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Interesting article for anyone having a brokerage account. I copied this as the link would not work. Probably something I am doing wrong.
RED ALERT: It’s Open Season on All Customer Funds
Posted by Ann Barnhardt – August 10, AD 2012 3:33 PM MST
The NFA in collusion with the banksters, government and judiciary have achieved their goal. The entire concept of “customer segregated funds” is officially, completely, legally dead.
Guys, it is OVER. I know that many of you are still cowering in normalcy bias, unable to deal with reality, unable to face the world as it is, but you have GOT to snap out of it. The marketplace is DESTROYED. You CANNOT be in these markets. All legal protections are now officially gone.
Do you remember how I told you about the Ponzi scheme that imploded in 2007 called “Sentinel Management Group” that stole over $500 million in customer funds? The NFA was the auditing regulator of Sentinel, and the NFA admitted after the Sentinel Ponzi imploded that they signed off on their audits even though the NFA claimed not fully understanding Sentinel’s books or accounting methods. In other words, the NFA didn’t really audit Sentinel at all – they just PRETENDED to audit them, drew up some forms, had some robosigners sign off, and then just hoped that when the shit hit the fan, everyone in the industry would be so terrified of the NFA that no one would hold the NFA accountable for their criminal malfeasance – or even talk about it.
Sentinel took customer segregated money and fraudulently used it as the collateral on a loan from Bank of New York Mellon for $312 million to fund their own in-house proprietary trading operations. When the Sentinel Ponzi collapsed, BNYM sued to go to the front of the line of creditors – ahead of the customers of Sentinel whose money was fraudulently used as collateral, which has now been “linguistically sanitized” into the word “hypothecated”.
The federal appeals court ruled yesterday that not only does BNYM stay at the front of the line, but that using customer segregated funds as collateral is NOT a crime, and that co-mingling customer segregated funds with proprietary funds is NOT fraud.
Here is the Reuters piece.
Read this quote from the ruling, which is, in essence, the entire financial market paradigm being guillotined:
That Sentinel failed to keep client funds properly segregated is not, on its own, sufficient to rule as a matter of law that Sentinel acted ‘with actual intent to hinder, delay, or defraud’ its customers.
U.S. Circuit Judge John D. Tinder
What this means is that even if Jon Corzine is somehow dragged into court by private citizens, because you know damn good and well that the Justice Department will never, ever touch him, Corzine now has a legal precedent, likely from a bribed or otherwise coerced Federal Appeals Court, explicitly stating that an FCM can use customer deposits to pay its debts, and that the customers themselves are subjugated and have basically no legal right to their own monies, no matter what the law says, or what legal assurances, claims or guarantees are made to that customer about their funds held with an FCM or any other brokerage or depository institution. The “secured” party at the front of the line will always be the mega-bank who made the fraudulent loan using the stolen customer funds as collateral.
In other words, all customer funds in the United States are now the legal property of JP Morgan, Goldman Sachs, BNYM, or whichever megabank is the counterparty on the loans the FCM or depository institution takes out in order to fund its mega-levered proprietary in-house trading desks.
For the love of God, I don’t know what more there could possibly be to say to snap you people out of your normalcy bias trance. You have GOT to get ALL MONIES out of the financial system NOW. This ruling sets precedence for every depository institution, not just futures brokerages. It is now legal in the United States for any financial institution to steal customer funds, borrow money against those funds for the uber-levered proprietary trading use of the financial institution, and the customers have ZERO CLAIM TO THEIR OWN FUNDS once they are in the custody of the financial institution.
The court has ruled that once your money passes out of your PHYSICAL POSSESSION, and I mean PHYSICAL possession, it is no longer yours, and you have no legal claim or legal recourse to it when it is stolen. This includes BANK ACCOUNTS. Money in a bank is in the possession of the BANK, not you. Do you comprehend this? The entire system is utterly devoid of any integrity or genuine security and is breaking down catastophically before our very eyes. You HAVE to comprehend that your money sitting in an account is no longer legally yours. You have to force your brain to process and comprehend this, no matter how incomprehensible it may seem. IT IS OVER. This is Marxist hell. We have arrived.
This ruling and precedent will be used by every brokerage, every bank, every insurance company and every pension fund to deny you your money when the financial system finally collapses, be it on Monday, or be it two years from now.
DO YOU UNDERSTAND?
You have GOT to GET OUT.
And all of this goes straight back to the criminal mafia that is the National Futures Association, and the fact that they have not actually been auditing those firms who were in the “cosa nostra”, and allowing Ponzi schemes to operate with full bureaucratic protection for decades. Sentinel. PFG Best. The legal precedent enabling this protection racket and blatant fraud and thievery is fully in force, and what Corzine did at MF Global is now legally PROTECTED.
This is ecomonic treason.
Treason is a capital offense, meaning that the death penalty is fully justified, warranted and on the table, should the day ever come when a Second American Republic is established, and with it the re-establishment of the rule of law and justice in this land.
Evening Jerry Gator,
Look for upcoming segments on this very important topic.
Best and thank you,
Big Al
It sounds like (and this is a compliment) Vortex is really Ann Barnhardt! Seriously, excellent article Jerry, thanks for breaking the link and just posting the whole thing.
As we all know, Ann has been treated as somewhat melodramatic by the media, much as Meredith Whitney was made into chicken-little for predicting a muni-bill collapse. Today, here we are with 3 or 4 more bankrupt cities in the last couple of months, and someone with her ear closer to the ground than most of us basically said in October 2011 what is happening today.
This is actually what we’d expect in a faltering money bubble in a corrupted system. Did any of us really think there’d be consensus on gold by 2012? With literally trillions of dollars of bailout money swimming around, people hardly learned a lesson from 2007…they only got greedier. No one with a chance at that kind of cash wants the party to end. They will continue to grind the law, whatever of it existed a few years ago, down to hamburger as long as they can. Everything is at stake when wealth transfer is involved, and any means justifies the end. History indicates that when flagrant theft is codified into law, the end of the current system is near. However, note that while we think it might only take 6 months for that to happen, it could stretch much longer than anyone thinks, up to 5 or even 10 years. I doubt it will take that long, but it could take longer than we think for Ann’s worst-case scenario to run its course.
John,
Ann has more smart’s in her little finger than I’ll ever have in totality. But thanks nonetheless. Thanks for being on-board and fighting the good fight.
respectfully
V
Don’t underestimate yourself Vort. You’re pretty good.
We are in a depression. In the 30’s people did not run walk around ringing a bell like a town crier saying “we are in a depression!!!!We are in a depression!!!!” It simply was the case. We are not slipping into a recession. We never slipped out of one. In an environment of 4 years running zero interest rates who can say all is well. When we exist with 1 of 6 Americans on food stamps who can say all is well. When we chronically under-report CPI what does the reported GDP really mean?
It is not pleasant to look through a half empty glass. But it will be less pleasant in the future for those who do not assess our economic situation realistically. Debt is a tool. Debt enslaves. In the near future these tools will be utilized to further enslave us and/or the failure of the system will create chaos. I would rather tend to my garden than to concern myself with such things. I only wish we were slipping into a recession. I hope to see “green shoots”. A “double dip” will mean we had a least at some point improved.
How do you make account when there is no standard?
How do you measure when there is no standard length?
How do you weigh when the scale is off?
We are on a rainy trip with old windshield wipers.
We cannot see where we are going.
All we do know is low interest rates as far as the eye can see…1 in 6 on food stamps….16 trillion in acknowledged debt and another raise of the debt ceiling pending….trillion plus deficits….a pattern of the Senate not bothering to pass a budget… moral MF hazard with every other headline……………………………………
Are we slipping back into recession?
You can slip back into something you never left.
An extended recession is a depression.
Geez, Dennis
You belong on CNB(S), or CNN…oh that is right, they won’t give you the time of day because…your problem is you are TOO IN TOUCH WITH REALITY…..my mistake….my bad :(.
Marc
I needed to vent and rant.
BTW – I wanted to type
You cannot slip back into something you never left.
How does technical analysis account for counterfeiting and fraud?
I guess we would not have a market and charts without them!
Do you have a Fibonacci retracement level for Quantitative malfeasance?
Speech-to-text converters are no match for a good keyboard and a sharp-edged wit.
Thanks Dennis M,
My thoughts exactly!
Big Al;
Man Dennis,
Reason, wisdom, and wit all in the same post! Beautiful! Love it!
Castanheiro………………..
Wherever you go there you are.
Tonight….. I found myself in front of a sign on the whorehouse door.
It read “Beat it!!!!! WE ARE CLOSED!!!!!!!!!!!!!
I know TR has been excited about the PM market “taking off” for some time. As I’ve posted “ad infininitum” the charts at this time are showing a slow bottoming pattern. We have some work to do for awhile. The weekly Bollinger bands are about as narrow as they can get and it appears we’ll be trading in them for awhile before the breakout either way. The strength indicators no longer favor the precious metals moving down. The momentum indicators now favor a sideways to up movement for the PMs. This week the dow/gold ratio has moved closer to the slowly downward 200 week MA. The ratio closed today at 8.17 while the 200 week MA is 8.52. Every week brings us closer to a major turning point. If the trend is our friend which it most likely is, we’re going to see a major move of all markets or only some. It’s a question only of how that move transpires. I feel the action of the PMs now are very positive when some would decry the lack of upward thrust. The longer the PMs move this way the closer the underlying supporting major MAs move into their neighborhood. There’s been a washout of junior miners and the risk/reward is now to the upside. I’m gradually purchasing them as they begin their consolidated sideways action. There are other resource stocks that have minimal downsides which are going to be excellent purchases. The action of the PMs will lull people to sleep and that’s healthy for those in the process of purchasing.
Howdy Doc!
I posted some of my similar concerns about gold on past Friday’s MARKET TRENDS. If you do a quick calculation with prices, one could come up with $1580 gold to 13,430 DOW and your ratio would hit that 200 DMA! The way the market is acting right now, I tend to favor those prices +/- a few points either way. Simply put, we are VERY close but I think right now it’s a game of “how many suckers” being played in the markets. The divergence between the Transports and the DOW is too big to ignore. IWM still can’t close strongly above resistance along with failures showing up in Railways and Trucking. The Baltic dry Index is nearing 2008’s low and the VIX is nearing a five year low! I got a funny feeling about this. But then again, they may try to drag this market out on just rumors and hopes of fairy dust QE.
Thanks for your inputs!
GREAT POINTS….DOC AND MARK….
The VIX is amazing. There’s a gap higher on the daily VIX which will have to be erased. The VIX has hit a low we haven’t seen in years. I believe the BDI will hit an all-time low in the next few weeks. The transports are headed for a recent new low. I have a feeling when the big QE3 comes, it’ll be “buy the rumor, sell the fact”. All I know is when the conventional markets finally catch up to reality, the down draft will be vicious. How long can you levitate with BS and verbal manipulation. The earnings’ season was worse than expected. Nothing makes much sense now. This cyclical conventional bull market is long in the tooth as well. Being the genetic contrarian I am, you would think I would be looking at the conventional markets going higher. But this is totally ridiculous. The VIX tells me the complacency and greed is now indicative of a lot of pain coming.
Mark, you’ll probably have to change your numbers since the ratio won’t hit the dow/gold 200 week MA for about 4-5 weeks if this price action continues. That’s why I don’t see the Dow going much higher. The Russell 2000 small cap index continues to diverge from the Dow as well and the weekly Bollinger bands are really starting to narrow. Something big is going to give in the next few weeks—it’s only a matter of time.
Oh i have no problem changing those numbers Doc! I just used them as a reference. There is no doubt that something big is going to give soon and I honestly don’t know HOW these hedge fund managers are all posting reports of “buy any dips”. I think that when the smart money returns post Labor Day, we may very well get that BIG move we are looking for.
Right on Doc
DOUBLE RIGHT ON….you are good….real good :)…you too Mark, OK?
🙂
Doc,
We need your continued input.
Thank you,
Big Al
sometimes the PM’s rally on 7-31 on the cycles and other times they start up 3-4 weeks later. This is broker vacation time and not much is moving anywhere- Traderrog
Folk’s,
I think it’s long past time to call a spade a spade and the public now needs to acknowledge that the world has entered a feeding frenzy destructive phase which is completely unprecedented on any level.
We are living through the greatest government sanctioned theft known to mankind which will facilitate a feedback loop of deeper destructive actions by elites in an effort to seize entire portfolio’s and idle cash sitting on brokerage balance sheet’s.
Up to this point the plunder has only manifested itself in the commodities and futures brokerages arena through hypothication and rehypothication actions sanctioned by exchange regulators and officials.
This in the open plunder and theft scheme will likely at some point transition to the discount brokerages with strong tie’s to the large Wall Street banking entities involved as third party subordinates and clearing houses and have assumed large degree’s of toxic leveraged assets within their respective in-house portfolio’s. Basically there are no more protections on behalf of the investing public.
You have been given the information and actions to undertake and protect your families and what little wealth you still may have intact if that wealth is in the form of stocks traded on exchanges.
If any of you have active brokerage accounts and hold securities with in those accounts it is advised that you take actions to remove your share’s from brokerage ownership (street name) to actually being listed in your name via ‘Direct Registration” or “Physical Certificate”.
The Direct Registration platform is less costly, easier to complete and removes your holdings from brokerage balance sheets, counter-party theft and bankruptcy risk.
These actions will take work on your part, but rationalizing away the possibility of nothing happening is what will land you in the Muppet camp.
And trust me, Wall Street hopes you remain a Muppet.
V
It won’t seem like a lot of work when your brokerage collapses and all “your money” suddenly cannot be withdrawn.
John,
Your a very smart man!
V
In Orwellian times we tend to call things exactly the opposite of what they truly are.
Street name held securities should be thought of as insecurities.
Core holdings should gravitate to physical medallion guarantee required stock certificates. The lack of instant digital liquidity can be a benefit if you did your due diligence on the front end. Impulse to sell a quality stock on a daily PR is removed when the certificate is in a fire safe.
For trading positions it is impractical so you need to pay attention.
My two cents.
Sounds like good advice vortex.
How about if every investor withrawls all their accounts and lets the “owners” of the game know we not getting back in untill they prove it’s honust?
Or at least let us use algorithmics too.
Benb,
I Think we need a balanced approach because the system as it stands today is not interested in a level playing field. There is simply no “one fit’s all” approach to making this turn out well.
Every individual is about to confront life’s greatest fear’s without much veriation for possitive outcomes.
So removing all of your assets out of the system may not be prudent simply because you will need flexibility as this great unwind unfolds. But removing most of them will more than likely be a very smart move.
One way to help protect assets in stocks is to move those assets to higher ground and greater protection.
V
When markets are so messed up there is super opportunity to make money. You have to be very careful but good traders can play a big move in both directionss sometimes in just one day or less. For us slower traders we have some great short positions coming for this fall. – Traderrog
Vortex, your right of course,personally I only have in the market what I have made from it taking initail “investment” out long ago, also whenever I have a profit, out it comes. That thinking came from a chance of the whole thing shutting down, this no longer owning monies at brokerages or bank accounts is just another risk on top of the too many already. But even with enough risk of the markets that it would be reasonable to call us, less than intelligent, for having any in it, there is I believe, a possibility of a payoff.
T.R. I think your right about shorting opportunities, as I havnt got a clue how to do that I must stick with inverted e.t.f.s.
More news about global recession. Hope people are preparing for the inevitable.
http://www.moneynews.com/StreetTalk/Faber-100chance-recession/2012/05/31/id/440837?PROMO_CODE=F144-1