By Pam Martens and Russ Martens: February 16, 2016  If you are not yet sufficiently repulsed by the billionaire class in New York City riding roughshod over the most basic rules of ethical conduct, consider what just happened at AIG – the too-big-to-fail insurance company that was bailed out by the taxpayer during the 2008 crisis to the eventual tune of a $182 billion commitment, while its Board had the gall to pay multi-million dollar bonuses to its disgraced executives. AIG also used its bailout money to make multi-billion dollar backdoor payments to Goldman Sachs and other Wall Street banks for credit default swap bets they had made, which AIG had insured, on dodgy subprime mortgage products. AIG’s Board of Directors just appointed hedge fund titan, John Paulson of Paulson & Company, to its Board – despite the fact that he is named in a SEC complaint as a willful … Continue reading →

By Pam Martens and Russ Martens: February 15, 2016 Millions of Americans would have trouble defining even one of the amendments to the U.S. Constitution known as the Bill of Rights — which set forth the individual freedoms we gained through bloody street protests and wars waged by our ancestors. Millions of Americans have never participated in a street protest or marched for a cause they care about passionately. Many Americans have lost the ability to even care – believing the system is hopelessly corrupted beyond cure. We sat in a small local theatre this past Saturday with friends to watch the new Michael Moore movie, “Where to Invade Next.” Coming in the midst of the presidential debates where one candidate is running on a platform to make America great again while continually insulting women and minorities and another is promising to reform campaign finance while raking in boatloads of … Continue reading →

By Pam Martens and Russ Martens: February 14, 2016  The facts surrounding the death of Associate Supreme Court Justice, Antonin Scalia, are in a state of continual flux. The question is why? The highly controversial Justice is reported to have died sometime between Friday night and Saturday morning at an isolated 30,000-acre luxury resort, Cibolo Creek Ranch in West Texas. The ranch is 30 miles from civilization. Scalia was initially reported to have gone there with “a friend” to quail hunt but that has been called into question. The name of the friend has not been released, raising more questions as to why the public has been denied a full accounting of the matter. The owner of the resort, John Poindexter, a Houston multi-millionaire, told NBC News that Scalia arrived at the ranch at around noon on Friday on a charter flight from Houston. As for the quail hunting, Poindexter … Continue reading →

By Pam Martens and Russ Martens: February 12, 2016 Starting last July, the share prices of the biggest banks on Wall Street have been on a steady downward trajectory. That trend heated up yesterday with Citigroup and Bank of America both dropping over 6 percent by the close of trading. Goldman Sachs and Morgan Stanley were down by over 4 percent. All four of the banks set new 12-month lows in intraday trading. A strong argument can be made that much of the public’s lack of confidence in these complex banking and gambling behemoths is a result of the dark curtain that has been drawn around their operations. Evidence is piling up that government regulators of Wall Street no longer see themselves as the protectors of the people but as the protectors of Wall Street’s secrets. The American historian, Henry Steele Commager, once wrote that “The generation that made the … Continue reading →

By Pam Martens and Russ Martens: February 11, 2016  Yesterday during the House Financial Services Committee hearing to take semi-annual testimony from the Fed Chair on monetary policy and the health of the U.S. economy, a tense exchange took place between Congressman Sean Duffy and Fed Chair Janet Yellen. (See video clip below.) Duffy effectively accused Yellen of defying a Congressional subpoena related to a House investigation of a Fed leak in 2012. The House investigation centers around a quite brazen newsletter put out by a firm called Medley Global Advisors that in 2012 reported what the Fed’s FOMC minutes were going to reveal the following day.  One revelation from the newsletter referred to continued large bond purchases by the Fed as follows: “Tomorrow’s minutes will reference a staff paper that concludes the market has capacity to absorb purchases this large for a period of time.” When the Fed released … Continue reading →

By Pam Martens and Russ Martens: February 11, 2016  At 8:00 a.m. this morning, futures on the Dow Jones Industrial Average were flashing a 274 point plunge at the open of the stock market at 9:30 a.m. ET, following a selloff of 99.64 points by the close of trading yesterday. There’s plenty of things rattling this market, not the least of which is the continued weakness in the share prices of the mega Wall Street and European banks. Analysts have started asking on business news outlets if there is something going on that the public can’t see. Adding to the market angst was the jumble of questions Fed Chair Janet Yellen received during her semi-annual testimony before the House Financial Services Committee yesterday. One particular line of questioning from multiple members of the Committee was on whether the Federal Reserve has the legal authority to use negative interest rates as … Continue reading →

By Pam Martens and Russ Martens: February 10, 2016  The world woke up this morning to find that the populist stirrings that were fanned by the leaderless Occupy Wall Street movement, which first galvanized the debate on the wealth and income inequality of the 99 percent, have been simmering in the hearts and minds of voters ever since. Apparently, voters were simply waiting for an authentic presidential candidate to frame their demands into a cohesive message. Yesterday, Senator Bernie Sanders of Vermont crushed Hillary Clinton in the first presidential primary in New Hampshire, taking 60 percent of the Democratic vote to Hillary’s 38.4 percent with over 90 percent of the vote counted. Donald Trump took 35.1 percent of the Republican vote, with the current Governor of Ohio, John Kasich, coming in at a distant second with 15.9 percent, based on a little over 90 percent of the vote counted. (See … Continue reading →

By Pam Martens and Russ Martens: February 9, 2016  Tomorrow, Janet Yellen will scurry over to the Rayburn House Office Building to give her semi-annual testimony to the House Financial Services Committee, now under the control of a deeply paranoid Republican majority when it comes to the Federal Reserve. (Not that some of that paranoia isn’t justified.) There is no question that Yellen will face hostile questioning from Republicans on the Committee, as she has in the past, although the questions tend to venture far afield from the real financial threats to U.S. stability. Most Democrats, on the other hand, are so wedded to holding up the Dodd-Frank financial reform legislation as their grand achievement after the 2008 crash that they refuse to look out the window and see the equity capital of the Wall Street mega banks currently in a death spiral as the same banks invent ever more … Continue reading →

By Pam Martens and Russ Martens: February 8, 2016  Senator Richard Shelby (R-Alabama), the Chair of the U.S. Senate Banking Committee, has announced a hearing on March 3 at 10:00 a.m. to examine “Regulatory Reforms to Improve Equity Market Structure.” To appropriately conduct that hearing, all the lights should be turned out in the hearing room and the senators and witnesses should have to fumble and stumble their way to their seats in the dark, since that’s what American investors have been forced to do since the 2008 crash – a tortuously long seven years of make-believe financial reform. Following the 1929 crash, whose economic impact was also swift and devastating, the Senate Banking Committee spent the years of 1932 through 1934 holding comprehensive hearings and investigations on the structure of the stock market. The hearings unraveled, day by day, the frauds that the Wall Street titans of that era … Continue reading →

By Pam Martens and Russ Martens: February 7, 2016  Last Wednesday something noteworthy happened on Wall Street. Four of the largest Wall Street banks, each holding trillions of dollars in derivatives, hit new 12-month lows in intraday trading. The banks are Bank of America, Citigroup, Goldman Sachs and Morgan Stanley. The banks recovered a little ground by the end of the week. These banks have two other things in common: they have been spending billions buying back their own stock and they all received bailouts during the 2008 crash. Over the past six years, publicly traded companies in the Standard and Poor’s 500 Index have bought back $2.7 trillion of their own shares according to Bloomberg data. There are four major problems with this strategy: much of the buybacks are financed with debt; some of the buybacks simply offset insider selling or stock awards to executives; none of the money … Continue reading →