I just finished reading a totally nauseating article by “the Economist”, praising Tim-the-tax-cheat Geithner as someone who is doing a wonderful job in difficult circumstances (gag!). Anyone who has ever heard Geithner speak would immediately suspect the Economist of writing in some strange “code” - understandable only to themselves, and other Wall Street zealots.

To avoid vomiting, I had to stop reading this article when “the Economist” praised the proposed “Public Private Investment Program” (try saying that five times, quickly!). This was supposed to be “better” than the “bad bank” concept (according to “the Economist”) - because it is (supposedly) less susceptible to corruption.

To hopefully prevent anyone from believing such nonsense, let me provide a hypothetical illustration of how the banksters intend this scam to operate. The first point to make is that most of the banksters have already proclaimed they plan to be buyers as well as sellers in this process. That should be all that anyone needs to know to see the thorough corruption of this scam.

Follow the “logic” here: the same banks who must get rid of these “toxic” assets, to avoid being bankrupted by them, are also saying they plan on buying these “assets” because they are such tremendous “values”. How do “toxic” assets which would bankrupt most if not all these fraud-factories get transformed into “great bargains”? That's easy: through massive taxpayer-subsidies in the form of loans and “guarantees”.

Let's create a hypothetical example. Fraud Factory #1 has an “asset” on its balance sheet with a “book value” of $10 billion. While it only has a real value (or “market value”) of $1 billion, Fraud Factory #1 still has this “asset” listed on its balance sheet as having a “value” of $10 billion. We'll call this “Asset A”.

Fraud Factory #2 also has an asset on its balance sheet with a “book value” of $10 billion (“Asset B”). Asset B also has a “market value” of only $1 billion. This means that both fraud-factories are currently faced with a devastating, 90% loss – which they refuse to write-down. Enter the “Geithner Scam”: the PPIP.

Both fraud-factories know that they cannot expect a “subsidy” of 90% - in order to get them back to a break-even level (that would be too blatant - even for the banksters). However, they are prepared to take a 20% “haircut", in order to rid themselves of this feces. So Fraud Factory #1 offers to “buy” Asset B from Fraud Factory #2 for $8 billion. Similarly, Fraud Factory #2 offers to buy Asset A from Fraud Factory #1 for $8 billion.

Naturally, neither company will actually pay $8 billion for assets only worth $1 billion. Instead, their portion of the purchase price will be $1 billion (the real value) of this “asset”, while the remaining $7 billion (loss) will be stolen from U.S. taxpayers in the forms of loans and guarantees.

If that isn't fraudulent enough, the deals will be written so as to provide generous tax incentives. Thus even if both fraud-factories are only able to sell their feces for $1 billion, they will reap a big profit (most likely by being able to “deduct” the losses of U.S. taxpayers on these assets – as if they were the banksters' own losses). Thus, there will be two, huge taxpayer subsidies with every one of these sham-transactions.

It is the classic example of “head's I win, tail's you lose” (with the U.S. taxpayer always being the loser). This is not “less corrupt” than a “bad bank” model, as the propagandists who write for “the Economist” would like to pretend, this was a scheme which was plotted entirely because it offered the MAXIMUM opportunities for corruption.

This is yet another failure and disgrace for mainstream media. There isn't even anything clever about this rip-off. At least the banksters could go through the motions of creating “front corporations”for these transactions – so that the obscene corruption in Geithner's scheme was at least slightly hidden.

Instead, U.S. bankster-oligarchs are becoming increasingly brazen with their lies and their obvious manipulation of Washington “puppets”. And still our “free press” remains content and oblivious – happy to parrot the day's propaganda, written for them each morning by Wall Street.

TrackBack URI for this entry

Comments (0)

Subscribe to this comment's feed