The Whistleblower Trend has Begun: Next up Backstabbing

The USA is addicted to debt.  No matter what the NY Bankers do to destroy our economy, they are above the law because they are the drug dealers.  With the U.S. hopelessly in a downward spiral of debt, they fear prosecuting them (since it will) cut off the salesmen who raise money to keep the borrowing going.  A drug addict will not turn on his supplier and cut off his own drugs.  There will never be a criminal charge against NY Bankers as long as the government needs to borrow.
– Martin A. Armstrong

At what point shall we expect the approach of danger? By what means shall we fortify against it? Shall we expect some transatlantic military giant,  to step the Ocean, and crush us at a blow? Never! All the armies of Europe, Asia and Africa combined, with all the treasure of the earth (our own  excepted) in their military chest; with a Buonaparte for a commander,  could not by force, take a drink from the Ohio, or make a track on the Blue Ridge, in a trial of a thousand years. At what point, then, is the approach of danger to be expected? I answer, if it ever reach us it must spring up amongst us. It cannot come from abroad. If destruction be our lot, we must ourselves be its author and finisher. As a nation of freemen, we must live through all time, or die by suicide.
– Abraham Lincoln

Disclaimer:  I am sure some of you will dislike me after reading this email and that is fine.  I am not trying to make friends, rather my intention is to speak out and call the situation as I see it.  More than anything else, the primary purpose of these emails is to get as many of the influential and moral people in the financial services industry as possible to become more aware of how serious a threat we face as a nation as a result of the actions being done by a fiendish and destructive union of big corporate interests across many sectors and an increasingly undemocratic political class.  My second intention is to advise people on how they can protect themselves and their clients from the financial calamity that is to come which will make 2008 looks like a picnic. 

How to Commit National Suicide:  America After the Crisis
We are in the process of committing national suicide on a grand scale.  Well, perhaps suicide isn’t the right word.  It is more akin to a death penalty being imposed upon the Republic by a greedy, corrupt and entirely unethical entrenched political and economic elite.  This elite deserved to go broke, get kicked out of office and lose their positions of power and influence as a consequence of the prior collapse.  This is how a free market economy would have worked.  When the collapse came; however, those that were appointed by an administration ushered in on the false promise of change appointed to key positions the very people that were responsible for the misguided and toxic economic policies of the past.  As soon as I heard Tim Geithner and Larry Summers were to hold key economic positions in the administration I knew my vote in November was wasted.  They were placed there to maintain the status quo, protect the financial interests of those that contributed to the campaign and ironically to specifically PREVENT change in the cesspool that is today’s financial services industry.

There is a growing movement on the ground that consists of people from all walks of life and political leanings that have experienced an awakening that is in my opinion extremely productive.  The fact that those that do not like this populism are actively and explicitly stating their intention to infiltrate tea parties and act outrageously at these event to discredit the movement demonstrates just how genuinely grass roots and powerful this movement is.  If there is one extraordinarily positive thing that came out of the crisis it is that the curtain was pulled away from the U.S. government and the Federal Reserve and the dazed eyes of a naïve public were granted a front row seat to how things work and how the game is played.  As Max Keiser proclaims, this is not free market capitalism it is “rigged market capitalism.”  The illusions of a free market economy are long gone for anyone that is paying attention with an unbiased perspective.  Ron Paul echoed a similar sentiment at the recent SRLC in New Orleans.  In his speech he pointed out that many Republicans are mischaracterizing Obama as a socialist.  He points out that Obama is no socialist he is a corporatist.  With this I agree.  It is counterproductive to classify Obama as a socialist since this might turn off many on the left that would join a real constitutional movement.  The founding philosophy that made the United States great was an aversion to and checks and balances against concentrated power that is so often justified via collectivist propaganda.  Sadly, this is what we now have and the longer we take to dismantle it the worse things will be.

The Whistleblower Trend and What it Means
Recently, there have been several interesting whistleblower cases to emerge.  The first relates to Andrew McGuire, a veteran precious metals trader who sent emails to the CFTC demonstrating precisely how JP Morgan manipulates the precious metals markets.  He explained to folks at the CFTC exactly how and when the prices would be knocked down on a particular day with uncanny precision.  Later, when he was denied an appearance at the CFTC hearing on metals position limits he came out publicly.  Amongst other things he has said:  “JPMorgan acts as an agent for the Federal Reserve; they act to halt the rise of gold and silver against the US dollar. JPMorgan is insulated from potential losses [on their short positions] by the Fed and/or the US taxpayer.”  I could write about this issue for many, many pages but I will refrain.  Rather, just listen to the words of McGuire himself in the attached interview (http://kingworldnews.com/kingworldnews/Broadcast/Entries/2010/3/30_Andrew_Maguire_&_Adrian_Douglass.html).  In addition, you can read the email trail he had with the CFTC using that link as well.  Coincidentally I am sure, McGuire and his wife experienced a hit and run car accident a couple of days after going public.

The next whistleblower event emerged via an anonymous interview with the Huffington Post earlier this week.  The whistleblower was described as “an anonymous executive at one of America’s 10 largest banks, who after many years of watching the worst of Wall Street’s ethics transform his company, has decided to speak out.”  Here are some of the more interesting paragraphs.

“In my part [of the bank] we had different people with different values. The Wall Street mentality has been pushed into the traditional bank, and it’s not always welcome there. It’s welcome to the extent that people can make a lot money, but it’s not welcome to the extent that it becomes all about money.”

“Over time, [securitized products and credit cards] were profitable and therefore it led to a diversion of resources away from the core business. And, in my view, and if you look at the at the growth of manufacturing and entrepreneurship versus the growth of the financial sector, clearly, if money had not been diverted to the financial sector, if those more resources and intellectual capital hadn’t been allocated to sectors that don’t create benefit for the society at large, you’d have more funding available now. And maybe we’d have more jobs now.”

“They’re not being told not to make loans. However, the difficulty of making loans has gone up several magnitudes. And the metrics have changed. In the past the organization has valued loans, now the organization values deposits and fee-based products… The question is what does that mean? There may not be a directive given that you will make fewer loans, but the practical effect is the you will make fewer loans. But also the skill set of your people will change to being skilled at loans to being skilled at other things.”

This is particularly timely in light of Bank of America’s earnings this morning.  I almost vomited when the CEO was asked about whether he was prepared to hire on CNBC because the economy was so good by the fantastically brainwashed Becky Quick.  He said that the headcount would remain relatively steady but some areas were growing like Investment Banking and Sales and Trading.  Great news!  See this sums it all up.  This is where these folks are making their money.  The only way you can make a big fortune in today’s America is to become a gambler in a suit.  To use the rigged Federal Reserve system and borrow at zero and place bets with a taxpayer backstop.  Meanwhile credit card interest rates remain in the double digits.  This is neo-feudalism and it is wrong.  Furthermore, to those that think they can just turn a blind eye and make a buck that’s not how these things work at these points in time.  Future generations are being sold out and it is tragic and it will come back to haunt all of us.

Are we Entering the Backstabbing Phase?
The whistleblower phase has begun and I expect it to accelerate.  Why?  Because I honestly think the vast majority of those in the financial services industry are good human beings that will increasingly feel uncomfortable supporting the crooked system that pays them.  Moreover, it is interesting that as I was writing this email the news about the SEC and GS came out.  I am not going to get into too much detail (although it is amazing that today was a Martin Armstrong pi event day, 2010.29) so this really may be a major turning point.  The one thing I will say is that as more whistleblowers and leaks emerge more people that have done things that are questionable are going to come forward and sell out those above them in the food chain to perhaps clear their conscience or to avoid prosecution down the road.  This is coming.  As far as today, the selling in the paper precious metals market provides a great opportunity to buy physical metals.  I would completely avoid the GLD and SLV and if possible convert those to physical as soon as possible.  No offense to those at GS on my list but someone wrote this to me today and I thought it was sums up the general perception in the markets.  He said:  “stocks are stabilizing as GS covers all the stocks they sold into the indictment.”  Whether this perception is justified or not, it is the perception and it’s not good for anyone and must be dealt with.

Have a great weekend and for those that I may have offended it is not my intention and, as I said, I think most people are good people it’s the system that is rotten and the incentives that it puts in place,

Mike

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