The latest fraud to be exposed is that of PFGBest. This looks like an instant replay of MF Global except that the CFTC is actually suing them this time (unlike MF Global) and not letting “the money get away”. This will be discussed in detail over time and again end up with a bunch of ignorant (there’s that word again) Congressmen asking dumb questions and trying for soundbites in their 5 min. allotted time. So far this looks like a ham sandwich deal being a little over $200 million, but that’s not the point. The CFTC was in PFG’s offices just a couple of months ago and what did they find? Apparently nothing…or if they did maybe they wanted to keep it quiet like the
Li(e)bor fixing where “everyone knew but nobody told”. Which brings me to the point.
“Who do you trust”? What is the point of “trading” and winning if…you end up losing it to your custodian going bankrupt? This is just one more example fraud and one more example of the “confidence” being knocked out from under the Ponzified system. I might mention that this “real world” shortfall and “use of funds” is the same thing that WOULD be going on in the off market derivatives market but isn’t public. It isn’t “public” because John and Jane Doe are not participants who will scream when they lose money, no, these derivatives are done between “big boys” who know that if their counterparty is in default it is in their own best interest to…say NOTHING!
Think about it, if your counterparty can’t pay you and you relied on that contract to pay someone else…you surely don’t want that “someone else” to know that you can’t pay. Which is where we are right now and have been since 2008 when Lehman went down. None of these derivatives can perform. They cannot perform in a “physical manner” where a “product” like Gold or oil or whatever is promised and they cannot perform in a financial manner either. The amount of “financial” derivatives are 20 times larger than the underlying markets so the money doesn’t even exist (yet) for these contracts to perform.
So…who do you trust? Do you trust that your institution is solvent? Do you trust that they haven’t made wild ass bets and lost it all…including yours? Do you trust that the CFTC will never let it happen again like they told us after the MF Global event? Do you even trust the markets themselves when you have already seen enough evidence that they are all rigged? Hell, do you even trust Timothy “we held a LIBOR fixing meeting in 2008” Geithner? Or Ben “everything’s contained” Bernanke? At the bottom of it all is fraud and as you know, “intent” is a part of the definition of fraud. None of this has happened by accident. It was not “bad luck” or coincidence of any sort. No, the entire era is marked by “covering up” past ills, past fraud, and has gotten to the point where there is no longer plausible deniability by anyone in charge of financial institutions or regulatory agencies. What started out as white lies and wink ‘n nod theft has turned into systemic fraud with intent to steal, conceal and destroy anything and everything in it’s path. …And you wonder why “they” tell you that “Gold is only for barbaric people”? It’s because Gold is real and cannot be debased or stolen through their main tool, inflation. They also cannot steal it from your institution if you have it in your own hands. Does anyone still wonder why precious metal ETF’s were invented in the first place? …and why they won’t help you when you’ll need it?