Kaiser Report: Occupy & Pirates

Hi, I'm Max Kaiser. This is the Kaiser Report. Yeah, we started the Global Interaction Against Banker Occupation. What are you going to do about it? You know, Stacey Herbert, I was thinking that now that you've got the Global Interaction against Banking Occupation and all the sub-chapters like Occupy Wall Street and Occupy Wall Street, the cities around the world, there needs to be now moved to politicize all this and I'm thinking that why not take all of the Occupy movements around the world and join them with the various global pirate parties around the world. You had the beginning of that movement in the Swedish pirate party and then a quickly spread to countries all over the world. That could be the political wing of the Occupy Wall Street movement. They're on the exact same page and this would give them representation because the pirate party already has representation in countries around the world and they can use the civil disobedience of abandoning the entire copyright intellectual property system. That is draconian, that is anti-creativity, which is basically part of the casino Gulag, state emerging. So I believe this could be the next phase. I'm calling for it. What do you think? Well, it's interesting because the pirate party is responding to monopolies and harsh laws, which penalize the people and that's what you see in the financial sector and the political sector from the white scale corruption, look at in the UK. Not only is Tony Blair, not only did he accept £27 million from the Kuwaiti royal family, but he has thanks for invading Iraq, but now Liam Fox, the defense secretary, is like openly handing out deals to cronies that are traveling with him as official companions. Well, another benefit of this of course is that a lot of the wealth confiscation schemes and algorithms used by Wall Street are patented wealth confiscation technologies. And if you repealed the patent laws and the copyright laws that would eliminate Wall Street's ability to use this patent to technology to confiscate wealth through high frequency trading and algorithmic trading. So that would be a way to topple them by eliminating their monopoly position using algorithmic patent and algorithmic trading to confiscate cash from society. Yeah, I'm due to copyright laws. The government regulators are not actually able to look at their proprietary theft machines with the HFT. Alright, well, we'll follow up on this now. Speaking of pirates, there's other pirates in the news. Tell me more. Max, that's in this first headline here. Maybe rescues Italian cargo ship from pirates. A royal navy team freed 23 hostages on a ship hijacked by pirates after picking up a message in a bottle. I mean, you think of the Occupy Wall Street protesters, the Tea Party protesters, or at least some of them, that these are like the equivalent of this message in a bottle. I mean, how random that the Royal Navy would happen upon a red message in the bottle come rescue us and yet openly we're saying, you know, rescue us from the pirates that have hijacked our financial system and are using it against us. Yeah, exactly. I mean, the pirates are the basis for the UK economy. So Cameron is unfairly prosecuting so-called looters. Pirates are the basis of the Somalia economy. So without the pirates, there would be no real estate boom and Kenya in other places. So again, it's double-speak from the real pirates. That is to say the banking pirates. But it also made me realize that, of course, even all of these occupied Wall Street protests, occupied the Fed protests, Tea Party protests, nobody listens. Like they just keep on handing the wealth of our nations to these bankers. And even the commander and chief of the US will not help. I have this little video here where Jake Tapper asked, Barack Obama last week, he has, why hasn't your department of justice done anything against the banker fraudsters? The ones that have stolen the economy, the ones who committed wide-scale subprime fraud. And this is what Barack Obama answered. The issue of prosecutions on Wall Street. One of the biggest problems about the collapse of the sub-sequent financial crisis in the whole sub-prime lending, Fiasco, is that a lot of that stuff wasn't necessarily illegal. It was just immoral or inappropriate or reckless. Well, this is where Barack Obama is wrong. The banks committed outright fraud. They committed illegal acts of fraudulent inducement, of fraudulent recicurization, and fraudulent misselling. They've committed a whole schmorgasbord of fraud. Barack Obama is completely wrong. And the press is too stupid to ask him specific questions. Like, well, what about in the case of Bank of America, or JP Morgan or Goldman Sachs, law number dot dot dot, where on this date they broke it, egregiously, why did you not prosecute you shameless punk? And as William K. Black, former Bank regulator, the man responsible for putting over 1500 bankers behind bars in the 1980s after the savings and loan collapse said here on the show, the laws were broken. And there are no new laws needed. And in fact, in this clip, Barack Obama then goes on to say, this is why we needed the Dodd Frank Act. Well, in fact, as William K. Black said, the laws were already there. You're not allowed to commit fraud. There is ample evidence. Okay. Well, if there, if no laws were broken, Barack Obama, then why is it necessary for Congress to pass a law that gives grants immunity to the banks? Is it because the banks a broke the law? Or be committed moral transgressions? So let's move over to the UK with the other center of financial fraud and how the leader of the country there openly states that there are crimes being committed and then does nothing about it. UK banks ran Ponzi schemes before 2008 financial crash Osborne says, so this is UK chancellor of the Exchequer George Osborne. He said that British bank practices before 2008 resembled Ponzi schemes contributing to the market crash. Well, he's absolutely right, George Osborne is correct. The banks committed massive fraud. They were part of a Ponzi scheme that crashed. But he's like that joke about the guy who goes to the doctor and says, doctor, my brother thinks he's a chicken. The doctor says, given these pills and he says, you don't understand, we need the eggs. The Osborne says, yes, the committed Ponzi scheme, but we all got rich from the fees and the fees trickled down to the people and that's our economic model, fraud. Well, he suggests it's a human error that caused it. So like those looters in Britain, I think they should just say, well, as human error that I stole the bottle of water that I'm now serving six years of prison for. Right. Why prosecute randomly looters that stole bottles of water and not prosecute banking looters and blame it on human error? If I see Osborne on the street and I reach into his pocket, and I steal his wallet, according to Osborne, that's just part of a Ponzi scheme that was accidental. So he goes on to say, meaning the bankers who operated the Ponzi schemes, he said, they let down their customers, they let down their shareholders, and they let down their country. Charles Manson let down Sharon Tate when he brutally murdered her. You know, that's the moral equivalency that George Osborne wants us to make here that it's just a question of the banks letting us down when they viciously stole and raped us repeatedly. Oh, George, Georgie Porgy. To their credit, Bloomberg then goes on to say, a Ponzi scheme is a fraudulent financial arrangement under which investors are paid. High returns from the deposits of subsequent investors. Bernard made off his jail for 150 years in June 2009. From masterminding the largest ever US Ponzi scheme, no UK banks have been prosecuted for running a similar operation. Look, when Warren Buffett makes an investment in Bank of America, as he did recently, he's engaged in a Ponzi scheme, an outright fraudulent Ponzi scheme where he's using guarantees made to him by the government to make an investment unavailable to the rest of the public. No, that's not technically illegal. That's not a Ponzi scheme. It's a sort of trade. According to the SEC, he carries the Act of 1933, 1934, that qualifies as an illegal insider trade. According to the series seven licenses that I obtained when I became a stockbroker on Wall Street, it had to know this stuff. He's committing massive fraud. But the defense that George Osborne gives you folks is that we need the fraud because that's our business model. Let's move on to the war that's going on. We've talked about in the beginning of the show about the Occupy Wall Street and Tea Party and Occupy Fed people fighting back against this banker occupation. Here's a tweet from Bill Gross. Gross. Class warfare by the 99% of course, they're fighting back after 30 years of being shot at. Well, Bill Gross is correct. I mean, he's just emphasizing what we're saying here. There's a war going on between law breakers like the Bank of America, Wall Street, Warren Buffett and the people being victimized by the laws being broken and Obama sits back and wonders where's my next corned beef sandwich or whatever he thinks about during the course today, but it's not about being president of the United States. But a lot of bankers claim our plead ignorance. They say, oh, it's socialism. It's Marxism. These hippies out there. They want to take what we, the 1% have so geniusly through our wealth creation. We've magically turned money printing into wealth and this is the way they operate. Yeah, let me interject here. When I worked on Wall Street, we had a term for this called selective amnesia. So anytime you break the law and you go to the compliance officer, you can you can claim selective amnesia and as long as you gave the compliance officer a big enough Christmas bonus, they ignore you. Okay. Yes, it's convenient to have amnesia when you're breaking the law. That doesn't mean that when Warren Buffett breaks the law, Bank of America breaks the law. Jamie Diamond breaks the law. Lloyd Blackfine breaks the law. Just because they have selective amnesia doesn't mean that it absolves them from having broken the law. Well, like Barack Obama said, it's not necessarily illegal. It is only illegal if the Department of Justice or the Attorney General prosecutes you. If they remember that their job is tuned for us to law. As long as they forget that they are job is to enforce the law, then it's not illegal. That's what Obama's saying. I forgot what the law is. Therefore, it's technically not legal. How is this guy not impeached? But going back to this final point, I have here, Max, because I want to get through this. The bankers are saying that the protesters out there are Marxists. Here's a headline, Brooks Brothers Bolshevism. Michael Sembalest, the chief investment officer of JPMorgan Chase wrote in July of this year, and a client's only newsletter obtained by the Washington Post, that profit margins have reached levels not seen in decades. And reductions in wages and benefits explain the majority of the net improvement. Sembalest printed the latter quote in bold faced lettering US labor compensation he explained is now at a 50 year low relative to both company sales and US GDP. I should have been bragging about disenfranchising other workers telling all their money. Among themselves. But as a headline in the Wall Street Journal, we'll be, they'll say US increases productivity. That's the phrase that they use to cover themselves when they destroy wages and destroy employment in the country. It's a productivity game, so we should all be proud. As this banker points out, it's a premeditated class massacre of unprecedented proportion that now is turning out to be killing people in the street in a program of financial fraud. And Obama's Twitter-linist thumbs hoping that he gets that TV soon. Well, you could put the message in the bottle of the commander and chief is not going to rescue you have to do it yourself. That's what my message to occupy Wall Street is. Well said, well said. All right, Stacey Herbert. Thanks for being on the Kaiser Report. Thank you, thanks. That's going to be much more coming away. So stay right there. Hi, welcome back to the Kaiser Report I'm Max Kaiser. Time now to go to New York and talk with Michael W. Hudson, author of The Monster. How again, if predatory lenders in Wall Street bankers fleece America and spawned a global crisis, Michael W. Hudson, welcome back to the Kaiser Report. Thanks for having me back, Max. All right, Michael Hudson, in your most recent article, you chronicle what can only be called fraud in the subprime mortgage practices at Countrywide. And yet President Obama said last week that subprime lending was a moral but not necessarily illegal your thoughts. It's really not that Obama's character to really lay down the gauntlet and say this is criminal conduct. This is fraud. As I say, he's very much all about compromise and meeting in the middle. It's interesting because if you go back a generation during the the era of the first president Bush, they had a thousand FBI agents investigating the savings and loan scandal. There were a thousand SNL insiders who were convicted of families and a lot of big names including Charles Keating, of Keating Five and Lincoln Savings and Loanfame, substantial prison sentences. We haven't seen that now. We don't have a lot of FBI agents on the case and most of what they're investigating is really low level, really the small fish, loan officers, mortgage brokers, folks like that, rather than trying to look up the chain, up the food chain and look at the big players who may have had something to do with the fraud. That was really endemic in the mortgage market and on Wall Street during the boom. Right. Well, in the case of the mortgage scandal, it was a case of illegal fraudulent inducement and then illegal fraudulent securitization. So they broke the law. Now you're saying it's not no bomb as character to say that they broke the law. I mean, what does that say about his character other than that he's a weasel? That's just his personality is his personality his personality he doesn't like to obey the law. I guess that's his personality. He has a personality of a lawbreaker. So that's who we have running a country of lawbreakers so the people of America voted for their one of their own a law breaking weasel. Okay. So don't corporate investigators find documentary evidence of fraud at countrywide. Let's talk, let's talk about the reality here of the real law breaking and did the Department of Justice to review those documents. In the summer of 2007, some of the in-house investigators from countrywide went out and went through the shred bins for a bunch of countrywide loan offices in and around Boston. And what they found was evidence that persuaded them that workers inside the branches were faking documents. They were cutting and pasting. Literally they would cut and paste the address from one piece of property onto an appraisal for a completely different piece of property and pressed out. Suddenly the first piece of property looked like it was more valuable and you could make a bigger loan on it and sell it easier. And that kind of thing happened throughout the mortgage industry. You talk about a Mara Quest which was the biggest subprime mortgage lender during the boom and the joke there was always among the employees. Oh well this this borrower doesn't qualify. Let's send the documents back to the art department. Send it back to the lab and they'll fix it. But what's interesting about the countrywide case is what happened when the internal gatekeepers, the in-house folks whose job was defined for odd, what happened. And I've talked with a lot of folks read a lot of lawsuits and their story is pretty consistent. They did their jobs, they found for odd, they read flagged it. And when that happened they were marginalized, ignored, harassed, demoted, fired, or some combination of the buff, including an executive vice president who was chief of the fraud investigations unit. I mean foster was fired shortly after Bank of America took over countrywide. Bank of America said they fired her for inappropriate, unprofessional conduct. But recently the US Department of Labor found that that know that wasn't the case that actually they fired her as payback for her investigations that were finding massive fraud at countrywide. And for trying to protect whistleblowers who she believed were being harassed and retaliate against buy countrywide. All right now what about the founder and CEO of Angela Missillow of countrywide? You know Missillow he was accused by the Security Exchange Commission of insider trading and securities fraud. The agency claimed that he had taken north of $140 million in ill-gotten gains out of the out of the company before it was near collapse and had to be bought up by Bank of America. Ultimately they settled for substantial sum 67.5 million dollars. But the key here is that most of that was paid by Bank of America or by countrywide insurers. Missillow himself paid out a pocket about I think it was 22.5 million which by my calculations is 16 cents for every dollar the government claim that he had taken out and ill-gotten gains. Okay keeping on countrywide the loans of course that were fraudulently induced they were packaged into securities. And so to Europeans and pension funds walk us through this part of the illegality and fraud that nobody in the Obama administration chooses to recognize. Right you got investors all over the world who are are suing countrywide slash Bank of America claiming that that not only was countrywide you know defrauding it's borrowers but it was also defrauding the investors by misleading them about what about the characteristics of the loans that they were in the packages the loans are being sold including in flighting people's credit scores and flighting their incomes and flighting the values of the homes all sort of the key characteristics which is German you know how much risk there is in this loan. So now we've got a $20 billion settlement and immunity for the lawbreakers over their mortgage fraud. I'm not sure if it's not illegal why they would need immunity. But I guess if I forget it real quick I can be like Obama and pretend it doesn't exist. I'm a back up on where am I? Who am I? Where am I? Geez now let's see the the $20 billion settlement took to immunize the rapists on Wall Street has been concluded the only matter holding it up now is just how much immunity banks will receive and whether or not a New York and California will sign making financial rape legal your thoughts. You know both California, New York or or holding out for a tougher deal also Arizona and Nevada are also holding out and this is very interesting that that if you go back before you know during the boom while all these bad practices are going on it was many of the states not all the states but many of the states were the ones that were fighting and trying to crack down on these practices while the federal government often would intervene and step in between the states and a lender that that was suspected of bad practices and say wait a minute with their their federal license this is a national bank so you you keep your hands off we'll take care of it but of course the problem was is the feds didn't take care of it so we're sort of seeing the same scenario where you've got a number of states that are that are looking to be tougher than the federal government. Right well this is interesting of course because I suppose the federal government if pushed to the wall and forced to somehow prosecute bankers I guess based on their recent activity they'll just start to assassinate Americans Willie Nilly who come forward and who protest the amnesia of the White House when it comes to prosecuting bankers that's that ought to solve the problem so what what some of the things you're working on now what give us a little preview of what you're working on. You can find my stories on iWatchNews.org that's the letter iWatchNews.org and I'm working on a series of stories I've already had a couple two or three pieces out about countrywide but I'm also writing about other companies too really looking at what happened to people internally who tried to do the right thing what happened to the whistleblowers who raised questions about fraud you know nobody wrote a memo from on high saying here's how we're going to commit fraud here is where we're going to take advantage of our customers and investigators but one way to really assess whether there was a culpability from management is to look at what happened when people reported fraud internally and as we've said a lot of folks say that when they did that they ran into trouble so that's really the issue I'm digging into and I'm encouraging more whistleblowers to come forward and more people to talk to me. Well you know in the Goldman Sachs case they admitted and it's in the record that they sold they used an of course word to describe a human defecation to their clients and they knowingly did this and profited from it but let's talk about the occupy wall street movement is this having an impact you think where do you see this going? It definitely seemed to be gaining steam you know you see it it's it's these sort of mini occupy wall streets happening all over the country if you read about it on Twitter it's it's kind of going like like a forest fire so it's it's very interesting it's clear that a lot of people out there are distrustful of large institutions and justifiably so you have an institution that has lots of power it has has the ability to do lots of good and lots of ill but what's interesting is you know you have the Tea Party movement that really was sort of focusing on on the power and dangers of big government and now we have occupy wall street which is focusing on the powers and dangers of really big business and the powers on Wall Street and what what they can do to to harm average Americans. Michael W. Hudson so these occupy wall streets are growing in numbers but they don't seem to have a very well-defined agenda which I guess is working in their favor because this way it's not it's not easy to defeat them by arguing their points because they have no points but at some point they're going to have to have some kind of agenda. What do you think are two or three points that they might want to pursue to consolidate their focus of all of this of all this grassroots activity? I don't know if I if I should be one to determine but but my guess would be when it when it really starts to come together and and and they start getting more specific they'll be talking about things like to big defail i.e. we shouldn't have banks so big that they need to be bailed out by government or that that they have too much influence over the government. I think the key element that that sort of ties together what most of the occupy wall street people are talking about is accountability and basic regulations some rules of the road to make sure that that what happened in 2007-2008 and it continues to happen now doesn't happen again. Well going back to the anti war movement of course you had a martyr with the Kent State murder on the campus of Kent State that seemed to galvanize that generation to got there got them in gear and they stopped the war. Now we've got a financial war going the Wall Street bankers headed up by Obama declared war in America and what's the blowers have been targeted for death and this is a popular step rising to try to survive against a corrupt crony banking class that not only makes frauds that loans to Europeans based on fraudulently induced mortgages but also creates the food stamp program run by jpe Morgan the very same bank to impoverish the majority of Americans and make money that way so this is really a program of programs like there's no program in history as exquisitely corrupt as the American banking Washington access. Okay well Michael W. Hudson thanks so much to solid-time we have thanks so much for being on the Kaiser Report. Thanks Max I appreciate it. All right and that's going to do it for this edition of the Kaiser Report with me Max Kaiser and Stacy Herbert. I want to thank you all for watching and if you want to send me an email please do so at Kaiser Report at rttv.ru until next time this is Max Kaiser saying bye y'all.