I think I've figured out the bailout conspiracy

I've been sitting on this for the last couple of days and think that this entire $700 billion bailout issue was done to control the international monetary system. This is how.

First, the govt. didn't have to go to congress for the $700 bailout. The Fed has been loaning and infusing the markets with billions of dollars anyways. They could have pumped out the money in smaller chunks so that it doesn't appear on people's radar as one huge total. People are generally stupid enough where they won't pay attention to $700 billion being pumped out in smaller amounts.

In addition, as we speak, banks are not loaning money to each other because they are afraid that other banks will not pay back the loan. I believe this is entirely manufactured because if the Fed continue to quietly inject money into the market to keep banks from failing, the banks may be still loaning each other money knowing that each bank would be propped up by the Fed.

When the banks don't loan each other money, there is this thing called LIBOR that is affected. LIBOR is the rate of interest banks charge each other when loaning out money to one another. Well, the LIBOR rate has gone through the roof in the last 2 weeks because banks will not lend each other money.

LIBOR is an extremely important index rate in the economy because many financial instruments and contracts base their right to increase debt obligations based on this rate. In particular, there are over $10 trillion derivative bonds/contracts and over $300 trillion financial contracts around the world based on LIBOR.

To me, this sounds like an extremely significant amount of money that is based on one index. That one index has the power to make or break the financial system of the world and what we are seeing is the attempt to break the global economy.

If this is true, whoever created this idea is an evil genius.

reply to post by SeekingAlpha


Hmmm... I like it! Problem is, I am not knowledgeable enough to determine my opinion. So, if you don't mind a few questions to round out my grasp of your theory...
1. What was LIBOR at two or so weeks ago? what's it at now?
2. When you refer to derivative bonds and financial contracts - could you expand on what these are? Who are they between and to what ends? What changes in these agreements when LIBOR changes? and that has the net effect of what?

Finance is not my strong suit. I have my deducted definitions and guesses about this, but I think and accurate understanding is called for in this case. If I'm seeing your theory right, there may be a strong argument for it's validity.

1. There are a few LIBOR indexes. Overnight, 1 month, 3 month, 6 month ect. Overnight LIBOR rates went from 2% and some change. This was a fairly low rate and it jumped to 6.88%. The overnight rate trippled in a matter of 2 weeks. The 3 month LIBOR has doubled.

2. Derivative bonds are a big mix of debts put into bonds that are sold to other banks and investment institutions. These Derivative bonds have been the most destructive for the banks and are one of the main reasons why the banks are going out of business.

What these banks did was mix bad subprime mortgage with good prime mortgages and bundled them up into bonds. The scandalous part was that these toxic bonds were sold as AAA bonds. AAA is the highest rating these bonds can have and because AAA means that these bonds should be extremely safe, the banks only needed to keep a small amount of cash in reserve just in case these bonds went bad. The problem was that all of these AAA derivative bonds went bad and the banks that had these bonds were caught with their pants down and didn't have enough money to cover the losses. This is why the banks have been hoarding cash and still failing.

As for financial contracts, they are more straight forward. Let's say we enter into an agreement where you have to pay me monthly for some service and that price is hedged to the overnight LIBOR rate plus let's say 3%.

Two weeks ago, you were doing business as usual because you were paying me the 2% LIBOR rate plus 3% in the contract. That means you were paying 5% for our financial contract. No problems. Today, the overnight LIBOR rate is 6.88%. You add that with the 3% in the contract and you are paying 9.88% for your obligation. Big problem if you are dealing with large sums of money because you are now paying almost double from what you were paying 2 weeks ago. The world has about $300 trillion in these financial contracts based on the LIBOR rate.

This is how the LIBOR rate is affecting the world economy. It has the power to force people to fail on their financial obligations.

Originally posted by verbal kint
reply to post by SeekingAlpha

 

Hmmm... I like it! Problem is, I am not knowledgeable enough to determine my opinion. So, if you don't mind a few questions to round out my grasp of your theory...
1. What was LIBOR at two or so weeks ago? what's it at now?
2. When you refer to derivative bonds and financial contracts - could you expand on what these are? Who are they between and to what ends? What changes in these agreements when LIBOR changes? and that has the net effect of what?

Finance is not my strong suit. I have my deducted definitions and guesses about this, but I think and accurate understanding is called for in this case. If I'm seeing your theory right, there may be a strong argument for it's validity.

[edit on 1-10-2008 by SeekingAlpha]

[edit on 1-10-2008 by SeekingAlpha]

So the bailout is to send funds to these banks by buying up the crap mortgages that are mixed in with these AAA bonds.


Allowing the banks to either sell this garbage, which the US treasury will.. and then sit on them because there are no buyers.

Whose going to pay the interest rate for those garbage bonds until the value is par?

Oh ya.. the US taxpayer....

Why do they not go after those institutions who sold those bonds and make them accountable?

reply to post by Willbert


Well, I'll tell you what, the last line of your post took the words right out of my head. These banks sold fraudulent bonds if I'm getting this correctly. They should be buyin back the garbage mortgages by making license plates.

To take your theory even further it is remotely possible that people in high places, which are heavily invested in the US economy (Dubai, Saudi Arabia, China, Europe come to mind), have been burned by some of the toxic debt. Under threat of these foreign investors calling their loans or dumping trillions of US dollars, the US, is forced to buy this toxic foreign debt so they create a bailout crisis and proposed legislation which the Fed figures will pass. If the trillions in US dollars came home to roost the US dollar wouldn't be worth a wooden nickel.

Under the bill passed by the Senate on Wednesday the Fed, with no strings attached and no real accountability, can purchase bad paper from any entity, which means foreign or domestic. This is the one requirement, any entity not necessarily a US entity, that Paulson originally demanded in the bill or it would get the veto. Without legislation the Fed would be blatantly breaking the law by just buying foreign debt a few billion at a time. The second key is that the bad paper does not have to be on something in the US; it could just as easily be bad paper in a failed investment overseas. End result is that the Fed sits on the bad paper until credit suddenly loosens up and the US taxpayer picks up the tab.

Why would these foreign powers with scads of money want to leave the US economy in a shambles if the Fed doesn't come across? My guess is that if the US doesn't do their bidding, then the entire balance of financial power in the world would shift Eastward.

Just thinking on paper!

Excellent analysis, and have to admit that the LIBOR consequences were something I had no thought of...

The thing then is, what is the motive?
How would breaking the backs of obligations around the world help make the day for the "evil genius"?

Ball's back to you...

Originally posted by SeekingAlpha

I've been sitting on this for the last couple of days and think that this entire $700 billion bailout issue was done to control the international monetary system. [...]

Or Else, the $700bn creates a perpetual 4th branch in US govenment,

which follows orders from the London banker cartel,
& ultimately answers to the BIS
(bank of international settlements)

reply to post by Anonymous ATS


You're on to something here. As I understand it, the Saudi's (among others) by way of agreements made 50 or so years ago, are obligated to purchase a certain amount of the US's debt. Could it be that the debt sold to them was a considerable amount of these bonds, fraudulently loaded down with toxic mortgages? Upon discovery of this, the rightful call to buy them back was made, which the banks attempted to comply with, however they were paying the prices of 1 and 2 years ago on property which is now worth half that, coupled with the bad morts they didn't sell... *accountant tears hair out and runs into street screaming*... banks start collapsing, but Saudi's still want their $$$$. This violates the agreement of way back, thus freeing Saudi's to start raising oil prices (which were kept especially low for the US in exchange for the majority of our oil purchases). Oil pushes up overhead costs, forcing business to make adjustments, but need to borrow money until changes in place and take effect. Banks can't loan money they don't have - already given what they had to the saudis. Can't liquidate real estate assets - now more so because they can't make loans to people to buy the properties. Banks continue to fail. The cycle is now set in perpetual motion and it's only a matter of time before the system crashes into so many overdrawn accounts. Gov't looks to save system/banks with buy liquidating their toxic real estate. which would free up some cash to start making loans again, but there still is the obligation to the saudis. PLUS now the turmoil had gotten the Chinese (the other big purchaser of our debt) nervous and they're starting to call in chips here and there, placing more pressure on the banks' already insufficient money supply. Everyone realizes banks have F'ed everyone, people, other banks, saudis, chinese. And this is AFTER the bailout!
SEE YOU IN HELL MOT___ ___KERS!
-hey, can someone loan me a $1 - I need a pretzel.
-v

LIBOR is the London Inter Bank Offered Rate...and it has a direct and vital impact on mortgage interest rates. The adjustments on most ARM products shift upward or downward depending on how this index fluctuates.

This is the same index that most sub prime mortgage loans were tied to.

Well I learned something new today. Thanks for that!

But I would still like to hear about the motive. What is it in your view?

Originally posted by Willbert


Why do they not go after those institutions who sold those bonds and make them accountable?

I find it insanely hypocritical that individual citizens are held accountable for their actions.....yet large groups of criminals are bailed out and pardoned under some kind of 'whoopsie daisey' clause......and as hard as I try and wrap my mind around these inconsistencies I am still pretty confused....in all of this clusterpuck mess I am TRYING SO HARD to see a vestige of the people of the USA as being free men and woman, and I don't see it.....we are nothing more than fodder fuel for the eating machine.

[edit on 2-10-2008 by theRiverGoddess]

The Chinese were going to stop lending to US banks which is what initiated the so called Credit Crisis.

Yes, Libor or the London Interbank Offered Rate is how money flows between countries or central banks essentially and how lending is used on a short term lending basis between banks to convert funds between international banks.
This is associated with moving currencies between countries. When you purchase something made in Japan like your Toyota Prius or Sony Playstation for instance, those dollars that you paid for the product in the US must be converted to Japanese Yen before Sony or Toyota actually get paid.
The money is lent between banks during the transaction interbank process similar to a credit card fee paid by businesses.

What the OP didn't mention though is that the crisis had to do with the Chinese central bank demanding that its banks stop lending to US banks which is the basis of your credit crisis as well as the sense of urgency.

here's the article from gata.org from Sept 25th, 2008

BEIJING -- Mainland regulators have told domestic banks to stop lending to United States financial institutions in the interbank market in a bid to prevent possible losses during the financial crisis, industry sources said yesterday.

The ban from the China Banking Regulatory Commission (CBRC) applied to interbank lending of all currencies to US banks but not to banks from other countries, a source said.

The CBRC was not available for comment yesterday.

The decree appears to be Beijing's first attempt to erect defences against the deepening US financial meltdown after the mainland's major lenders reported billions of US dollars in exposure to the credit crisis.

Lending transactions on the mainland interbank market totalled 10.65 trillion yuan (HK$12.17 trillion) last year, according to the People's Bank of China.

In the first eight months of this year, transactions totalled 10.11 trillion yuan, up 104 per cent from a year earlier.

At the end of last year, the mainland interbank market had 717 members, including banks, securities companies and trust companies.

Another banking source said the CBRC issued the ban after obtaining data about the exposure of mainland banks to bonds issued by bankrupt Lehman Brothers Holdings.

Top officials said they were keeping a close watch on the crisis and warned mainland financial institutions to be cautious in their daily business and overseas expansion.

"The international transaction volume of Chinese banks is not big. Those concerning subprime loans are probably lower than US$10 billion," deputy central bank governor Ma Delun wrote this week in the China Business Post, a People's Bank of China-affiliated newspaper.

But the deteriorating situation in the US has shocked top officials.

Mr Ma said that among the unexpected developments was the effect the crisis was having on normal assets, not just problematic assets; its impact on the whole credit market, not just single products; and its effect on Europe and other nations, not only the US.

The exposure of seven listed mainland banks to bonds related to Lehman Brothers totalled US$721 million.

Mainland banks had US$9.8 billion in exposure to US subprime loans at the end of last year and US$25 billion to Fannie Mae and Freddie Mac by June 30.

[edit on 3-10-2008 by nh_ee]

reply to post by SeekingAlpha

I think you're onto something, but why would anyone need to break the global economy? Perhaps to bring down the value of the Euro and consequently improve the dollar? That's one possibility. Another possibility is this is a way to allow the government to buy into the stock market, take equity in the banks, and invest in real-estate. Everything their buying up is cheap and will go up in value. This is how they will pay for entitlement. Privatizing social security was not a popular idea, so they found a way to do it without saying that's what they're doing.

Originally posted by Willbert
So the bailout is to send funds to these banks by buying up the crap mortgages that are mixed in with these AAA bonds.


Allowing the banks to either sell this garbage, which the US treasury will.. and then sit on them because there are no buyers.

Whose going to pay the interest rate for those garbage bonds until the value is par?

Oh ya.. the US taxpayer....

Why do they not go after those institutions who sold those bonds and make them accountable?

agreed, what this all adds up to is continued debt slavery and theft of America--A SOVEREIGN COUNTRY..look it up!

Originally posted by SeekingAlpha
I've been sitting on this for the last couple of days and think that this entire $700 billion bailout issue was done to control the international monetary system. This is how.

your LIBOR scheme sounds close enough.



the way I see the $700Bn PaulsonPlan....
is that Congress has once again given away its own authority,
and has blessed the combination of an 'Appointed' Treasury Secretary
and a NGO (non government organization) specifically the NY Federal Reserve.... the full power and funding to remain a robust "4th branch" of the USGovernment.


The Fed/Treasury Oiliarchy has an NorthAtlantic directive to ensure that 14 international banks remain solvent and active, the USA group will be the 4 to 7 surviving banks/primary dealers which includes names like
GoldmanSachs, MorganStanley, BankofAmericaConglomorate, Citigroup, and the regular 'A' list names.
(the 14 conglomerate banks, I first heard on ->> JohnGaltfla.com/)






the USA Fed/Treasury, will in turn answer to the north european banker cabal, and all of them will answer to the Bank of International Settlements
, which is the puppet of the "Illuminist NGO's" like Bilderberger, Tri-Lateral, CFO, Carlyle group, Rand, and a raft of think-tanks & foundations

~which are still in conflict with the Asian, Russian, and Islamic blocs~

Hey Guys:

You all have some good points, but the fact of the matter is that the U.S. has been stolen from its citizens and, with Obama probably becoming out newest president by Wednesday, AND with Democratic control of both the house and the Senate, additional legislation will be quickly added to build upon and shore up enforcement policies that will defacto lasso control of our banking and monetary system system. All of this done under the pretense of saving our great country from a devastating depression. Sounds good. How can we possibly not go along with such a necessary plan to save our financial lives.

Personally, I feel like I am in a poker game and am the only one not allowed to cheat.

Having spent a former 15 years in the investment banking business, I can tell you that this whole affair is an absolute sham. There is not one single policy maker inside the Fed that did not know that this was coming years ago.

It almost make one think that this was not accidental.

Who is to blame?

May I suggest the following link:

www.rense.com...

I do not know the author, Mr. Eastman, and he has a few holes in his presentation that need correcting. He stated that his presentation was hurriedly put together, so I forgive him for the journalistic mistakes. My biggest objection is that he failed to properly footnote his dissertation with proper sources which leaves him open for justifiable criticism.

Although I do have the time to fill in those gaps, I will say that he is right on in identifying the persons who have conspired to get us into this mess. This is a great starting point for those of you who may be looking at this for the first time. His story confirms my own experience in the business. Believe what you may, but do your own research.

It is a worthy read.

My first suggestion would be to move your money out of major banks and into credit unions if you can. Secondly, buy a little gold... just in case.

Who knows what the future will bring. I certainly do not. I will say that I have seen these vermin using the bologna technique for many, many years (a thin slice at a time) and the American people continue to sit in front of the TV wondering what team will win Sinday afternoon,

Here is an after thought for those of you who have trouble visualizing numbers. If you began stacking $20 bills on top of one another, by the time you reached 700 billion dollars, your stack would extend into space 2, 375 miles!

Good Luck.

reply to post by SeekingAlpha
Bailout were just keeping the banks alive to reposses all our property so americans wake up homless

Originally posted by St Udio

Originally posted by SeekingAlpha
I've been sitting on this for the last couple of days and think that this entire $700 billion bailout issue was done to control the international monetary system. This is how.

your LIBOR scheme sounds close enough.



the way I see the $700Bn PaulsonPlan....
is that Congress has once again given away its own authority,
and has blessed the combination of an 'Appointed' Treasury Secretary
and a NGO (non government organization) specifically the NY Federal Reserve.... the full power and funding to remain a robust "4th branch" of the USGovernment.


The Fed/Treasury Oiliarchy has an NorthAtlantic directive to ensure that 14 international banks remain solvent and active, the USA group will be the 4 to 7 surviving banks/primary dealers which includes names like
GoldmanSachs, MorganStanley, BankofAmericaConglomorate, Citigroup, and the regular 'A' list names.
(the 14 conglomerate banks, I first heard on ->> JohnGaltfla.com/)






the USA Fed/Treasury, will in turn answer to the north european banker cabal, and all of them will answer to the Bank of International Settlements
, which is the puppet of the "Illuminist NGO's" like Bilderberger, Tri-Lateral, CFO, Carlyle group, Rand, and a raft of think-tanks & foundations

~which are still in conflict with the Asian, Russian, and Islamic blocs~

This last paragraph I can relate to, however I'm thinking that there is a very small group of people who are taking a "wrecking ball" to the global financial world.

I'd like to think that probably five or six people, who are the NWO or TPTB, are responsible for the financial mess.

The REAL question IS, WHO, I mean REAL names.

Some more informed guys here at ATS might be able to supply some names, because I surely cant.