Fraud Charges on Interest-Rate Swaps
Regular readers will be familiar with my position on the banksters' gigantic, interest-rate swap scam (see “WHO Were the Winners on Interest-Rate Swaps”). In that piece, I pointed out a remarkable “coincidence”: specifically, that all the winners on bets on interest-rate swaps were big-banks – primarily the Wall Street Oligarchies.
I also pointed out the inherent conflict of interest in these contracts, in that (unlike normal “insurance”) the banks writing up these contracts were capable of causing pay-outs to themselves on these contracts. For those who didn't read that previous commentary, here is how the scam worked. The same big-banks which were responsible for creating the U.S. housing-bubble (and the trillions of dollars of “securitized” scam-investments that went with it) knew that when their Ponzi-scheme blew up that this crash in financial markets would force governments to slash their interest rates. However, this is not what the bankers were saying to their victims when they were drawing-up these contracts.
To begin with, their accessory, Federal Reserve Chairman Ben Bernanke was hard at work duping the world with his propaganda that the U.S. had a “Goldilocks economy” where U.S. markets (and U.S. house prices) would just keep going up, forever. Despite the fact that this was never a possibility, people all over the world were conned into believing that there was only upward pressure on interest rates (to “cool off” the U.S. economic juggernaut).
Big-banks (led by Wall Street) then went around the world scamming towns, cities, schools, and hospitals into entering into these “interest-rate swaps” - with the bankers promising their victims that these interest-rate swaps would help them “save money” on their borrowing costs. In reality, once the Wall Street Ponzi-scheme imploded, and markets crashed, these chumps all suffered huge losses – meaning all the bankers booked huge gains.
Supposed “economic genius”, Larry Summers (who is currently telling Barack Obama how to run the U.S. economy) was scammed for nearly $1 billion, while the head of Harvard University – in financing only $2 billion of borrowing.
Today, it appears that legal authorities in Milan, Italy have adopted the same interpretation of these contracts as I did. They have charged three of the multi-national banking oligarchies with criminal fraud: JP Morgan (American) , Deutsche Bank (German), and UBS (Swiss). This is huge news on a number of fronts, which I will review one-by-one.
