scam, but it is what has been happening, both in the residential and
commercial real estate marketplace (it must be said that some persons in
Congress would like to see this change; but it is doubtful).
Ticker says “The reason these
loans are not being modified and people are literally living for a year or more
in their homes after they stop paying their mortgage without having a
foreclosure processed against them is that
if the bank modifies the loan or forecloses it must
recognize the actual loss, as there has now been an event that makes the
possibility of self-cure go away and you can't claim that a loan might perform
once it has been extinguished through modification or foreclosure!”
The conclusion from the above is
obvious. The bank is certainly in no
mood to modify loans which will again default.
And even in a default, they are not anxious to have to foreclose since
foreclosures will hurt their income statements and balance sheets. The result is that many banks are using the
excuse of fair value judgments to valuate bad debts which are not written off
but are kept open in the books with very high inflated valuation figures.
America’s
Debt Structure is in a Giant Mess Waiting for the Biggest Collapse in History
The whole system is a house of
cards built on lies and deception—starting with the government, on to the media
(which hides and covers up the corruption) and on to the banks and financial
institutions. Any system this corrupt
and built on this much deception and lies will at some point in time
collapse. There is no other way. Actually, the Fed and government are using
bubble gum and bailing wire to bail out the banks as we go along with no
thought as to the basic problems and their solutions (with the totals to
perhaps reach $23.7 trillion). So if the
leadership is not willing to correct things, what course will it take?
Well, there are several things
which can go wrong. Of course, any single
one could be all that it takes to bring about an implosion. But if two or more surface at the same time,
it will be good-by to the whole apple cart.
One of the things which I am most suspicious
of is the result to the US banking system if foreigners accelerate their
withdrawal of assets from the US. A
report on this issue on Jul 16, 2009 noted that foreigners are already fleeing
long term US debt (May 2009 was down by $20 billion). The only reason many foreigners are still
willing to take US debt and hold US dollars (overseas or in US accounts) is because
the dollar is still the reserve currency that can be used to buy things on the
market. But this is changing because
many nations are abandoning the dollar and doing their trading with local
currencies.
There are other reasons at work
which might also bring about a flight of foreigners from US assets. Here, we can surmise problems erupting when
the US makes its inevitable attack on Iran and/or the coming of WWIII, both of
which are on the drawing boards. There
remains the overall $200 trillion in derivatives. Hence, almost anything could cause a run on
derivatives that would collapse the whole house of cards.
Another very explosive issue has
to be the status of the Credit Default Swaps which Congresswoman Maxine Waters
has brought up (as discussed in the Goldsmiths 91). What in the world will happen to these
instruments if the banks ever start foreclosing on bad paper in earnest while
the CDSs are presence in volume to supposedly insure and protect the accounts
at the banks.
Who knows if the writers of these
agreements could make good if they were faced with numbers of foreclosures? This problem is like the one the old goldsmiths
had when they issued more receipts than they had of gold. Once a run starts, the people would find that
the goldsmiths didn’t have the gold to cover the receipts. On the CDSs, how many could be covered in
case of a massive need to pay off?
The
Bottom Line
Right now, the system is designed
to protect the big banks (especially the five big banks cited in the Goldsmiths
91). Everything being done so far is
pointed in that direction. It is clear
that nothing positive will be done to do anything but try to save the banks for
the ruling Rothschild Cabal.
The next big
feature of this presentation is the fact that the big five banks involved are
all owned/controlled by the Rothschild Cabal of big bankers—the Rothschilds,
Oppenheimers, Warburgs, Lazards, Rockefellers, Montegus, etc. So there is enormous collusion at the top on
how this game is played.
Last, an
acquaintance of mine once said that if we, the common/little people, try to
enter into a financial transition with any member of this manipulating class,
we lose. Yes, if you or I should try to
deal with one of them, there is no way that we can win in the game (because
they have rigged the game in their favor in advance).
Since our
government and system has turned over our money and commodities to these expert
speculators for them to manipulate, massage and manage, there is no way that
any of the little people can come onto their playing field and win. They get up early in the mornings to plan and
scheme how they will take our money from us.
Hence, the best thing to do is to stay away from them.
Alex Wallenwein,
in his Euro Monitor newsletter, put it well—stay out of the futures
markets. If one of us tries to make some
money in the futures’ markets, we are doing exactly what they want us to do. This team of market manipulators has been at
this game for 3,000 years. There is no
way we can win with any of them.
Perhaps this
reality in the present situation is beginning to soak in on people. This real world approach makes a thinking
person turn to one of the most sure things of all--gold. A number of analysts and students of gold
have begun recommending the purchase and holding of gold physically for the
long pull. This seems like good advice. When the big collapse comes, gold will be one
of the few things still holding value.
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Back issues of the Goldsmiths, by the editor of the Analysis
of News, can be accessed from a Google or Yahoo search engine by typing in “R.
D. Bradshaw” Goldsmiths. Several hundred
web sites can be found with the back issues and with translations to Spanish,
Italian, German, Chinese, Dutch, Polish and other foreign languages. Finally, the “Archives-Goldsmiths” of this
website (www.analysis-news.com ) has all of the Goldsmith articles
issued to date.
Besides the revelations contained in the Goldsmiths’
articles, the work of the plutocratic financial market manipulators to
conspiratorially manipulate and control the financial markets (to make more profits
and install a world government under their management) is also addressed at
length in the periodic analysis of the news and in other articles produced at www.analysis-news.com. This website has an
article of interest to any person interested in understanding the market
Manipulators. It is the Hidden Secret of
the Manipulators, why they succeed and how to follow their manipulations.
Readers of the above articles are invited to visit www.analysis-news.com and become a subscriber to regularly read some of the
material from the world of information which will further reveal how extensive
the manipulation, control and dishonesty realities are in the financial, currency
and commodity markets, not only in the US but indeed around the world. To go to the home page of this website,
please click at the link here: www.analysis-news.com.