Former Greek Finance Minister Yanis Varoufakis had developed a covert emergency payment system that would work by hacking into government servers in the event of bank closures forced by the European Central Bank (ECB), local media reported Sunday, citing a recorded conversation they obtained.
ATHENS (Sputnik) – Varoufakis allegedly disclosed the so-called parallel payment system in a July 16 teleconference between hedge fund leaders organized by former British Chancellor of the Exchequer Norman Lamont. Continue reading
Tag Archives: hedge funds
Bank Losses From Swiss Currency Surprise Seen Mounting
Among those taking a hit: Everest Capital, who lost its main fund.
The $400 million of cumulative losses that Citigroup Inc. (C), Deutsche Bank AG and Barclays Plc (BARC) are said to have suffered from the Swiss central bank’s decision to end the cap on the franc may be followed by others in coming days.
“The losses will be in the billions — they are still being tallied,” said Mark T. Williams, an executive-in-residence at Boston University specializing in risk management. “They will range from large banks, brokers, hedge funds, mutual funds to currency speculators. There will be ripple effects throughout the financial system.” Continue reading
Billionaire Warns: Yellen Collapse ‘Will Be Unlike Any Other’
Another horrific stock market crash is coming, and the next bust will be “unlike any other” we have seen.
That’s the message from Jeremy Grantham, co-founder and chief investment strategist of GMO, a Boston-based firm with $117 billion in assets under management.
Grantham pulls no punches when assigning responsibility for the coming financial carnage. In a recent interview with The New York Times, he calls Federal Reserve Chair Janet Yellen “ignorant” and says the Federal Reserve all but killed the economic recovery.
A Tour of Syria’s Chemical Weapons
Syrian chemical weapons sites revealed as defector adds new details on regime’s plans to use nerve gas.
U.S. intelligence agencies recently reported on several chemical arms sites in Syria that were revealed in five YouTube videos uploaded to the Internet in July, according to officials familiar with the recordings.
The posting of the videos coincided with the defection in July of Maj. Gen. Adnan Sillu, head of Syria’s chemical arms forces, who told Britain’s Times of London newspaper that Assad will use the arms to stay in power and that his regime has discussed handing over some of the weapons to the Lebanese terrorist group Hezbollah.
One video reveals a major chemical weapons facility in the downtown area of the Syrian capital of Damascus located a short distance by underground tunnel from al-Mazzeh military airfield in southwestern Damascus.
The tunnel can accommodate tractor trailer-sized trucks and exits several buildings on the base. An Arabic-speaking narrator on the video shows the path of the tunnel leading to an underground storage area north and east of the airfield.
The narrator said the roof of the bunker includes 45 feet of reinforced concrete designed to withstand a strike from U.S. Tomahawk missiles. The facility is said to contain a variety of chemical weapons, from hand grenades filled with the blistering agent mustard to chemical weapons rockets of differing sizes.
A second video reveals what is believed to be the largest storage facility for Syria’s biological and chemical weapons, located in a residential area north of Damascus between Al-Tal and Aysh Wurur.
Roads are identified in the video that lead to tunnels built into mountains that stretch 1,500 feet inside the mountain and are hardened against attack.
The narrator of this video, identified as Abu Saqr, stated that he has been inside one of the tunnels that had separate storage rooms sealed with heavy metal doors.
Full article: A Tour of Syria’s Chemical Weapons (Washington Free Beacon)
Credit Default Swaps Remain a Secret Weapon of Economic Warfare
Kevin Freeman points out exactly what is flying over most people’s heads, and what has most likely happened to JP Morgan Chase:
The strategy involved credit default swaps , a kind of derivative that was at the center of the 2008 financial crisis. The swaps were originally used to hedge the bank’s exposure to other investments it owns and included contracts tied to North American investment grade and junk corporate bonds, as well as bonds in Europe and Asia. JPMorgan helped invent the market for such swaps, known as “synthetic” positions because they trade risk without trading the actual bonds. But two things made these particular positions untenable and costly for JPMorgan, according to traders in the market and derivatives experts.
First, as bond markets shifted and forced JPMorgan to realign its hedges, the bank layered swap on top of swap, complicating the structure and increasing the risk that its hedges would fail to offset losses from one swap with gains from another. Second, the sheer size of JP Morgan’s swap position became more than the thinly traded market could easily manage. The lack of liquidity meant the exit door was too small for JPMorgan to fit through quickly once the trades started to deteriorate. Making matters worse, because JPMorgan was so dominant in this market it became clear to hedge funds and other trading entities that it was isolated and at risk—providing opportunities for those who could successfully trade against the bank’s position. The complexity of the trades made it difficult for the bank to stay on top of the risks as its position worsened.
Stop and contemplate this for a moment. No one knows Credit Default Swaps better than JP Morgan Chase. They invented the instruments after all. And, they have long been considered “best in breed” on Wall Street in this regard. Nobody does it better. Yet, this quote is so very significant: “it became clear to hedge funds and other trading entities that it was isolated and at risk—providing opportunities for those who could successfully trade against the bank’s position.” The article went on to say: “But hedge funds and other institutions in the market smelled weakness and dozens took advantage of the bank, according to traders. Reports by the Wall Street Journal and Bloomberg in early April about the bank’s giant positions only made awareness of JP Morgan’s problem and its isolation greater.”
Now, we know that there are players in the world who desired to see JP Morgan Chase brought down. That is motive. Remember a year ago? We wrote a post titled The Invisible Gorilla that had quotes from Stephen Lerner of SEIU and George Soros regarding the need to tear down and remake the financial system. Quotes attributed to Lerner:
“S. Lerner: It seems to me that we’re in a moment where we need to figure out in a much more, through direct action, much more concrete way how we really are trying to disrupt and create uncertainty for capital, for how corporations operate. . . .
And I think the only way we can do that is to think much more creatively, and the key thing I …is we have to say what does the other side fear most? They fear disruption, they fear uncertainty. Every article about Europe says a riot in Greece, the markets went down. The folks that control this country care about one thing: how the stock market does; how the bond market does; and what their bonus is. So I think we weed out a very simple strategy: how do we bring down the stock market, how do we bring down their bonuses, how do we interfere with their ability to, to be rich. And if we don’t do, and that means you have to politically isolate them, economically isolate them and disrupt them. So, it’s not all theory, I’ll do a pitch.
So, a bunch of us around the country are thinking about who would be a really good company to hate? We decided that would be JP Morgan Chase. …. And so we’re going to roll out over the next couple of months what will hopefully be an exciting campaign about JP Morgan Chase that is really about challenge the power of Wall Street. And so what we’re looking at is in the first week of May, we get enough people together – we’re starting now – to really have a week of action in New York with the goal of … I don’t want to go into any details because I don’t know which police agents are in the room, but the goal would be that we would roll out in New York the first week in May…”
Regarding George Soros:
“Two years ago, George Soros said he wanted to reorganize the entire global economic system. In two short weeks, he is going to start – and no one seems to have noticed. On April 8, a group he’s funded with $50 million is holding a major economic conference and Soros’s goal for such an event is to “establish new international rules” and “reform the currency system.” It’s all according to a plan laid out in a Nov. 4, 2009, Soros op-ed calling for “a grand bargain that rearranges the entire financial order.”
Soros wrote an Op-Ed in March 2009 that explained how Credit Default Swaps were used as Bear Raid instruments to bring down the big banks in 2008.
Full article: Credit Default Swaps Remain a Secret Weapon of Economic Warfare (Global Economic Warfare)