Tag Archives: Goldman Sachs

The Greek Vote, Goldman Sachs, and a Solar Eclipse

The results from the Greek vote on compliance with the austerity demands of its Eurozone neighbors are in.

The referendum tally may have come as no surprise, but the outcome of the Greek vote was a resounding NO!

It wasn’t even close.

With 60% of those who went to the polls in the Greek vote thumbing their noses at the European Community’s efforts to negotiate a bailout deal and a loan extension, there’s been a lot of confusion and consternation in the halls of the European Central Bank and in markets across the globe.

The Aftermath of the Greek Vote

What happens next?

Nobody knows for sure. But at least we can say that we saw it coming.

Six years ago, in fact.

After all, it was the solar eclipse on July 22, 2009 that triggered much of the financial stress that the referendum this Sunday gave voice to as the Greek vote was heard around the world.

That eclipse conjoined the Sun in the national horoscope for Greece. In that chart the Sun is not only emblematic of the nation itself and its leadership; it also rules the second house of finances, compounding the problem enormously.

I reviewed some of those details – and the role that Goldman Sachs played in creating the whole mess in the Greek economy in the first place – in a special 5-minute video I posted on YouTube early in 2010. It’s worth looking at right now:


As you can see from the video, things weren’t particularly rosy in Greece at the time. There was little inkling then, however, of just how much worse conditions could become in the ensuing years.

What’s interesting now is how little attention is being paid to the origins of the current crisis with the solar eclipse in July, 2009.

For that matter, nobody seems to be saying much right now about the role of Goldman Sachs, either. It deserves a closer look as discussions continue about the future role of Greece and the emerging face of the euro.

 

The AIG Trial – The 2008 Crash 6 Years Later

It’s been six years now since the bottom fell out of the stock market.

That was a tumultuous time, with the global financial system on the brink of total collapse.

And at the heart of the crisis was American International Group (AIG), the huge insurance company that had put itself on the line with credit default swaps on collateralized debt obligations (CDOs) to insure $441 billion worth of subprime mortgages. As the housing bubble began to deflate in 2007 and 2008, AIG had to pay out on more and more claims, until the big banks that had created the fraudulent CDOs backed with Liars’ Loans put themselves in jeopardy, ultimately pushing AIG into a massive liquidity crisis and virtual bankruptcy.

On September 16, 2008, with stock prices in a nosedive and the U.S. financial leadership in full panic mode, Ben Shalom Bernanke, at the head of the Federal Reserve Board, in collusion with U.S. Treasury Secretary Hank Paulson and New York Federal Reserve President Timothy Geithner, pushed through a high-interest federal loan to AIG of $86 billion and demanded the resignation of AIG CEO Robert B. Willumstad, who was replaced by Edward M. Liddy, a board member at Goldman Sachs.

More than five weeks before the collapse of AIG, on August 7, 2008, I had put the spotlight on AIG during an interview with Michael Yorba on his Commodities Classics TV show:


Although I called for “considerable downside” for AIG and the markets in general because of the then-imminent ingress of Pluto into Capricorn, and identified the September 23, 2008 Mercury/Mars conjunction at a Mercury station as a target zone for a trading bottom following a price decline by AIG and the insurance industry as a whole, I was definitely too conservative in my forecast at that time. Instead of finding a bottom at 17.25 as I thought possible, AIG dropped to below $5 a share – but it did find a trading bottom following the September 23 Mercury station.

The details about AIG are especially worth reviewing now, more than six years after that original interview, since AIG and all the big financial players from that time frame are the focus of a major trial set to begin in U.S. Federal Court of Claims on Monday, September 29, 2014. During the AIG trial, many new facts about the mechanics of the government bailout of AIG are likely to come to light. Former Federal Reserve Chairman Ben Shalom Bernanke is expected to testify, as well as former Treasury Secretary Henry Paulson, and Timothy Geithner (president of the New York Fed in 2008, and later Treasury Secretary).

Bernanke’s testimony in the AIG trial is certainly likely to attract lots of media attention. During a 2009 interview with 60 Minutes, he said that the AIG collapse made him so angry at the time that he “slammed down the phone more than a few times.”

During that interview, Bernanke said that “It’s absolutely unfair that taxpayer dollars are going to prop up a company that made these terrible bets, that was operating out of the sight of regulators, but which we have no choice but to stabilize, or else risk enormous impact, not just in the financial system, but on the whole U.S. economy.”

In spite of Bernanke’s claims, however, the argument in the AIG trial is that the Federal Reserve and the U.S. Treasury used the ailing AIG “as a vehicle to covertly funnel billions of dollars” to Goldman Sachs and other financial institutions favored by the government in a nefarious backdoor deal.

The complaint in the case for the AIG trial notes that “This is the only time in history when the government has taken without just compensation and/or illegally exacted the assets and equity of a company and its shareholders in connection with a loan, let alone a fully-secured loan bearing an extortionate interest rate.”