28 September Updated.
25 September 2008
Comments on the financial mess welcome. Send to: cryptome[at]earthlink.net.
State if anonymity is wanted.
Cryptome, 20 September 2008
The Financial Crisis as the Second 9/11
The failure to connect the dots, dismissal of warnings as unfounded, declarations
of unexpected calamity, calls for urgent action by government to prevent
greater disaster, insistence that Congress and the Administration must act
immediately, frightening secret briefings by those who claim to know what
has led to the emergency and what must be done to handle it, public assurances
that while the nation is in jeopardy wise heads have a plan for protection,
with continuing risk to be borne by all Americans, those responsible for
a solution to be trusted in the future even though they failed in their
responsiblities to prevent the crisis, and don't waste time questioning who
was responsible for the failure now is the time to plan for the future.
That the problem is due to the US dropping its guard, being complacent about
its superiority, not recognizing threats different from those well-known
in political and military terms. And failing to see that a national threat
has come from a source that no sensible person could have foreseen, sure
a few gloom and doomers raised alarms about incomprehensible financial dealings,
but who could believe those obsessed with imaginary hazards to the financial
Financial power has shifted from the US to Asia and the Middle East, some
say, and who knows, maybe that was the plan -- to outfox the US masters of
the financial universe who believed that nobody better knew global economics,
and no nation could challenge military protection of the US economy.
Since 9/11 the second 9/11 was predicted to happen in a way that could not
be anticipated, that its success would depend on bypassing defenses derived
from the first 9/11. Not nuclear, biological or chemical, but financial.
Why target a few thousands when millions can be harmed using the institutions
and technologies invented for global commerce supremacy -- hi-jacked airliners
a mere test run.
The confused rush to handle the financial crisis with piecemeal reactions
developed over a couple of weeks is likely to have been anticipated by attackers
to panic their targets while continuing to withdraw funds from US institutions,
picking them off one by one, assured that no military countermeasure is possible
so long as targets cannot be identified in time to halt the aggression.
Or is there an armageddon military spasm in the offing of wounded warriors
unable to pinpoint targets so goes for all in the database of those who invented,
inflicted, condoned and avoided punishment for debt WMD.
[Added 22 September 2008]
[Federal Register: September 22, 2008 (Volume 73, Number 184)]
Notice of September 18, 2008
Continuation of the National Emergency With
Respect to Persons Who Commit, Threaten to Commit, or
On September 23, 2001, by Executive Order 13224, I
declared a national emergency with respect to persons
who commit, threaten to commit, or support terrorism,
pursuant to the International Emergency Economic Powers
Act (50 U.S.C. 1701-1706). I took this action to deal
with the unusual and extraordinary threat to the
national security, foreign policy, and economy of the
United States constituted by the grave acts of
terrorism and threats of terrorism committed by foreign
terrorists, including the terrorist attacks in New
York, in Pennsylvania, and against the Pentagon
committed on September 11, 2001, and the continuing and
immediate threat of further attacks against United
States nationals or the United States. Because the
actions of these persons who commit, threaten to
commit, or support terrorism continue to pose an
unusual and extraordinary threat to the United States,
the national emergency declared on September 23, 2001,
and the measures adopted on that date to deal with that
emergency, must continue in effect beyond September 23,
2008. Therefore, in accordance with section 202(d) of
the National Emergencies Act (50 U.S.C. 1622(d)), I am
continuing for 1 year the national emergency with
respect to persons who commit, threaten to commit, or
This notice shall be published in the Federal Register
and transmitted to the Congress.
THE WHITE HOUSE,
Washington, September 18, 2008
Betty, 21 September 2008
Well stated... your analysis of the Financial Crisis.
Thank you for your words. You are right on!
FBI, 22 September 2008
WHEN CRISIS STRIKES: New FBI Technology is Ready to Help
A software system built by our agents and technology experts is helping the
FBI and its partners better manage crisis situations.
Robert 1, 22 September 2008
Nettime, 23 September 2008
I need to ask you to support an urgent secret business relationship with
a transfer of funds of great magnitude.
I am Ministry of the Treasury of the Republic of America. My country has
had crisis that has caused the need for large transfer of funds of 800 billion
dollars US. If you would assist me in this transfer, it would be most profitable
I am working with Mr. Phil Gram, lobbyist for UBS, who will be my replacement
as Ministry of the Treasury in January. As a Senator, you may know him as
the leader of the American banking deregulation movement in the 1990s. This
transactin is 100% safe.
This is a matter of great urgency. We need a blank check. We need the funds
as quickly as possible. We cannot directly transfer these funds in the names
of our close friends because we are constantly under surveillance. My family
lawyer advised me that I should look for a reliable and trustworthy person
who will act as a next of kin so the funds can be transferred.
Please reply with all of your bank account, IRA and college fund account
numbers and those of your children and grandchildren to
email@example.com so that we may transfer your commission for
this transaction. After I receive that information, I will respond with detailed
information about safeguards that will be used to protect the funds.
Minister of Treasury Paulson
Michael, 23 September 2008
It took me a while to find it, but find it I did. OFHEO is the regulator
for Fannie and Freddie and won't be around much longer:
Charles, 24 September 2008
On September 21 you linked to a blog entry
with link name Magic and description "How Banks Create Money Out Of Thin
The opening description, of what economists call velocity, is quite correct,
though friction (not all money is deposited) and competition (of the money
that is deposited, not all is deposited at the same bank) are of course
neglected. But just after this Econ 201 description, it continues:
"When you cash out your CD, you get your $100,000 deposit back, in addition
to the $5,000 interest. Meanwhile, the bank has created $243,900 of new money.
After it pays you 5% interest, the bank has made a tidy profit of $238,900.
($243,900 - $5,000 = $238,900.) If the numbers are confusing, go over them
again until you see how magical this process is. This is how banks create
In fact this is quite wrong. When the money is withdrawn by cashing
out the CD, the reserve requirement for the $243,900 is no longer met so
the bank must reduce its liabilities by this amount. They money that
the bank makes on the CD is the interest charged on the $243,900. (Actually
the figure will be lower for the reasons mentioned above.)
I thought this might be of interest to you, since you found the entry amusing
enough to post.
Anonymous, 24 September 2008
Anonymous has left a new comment on your post "Anonymous Posts Welcome":
Here are some great tips for investing:
Tyler, 24 September 2008
Aside from [Tim] May, who woulda thunk it? One could argue that the investment
banks were not self-regulating after all, but perhaps the fault boils down
to a plain-and-simple statist approach to the money supply. There is no "economic
stimulation" knob after all, or if there is the economy eventually cancels
out external stimulation so that the stimulation is temporary.
Actually, the US economy is arguably not a hell of a lot different than a
crack whore: The government gives it periodic toots of blow but it has built
up a tolerance and the old tricks don't do it no more.
Arguably, a government MIGHT be able to facilitate economic growth through
things like education and perhaps some infrastructure. But growth doesn't
come in a can and this governmental imposition of ultra-leverage hasn't done
much but redistribute wealth into the Hamptons and the upper East side...these
are the pimps that have to be paid in order for the defense industry to have
a go tryin' a little anal with ole' Lady Liberty.
Robert 2, 24 September 2008
Visual Perspective of the figure 'Trillion':
POC, 25 September 2008
Friends and folks,
Many of you have heard me talk over the last year about getting out of the
stock market, diversifying across global currencies, getting some of your
savings out of "fiat money" altogether. Some of you thought I was batty to
be warning of financial apocalypse, others took me seriously, but few acted.
Now we're (supposedly) at zero hour again, and some people are asking me,
"What did you say I should do again?" The most general answer I have is to
seek good stores of value, besides the US dollar, and to get out of the
criminally manipulated US equities markets. (Warning: I am not a financial
professional. By law, I must tell you that this is not a recommendation to
buy, sell, or hold any financial instrument.)
It's impossible to know what will be a good store of value in the future.
However I believe that diversified fiat money and gold bullion are good places
For those with time and curiosity, here's a brief and opinionated run-down
of various stores of value: REAL ESTATE is traditionally one of the best,
but putting its immense human value aside, its actual price remains artificially
inflated by various well-known shenanigans. COLLECTIBLES have been good stores
of value historically, but a global decline in discretionary spending could
lead to deflation of the value of many such assets, so you need to be very
picky (or just lucky). PRECIOUS METALS are historically good stores of value,
but a global recession will reduce demand for their consumption, causing
them to lose some value. Rather different from other precious metals, GOLD
is priced largely for its value as a store, with less consumption-based price
influence compared with other collectibles and commodities. It has been hoarded
by world powers for millennia, has retained its perceived value through thick
and thin, which puts it high on my list of good stores of value. FIAT MONEY
(also known as "cash" or "currencies") is less volatile than gold over short
periods of time, and is widely recognized as means of payment, despite the
fact that it's backed only by the economic and military power of the issuer.
The value of today's currencies as symbols of world government gives me some
faith in the future of some of the better currencies as stores of value.
The following two mutual funds are focused on holding "hard currencies,"
meaning stable stores of value in the opinion of the fund advisor. Both are
invested mostly in the treasury instruments of various first-world governments,
and have some exposure to gold through third parties.
The Prudent Global Income Fund (symbol PSAFX)
The Merk Hard Currency Fund (symbol MERKX)
While I like both of these funds a lot, it's important to remember that they're
securities, they don't give you direct ownership of any foreign currency.
When you own a mutual fund, you're trusting that it will operate per its
stated goals. The SIPC does not insure you against fraud. But if you're not
wealthy enough to have private banking relationships, your options for holding
foreign cash are very limited.
I sleep pretty well at night having my foreign currency allocations managed
by these two funds.
Moving onto the US dollar, some people feel that holding this currency is
still a good idea. To me, it looks more like a bad idea with every passing
day. However I do recommend keeping a chunk US dollar cash around, somewhere
safe, for emergencies. Bank "safe deposit" boxes are no longer safe in the
current banking environment.
Finally, there's gold. This is where you get to thumb your nose to the entire
banking system and take direct ownership of a historically stable and efficient
store of value. Depending on how you acquire it, you might even be thumbing
your nose at the US government, which has previously confiscated gold from
its citizens en masse.
Right now I own my gold through an intermediary called BullionVault, which
operates under British law as a bailor, meaning that they serve merely as
a custodian for my gold ownership. This is far superior to the "unallocated
gold" offered by banks, which is really just another sketchy debt issuance.
My gold lives in a vault in Switzerland, that government offering some of
the strongest personal property rights in the world. Another big advantage
of BullionVault over keeping gold in your personal posession is that you
don't need to get it re-assayed if and when you sell it. The entire operation
at BullionVault is very meticulous, and they don't dabble in other business
Please use the following link for BullionVault:
You should also consider having some Krugerrands in your physical posession.
These are conveniently small South African gold alloy coins with no face
value, widely recognized as a standard form of gold. If you find a reputable
dealer who will let you pay cash for Krugerrands, it's a good way to own
the metal off-the-books. "Junk" coins (with precious metal value but no
collectible value) are a similar strategy, possibly easier to acquire with
Finally, please call, email, and fax your SENATORS and REPRESENTATIVES and
tell them who you'll hold responsible for the consequences of this criminal
bailout if it passes into law.
Good luck to all.
Robert 3, 25 September 2008
In my previous political and economic letters and papers, we have disagreed
about the finer points of some issues, but we may now have some common ground,
being against the Bush Administration's proposed additional bailout of
incompetently managed financial institutions that are also likely corrupt
and fraudulent. This proposed 700+ billion dollar bailout comes on the heels
of many hundreds of billions of dollars already doled-out to such financial
institutions during recent weeks. I place much of the blame for this crisis
on the Bush Administration's failure to monitor and regulate the industry,
and their tolerance of shameless greed. Although some of you remain free-market
purests, I remain a believer in reasonable regulation because I have seen
so much shameful greed and dishonesty in my time, it seems regulation is
the only leash to restrain the seemingly infinite greed and dishonesty of
some people. The current mess with 53,000+ children being poisoned with tainted
baby formula is but one current example that continues.
Regarding the current fiscal woes here in the States and spreading overseas,
I am very skeptical about this proposed 700+ billion dollar bailout (in addition
to several hundreds of billions already flushed down-the-drain in recent
weeks by the Bush Administration, to benefit their most wealthy friends and
supporters). First, I have doubts that the additional 700+ billion dollar
bailout will cure the problem. As a matter of fact, at best it may act as
a bandage for one financial sector in trouble, but other financial sectors
are skating on thin ice, and these potential financial meltdown's will likely
become more apparent by year's end. Obvious examples of such unstable financial
sectors that are "skating on thin ice" are the banking institutions with
trillions of dollars in loans in the credit card sector, most of these loans
being unsecured and unlike those secured loans in the real property sectors.
It is only a matter of time before this banking sector winds-up in hopelessly
a deep hole. A large set of banking institutions have much of their business
in unsecured credit card loans. How long do you think it'll be before millions
more people stop paying unsecured loans and focus on paying-off their secured
loans, such as car loans and home loans? This may likely happen following
the forthcoming Holiday Season charge-up in consumers' credit card accounts?
Will the public be held responsible for bailing these banks out to the tune
of another trillion or several trillion more dollars? This sort of potential
financial collapse will be bigger and more expensive to bailout, and it is
not unlikely to happen. Second, we have heard this sort of doom and gloom
before, historically, and as recently as the doom a [text missing]
Whenever we have financial messes historically, you can be sure greedy, scheming
bank executives are at the root of the problem. Recall during recent memory,
not only the Great Depression during the Hoover (R) Administration, but the
numerous Savings & Loan failures during the Reagan (R) and Bush I (R)
Administrations, which involved fraud and misconduct of Bush family members
(e.g., Neil Bush @ the Silverado Savings and Loan fraud and bank failure)
and the fraud and misconduct of prominent politicians (e.g., McCain as one
of the Keating Five @ the Lincoln Savings and Loan fraud and bank failure).
This whole matter regarding the bailout must be well-defined with strict
limitations on executive compensation and profits, and scrutinized under
a microscope, before the government doles-out what will far exceed a trillion
dollars in bailouts. These trillion dollar bailouts may pose more of a threat
to us than the failure of some mismanaged and corrupt institutions. The CEO's
and the top managers of these grossly mismanaged institutions, and their
associates, should also be scrutinized and face the full power of the DOJ's
Criminal Division, as well as that of their States' Attorney General. When
Sir Issac Newton was honored by being appointed Master of the Mint,
counterfeiting was rampant throughout the U.K. Newton's solution to the problem
was seemingly simple and quite effective: He ordered the arrest of suspected
counterfeiters and their immediate trial and if found guilty, their prompt
public execution. Within a matter of months, counterfeiting was reduced to
a negligible level. Perhaps doling-out a trillion dollars more is not a logical
solution to this problem, and there may be another lesson, a more powerful
lesson, to be learned from Newton. nb
The Bush Administration's proposed 700+ billion dollar bailout is just another
means for them to enrich their super wealthy friends and supporters, using
fear, and smoke and mirrors. The Bush Administration must think the American
public is incredibly stupid and gullible to keep believing the smoke and
mirrors they use to back their several fear-based lies and fraudulent schemes.
Their 700+ billion dollar bailout scheme is clearly more fraudulent and dishonest
that anything Wall Street has ever come up with, and I'll bet that its not
going to be the last time the Bush Administration uses fear and smoke and
mirrors to milk another trillion dollars or more from the public.
I urge you to demand that your Congressional Representatives vote against
this proposed 700+ billion dollar bailout, or you'll actively vote them
out-of-office in little more than a month's time.
Barack Obama Campaign, 25 September 2008
Friend -- This morning Barack called John McCain to suggest a joint statement
of principles that would help Congress resolve the immediate financial crisis.
Then John McCain went on television and said he was suspending his campaign
and that Friday's presidential debate should be postponed. Barack spoke about
the crisis and took questions from reporters a few hours ago. He also made
it clear that -- with only 40 days left for the American people to decide
who will be responsible for leading our economic future -- it is more important
than ever that the scheduled debate takes place. Please take a minute to
watch the video of Barack's press conference and share it with your friends:
This is an important time, and we have to keep this campaign focused on the
crucial issues. Thank you, David
Obama for America
Graham, 25 September 25, 2008
Just thought that you might like to give the Following, an AIRing on Cryptome.
For years now, your work has been providing Valuable Insight and Information
to me, for my Work Rest and Play. :-)
A Patent Application for the Prevention of Capitalist Systems Meltdown
Posted Thursday 25th September 2008 09:51 GMT
Share widely please. ...... Patents are hereby Gifted to open source and
Open Source under CopyLeft Common License
"The net worth of the Forbes 400 richest Americans is now a staggering $1.54
trillion, which is up $290 billion from last year." .....
Mr Paulson's $700 billion dilemma is easily solved for Americans by Americans
at no cost to the taxpayer and at no real personal cost to those who bale
out the System because all that is needed is for the Forbes 400 richest Americans
to donate just half of their enormous, we'll never ever be able to spend
it, wealth to him.
And that would also show everyone that they have all the confidence in the
world that the American economy and its Capitalist System is Sound rather
than a Crooked Rigged Game.
PS That net worth figure by the way is conservative and last year's figures
[which were up $290 billion from the previous year, so one can reasonable
expect the figure to be considerably higher]. .... "estimates of net worth
are deliberately conservative and should be considered 'at least' figures."
...... so the White Knights would be quids in.
Or is there a problem with that solution? It is surely the most Patriotic
ACT thing to do, is it not, returning one's Good Fortune in Times that have
turned sour to Institutions which the Government and Market leaders are
Touting/Pimping as Triple AAA Worthy of National Support to save All from
Catastrophic Collapse and Markets Meltdown.
What better Act could one expect of true Americans caring for their Peoples?
However, the note of caution would be that if Paulson and friends are
perpetrating a Scam, will their Money be lost into the same black hole as
swallowed all of the other wealth ....... but it will not really effect the
lifestyle of the Donors, will it .... so no Real Harm done.
28 September 2008
Jeremy Wells (jeremy[at]infowells.com) writes:
There is no quick fix to the current "financial mess". This "mess" is an
intrinsic characteristic of capitalism and yet another crises of U.S. capitalism
careening to complete economic and political collapse.
I suggest a daily read of the World Socialist Web Site:
http://www.wsws.org for an anti-capitalist,
socialist perspective on current affairs.
For further understanding go to the web page of the Socialist Equality Party,
founding convention in August 2008, at: