Geithner’s ‘Dirty Little Secret’: The Entire Global Financial System is at Risk

www.infowars.com...

US Treasury Secretary Tim Geithner has unveiled his long-awaited plan to put the US banking system back in order. In doing so, he has refused to tell the ‘dirty little secret’ of the present financial crisis. By refusing to do so, he is trying to save de facto bankrupt US banks that threaten to bring the entire global system down in a new more devastating phase of wealth destruction.

.....

The ‘dirty little secret’ which Geithner is going to great degrees to obscure from the public is very simple. There are only at most perhaps five US banks which are the source of the toxic poison that is causing such dislocation in the world financial system. What Geithner is desperately trying to protect is that reality. The heart of the present problem and the reason ordinary loan losses as in prior bank crises are not the problem, is a variety of exotic financial derivatives, most especially so-called Credit Default Swaps.

.....

One significant law was the repeal of the 1933 Depression-era Glass-Steagall Act that prohibited mergers of commercial banks, insurance companies and brokerage firms like Merrill Lynch or Goldman Sachs. A second law backed by Treasury Secretary Summers in 2000 was an obscure but deadly important Commodity Futures Modernization Act of 2000. That law prevented the responsible US Government regulatory agency, Commodity Futures Trading Corporation (CFTC), from having any oversight over the trading of financial derivatives. The new CFMA law stipulated that so-called Over-the-Counter (OTC) derivatives like Credit Default Swaps, such as those involved in the AIG insurance disaster, (which investor Warren Buffett once called ‘weapons of mass financial destruction’), be free from Government regulation.

Whoa!!

Okay, sorry but this article is SO important, I just have to quote more of it!!!

Today five US banks according to data in the just-released Federal Office of Comptroller of the Currency’s Quarterly Report on Bank Trading and Derivatives Activity, hold 96% of all US bank derivatives positions in terms of nominal values, and an eye-popping 81% of the total net credit risk exposure in event of default.

The five are, in declining order of importance: JPMorgan Chase which holds a staggering $88 trillion in derivatives (€66 trillion!). Morgan Chase is followed by Bank of America with $38 trillion in derivatives, and Citibank with $32 trillion. Number four in the derivatives sweepstakes is Goldman Sachs with a ‘mere’ $30 trillion in derivatives. Number five, the merged Wells Fargo-Wachovia Bank, drops dramatically in size to $5 trillion. Number six, Britain’s HSBC Bank USA has $3.7 trillion.

The Government bailouts of AIG to over $180 billion to date has primarily gone to pay off AIG’s Credit Default Swap obligations to counterparty gamblers Goldman Sachs, Citibank, JP Morgan Chase, Bank of America, the banks who believe they are ‘too big to fail.’ In effect, these five institutions today believe they are so large that they can dictate the policy of the Federal Government. Some have called it a bankers’ coup d’etat. It definitely is not healthy.

This is Geithner’s and Wall Street’s Dirty Little Secret that they desperately try to hide because it would focus voter attention on real solutions. The Federal Government has long had laws in place to deal with insolvent banks. The FDIC places the bank into receivership, its assets and liabilities are sorted out by independent audit. The irresponsible management is purged, stockholders lose and the purged bank is eventually split into smaller units and when healthy, sold to the public. The power of the five mega banks to blackmail the entire nation would thereby be cut down to size. Ooohh. Uh Huh?

Great confirmation of what should be realized by everyone now.

They are giving these propped banks TARP funds through AIG, even though they too are propped.

The derrivatives are junk but they want the profits speculated on and lost none-the-less, and they want us to give it to them.

Why is Congress subserviant to this looting?

Where are the endictments and why isn't Congress repealing all of the bailouts and loophole laws?

They must be invested or they are all moles for the should be defunked firms and institutions.

The scarier part is the usurper at the helm.

Originally posted by imd12c4funn
Why is Congress subserviant to this looting?

Where are the endictments and why isn't Congress repealing all of the bailouts and loophole laws?

Enter: Ron Paul's "Audit the Fed" bill

All five of the indicated mega-banks are on the Federal Reserve Board, aren't they....?

Just when I think "Oh it's just Prisonplanet" I'm reminded of about 2 years ago (when Alex Jones got back from the Bilderberg meeting) he said something about the housing market, before the bubble bursted i.e subprime mess we saw ourselves in.

At the time Summers was busy opening the floodgates of financial abuse for the Wall Street Money Trust, his assistant was none other than Tim Geithner, the man who today is US Treasury Secretary. Today, Geithner’s old boss, Larry Summers, is President Obama’s chief economic adviser, as head of the White House Economic Council. To have Geithner and Summers responsible for cleaning up the financial mess is tantamount to putting the proverbial fox in to guard the henhouse.

My jaw has just hit the floor. Jesus Christ, how does no one notice these things?

reply to post by cognoscente


Yep! This has got to be THE best article I've ever seen on Infowars!

Pass it around, everyone!

It is no secret. It is only a secret to those that don't know of who actually rules the world. The information is easily gotten, in fact this is an excerpt from wikipedia of all places of the Rockefeller dynasty. Oh yeah, and you really think that these banks will be split? Hahahahahaaa....never in a million years! It's not the banks that are too big to fail, it's the people behind them.

David Rockefeller Sr.

When Stillman and William Rockefeller's children later intermarried they became the Stillman Rockefellers and a descendant, James Stillman Rockefeller, subsequently became chairman of Citibank from 1959, at about the same time as David became Chase president in 1960.

In the 1960s Rockefeller and other businessmen formed the Chase International Advisory Committee (IAC) — which in 2005 consisted of twenty-eight prominent and respected businessmen from 19 nations throughout the world, many of whom were his personal friends; he was subsequently to become chairman until he retired from that position on the IAC in 1999. After the J. P. Morgan merger, this committee was renamed the International Council, and contains prominent figures such as Henry Kissinger, Riley P. Bechtel (of the Bechtel Group), Andre Desmarais, Lee Kuan Yew and George Shultz, the current chairman. Historically, prominent figures on the IAC have included Gianni Agnelli (a longtime associate, who spent thirty years on the Committee), John Loudon (Chairman of Royal Dutch-Shell), C. Douglas Dillon, David Packard and Henry Ford II.[13]

Under his stewardship the Chase spread internationally and became a central pillar in the world's financial system, including being the leading bank for the United Nations. It has a global network of correspondent banks that has been estimated to number about 50,000, the largest of any bank in the world. A notable achievement was the setting up of the first branch of an American bank at One Karl Marx Square, near the Kremlin, in the then Soviet Union, in 1973. This was also the year Rockefeller traveled to China, resulting in his bank becoming the National Bank of China's first correspondent bank in the United States.

Before becoming Chairman of the Federal Reserve, Paul Volcker worked for Chase. Volcker has had a long association with Rockefeller, becoming a member of the Trust Committee of the family in 1987, after stepping down from his position at the Reserve. The Trust Committee is the pivotal committee which controls the wealth of the family through trusts established by John D. Rockefeller, Jr., as well as the real estate firm that then owned Rockefeller Center, before it was sold.[14]

World Bank and IMF

The Chase Bank has also had a strong connection to the World Bank, as three presidents (John J. McCloy, Eugene R. Black, Sr. and George Woods) all worked at Chase before taking up positions at the international bank. A fourth president, James D. Wolfensohn, is also closely associated with Rockefeller, serving as a director of the Rockefeller Foundation, amongst other family-created institutions.[15]

Rockefeller has also for many years hosted annual luncheons at the family's Westchester County Pocantico estate for the world's finance ministers and central bank governors, following the annual Washington meetings of the World Bank and International Monetary Fund.[16] These luncheons were held at the Playhouse. These regular meetings were also attended by the other internationalist in the family, John D 3rd, up until his death in 1978.

[edit on 30/3/2009 by Iamonlyhuman]

it sure weren't INFO-WARS, as some one suggested in their response"

By F. William Engdahl
www.engdahl.oilgeopolitics.net

COPYRIGHT © 2009 F. William Engdahl. ALL RIGHTS RESERVED

* F. William Engdahl is the author of A Century of War: Anglo-American Oil Politics and the New World Order [...]

heres the crux of the issue, which was already cited in part & without Emphasis where needed:

The ‘Dirty Little Secret'

What Geithner does not want the public to understand, his ‘dirty little secret' is that the repeal of Glass-Steagall and the passage of the Commodity Futures Modernization Act in 2000 allowed the creation of a tiny handful of banks that would virtually monopolize key parts of the global ‘off-balance sheet' or Over-The-Counter derivatives issuance.

Today five US banks according to data [..],
[..] hold 96% of all US bank derivatives positions in terms of nominal values, and an eye-popping 81% of the total net credit risk exposure in event of default.

The five are, in declining order of importance: JPMorgan Chase which holds a staggering $88 trillion in derivatives (€66 trillion!). Morgan Chase is followed by Bank of America with $38 trillion in derivatives, and Citibank with $32 trillion. Number four in the derivatives sweepstakes is Goldman Sachs with a ‘mere' $30 trillion in derivatives. Number five, the merged Wells Fargo-Wachovia Bank, drops dramatically in size to $5 trillion. Number six, Britain 's HSBC Bank USA has $3.7 trillion.

After that the size of US bank exposure to these explosive off-balance-sheet unregulated derivative obligations falls off dramatically. [...]

see: www.marketoracle.co.uk/


I've been 'reading between the lines' on several posts on several different 'threads' here on ATS, for awhile now...
the 5 banks in this expose' .. are the 'main' perps.
but the Fed/Treas. [unholy alliance] has on their mind to empower the 20-21 big banks/ 'Primary Dealers' as their "Liutenants" in the cabals heirarchy... and indeed as the article posits====
the main banks will continue to get trillion$$
and these banks will afford a haven and positions to elites who will rotate out of the public sector in their due time... along with contributions
which will have 'nothing to do with political influence' what-so-ever


the coup is underway, elected governments are being replaced by boards & bankster CEOs, which implement the directions of the Fed/Treas ubermiesters

The FDIC places the bank into receivership, its assets and liabilities are sorted out by independent audit. The irresponsible management is purged, stockholders lose and the purged bank is eventually split into smaller units and when healthy, sold to the public. The power of the five mega banks to blackmail the entire nation would thereby be cut down to size. Ooohh. Uh Huh?

I've been saying the following for months:
The above standard procedure hasn't happened because the controlling stockholders of the giant failing banks are the very same people that are on the board of directors in the federal reserve.

Do you see how one hand prints cash for the other hand?

If the fed is ever audited you will see this.

[edit on 30-3-2009 by djzombie]

reply to post by djzombie


Yep, all roads lead to the Federal Reserve Board (big surprise).

Thank God for Ron Paul!!

Very telling. I wonder if the sheeple will ever catch on and when they do it will be far too late. The thieves will just pack up and fly to South America if there were ever an outcry so great as to threaten them personally. Once down there they will live like kings as the entire world laments and starves. Then again it would never get that far because they will just use their media puppets to convince the sheep that they saved them all the while they are robbing them of everything. I couldn't imagine bankrupting and ruining the life of a single person let alone an entire world. These people lack any kind of redeemable virtue.

Excellent article. S & F

The article puts the top US banks as holding approx. $200 TRILLION!!! in derivatives
I think for alot of people this is puts it into context well as this imagined wealth is indeed fallible, ie susceptible to default.

reply to post by MajorDisaster


Here is a brake down of where 10 trillion dollars has been planned to go and where already 2.6 has gone.

Economy rescue: Adding up the dollars
The government is engaged in an unprecedented - and expensive - effort to rescue the economy. Here are all the elements of the bailouts

money.cnn.com...

Note who will get trillions and unlimited funding.

September 2008 - Foreign exchange dollar swaps
Exchange of dollars to 13 foreign central banks for collateral. Aim is to provide liquidity to foreign financial institutions.
Unlimited so far $327.8 billion

October 2008 - Commercial Paper Funding Facility
Purchases of short-term corporate debt aimed at boosting the struggling market and providing critical three-month financing to businesses.
$1.4 trillion so far $241.3 billion.

And who is paying for all that? I wonder.

Here the answer from the Feds on this.

Ha! What are you going to do about it?
Fire us? lol hahahahaha

www.congress.org

Star and Flag for the OP by the way.
Excellent find.

[edit on 30-3-2009 by j2000]

Help me out here, didn't JPMorgan Chase make donations to Obama's campaign ?

I think come April 15, the "tea party" protests nationwide, the chant should be AUDIT THE FED, and Ron Paul elected spokesman for the revolution.

www.abovetopsecret.com...

This following is from the above thread, knew I had seen it somewhere before.

Contributor--------------Total
University of California------$1,392,675
Goldman Sachs---------$1,035,095
Harvard University-----------$831,110
Microsoft Corp----------------$809,799
Google Inc--------------------$796,564
JPMorgan Chase & Co-------$700,808
Citigroup Inc------------------$681,318
Sidley Austin LLP-------------$604,938
University of Chicago--------$599,089
Stanford University----------$584,904
Skadden, Arps et al---------$564,345
Time Warner-----------------$540,051
UBS AG-----------------------$529,869
IBM Corp---------------------$525,857
WilmerHale-------------------$525,792
Morgan Stanley--------------$513,623
Columbia University---------$507,316
National Amusements Inc---$506,751
Kirkland & Ellis---------------$501,335
US Government--------------$482,956

reply to post by MajorDisaster


There is a conflict of interest when a politician owns stock in any company.

They are representing only themselves and their holdings.

Enter phase one of the End the Fed revolution

Federal Reserve Transparency Act H.R. 1207 (thanks Ron)

This is really getting some steam, 46 co-sponsors, look for your rep

HR 1207 Co-Sponsors (as of 3/27/2009)

Rep Abercrombie, Neil [HI-1] - 2/26/2009
Rep Akin, W. Todd [MO-2] - 3/19/2009
Rep Alexander, Rodney [LA-5] - 3/10/2009
Rep Bachmann, Michele [MN-6] - 2/26/2009
Rep Bartlett, Roscoe G. [MD-6] - 2/26/2009
Rep Blackburn, Marsha [TN-7] - 3/16/2009
Rep Blunt, Roy [MO-7] - 3/24/2009
Rep Broun, Paul C. [GA-10] - 2/26/2009
Rep Buchanan, Vern [FL-13] - 3/17/2009
Rep Burgess, Michael C. [TX-26] - 3/19/2009
Rep Burton, Dan [IN-5] - 2/26/2009
Rep Castle, Michael N. [DE] - 3/17/2009
Rep Chaffetz, Jason [UT-3] - 3/6/2009
Rep Culberson, John Abney [TX-7] - 3/26/2009
Rep Deal, Nathan [GA-9] - 3/23/2009
Rep DeFazio, Peter A. [OR-4] - 3/9/2009
Rep Duncan, John J., Jr. [TN-2] - 3/6/2009
Rep Fleming, John [LA-4] - 3/18/2009
Rep Foxx, Virginia [NC-5] - 3/10/2009
Rep Franks, Trent [AZ-2] - 3/23/2009
Rep Garrett, Scott [NJ-5] - 3/5/2009
Rep Grayson, Alan [FL-8] - 3/11/2009
Rep Heller, Dean [NV-2] - 3/6/2009
Rep Jones, Walter B., Jr. [NC-3] - 2/26/2009
Rep Kagen, Steve [WI-8] - 2/26/2009
Rep Kingston, Jack [GA-1] - 3/6/2009
Rep Lummis, Cynthia M. [WY] - 3/19/2009
Rep Marchant, Kenny [TX-24] - 3/11/2009
Rep McClintock, Tom [CA-4] - 3/6/2009
Rep McCotter, Thaddeus G. [MI-11] - 3/19/2009
Rep Miller, Jeff [FL-1] - 3/24/2009
Rep Peterson, Collin C. [MN-7] - 3/19/2009
Rep Petri, Thomas E. [WI-6] - 3/10/2009
Rep Platts, Todd Russell [PA-19] - 3/19/2009
Rep Poe, Ted [TX-2] - 2/26/2009
Rep Posey, Bill [FL-15] - 2/26/2009
Rep Price, Tom [GA-6] - 3/10/2009
Rep Rehberg, Denny [MT] - 2/26/2009
Rep Rohrabacher, Dana [CA-46] - 3/6/2009
Rep Sessions, Pete [TX-32] - 3/23/2009
Rep Stark, Fortney Pete [CA-13] - 3/26/2009
Rep Stearns, Cliff [FL-6] - 3/6/2009
Rep Taylor, Gene [MS-4] - 3/6/2009
Rep Wamp, Zach [TN-3] - 3/16/2009
Rep Woolsey, Lynn C. [CA-6] - 2/26/2009
Rep Young, Don [AK] - 3/6/2009

RonPaul.com

If yours is not there let them know about it. Believe in the 5 percent theory, go to a tea party.. If we can get this to pass. It will be a huge victory for the revolution.