By Pam Martens and Russ Martens: January 8, 2021 ~ We have become convinced that the allocation of $454 billion under the CARES Act stimulus legislation to cover any losses incurred in the Fed’s emergency bailout programs was a dog and pony show created by U.S. Treasury Secretary Steve Mnuchin (who has testified to Congress that he helped write the legislation) in order to provide Mnuchin with a slush fund to trade in markets. (See Trump Issued an Executive Memorandum Giving Mnuchin a $50 Billion Slush Fund; Mnuchin Gave Himself $386 Billion More.) Our suspicions are heightened by the fact that the Fed ran very similar emergency bailout programs from 2007 to 2010 and did not require any funds from the Treasury to backstop losses. The Fed simply relied on collateral from the Wall Street firms borrowing from the Fed. If those firms don’t have the collateral today, then they’re … Continue reading →

By Pam Martens and Russ Martens: January 8, 2021 ~ The Wall Street Journal’s Editorial Board, which has coddled Trump for his entire four years in office, now apparently realizes that its own credibility is being called into question. So it is now calling for Trump to resign, writing as follows yesterday: “In concise summary, on Wednesday the leader of the executive branch incited a crowd to march on the legislative branch. The express goal was to demand that Congress and Vice President Mike Pence reject electors from enough states to deny Mr. Biden an Electoral College victory. When some in the crowd turned violent and occupied the Capitol, the President caviled and declined for far too long to call them off. When he did speak, he hedged his plea with election complaint. “This was an assault on the constitutional process of transferring power after an election. It was also … Continue reading →

By Pam Martens and Russ Martens: January 7, 2021 ~ There is growing anger in America today as the public has time to digest the violent video footage of Trump’s citizen militia storming the Capital building yesterday. According to the Washington, D.C. Police Chief, Robert Contee, four people died during the melee, one woman from a gunshot wound inside the Capital building and three others from “medical emergencies.” Contee also reported that at least 56 police officers were injured. As questions grow as to why the Capitol Police were not adequately prepared for the invasion, Army Secretary Ryan McCarthy announced at a news conference today that the military is erecting a seven-foot, non-scalable fence around the full perimeter of the Capitol. McCarthy also announced that 6,200 National Guard troops from Washington, D.C. and six states will be deployed to the area. McCarthy said these security measures will be in place … Continue reading →

By Pam Martens and Russ Martens: January 7, 2021 ~ As a violent mob of Trump’s citizen militia scaled walls, broke windows and seized control of the Capitol building yesterday around 2 p.m., the Dow Jones Industrial Average set a new intraday high of 31,022.65. It gave up very little by the 4 p.m. close, gaining 437.8 points on the day. The Trump operatives were attempting to stop Congress from confirming President-elect Joe Biden’s electoral win. Dressed in paramilitary clothing or jeans and red MAGA hats, the mob overpowered the Capitol Police inside and outside the building, gaining access to both Senate and House chambers and lawmaker offices, including the office of the Speaker of the House, Nancy Pelosi. Jamie Stiehm, a US political columnist, was inside the Capitol building and reported the following for the BBC: “I went inside to the House of Representatives and up into the press … Continue reading →

By Pam Martens and Russ Martens: January 6, 2021 ~ On December 29 we needed a clarification from former Treasury Secretary Larry Summers about his opinion column against Congress issuing $2,000 stimulus checks. We sent him an email at 10:13 a.m. and received a very clear response from him directly at 12:51 p.m. that day — a span of a few hours. Compare that timely response to Janet Yellen’s respect for the media’s obligation to report a full set of facts to the American people. Three days ago, we contacted Yellen at four different entities with which she is affiliated. Only the Brookings Institution responded, saying she was on leave. President-elect Joe Biden’s media team did not respond at all, nor did the Washington Speakers Bureau and University of California, Berkeley. Yellen is Biden’s nominee for U.S. Treasury Secretary. In anticipation of her Senate confirmation hearing, she has released her … Continue reading →

By Pam Martens and Russ Martens: January 5, 2021 ~ Last Saturday, the sitting President of the United States, Donald Trump, called the Secretary of State of Georgia, Brad Raffensperger, and told him this: “I only need 11,000 votes. Fellas, I need 11,000 votes. Give me a break.” The Washington Post has posted the audio of the call. That phone call has come under withering criticism as an attempt to coerce votes from a state Trump lost in the November 3 election. Among those on the call as an apparent advisor to Trump was attorney Cleta Mitchell, who at no point suggested to Trump that what he was saying might be illegal. Mitchell is a long-time law partner at Foley & Lardner, which is now attempting to distance itself from the mess. The law firm released a statement which coyly stated: “We are aware of, and are concerned by, Ms. Mitchell’s … Continue reading →

By Pam Martens and Russ Martens: January 4, 2021 ~ Following the stock market crash in 1929, more than 9,000 banks in the United States failed over the next four years. In just the one year of 1933, more than 4,000 banks closed their doors permanently as a result of insolvency. The 1930s banking crisis came to a head on March 6, 1933, just one day after President Franklin D. Roosevelt was inaugurated. Following a month-long run on the banks, Roosevelt declared a nationwide banking holiday that closed all banks in the United States. On March 9, 1933 Congress passed the Emergency Banking Act which allowed regulators to evaluate each bank before it was permitted to reopen. Thousands of banks were deemed insolvent and permanently closed. It is estimated by the Federal Deposit Insurance Corporation (FDIC) that depositors lost $1.3 billion to failed banks in that era. That would be … Continue reading →

By Pam Martens and Russ Martens: December 31, 2020 ~ Happy New Year’s Eve 2020 and welcome to a correctly skeptical America when it comes to Wall Street. Despite the President of the United States using his bully pulpit for the past four years to tell Americans how great the stock market is (see here, here and here, for example) Gallup polling shows that U.S. adults have consistently favored real estate as the better long-term investment over stocks. (See chart above.) In fact, in the April 1-14 poll that Gallup conducted this year, stocks reached their lowest score versus real estate since 2012. In the spring poll, which followed the sharp stock market selloff in March, 35 percent of adults rated real estate the better long-term investment versus 21 percent who voted for stocks. The perception that Wall Street is a rigged arena for the benefit of the one percent … Continue reading →

By Pam Martens and Russ Martens: December 30, 2020 ~ The question of just how much fiscal stimulus and COVID-19 relief payments are needed right now in order to prevent the U.S. economy from going off a cliff requires a recognition of what we do not know about the actual fragility of the U.S. economy over the next 12 months and the current fragility of the financial system of the United States. We start from the factual premise that the current financial crisis did not originate as a result of the pandemic. The plumbing of the financial system broke on September 17, 2019, months before the first COVID-19 case was discovered anywhere in the world. We know this because this is the date that the Federal Reserve announced it would begin acting as lender of last resort to the repo loan market on Wall Street. (Repos are a form of … Continue reading →

By Pam Martens and Russ Martens: December 29, 2020 ~ As Senator Bernie Sanders advocates for $2,000 pandemic relief checks for struggling Americans, Larry Summers is challenging the premise of $2,000 checks using ginned-up statistics that were dubiously published by Bloomberg News on Sunday. Larry Summers stepped into Robert Rubin’s post as Treasury Secretary under President Bill Clinton after Rubin left to make $15 million a year serving on Citigroup’s board. Citigroup was the Frankenbank that both Summers and Rubin made possible by advocating for the repeal of the Glass-Steagall Act. That seminal piece of legislation from 1933 had successfully banned the combination of deposit-taking banks with Wall Street’s casino trading houses for 66 years until these two men and their ilk got Clinton to sign its repeal in 1999. At the November 12, 1999 signing ceremony for the Gramm-Leach-Bliley Act, the legislation that repealed the Glass-Steagall Act, Summers said … Continue reading →