UN Speech - President Obama, Hypocrite In Chief - Karl Denninger

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President Obama, Hypocrite In Chief

From the UN speech today (which, incidentally, got lots of press coverage while Geithner's dissembling in front of Congress got none):

Developing nations must root out the corruption that is an obstacle to progress – for opportunity cannot thrive where individuals are oppressed and business have to pay bribes. That's why we will support honest police and independent judges; civil society and a vibrant private sector.

How about developed nations? Let's run a short list right here:

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Congressfolk who got "Friends of Angelo" mortgages - even the name of the program was a statement of special privilege - while Countrywide Financial literally looted the hopes and dreams of millions of Americans through intentional and willful blindness to anything that could reasonably be called a credit standard. Countrywide was subsequently forcibly merged into Bank of America and the homeowners involved lost their homes - and dreams.

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Our former Treasury Secretary who came to the SEC in 2004 to ask (for a second time) for leverage limits to be removed from investment banks - backed by literal millions in campaign donations and lobbying over the previous years - and got it. The consequence? Detonation of both Lehman and Bear Stearns, neither of which would have blown up but for the leverage that they were legally forbidden to take on prior to 2004.

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A banking system that has Congress so far in its pocket that it persuaded Congress to threaten FASB in open Congressional hearings this spring if they did not change accounting standards to effectively legalize accounting fraud through "mark to make-believe." This scam that Congress shoved down everyone's throat at the behest of the banking lobby continues to this day.

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A banking system that has Congress, The SEC, OTS and OCC so far in its pocket that despite over eighty examples of hard proof of falsely-inflated asset valuations and willful misfeasance by OTS and OCC in seizing insolvent banks before they result in FDIC loss the willful blindness continues to this day, causing the FDIC to teeter on the edge of running out of cash and begging the obvious question: Are all the large banks as far beyond insolvent as these regional and local banks have been proved to be once seized?

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A blatantly-corrupt OTS (banking regulatory body) that was caught conspiring with IndyMac to "backdate" deposits so as to falsely present a better financial picture than really existed at the time. The person at OTS involved had previously been caught doing the same thing during the S&L crisis BUT WAS NOT FIRED AND BARRED FROM FUTURE BANKING REGULATORY WORK! Nobody has been indicted in connection with this outrageous "in your face" fraud. Worse, the OIG's office said there were other examples - but refused to name them; are those institutions still operating?

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A Federal Reserve that has openly threatened Congress with the destruction of the economy and the dollar, under oath, in open Congressional Hearings, should Congress pass and enforce an audit of The Fed's activities, and yet The Fed continues to enjoy authorization to run monetary policy.

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A Federal Reserve Chair who denied under oath that The Fed would monetize the nation's debt - while it had and was doing exactly that. Isn't that the definition of perjury?

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An SEC and Congress that is so embedded in the financial system via its revolving door policies that despite multiple reports both Stanford Financial and Bernie Madoff were permitted to continue to operate even after multiple reports of suspicions that they were outright frauds. Investors lost billions as a consequence of the purchased willful blindness of our regulators.

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An international bank that was caught advising customers to smuggle diamonds in toothpaste tubes to illegally evade taxes, and was permitted to keep their banking charter even after this became known.

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Over a dozen "in your face" examples of clearly illegal insider trading over the last two and a half years, including August 2007, the "shorting ban", Bear Stearns collapse and more. All are trivially visible in price and volume action before the announcements were made. None have been investigated or resulted in indictments.

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The government's CPI and other statistics are intentional lies promoted by the banking, finance and credit industries to support their issuance of debt which they know cannot be paid back.

ALL OF THIS and much more (there are well north of 1,000 posts here documenting it all) has been undertaken for one singular purpose - to intentionally misrepresent to consumers, businesses and investors worldwide that the level of debt in the economy was supportable when in fact it was not.

This in turn allowed these financial entities to issue credit that they knew full well could never be paid back by the debtors, syndicate it, slice it, dice it, and sell it to suckers worldwide, extracting their fees from the process and guaranteeing that those who bought this garbage would suffer enormous losses.

Our government conspired with these people in allowing and enabling this fraud, and when it started to unravel government was then bribed (or was it blackmailed?) into attempting to offload all of the remaining undistributed trash to the US Taxpayer via transferring it to "sovereign credit" - that is, Federal Debt. This attempt is still ongoing, with Ben Bernanke buying hundreds of billions of dollars of likely-impaired (if not worthless) mortgage-backed paper from two companies that in fact went bankrupt (and were "taken into conservatorship") last year - Fannie and Freddie. But for the nearly $100 billion dollars that Taxpayers have forked over thus far to prevent their collapse this paper would have been discounted and sold into the market at its recovery value - a process that has been intentionally hidden from view by the actions of The Fed and Treasury.

President Obama, you're a hypocrite of the highest order and have absolutely no right to lecture any third-world banana republic while your administration practices every form of public and private corruption seen in such back waters of humanity - plus dozens they aren't sophisticated enough to figure out.