How the Banksters Broke the Market; Billions More for the IMF

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• Bank of America admits central banks are rigging equities game.

By Ronald L. Ray —

Long-time readers of AMERICAN FREE PRESS know that we have been relentless in exposing the massive corruption and greed in the banking industry. But it may be that this centuries-old international Ponzi scheme is about to collapse. Giving a sign that the plutocrats are preparing to eat their own, Bank of America (BoA) recently released a stunning and straightforward report, which explains how the Federal Reserve Bank and other central banks around the world have rigged the equities markets.

In the United States, a corrupt Congress is also to blame, since it unconstitutionally gave the Fed the task of not only controlling the nation’s money supply but also ensuring sufficient employment and maintaining balance in the stock, bond, and commodities markets. The Fed has—deliberately, we would say—failed its mandate, seeking only the enrichment of its private member banks, like Goldman Sachs and the Rothschild financial empire.

According to Benjamin Fowler, chief of BoA’s global equity derivatives research, in a December 9, 2015 report entitled “Fragility is the new volatility,” the years since the 2008 international financial collapse have seen unprecedented central bank interventions in the market—a monstrous manipulation of such proportions that the banksters have, in fact, “broken the market.”

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Fowler writes, “Essentially central banks, by unfairly inflating asset prices, have compressed risk like a spring to unfairly tight levels. Unfortunately, the market is aware the price of risk is not correct, but they can’t fight it, and everyone is forced to crowd into the same trade. By manipulating markets, they have also reduced investors’ inherent conviction by rendering fundamentals less relevant.”

In plain English, the central bankers have created money out of thin air to provide too-easy credit and even secretly bought up stocks, bonds and commodities in order to prop up an otherwise collapsing market. The market is a fraud, because real profits do not exist in too many companies, especially the largest.

The illusion of prosperity is created in this case by the central banks’ continuing injection of credit and purchases of equities. This money artificially inflates prices and balance sheets.



 

This manipulation has radically destabilized the markets and created a nightmare scenario. Too much liquidity—cash or credit—from the central banks has caused an artificial reduction or “compression” of risk and “forced crowding” of investors into the same trade. This compression and crowding in turn ignore the importance of companies’ fundamental worth and profitability, while producing low conviction among investors in the value and stability of the market.

Consequently, the least significant market event can trigger a panic sell-off—a “flash crash.” When investors realize the central banks are still there to manipulate the market and provide illusory “stability,” those with money left all pile back in, sometimes with even greater violence. This market “fragility” provides a new and dangerous volatility to the markets, to the point where they no longer operate according to previous fundamental norms.

Think all of this is an accident, or that Big Banking is an innocent bystander? Think again. J.P. Morgan Private Bank declared, “Mission accomplished—QE [quantitative easing] drives up equity valuations.” That is, the central banks have inflated the equities markets, in order to fool investors into throwing good money after bad. Algorithmic trading by mega-banks and traders then forces out the little guy and robs him of his money. This is a commonplace occurrence. The bankers have “broken the market.”

One honest equities fund, Nevsky Capital, confirmed this publicly and drew correct conclusions, recently closing down. Chief Investment Officer Martin Taylor stated, “Truly—to mix metaphors—butterflies flapping their wings now regularly create hurricanes that stop out fundamentally driven investors who cannot remain solvent longer than the market can remain irrational.” Unable to make money, the fund returned investors’ cash.

Add to all this the exorbitant fees charged to investors, especially to pension funds, by hedge funds and private equity firms, and a “trifecta” of avarice appears, designed to impoverish the masses and starve them in their old age.

The usury industry—banking’s true name—is like some inescapable, bottomless primeval tar pit. The financial pharaohs suck down more and more of the world’s wealth for the enrichment of the privileged few. Their greed now has reached such proportions that entire industries, economies, and nations are threatened. It is not only immoral; it is criminal.

With derivatives investments more out of control than ever, a new year of a swiftly imploding stock market and Christine Lagarde of the International Monetary Fund, along with JPMorgan Chase and others, signaling a world economic slowdown, a global disaster looms.

No worries for the plutocratic poohbahs, though. When their Ponzi scheme collapses, they will simply seize depositors’ money for themselves in legislatively enabled “bail-ins.” The “little guy,” though, should prepare for the impending financial Armageddon and societal collapse.

It is time to end the horrible scourge of usury and fractional reserve banking. Time to end the Fed and all central banks. Time to restore constitutional money. Time for a return to a more self-sufficient lifestyle.

And it’s also time to tell Congress and the president to do these things now.

Tell them today.

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Ronald L. Ray is a freelance author and an assistant editor of THE BARNES REVIEW. He is a descendant of several patriots of the American War for Independence.

$56.7 Billion More for the IMF?

• GOP Congress OKs $211 billion credit line for international banking cartels

By Robert Romano

Tucked into the omnibus spending bill for the remainder of fiscal year 2016 was a $56.7 billion increase in the U.S. quota subscription to the International Monetary Fund (IMF). This will double the current U.S. quota to $115.2 billion at today’s exchange rate.

The legislation also puts a 2022 sunset on the now-$95.8 billion New Arrangements to Borrow, a program enacted in 2009. However, watch for that to be reauthorized akin to the same way the Export-Import Bank comes up periodically before Congress. No government program ever truly dies.

In any event, for the foreseeable future, the U.S. commitment to the IMF will rise to $211 billion in credit lines in total.

The U.S. already disproportionately lends to countries via the IMF credit lines. Despite a 17.68% quota at the IMF, in actuality the U.S. currently lends 22.83% of all outstanding IMF credit, thanks in large part to the New Arrangements to Borrow.



 

That accounts for $18.4 billion out of $80.5 billion lent worldwide. Half of current U.S. lending comes from the New Arrangements to Borrow.

And most of that lending goes to just three countries—Greece ($18.98 billion), Portugal ($22.7 billion), and Ireland ($5.2 billion)—still suffering from the European sovereign debt crisis.

Americans for Limited Government President Rick Manning wrote that the IMF expansion was a betrayal by Republican congressional leaders.

“It is particularly troubling that ending the New Arrangements to Borrow was once a priority for House Republican Conference Chairwoman Cathy McMorris-Rodgers, and now with her in leadership, our nation is trapped into a funding commitment that swamps that promise,” Manning wrote.

Representative Cathy McMorris-Rodgers (R-Wash.) had sponsored legislation in 2011 that would have ended the New Arrangements to Borrow. It had 83 cosponsors.

Now with the omnibus, not only is the $95.8 billion New Arrangements to Borrow not eliminated, but the quota is doubled, too.

“This is just one more gigantic proof point that the GOP establishment cannot be trusted with the public treasury,” Manning concluded.

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Robert Romano is the senior editor of Americans for Limited Government.

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