Ann Barnhardt on a Bank Holiday

[don]

tip of the hat to Jesse's Cafe Americain . . .

[Mega]

Re: Ann Barnhardt on a Bank Holiday

I wonder if she is married?
Mike

[don]

Re: Ann Barnhardt on a Bank Holiday

If there's a bank holiday in our near future, how important is the amount of cash on hand - the bonars under the mattress?

to take it a step of worry further (from Zerohedge)

Has Italy Gone Fascist?

In August this year, CLSA’s Russell Napier wrote: “Italy is scary – yields will rise when governments chose to take money from their savers – what Russell calls THE GREAT THEFT - Expect massive capital flight”. Yet while Russell was commenting on Italy’s opening move in repressing private capital by raising the capital gains tax, but not on gains of government debt, the situation has moved with such speed over the past 5 months that the emergence of the first Fascist regime following the 2008 crisis can probably now be associated with the new Monti government.

And while Doug Casey addresses getting out of Dodge on these pages (http://www.zerohedge.com/news/doug-c...ting-out-dodge), it may be time for Italian to get themselves as well as their capital even faster out of Pizzaland.

Here are the latest developments which are coming in at extraordinary speed:

• The appointment in December of an unelected government. This government has no accountability and no fixed time mandate. It is being sold as being “technocratic”, but is in fact headed by a University Professor who is distinguished for: (i) having been head of the EU Internal Market Commission, where he used the power of the State to fine Microsoft and other corporate that were “getting too big for their boots”;(ii) being a good friend of Romano Prodi, another University Professor from the Communist heartland of the University of Bologna and creator of the Euro (more on him later);(iii) a paid hand of Goldman Sachs and a friend of Mario Draghi, another Goldman puppet who dispatched of the government of Berlusconi within days of taking the helm of the ECB; (iv) a fervent believer in the pre-eminence of the state over the individual;

• Prodi, the original architect of this catastrophe, famously made this comment in 2001, indicating that this cabal of Professors are playing a very long game indeed:

I am sure the Euro will oblige us to introduce a new set of economic policy instruments. It is politically impossible to propose that now. But some day there will be a crisis and new instruments will be created.”

Romano Prodi, EU Commission President, December 2001

• Thanks to his friendship with Monti and the current government, he is very much still involved in shaping just what such instruments can be;

• The passing of an extraordinary edict making cash transactions of more than Euro 1,000 illegal (not subject to reporting – just plain illegal). Following Prodi’s own desire, the existing regime has indicated that this level will be progressively reduced to a limit as low as Euro 300. Hence cash is maybe for the first time in history no longer legal tender (over Euro 1,000, for now);
• A requirement that credit card companies report all transactions carried out by Italians, in Italy and abroad to the fiscal authorities;
• Delays and refusals by banks in allowing customers to withdraw cash balances of as little as Euro 10,000;
• Finance Police has placed cameras at the physical borders with Switzerland (see below) to register all license plates. In addition, currency-sniffing dogs have been deployed at the border (http://www.cdt.ch/ticino-e-regioni/cronaca/56250/fiscovelox-riapparsi-no...).

Events in Italy must be watched closely. The country that gifted Fascism to the world in the 1930s was widely admired even by FDR, who held Mussolini in high regard and was no doubt inspired in many of his own policy choices. Will Italy lead the way once more, as politicians in Europe and the US watch to see what oppressive policies they may get away with?

And while Russell Napier (correctly) foresees capital controls being imposed and suggested that one parks his cash in Singapore dollars, Italians may want to get themselves out as well before the current group of Professors slams the gates shut. Things are moving even faster than one of the world’s leading financial historians could foresee.

[goodrich4bk]

Re: Ann Barnhardt on a Bank Holiday

Ann is essentially admitting that she was unaware of the extensive legal rights JP Morgan/Chase had under its agreements with MF Global. She keeps talking about the fact that "traditionally" customer funds could only be invested in 90 day T-bills when, in fact, customer agreements with MF Global, as well as MF Global's agreements with JP Morgan/Chase, allowed (via hypothecation and re-hypothecation) contained no such restrictions. She is deflecting customer anger from her firm to JP Morgan, rather than conceding that her firm was merely too small, or she was merely too naive, to protect her clients' money.

For example, she admits at the start of the interview that zero rates made it impossible to fund trading desks with 90 day T-bill income. Knowing that, why wasn't she more concerned that MF Global would chase yields with Euro bonds on high leverage? She readily calls Corzine a moron, but why didn't she take a closer at her agreements that allowed MF Global to re-hypothecate her customer funds?

I sympathize with her clients' situation, but I don't agree that what has happened is "Obama's fascism" as she has been quoted as claiming. It is simply regulatory capture and regulatory failure. None of her clients would have lost a penny if Glass-Steagal were still law, but I suspect from her comments that she was a big supporter of financial deregulation, at least while it made her fabulously wealthy.

[goodrich4bk]

Re: Ann Barnhardt on a Bank Holiday

Here is another quote from Ann's letter to clients when she closed her futures brokerage firm after the MF Global bankruptcy:

"Everything changed just a few short weeks ago. A firm, led by a crony of the Obama regime, stole all of the non-margined cash held by customers of his firm. Let’s not sugar-coat this or make this crime seem “complex” and “abstract” by drowning ourselves in six-dollar words and uber-technical jargon. Jon Corzine STOLE the customer cash at MF Global. Knowing Jon Corzine, and knowing the abject lawlessness and contempt for humanity of the Marxist Obama regime and its cronies, this is not really a surprise."


As my other post notes, I am not very impressed with Ms. Barnhart's knowledge of her own industry. She seems to think that the loss of customer funds was a result of Corzine's "theft" when, in fact, it was an express right that JP Morgan had in its written agreements with MF Global --- a right that was also enshrined by amendments to the bankruptcy code in 2005 that elevates JP Morgan's collateral rights to those funds ABOVE the rights of the owners of those funds.

Don't get me wrong. I think the result stinks. But it was a result that was mandated in 2005 by a "free market" Republican president and Republican Congress. It has absolutely nothing to do with Obama, his "regime" or Democrats. The only connection between the loss of customer funds and Obama is that the head of MF Global was a democrat. I think the more important connection is that he was an ex-Goldman CEO and that Ms. Barnhart was a very small fish playing in a very big pond.

[lektrode]

Re: Ann Barnhardt on a Bank Holiday

thanks for that overview g4bk, altho what shes had to say seems plausible, methinks shes a bit over the top and perhaps a bit overly biased to the right (the 'christian' right) - however to say the "only connection" tween what happened with MF'nG and the dems is corzine requires the 'suspension of disbelief' as hilary so famously put it a few years back - corzine is the poster child for whats happened in the past dozen or so years and how the dems (puppets on the end of GS strings) in both DC and NYC have so thoroughly corrupted the financial system - from the repeal of glass-steagall on forward - mostly engineered by the upper echelon of lower manhattan - whom in my observation are _mostly_ dems.

and what further evidence does one need to conclude this to be true?

with all three branches of the .gov under control of the dems, NOTHING was done to effectively address the issues that repeal of glass-steagall hath wrought - NOTHING has been done to prosecute what most people (not politicians) would consider to be a step or 2 beyond 'immoral', while we have the POTUS quoted as saying nothing was "illegal" on 60minutes - NOTHING was done to prevent AIG from paying GS 100 cents on the dollar for counter-party risk contracts that AIG had neither the legal basis to write nor the capital to back - and that this was allowed to occur, while the bondholders of GM got SCREWED?

meanwhile the dept of 'justice' seems intent on merely running down the clock till either the end of this rotten to the core administration is ejected next november, or the statute of limitations allows these thievin bastards to escape with the BILLIONS they've swindled the US Taxpayers out of!

nope - the 'suspension of disbelief' is being as polite as i can be in disagreeing with that POV.

[goodrich4bk]

Re: Ann Barnhardt on a Bank Holiday

thanks for that overview g4bk, altho what shes had to say seems plausible, methinks shes a bit over the top and perhaps a bit overly biased to the right (the 'christian' right) - however to say the "only connection" tween what happened with MF'nG and the dems is corzine requires the 'suspension of disbelief' as hilary so famously put it a few years back - corzine is the poster child for whats happened in the past dozen or so years and how the dems (puppets on the end of GS strings) in both DC and NYC have so thoroughly corrupted the financial system - from the repeal of glass-steagall on forward - mostly engineered by the upper echelon of lower manhattan - whom in my observation are _mostly_ dems.

and what further evidence does one need to conclude this to be true?

with all three branches of the .gov under control of the dems, NOTHING was done to effectively address the issues that repeal of glass-steagall hath wrought - NOTHING has been done to prosecute what most people (not politicians) would consider to be a step or 2 beyond 'immoral', while we have the POTUS quoted as saying nothing was "illegal" on 60minutes - NOTHING was done to prevent AIG from paying GS 100 cents on the dollar for counter-party risk contracts that AIG had neither the legal basis to write nor the capital to back - and that this was allowed to occur, while the bondholders of GM got SCREWED?

meanwhile the dept of 'justice' seems intent on merely running down the clock till either the end of this rotten to the core administration is ejected next november, or the statute of limitations allows these thievin bastards to escape with the BILLIONS they've swindled the US Taxpayers out of!

nope - the 'suspension of disbelief' is being as polite as i can be in disagreeing with that POV.

I understand your point, but how could Democrats prosecute Wall Street for acts that were no longer illegal after the repeal of Glass-Steagall? And exactly how would one go about reinstating Glass-Steagall now that commercial deposits are the capital that backs Wall Streets' products? There may be a way to do it, but I have seen nobody submit such legislation. If you think every Congressman is GS's bitch, I might agree but where are the outside voices calling for a return to Glass-Steagall?

Obama was correct on 60 minutes: what caused the financial crisis was not illegal. Nobody is going to jail, other than the mortgage brokers and borrowers. Yes, it's a "crime" that it was not illegal, but that "crime" was committed in 1999 by a bipartisan Congress and a Democratic president who is not Obama. That was my point. The "crime" was committed by Christopher Cox's SEC giving the five largest Wall Street investment banks the ability to leverage MBS 30:1. The "crime" was committed by Alan Greenspan's excessively low interest rates and his failure to use existing regulatory power to restrain subprime lending products. The "crime" was committed by the ratings agencies who were paid to find mathematical justification for their ratings and did, despite such evidence being contrary to common sense. The "crime" was committed by millions of Americans who when offered financial products that were too good to refuse, didn't refuse. I can continue with other favorite targets --- Fannie Mae, Barney Frank, CRA --- but in each case there is no federal law prohibiting the actions they did that may have contributed to the financial system's collapse.

The only cogent argument I've seen for how what happened constitutes illegal fraud is William Black, who has done a masterful job of framing the issue as "control fraud". But "control fraud" is not a crime that can be prosecuted by our government under U.S. laws that apply to any of the above players (private plaintiffs such as investors might be able to bring suit, and many of them have). The government can't sue Cox for being an idiot or exercising poor judgment. It can't sue Greenspan for his judgment failures. It can't sue the ratings agencies for their opinion (1st amendment protection) -- and, in any case, they've got lots of evidence that their opinion was shared by most economists around the world. Yes, we all know how the Fed's groupthink influenced that, but you'd never even get to a jury to make that argument.

My point about Ann Barnhardt is that she and others in the financial industry saw no problems with making all of the above actions legal. She just never read the fine print and understood how she might be a victim of even larger greed than her own. Hence, the small fish/big fish remark.

As for GM, I'm sorry if you were a bondholder. But as a bankruptcy attorney, I can tell you that there was nothing different or unusual about the GM prepackaged plan that hasn't been done hundreds of times before by private reorganization efforts. GM's shareholders were screwed by prior management and the financial crisis. At the time the prepackaged BK was confirmed, their collateral was worth much less than they received under the Chapter 11 plan --- which, again, is all the law guarantees them, their collateral values. I don't know where you get the idea that the GM reorganization was somehow illegal, or that bondholders had a right to receive more than the value of their collateral, but the notion is mistaken, as evident from the lack of any successful appeal.

[Thailandnotes]

Re: Ann Barnhardt on a Bank Holiday

“Obama was correct on 60 minutes: what caused the financial crisis was not illegal.”

This seems almost as bad spin as blogs that claim, “Government intervention caused the financial crisis.” Clearly regulatory capture and the revolving door between FIRE and the federal government are the ultimate root causes, but the housing bubble could not have happened without somebody buying the paper and the paper was fraudulently sold and laws were broken. Gemstone 7 comes to mind.

You may be right that only mortgage lenders will go to jail, but there was plenty of criminal activity a tier or two above. Miller's inability to get 50-state agreement suggests that it's more than just robo signing and foreclosure fraud that Coakley and others are going after.

I understand this thread is mostly about MF Global which had probably legally secured the use of the customer funds through fine print, but that doesn't translate to “what caused the financial crisis was not illegal.”

[Raz]

Re: Ann Barnhardt on a Bank Holiday

Here is another quote from Ann's letter to clients when she closed her futures brokerage firm after the MF Global bankruptcy:

"Everything changed just a few short weeks ago. A firm, led by a crony of the Obama regime, stole all of the non-margined cash held by customers of his firm. Let’s not sugar-coat this or make this crime seem “complex” and “abstract” by drowning ourselves in six-dollar words and uber-technical jargon. Jon Corzine STOLE the customer cash at MF Global. Knowing Jon Corzine, and knowing the abject lawlessness and contempt for humanity of the Marxist Obama regime and its cronies, this is not really a surprise."


As my other post notes, I am not very impressed with Ms. Barnhart's knowledge of her own industry. She seems to think that the loss of customer funds was a result of Corzine's "theft" when, in fact, it was an express right that JP Morgan had in its written agreements with MF Global --- a right that was also enshrined by amendments to the bankruptcy code in 2005 that elevates JP Morgan's collateral rights to those funds ABOVE the rights of the owners of those funds.

Don't get me wrong. I think the result stinks. But it was a result that was mandated in 2005 by a "free market" Republican president and Republican Congress. It has absolutely nothing to do with Obama, his "regime" or Democrats. The only connection between the loss of customer funds and Obama is that the head of MF Global was a democrat. I think the more important connection is that he was an ex-Goldman CEO and that Ms. Barnhart was a very small fish playing in a very big pond.

Uh, goodrich, Billy Clinton sent Robert Rubin down to Crapital Hill to seek the repeal of Glass-Steagall. Saying it had "nothing to do with ... Democrats" just ain't so.




http://jessescrossroadscafe.blogspot...rt-rubins.html


Now I'll freely admit that Phil Graham and Jim Leach led the charge and deserve more than 50% of the blame, along with that useless Ole' Miss cheerleader Trent Lott, and most of the whole damn Elephant crowd. But the Demonrats are just as corrupt, and until everyone recognizes that fact and seeks the remedy of a Third Party - none of this gangrenous government is going to really change.

[don]

Re: Ann Barnhardt on a Bank Holiday

“Obama was correct on 60 minutes: what caused the financial crisis was not illegal.”

This seems almost as bad spin as blogs that claim, “Government intervention caused the financial crisis.” Clearly regulatory capture and the revolving door between FIRE and the federal government are the ultimate root causes, but the housing bubble could not have happened without somebody buying the paper and the paper was fraudulently sold and laws were broken. Gemstone 7 comes to mind.

You may be right that only mortgage lenders will go to jail, but there was plenty of criminal activity a tier or two above. Miller's inability to get 50-state agreement suggests that it's more than just robo signing and foreclosure fraud that Coakley and others are going after.

I understand this thread is mostly about MF Global which had probably legally secured the use of the customer funds through fine print, but that doesn't translate to “what caused the financial crisis was not illegal.”

A recent posting, "State AGs Flipping Rocks", covers some of the latest "discoveries" in mortgage and foreclosure malfeasance.

[goodrich4bk]

Re: Ann Barnhardt on a Bank Holiday

Raz, my last post on this thread gave Clinton and a bi-partisan Congress full "credit" for the repeal of Glass-Steagall and further argued that it was one of the leading causes of the financial collapse. My point above was much more narrowly focused on the 2005 BK amendments and how they allowed JP Morgan to assert superior claims to MF's customer accounts. Those amendments had very few Democratic votes, Clinton was not in office and Obama, of course, had nothing to do with it. In fact, Senator Obama voted against the very law which Ms. Barnhardt is now belatedly realizing has fucked her clients. For her to drag him into the debate is ignorant or reprehensible.

[Raz]

Re: Ann Barnhardt on a Bank Holiday

Raz, my last post on this thread gave Clinton and a bi-partisan Congress full "credit" for the repeal of Glass-Steagall and further argued that it was one of the leading causes of the financial collapse. My point above was much more narrowly focused on the 2005 BK amendments and how they allowed JP Morgan to assert superior claims to MF's customer accounts. Those amendments had very few Democratic votes, Clinton was not in office and Obama, of course, had nothing to do with it. In fact, Senator Obama voted against the very law which Ms. Barnhardt is now belatedly realizing has fucked her clients. For her to drag him into the debate is ignorant or reprehensible.

In that case you have my apology for any misunderstanding.

I'm glad that Obama voted against those amendments; along with his vote against the Messinpotamia (Iraq War) it allows me to say that his indistinguished career has been sprinkled with a few correct decisions.

[Prazak]

Re: Ann Barnhardt on a Bank Holiday

Uh, goodrich, Billy Clinton sent Robert Rubin down to Crapital Hill to seek the repeal of Glass-Steagall. Saying it had "nothing to do with ... Democrats" just ain't so.




http://jessescrossroadscafe.blogspot...rt-rubins.html


Now I'll freely admit that Phil Graham and Jim Leach led the charge and deserve more than 50% of the blame, along with that useless Ole' Miss cheerleader Trent Lott, and most of the whole damn Elephant crowd. But the Demonrats are just as corrupt, and until everyone recognizes that fact and seeks the remedy of a Third Party - none of this gangrenous government is going to really change.

I enjoyed one of the quotes Andrew Napolitano had in this respect on Jon Stewart Show a couple nights ago: "I don't believe there are two parties in this country . . . We have one big government party; it has a Democratic Party wing that likes war and taxes and individual welfare, and a Republican wing that likes war and taxes and corporate welfare."

Here's the interview, worth watching through: http://www.thedailyshow.com/watch/tu...rew-napolitano. Stewart is hosting an increasing number of conservative and libertarian commentators lately, and has been an early sympathizer (not supporter) of Ron Paul's this election season. Interesting realization going on at both ends of the political spectrum.

[Raz]

Re: Ann Barnhardt on a Bank Holiday

I enjoyed one of the quotes Andrew Napolitano had in this respect on Jon Stewart Show a couple nights ago: "I don't believe there are two parties in this country . . . We have one big government party; it has a Democratic Party wing that likes war and taxes and individual welfare, and a Republican wing that likes war and *deficits* and corporate welfare."

Here's the interview, worth watching through: http://www.thedailyshow.com/watch/tu...rew-napolitano. Stewart is hosting an increasing number of conservative and libertarian commentators lately, and has been an early sympathizer (not supporter) of Ron Paul's this election season. Interesting realization going on at both ends of the political spectrum.

Thanks, Prazak. I enjoyed that one!

(And I *corrected* your "transcript" - Napolitano said "deficits" along with war and corporate welfare are what Republicans like.)

I believe that BOTH of them like deficits.

[Prazak]

Re: Ann Barnhardt on a Bank Holiday

Thanks, Raz. That sounds a lot more like it. Such are the hazards of transcribing before my second shot of caffeine!

You might also enjoy the Jim DeMint interview from last night (although Stewart himself gets a little annoying during the interview).