U.S. DOJ is building criminal cases in LIBOR rate-fixing

July 16, 2012 by · Leave a Comment
Filed under: Legal News 

Bottom-line, this type of crime has to be prosecuted to the fullest extent of the law.  The Libor rate is used in many financial instruments that use that interest-rate as the baseline in all kinds of contracts.    If you bid the rate up, then you forcing trillions of dollars of borrowers to pay more interest.   If you under bid, then you putting an artificial signal to the market that there is less risk than is truly their.   With these scenarios, you can see how this can become political and it could be used as a tool to shape perception.

Markets need market forces so it can do the job it does so well, indicate conditions in the market to borrowers and savers can make the best choice available with the information and signals available.  We continually mess with this basic function.   One of the biggest problems is that people just lose confidence in these indicators.   I believe that has happened and it is getting worst.   That will increase volatility in the market and creates an environment that you will see major swings that will hurt many.

Lets see if the DOJ can step up to the plate and actually put people in jail.  The American people are sick of continually reading about out of court settlements with no admission of wrong-doing.  We have to have accountability of all parties and people who abuse this most crucial trust need to be run out of the industry and should face stiff penalties to discourage any future wrong doers that want to engage in this reckless behavior.

If we do not step up and hand down punishments, some day we will wake and lose faith in the system and at that point, an amount of lawlessness will continue to seep into our society.  If the standard of our society is the we will do anything that is legal even though it is morally objectionable, then we will be in a society that people will not want to live in.   Just cause something is legal, doesn’t mean you should do it.  At some point people need to realize we still live in a community and you actions have an effect on everyone.   We need a fair system where the rules are handed down equally no matter who you  are, what class your from and who you know.  That is having back-bone and principle to stand for something.   Countries around the world look to us and try and emulate our culture, that means we need to set the standard and stick to it.  The standard needs to be much higher than where we are.

DealBook (NY Times) – As regulators ramp up their global investigation into the manipulation of interest rates, the Justice Department has identified potential criminal wrongdoing by big banks and individuals at the center of the scandal.

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Document accidentally released by lawyer shows naked short-selling by investment banks

May 17, 2012 by · Leave a Comment
Filed under: Legal News 

Matt Taibbi is right that god rarely shines down on us in these matters.   I wonder how that lawyer is doing right now?   Has he resigned or is he sprucing up his resume?

I am not even going to try to give too many remarks on this.   Mr. Taibbi and the Economist has done excellent work in this regard and I will instead link to each article respectably.   If you want to read the actual release yourself, click here, pages 14-20 are what both articles are referring too.

Bottom-line is that naked-short selling is illegal, has to stop now and the people who have done this need to be put into jail, this will teach them and others a lesson about the rule of law and why we have them.   Making bets on declining stocks is fine but you need to first secure them, creating them out of thin area outside of the normal supply and demand model is plain old fraud, pure and simple.

Rolling Stone’s Article (Matt Taibbi)

Economist’s Article

Supreme Court “Healthcare” argument: single-payer is on it way

March 27, 2012 by · Leave a Comment
Filed under: Legal News 

I am listening to the audio transcript and you know what?  I keep hearing the judges challenges, it seems to be hinting on if the Congress and determine if markets can exist.  I have heard 3 judge pointing to this item.  At the same time, they hint that is a service everyone is going to need.  Put that together, they could be saying if you want to give universal health care, then you have to take that market over and provide it.   This sounds like a public single-payer system where we are compelled to join like Social Security.  This could be a turn of events.

Live Supreme Court Audio Stream Archive

Your thoughts?

Barret Capital Management accused of using client funds for its own purposes

January 17, 2012 by · Leave a Comment
Filed under: Legal News 

With the ongoing lack of answers and clients funds in the MF Global fraud, we have another alleged instance of a trusted financial fiduciary using their clients money to trade on the companies book for internal profits.  The investors at Barret better put pressure on the regulators to prosecute this as hard as possible and not let them get off the hook by admitting no wrong-doing.   It was a joke watching the C-span hearings of former MF Global boss Jon Corzine.   He sat up their and told people about his intentions, in my opinion, that does not matter.

You should not be able to use your “intentions” as a defense.   We HOPE, your intentions were not to mis-use a clients trust in you and your company.  The facts are the facts and if we want a healthy and functioning banking, capital markets and regulatory system, we need to take a very hardline approach on this type of behavior, too many people are getting off with too little admitted guilt.  Why are the people who are their to protect us, so capture that they can’t seem to do their job effectively?

Winnipeg Free Press – One of Canada’s investment regulators has accused Barret Capital Management, a firm specialized in futures and options on metals and other exchange-traded commodities, of using client money for its own purposes.

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Federal reserve finally reveals secret bailout loan details per judgement

April 1, 2011 by · Leave a Comment
Filed under: Legal News 

Remember, nothing is for free and this disclosure is not an exception.   It has been 2 years since this legal action start to get the secret bank bailout loans that were made during the financial crisis of 2008-present.  The U.S. Federal Reserve released the details per the judgment of the courts that has to do with the Bloomberg L.P lawsuit.  But now we have a law in place that starting in 2012, the Fed will be required to reveal these type of details in the future but with a mandatory 2-month delay.

What this means is now we have codified in law a delay on secret loans as public-private partnership makes on behalf of the U.S. Congress.   Who I add are not elected so we do not really know at all times which mandate they are following, full employment (pro-banks) or stable prices (pro-savers & investors).  We have basically codified secrecy in this part of our market system.  That gives great advantage to the organizations that are receiving this type of public support and harmful to  anyone who competes with these institutions and does not get the same favor (ie: WaMu, Lehman, Bear Sterns, etc.).  Not to say those companies I mentioned did not operate is a self-interested greedy manner but they did not get the red carpet treatment.

MSN Money – The Federal Reserve released thousands of pages of secret loan documents under court order, almost three years after Bloomberg LP first requested details of the central bank’s unprecedented support to banks during the financial crisis.

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