Skeletons in the cupboard — The Ghost House, Rondebosch
"The largest Ponzi scheme in the history of the capital markets is the relationship between failed mortgage lenders and investment banks that securitized the risky overpriced loans and sold these packages to other investors—a Ponzi scheme by every definition applied to Madoff." ... "These and other related deeds led to the largest global credit meltdown in the history of the world."
Janet Takavoli quoted in BusinessWeek | Ponzi Nation
Watching the Dow leap from a 3:40 low of 8,469 to close at 8,564 in thin trading yesterday, I felt indifferent. The machinations of traders, when all is said and done, merely contribute to a larger thesis, i.e. the moral failure and inevitable collapse of Western Capitalism. Bernard Madoff, referred to by Janet Takavoli above, is but one case among many (see Tom Petters, Marc Dreier, and the hyena-like Wall Street mentality).
As the ticker refreshed to reveal improbable rises and falls, I was reading Yudhijit Bhattacharjee's article in The Atlantic, Caveat Donor. It details the rise and fall of Amit "Dr. Horror" Kumar, India's kidney-theft king. Initially paying Mumbai Muslims $500 to $2,500 for a kidney, Kumar's body-parts empire spread to the states of Hary'na and Uttar Pradesh. Arrested in 2007 after a street fight between a 'donor' and an agent, the man "... with clients from Europe, Asia, the United States, and the Middle East, and with homes and properties in Mumbai, Toronto, Hong Kong, and Australia ..." is now serving time in a Hary'na prison.
Kumar's evil is made banal by its ubiquity. For me, the speed of his arrest and conviction was intriguing. If investigative magazine noseweek and the Independent Group are to be believed, Netcare Limited, one of South Africa's largest hospital groups and health-care providers, has been flogging kidneys for years from its hospitals in Johannesburg, Durban, and Cape Town.
In collaboration with Israeli body-parts thief and Medikt manager Ilan Perri, and supervised by Netcare's national transplant co-ordinator, a veritable Who's Who of South African surgeons happily contributed R50 million to Netcare's not-insignificant coffers between 2001 and 2003 by gutting impoverished Brazilians and Romanians.
To their credit, Netcare paid $3,000 to their victims. And, after seven years, it seems the matter will go to court with Netcare facing, among others, charges of racketeering and homicide.
My interest in matters formerly deemed "medical" (they now form part of the commodities' markets) was piqued by the origins of "Transplant Tourism" in China. Netcare collaborator Ilan Perri found, among condemned Chinese prisoners, a lucrative source of cheap kidneys for Israelis, who appear to suffer mightily from the failure of these organs.
Perri, and others working for health-care provider Kupat Holim Klalit and insurance company Dikla, were nabbed for stinting the taxman of 30,000 shekels after an investigation by Yediot Aharonot. The Wall Street Journal reports the Chinese government putting a stop to Transplant Tourism in March last year. It's assumed the organs of executed prisoners now go to deserving Chinese recipients.
With the Asian and European markets pretty flat today, U.S. futures are looking up.
Which, I guess, is where Gao Xiqing comes into the picture. I'd been reading "Be Nice to the Countries That Lend You Money" before discovering the similarities between organ thieves and Wall Street bankers. General Manager and Chief Investment Officer of the China Investment Corporation, Xiqing uses The Atlantic to offer the butchers of Wall Street sage, dispassionate advice.
People, especially Americans, started believing that they can live on other people’s money. And more and more so. First other people’s money in your own country. And then the savings rate comes down, and you start living on other people’s money from outside. At first it was the Japanese. Now the Chinese and the Middle Easterners.
We—the Chinese, the Middle Easterners, the Japanese—we can see this too. Okay, we’d love to support you guys—if it’s sustainable. But if it’s not, why should we be doing this?
James Fallows | “Be Nice to the Countries That Lend You Money”
As far as I can see, no good reason at all. CapeTalk's running an advert for a financial publication. The introductory voiceover has a guy building up to a big, cold-infested sneeze. It takes forever; numerous short, sharp intakes of breath to avert the inevitable. Eventually, it explodes. A couple of seconds' silence is followed by a sympathetic voice: "Bless you, America. Now, find out what it feels like for the rest of us."
Playing on the old maxim "When America catches a cold, Europe catches the 'flu, and Africa contracts pneumonia, tuberculosis, and AIDS", the advertisement lends weight to Gao Xiqing's many salient observations. Down here at the foot of Africa, we can no longer afford to subsidize "The American Way" or have our economies eviscerated by ruthless banksters out to enrich themselves. It's costing us an arm and a leg.
Note: Well, there we go. With Goldman Sach's reporting a fourth-quarter $2.12 billion loss, slashing 2,500 jobs and reducing average pay by 45 percent, U.S. consumer prices dropping a further 1.7 percent in November, and the Fed set to lower interest rates to an historic low, the Dow's up a healthy 75 points — with GS adding 8.25 percent.
It still amazes me that the market rewards companies for slashing jobs but plummets on the release of increased unemployment figures. There's a definite contradiction somewhere in there. Ah well ... if it's light reading you want — and some background on Indo—Pakistani relations, you can do no better than read Arundhati Roy's 9 Is Not 11.
And for dessert, don't miss A. Gary Shilling's (I'm assured it's his real name) Semi-Annual U.S. Economic Outlook: Collapsing On Schedule. Excerpted by the ever-informative, insightful, and prolific John Mauldin (for accredited investors with a net worth exceeding $1.5 million) at InvestorsInsight, it highlights how bailout (Hoover) and quantative easing (Japan) strategies have thus far failed to revive a global economy fast approaching rigor mortis. However, and as Mauldin explained last week, having no playbook for systemic collapse forces the Treasury and Fed to 'make it up as they go along'; no matter who's in charge.
A Few Good Men ...
Spot the Democrat ...
Blagojevich Complaint
Perhaps sadly, Tom, I spent some time reading Agent Daniel Cain's affidavit detailing Rod Blagojevich's alleged misdemeanours. I still — despite decades of compelling evidence, find it difficult to believe people can be so blatantly arrogant, dumb, and criminal. Worse, I find my own inability to comprehend such high-profile criminality responsible, within reason, for aiding and abetting it. I've a feeling it's the flagrant nature of their violations. "All your base are belong to us" is a great line and they use it freely. A part of us (the Mugabe bit) wants to believe it's not real.
Again sadly ...
Comment appended to "There is no innocent explanation."
