Jul 6, 2013

HSBC: Do Investment Bankers Lack Morality OR Is It Trained Into Them By The Lifestyle?

Are The Koch Brothers & Other GOP-Republicans Laundering Money Through HSBC?
Jon Stewart Smashes Jim Cramer and Exposes Stock Market Shenanigans
The Battle Between Jon Stewart and Jim Cramer
Jon Stewart looks at the economy, the bail outs and the Stock Market.

Emotional Dealings of the Stock Market Explained

I have been asking myself how HSBC could be laundering money for terroristsI think it may the investment banking lifestyle that makes it difficult to manage their employees? This post considers that possibility.

HSBC Laundering Charges - Matt Taibbi: "Secrets and Lies of the Bailout" author Matt Taibbi talks about HSBC, his famous Goldman Sachs dig and the problem with super wealthy banks.  (04:16)

An Overview of "Short Selling"

Short selling involves 'selling' something you don't own expecting the price to go down in the future. In extreme cases this technique can destroy an economy like an old fashioned, panic induced, bank run.

What Does Short Selling Mean? The selling of a security that the seller does not own, or any sale that is completed by the delivery of a security borrowed by the seller. Short sellers assume that they will be able to buy the stock at a lower amount than the price at which they sold short. Investopedia explains Short Selling Selling short is the opposite of going long. That is, short sellers make money if the stock goes down in price. This is an advanced trading strategy with many unique risks and pitfalls. Novice investors are advised to avoid short sales.

Notes on above video:

1. 20 secs - Rumors can move markets

‎2. 1min 36 secs - 'professional investors would look at this with allot of misgiving... cause of suppression being forced in the market place... by agencies, typically market authorities or governments, which shouldn't be stopping natural market appetites and that will spook the professional investor' - note: if this 'professional investor' deals in rumors to spook markets to sell stuff they don't have in hope of making money... then maybe you have your priorities messed up?

3. Clear cut regulations with explanations are needed in areas where market manipulation is dangerous to an economy.

‎"The biggest bankruptcy in history might have been avoided if Wall Street had been prevented from practicing one of its darkest arts. As Lehman Brothers Holdings Inc. struggled to survive last year, as many as 32.8 million shares in the company were sold and not delivered to buyers on time as of Sept. 11, according to data compiled by the Securities and Exchange Commission and Bloomberg. That was a more than 57-fold increase over the prior year’s peak of 567,518 failed trades on July 30. The SEC has linked such so-called fails-to-deliver to naked short selling, a strategy that can be used to manipulate markets. A fail-to-deliver is a trade that doesn’t settle within three days. “We had another word for this in Brooklyn,” said Harvey Pitt, a former SEC chairman. “The word was ‘fraud.’”

Arguments For and Against Short Selling: Against "The argument for restricting short-selling runs as follows: betting that catastrophe will befall a bank can become a self-fulfilling prophecy; if a bank's shares or bonds can be forced down to distressed levels, its cost of funding will increase as counterparties lose faith in its solidity; in this way real damage is done to the bank; thus the odds are skewed unfairly in favour of the short-seller." For "The trouble is, this argument is a little too unworldly. Short-sellers may not be the most cuddly creatures in the financial jungle, but they do contribute to biodiversity. Even the Committee of European Securities Regulators, the predecessor to the new EU regulator, acknowledged last year that legitimate short-selling helps markets run efficiently. It can help to prevent bubbles – miserable Eeyores are a useful check on excitable Tiggers."

Proof that Rumors Move Markets (if the info above ins't enough!)

Expectations, Market Volatility and Stock Market Shenanigans 
Markets today fluctuate at the drop of a hat. For example in the following video you see that

This shows that an incident that has nothing to do with business or the proceedings at hand can boost the prices in today's stock markets a great deal.

So when Senator Bernie Sanders writes; Why have oil prices spiked wildly? Some argue that the volatility is a result of supply-and-demand fundamentals. More and more observers, however, believe that excessive speculation in the oil futures market by investors is driving oil prices sky high. A June 2 article in the Wall Street Journal said it all: “Wall Street is tapping a real gusher in 2011, as heightened volatility and higher prices of oil and other raw materials boost banks’ profits.” ExxonMobil Chairman Rex Tillerson, testifying before a Senate panel this year, said that excessive speculation may have increased oil prices by as much as 40 percent. Delta Air Lines general counsel Richard Hirst wrote to federal regulators in December that “the speculative bubble in oil prices has concrete detrimental consequences for the real economy.” An American Trucking Association vice president, Richard Moskowitz, said, “Excessive speculation has caused dramatic increases in the price of crude oil, which harms end-users like America’s trucking industry.”

This is a claim that should be taken seriously about the unreliability of some of these stock market reactions (afterall, with much of the wealth with a small number of people (i.e. income inequality), it doesn't take much to skew a market)

In fact, it has been shown that even 'rumors can move markets'. So starting a rumor and using it make money on the market fluctuation would be easy for people with the right connections


The following timeline shows how government officials, members of the Federal Reserve (which in the US is a private company and thus wide open to conflicts of interest) and business conspired together to bring down the American economy. Notice how mortgages are bundled together, then chopped up and resold... while Goldman Sacks bet against their clients, banks push bad mortgages on to their clients, Sachs (again) got Greece to hide their debt, how businesses LITERALLY took money from the government and lent it back to to the government for interest (Yes, the Federal Reserve was involved and even gave trillions - clear contradiction of interest i.e. they are required to look after the public good not their buddies).

Alan Greespan (former head of the FED under Clinton AND Bush) pushed to move jobs abroad, destroying the manufacturing base of the US = Senator Bernie Sanders  thinks Alan Greenspan shouldn't be sending jobs abroad.

State today: Manufacturing jobs have become more specialized requiring less labor and more technical expertise - i.e. small companies making big ticket items such as fighter jets; this means less people are employed, smaller number of people make huge profits and these huge profits make the economy look like its growing when actually its just a few companies making huge profits benefiting a small group of people. 
So. No jobs. No Manufacturing sector. The housing bubble was fueled by Alan Greenspan's bad policies combined with the worst housing development plan known to man (passed by George Bush)... and that's how you bring down the economy folks! Notice that if the Federal Government didn't have so much power over mortgages and how these mortgages are given out then this housing bubble financial disaster would never have happened. And if Alan Greenspan, with his private bank controlling public interests, hadn't pushed to create policies to move businesses abroad then this job crisis would never have been created.
All of the housing bubble/crises, originating with Freddie May/Mac, was all overseen by the United States Department of Housing and Urban Development (HUD). Too much power in too few hands while being totally compromised, is a recipe for disaster.

On top of all that, top controllers allowed the biggest Wall Street scam in history to occur... then bailed them out... then turned on the government for having too much debt!

On the one hand, the debts of private banks and those who own that debt, the bond holders, are being protected from any losses by the publicly funded bailouts. Public debt, on the other hand, at the insistence of the same banks and bond holders we have bailed out, is being paid down at breakneck speed, no matter what the cost in unemployment and the destruction of social services.
This double standard is creating two different groups with very different financial prospects: one group made of the bankers and their bond holders (the financial class), is doing rather well because, by not having to pay off its debts, its wealth – the money to make more money – is being maintained. The other group, the rest of us, find our wealth is disappearing because we are paying off not only our debts but theirs as well. Our welfare, pensions and pay are all being cut in order to appease the bond holders, while the banks and the money they owe us, seems to have almost disappeared from the story altogether. (read more)

Best part is that the 700 billion, no questions asked, TARP bailout was just the tip of the iceberg as the Federal Reserve (again playing God with the US economy) gave out an additional 16 trillion to their close buddies. Notice that the Federal Reserve is a private bank and thus has no oversight. They can do whatever they want to the economy and NEVER have to face elections for this actions, i.e. no consequences! If you have access to a money printing machine and couldn't get in trouble no matter what you did, would you print yourself up some cash? If you could give this money away with no consequences would you give some to your friends? It's just paper, after all. 

A look at the morality that tpervades the lifestyle of an investment banker ... 

A PBS investigation about the financial crisis reveals that ...

"Long before the meltdown, one woman tried to warn about a threat to the financial system..."

Watch The Warning on PBS. See more from FRONTLINE.

Above video is from "The Warning, FRONTLINE, PBS Video"


1. 29 minutes 10 seconds- "this deregulated market is part of the reason we are having this boom" - Alan Greenspan supports the boom bust cycle.

2. 38 mins - Math geniuses thought they had a full proof money making system and this group included people who had won the Nobel Prize. - The foundations of math are based on assumptions or in other words, just because a mathematical model has results that could mean there are other worlds existing right next to us, doesn't make it so (such asmultiverse model or the many worlds theory). [ Math has a practical function and a purely theoretical function as every field of knowledge. ] .

It was the holy grail of investors. The Black-Scholes equation, brainchild of economists Fischer Black and Myron Scholes, provided a rational way to price a financial contract when it still had time to run. It was like buying or selling a bet on a horse, halfway through the race. It opened up a new world of ever more complex investments, blossoming into a gigantic global industry. But when the sub-prime mortgage market turned sour, the darling of the financial markets became the Black Hole equation, sucking money out of the universe in an unending stream. (read more)

3. 39 - 40 mins - 'Many banks had invested in the derivatives believing they were the only ones' i.e. This is like having 15 owners for the same house - basic fraud or scamming being done by a gambling model based on statistical averages of historical financial market fluctuations.

4. 45 mins 20 seconds - 'you keep seeing these regulators saying the market knows best how to regulate' thereby leaving banks free to take on riskier assets (while ignoring the warnings of watchdogs)= Results 45 mins and 36 seconds - 'by 2007 the OTC market was at over 500 trillion dollars and consisted of most, if not all, of a 'boom' - In other words, a recession had begun and was being propped up by over leveraging assets/derivatives (selling one house to 15 people, in full) - followed by a TARP bailout with huge bonuses... wow! More about how the Bail out money was used: The big banks make money by taking the bailout money we gave them and lending it back to the government with interest.

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