At The Eye Of A Looming Storm? Those Banker Deaths & More Missing…[Part 2]

Banksters
Source: GizaDeathStar.com
Dr. Joseph P. Farrell
January 29, 2017

Yesterday I began this two part blog by noting an important article that appeared in Bloomberg Business Weekly, authored by Vernon Silver and Elissa Martinuzzi, concerning how Deutsche Bank made billions disappear from its books. At the end of that blog, I noted the banker deaths that mysteriously surrounded the Deutsche Bank transactions with Michele Faissola and the Italian Banca dei Paschi di Sienna, a bank in continuous operation since the Renaissance. I also noted Bloomberg’s “take” that this transaction was a microcosm of Deutsche Bank’s other operations. Finally, I noted that the banker deaths were not confined to associations with Deutsche Bank, but that they engulfed other prime banks and even some insurance institutions in the Western financial system, among them J.P. Morgan Chase. So to refresh our memory, we have the following elements:

(1) Derivatives trade, which comprise in part mortgage-based securities, that are tied to “triggers” such as interest rates;

(2) Deutsche Bank’s role in helping rig the LIBOR(London Inter-Bank Offered Rate), one such “trigger”;

(3) the global phenomenon of banker deaths, which I now hypothesize is an indicator that Deutsche Bank’s practices are, indeed, not confined to that bank alone but part of a systemic “operating procedure” for purposes yet to be speculated about; and,

(4) the details of the Deutsche Bank-Banca dei Paschi di Sienna transaction, currently being investigated and adjuticated in Italy.

Let us refresh our memory on the details of that last point, for they bear directly on today’s high octane speculation, which I have titled “I PROMIS you it will Float”:

That’s typically a red flag to auditors and regulators, and it took almost a month for Deutsche to alter the deal so it contained a small amount of actual risk. The bankers did this by mixing in two interest rate triggers—that is, prices to be fed into a formula that would determine how much money the participants in the trade had to pay or receive from each other. But that created a slight possibility that Paschi could win both sides of the bet. To mitigate this potential Deutsche loss—as much as €500 million—Deutsche added a third trigger. Underlying the now complex flowcharts of rates, payments, and triggering events was the asset on which the transactions were to be based: about €2 billion in Italian government bonds.

Further illustrating the incestuousness of the deal, Paschi would need to buy the bonds and hand them over to Deutsche as collateral. Deutsche, for the sake of its own accounting, would need to sell the bonds to come up with cash that it then would give right back to Paschi to pay off the Santorini loss. And Paschi would buy the bonds in the first place from a third bank that had bought them from Deutsche.

Now notice that this is simply a circular “triangle” designed to facilitate the accounting practice that would allow the whole transaction to be kept off the balance sheets:

Deutsche also benefited from the way it accounted internally for its side of the deal. That complex shuttling of Italian bonds? The bank decided that all of the back-and-forth maneuvers canceled themselves out and did not need to appear on its balance sheet. Deutsche began to apply the practice to transactions around the world, totaling more than $10 billion that never showed up on its books and making the bank look smaller and less risky than it really was.

But what is really going on? I suspect it has a great deal to do with a method of generating money and keeping that money off the books, a method known as the “float.” (There are actually two kinds of floats here, but we’re only considering one of them in this exercise of high octane speculation). Investopedia defines the first type of float this way:

Money in the banking system that is briefly counted twice due to delays in processing checks. Float is created when a bank credits a customer’s account as soon as a check is deposited. However, it takes some time for the check to be received from the payer’s bank. Until the check clears from the payer’s bank, the amount of the check appears in the accounts of both the recipient’s and payer’s banks.(See Investopedia: What does “float” mean?)

Notice that money deposited in an account appears on the bank’s books as a liability of the bank; however, prior to actual clearing of the transaction, both at the paying and receiving end, that money is in a kind of accounting limbo, during which time it can actually function as a “hidden” reserve, allowing the bank to use it for very quick transactions on which it will earn more money, before the transaction is cleared.

In this case, the Deutsche Bank-Banca dei Paschi di Sienna triangular transaction created an enormous float, which could be conveniently tracked in real time by…oh, say, a database management software program like PROMIS, brainchild of Inslaw Corporation and its founder, William Hamilton. As most readers here are aware, Inslaw’s software was stolen by the Reagan Justice Department, modified with several backdoors, and then covertly marketed by the American intelligence community to a variety of countries. As I noted in Hidden Finance, Rogue Networks, and Secret Sorcery, this software could track anything – including financial flows – in real time through a variety of databases.

Such money generated by this practice may, or may not, be entered on the bank’s books. In the latter case, it would constitute a “hidden reserve”, so to speak, which can then be used to create even more liquidity. As I’ve noted above, coupling this practice to the derivatives and to mortgage fraud – think only of Catherine Austin Fitts’ story detailing massive mortgage fraud in the Department of Housing and Urban Development when she was assistant secretary there, and one creates an enormous hidden financial system with a volume of liquidity that would probably boggle the mind, liquidity that in turn can be covertly used for a variety of purposes, from manipulation of markets of all sorts – commodities, bullion, interest rates and so on – to covert funding mechanisms for covert operations and, given the sheer scale of the system, funding for expensive black projects research and technologies, and even as a mechanism to fund “off world” projects and trade. Keeping the float secret is, I am arguing, a fundamental component of this hidden system of finance, and it would be a national security secret worth keeping at any price, including the murder of those who…

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About Joseph P. Farrell

Joseph P. Farrell has a doctorate in patristics from the University of Oxford, and pursues research in physics, alternative history and science, and “strange stuff”. His book The Giza DeathStar, for which the Giza Community is named, was published in the spring of 2002, and was his first venture into “alternative history and science”.

….Oh, And About Those Deutsche Bank Derivatives…

…OH, AND ABOUT THOSE DEUTSCHE BANK DERIVATIVES…

Source: GizaDeathStar.com
Dr. Joseph P. Farrell PhD
September 7, 2016

In last Thursday’s News and Views from the Nefarium, I talked about the strange behavior of Germany’s largest, and one of the world’s largest, banks, Deutsche Bank. Then I pointed out the strange behavior of the bank both in deny gold deliveries, and in the fact that it had finished and published a study questioning the overvaluation of stocks on the Standard and Poor’s index, and casting the blame for that over-valuation on central banks, namely, the US Federal Reserve. Well, while you’re pondering those wrinkles, consider this article from our friends at The Daily Bell, shared by Mr. S.D.:

Why Is Citi Gobbling Derivatives?

http://www.thedailybell.com/news-analysis/why-is-citi-gobbling-derivatives/embed/?wmode=transparent#?secret=dqFKoYrimY

Now here’s the crux of the story:

The bank in talks to buy the Deutsche Bank derivatives is Citigroup Inc. according to this article. Well written and focused, it asks why Citi would buy more derivatives when last year Citi purchased $250 billion from Deutsche Bank.

The idea is that Wall Street is simply too greedy for its own good and that this greed can rob bankers of perspective.

Citi is making deals because it can make money and damn the consequences. We’re not quite sure this interpretation is the correct one, as we’ll show in a moment.

Certainly, Citi’s actions don’t make much sense from a longer-term perspective. Most banks are trying to downsize. For instance, Credit Suisse Group AG just sold $380 billion of derivatives to … Citigroup! And this does seem strange, as Citi “nearly destroyed itself” with derivatives in 2008.

So why is the Citibank group negotiating with Deutsche Bank to buy derivatives from it, the very derivatives threatening the German banking giant? The Daily Bell offers its own high octane speculation here:

And within a larger context these banks are in some sense an extension of the US government, and certainly of the Federal Reserve.

Is it possible the US government and the Fed are using Citi as a stalking horse to gather derivatives contracts?

If these derivative relationships are jeopardized by a market event, or even by a serious crash, could the Fed can step in and print the money necessary to stem the proverbial tide?  The dollar remains the world’s reserve currency, after all.

And isn’t this in a sense what Ben Bernanke did when he sent $16 trillion around the world in 2008-2009 to ensure there was no larger collapse of the entire financial system (here).

The more derivatives owned by US banks, the more control presumably that the Fed has over the market. Perhaps it can create solvency for some participants while leaving others out, as it did during the throes of the financial crisis when it salvaged Merrill Lynch but sank Lehman Brothers.

In other words, if there are all those derivatives out there – and let us remember it was largely reckless regulatory policy under the Clinton administration that made the mess possible – then it’s best to “bring them home” where at least they can be more carefully controlled. And perhaps, just perhaps, this might even be being done in advance of a “jubilee” of sorts, a write down of all that bad paper.

Well, perhaps.

But from my point of view, the other equally interesting part of this story isn’t the Citibank end of it, it’s the Deutsche Bank end of it, which brings us to our high octane speculation. For if the move does represent an attempt by the US government and the Federal reserve to use Citibank as a “stalking horse,” then it takes two to tango, and Deutsche Bank, as a large foreign bank with big exposure to derivatives, is apparently willing to dance.

The question is, why? And my high octane speculation of an answer says that…

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Profile photo of Joseph P. Farrell
Joseph P. Farrell has a doctorate in patristics from the University of Oxford, and pursues research in physics, alternative history and science, and “strange stuff”. His book The Giza DeathStar, for which the Giza Community is named, was published in the spring of 2002, and was his first venture into “alternative history and science”.

CME To Open Account AT FED…

CME TO OPEN ACCOUNT AT FED…
Source: GizaDeathStar.com
Dr. Joseph P. Farrell
April 27, 2016

Now, this unusual story was shared by Mr. T.S., who sent it along with an email posing the question: “is this new account going to be used to bolster Commercial Banks with Funds from the FED in the Event of Margin Failures resulting from Extreme Gold demand forcing the shorting banks to liquidate their margin accounts?” Well, I’ll let you read the short article, and “you can tell me”:

CME Group says preparing to open account at the Fed

So what’s going on here? Well, I suspect that for one thing, Mr. T.S. is right, or at least, close, in that something like what he has proposed may be going on. But there are other possible explanations as well, and one of them is that this, too, is a manifestation of what, in part, may have transpired at that secret meeting of Mr. Obama, Mr. Biden, and Ms. Yellen, at the Fed last week. You’ll recall two days ago that I blogged about the fact that most derivatives trades are currently still “over-the-counter” and not subject to central clearing. You’ll also recall that the initial Obama-Biden-Yellen meeting was due to the Fed invoking “expedited procedures”, and that this meeting was followed up by meetings of major bankers in Washington, and a letter to JP Morgan Chase warning it that its “wind down” plan – sort of a last will and testament for banks about to expire – was simply inadequate, since the bank was exposed to seizures of its liquidity from “foreign jurisdictions” (the Fed’s phrase) and unspecified “third parties”(again, the Fed’s phrase).

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Joseph P. Farrell has a doctorate in patristics from the University of Oxford, and pursues research in physics, alternative history and science, and “strange stuff”. His book The Giza DeathStar, for which the Giza Community is named, was published in the spring of 2002, and was his first venture into “alternative history and science”.

 

Remember That German Gold Repatriation? Well, You May Not Have Heard…

Source:  GizaDeathStar.com
Dr. Joseph P. Farrell
February 8, 2016

Mr. B. noticed this one, and passed it along with a passage in it highlighted in bold, along with his own speculations, So I read the article, and responded to him that I basically concurred. See if you can spot what he spotted:

In uncertain times, Germany takes more gold home

There’s the usual bow to the meme of German fears about an uncertain financial and geopolitical future, and one can only imagine these fears have intensified with the recent backlash against Chancellorin Merkel’s “refugee policy,” which is being met with increasing popular opposition both in her own country and in neighboring Holland, Sweden, France, and Austria:

In the wake of the euro zone crisis, many ordinary Germans want to see more of the 3,381 tonnes of gold in vaults at home and some have even questioned whether it still exists, prompting the Bundesbank to recently publish a long list of gold bars.

Just over 40 percent of the reserve, which Germany started building in the post-war boom years, is now held underground at the Bundesbank in Frankfurt, while almost the same amount is stored at the Federal Reserve in the United States.

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