Crime Scene Investigation
by Rob Kirby, Kirby Analytics. February 9, 2009
Last week on Thursday February 5th, 2009, The President’s Working Group On Financial Markets held their first official soiree with former New York Federal Reserve Bank President, Timothy Geithner, installed as President Obama’s pick as Treasury Secretary.
In the spirit of “Change has come to America” and transparency, cameras were invited in for the ‘proverbial photo-op’ in what was no doubt an attempt to demystify this shadowy organization. You can see this press conference for yourself beginning at the 3:20 minute mark of this video excerpt.
Twenty-one years ago, the President's Working Group on Financial Markets [colloquially known as the Plunge Protection Team] was created by Executive Order 12631, signed on March 18, 1988 by United States President Ronald Reagan.
The Group was created in response to disastrous events in the financial markets surrounding October 19, 1987 ("Black Monday") to give recommendations and pose solutions to ensure that a repeat does not happen. It was also designed to "enhance the integrity, efficiency, orderliness, and competitiveness of [United States] financial markets and maintain investor confidence."
The Group is constituted of the following:
- The Treasury Secretary
- The Chairman of the Federal Reserve
- The Chairman of the Securities and Exchange Commission [SEC]
- The Chairman of the Commodity Futures Trading Commission [CFTC]
Over the past decade, much has been written and documented regarding claims about what the Working Group really does. While the mainstream financial press generally dismisses these activities as conspiracy theories, preferring the romantic notion that free markets really exist, the Working Group acts in concert with its agents [J.P. Morgan, Goldman Sachs et al] to:
- manipulate currencies, including precious metals
- manipulate stock markets and bond markets using various means like “moral suasion” or falsified / massaged economic data
- surreptitiously change benchmarks, utilizing data keepers like the BLS
- purchase and sale of stocks and stock idex futures
- utilize various derivatives icluding interest rate swaps in close co-ordination with Federal Reserve Open Market Operations.
Taken together, these activities are more akin to Central Planned “economies” than that espoused by free markets and the Constitution for the United States of America.
Policy makers justify these acts of malfaesence in the name of “National Security.” The majority of these nefarious financial perversions promote the false illusion of strength in the almighty U.S. Dollar – an irredeemable fiat currency backed by nothing but a financially bankrupt government, a morally and ethically bankrupt Central Bank and a criminally complicit cadre of Regulators. These same financial perversions are at the root of the current malaise of our financial system. TARPS, money printing and other delusional debt hoaxes do not address our fundamental problem – irredeemable fiat money draws its sustenance from faith – and that faith is now lost.
The reason most often cited by pundits as to why claims of market manipulation[s] cannot be taken seriously, and are therefore not worthy of mainstream news coverage, goes something like this,
“Surely, if markets were being interfered with on a scale such as claimed – it would be obvious to everyone and especially REGULATORS. Therefore, large-scale systemic market malfeasance is virtually impossible.”
Eight years ago, a whistle-blower and Independent Financial Fraud Investigator & Analyst named Harry Markopolos took his concerns and findings regarding fraudulent activities at Madoff Securities to the Securities and Exchange Commission [SEC].
Astonishingly, after repeated claims by Mr. Markopolos, the derelict SEC failed to take action for over eight years.
Last week, Mr. Harry Markopolos gave sworn testimony to Congress regarding his crusade to share his insight and expose to the SEC the scandal that we now know as The Madoff Affair. In sworn testimony Markopolos stated,
"I gift-wrapped and delivered the largest Ponzi (Madoff) to them."
Congress and the whole world listened.
Markopolos testified that he feared for his life because he knew that Madoff Affair had ties to the rich and powerful as well as shadowy organizations and operators. You can watch and listen to his testimony here.
You can watch and listen to Dem. Congressman Rick Ackerman question SEC leadership / legal counsel why the SEC – having been delivered the Madoff fraud on a silver platter - failed to act in the public interest here.
A little more than 10 years ago, a Cornell graduate and commodity trader by the name of Bill Murphy – after conferring with close knit group of knowledgable associates – realized that something was seriously, systemically amiss in the gold market. Murphy began a crudsade of his own, writing essays detailing his concerns and findings and presenting them to law-makers, regulators and the media.
Like Mr. Markopolos, Murphy and his cohorts were and continue to be ignored, too.
To inform the masses of these findings, he started a web based investor community – Lemetropolecafe.com – and along with a newspaper editor named Chris Powell, they founded GATA – the Gold Anti Trust Action Committee.
On January 31, 2008, at a cost of $264,426.26, this full page advertisement sponsored by GATA was published in The Wall Street Journal. You can read about it here:
Amazingly, for the last eight to ten years, Bill Murphy and the GATA associates have compiled overwhelming evidence that the gold market is surreptitiously manipulated by the U.S. Government, Federal Reserve and their various proxies in furtherance of government economic policy. Central to this policy has been maintenance / dominance / perpetuation the global U.S. Dollar hegemony. The resulting catastrophic systemic problems to the banking and financial system were accurately forecasted by Murphy and GATA years ago and are now manifesting themselves in the current financial turmoil.
The highly documented gold price rigging campaign that Murphy and GATA have brought forward is a key element in a series of systemic financial abuses which has all been foisted upon us in a vain attempt to perpetuate the life of something inherently unstable which is destined to die – our fiat money system.
Everyone deserves to know that irredeemable fiat currency systems possess an impeccably perfect record in that every one that has ever graced this earth [there are over 3,800 past examples of paper currencies that no longer exist] – has failed.
While ALL irredeemable fiat money systems eventually fail – GOLD endures.
Gold bugs who understand this concept often articulate the process by which fiat money fails by saying,
“In the end, all paper burns.”
So, as all of us – the little people – sit and suffer through the last few gruesome, fraudulent scenes being played out on the make-believe silver screen in this financial-house-of-horrors constructed for us by our Friends on Wall Street, we can rest assured that as the movie house continues to fill with toxic smoke, The Plunge Protection Team is hard at work, discrediting the virtues of gold, blocking the exits:
Overseas equity markets began the week on a sour note with Japan’s Nikkei Index giving up 107 points to close at 7,969. North American markets ended the day mixed with the DOW losing 9.7 to 8,270.90, the NASDAQ giving up .15 to 1,591.56 and the S & P edging up 1.30 to close at 869.90. NYMEX crude oil futures finished the day at 39.90 per barrel – off .27 on the day.
Benchmark interest rates: the 5 yr. U.S. government bond finished the day at 1.99% while the benchmark 10 yr. bond edged up to 3.01%.
On foreign exchange markets the U.S. Dollar Index fell .44 to 84.78.
Precious metals were in a funk all day with COMEX gold futures losing 14.40 to close at 898.00 per ounce while COMEX silver futures lost .26 to end the day at 12.90 per ounce. The XAU Index fell 3.54 to 126.18 while the HUI Index gave up 7.90 to finish at 299.07.
On tap for tomorrow, at 10:00 a.m. Dec. Wholesale Inventories data is due – expected -.7% vs. prior -.6%.
Wishing you all happy investing and a pleasant evening!
© 2009 Rob Kirby