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Another fraudulent financial instrument for extracting wealth from the productive economy?"As McClatchy newspapers reported in November 2009:"For those listening carefully, there were some notable moments in the Maddow interview with Senator Warren on Thursday evening. At one point, Warren attempted to show how cold and calculating the Republican Presidential candidate, Donald Trump, was during the housing crash. Warren stated:
“'Look, I’ll pick one example when we talk about him and that is the housing crisis. Remember where Donald Trump was in this? In 2007, before the big explosion in 2008, a lot of people are starting to look around and say, whoa, we’ve got an inflated bubble here, there’s going to be trouble coming. And Donald Trump said, was quoted, he was excited for the crash because he knew how to make money off it. He was rooting for an economic crash because it was going to help line his pockets. What kind of a person does something like that? What kind of a person roots for people to be kicked out of their home? What kind of a person does that?'”
"This was the perfect opportunity for Maddow to say to Warren, 'Well, the kind of people that do something like that are the very people on Wall Street that are funding your endorsee’s political campaign.'
"Both Goldman Sachs and Citigroup made wagers that homeowners would default on their subprime mortgages after both firms participated in building this pile of toxic waste.
"Not only did Goldman Sachs personally pay Hillary Clinton $675,000 for three speeches but it and Citigroup rank among her top four lifetime political campaign donors according to the Center for Responsive Politics."
Wall Street On Parade
Warren's failure to support Bernie when it could have mattered makes me wonder if she's holding out hope for a VP spot with Clinton?
"Both Goldman Sachs and Citigroup made wagers that homeowners would default on their subprime mortgages after both firms participated in building this pile of toxic waste.
Goldman and Citigroup lost billions after homeowners defaulted.
“'In 2006 and 2007, Goldman Sachs Group peddled more than $40 billion in securities backed by at least 200,000 risky home mortgages, but never told the buyers it was secretly betting that a sharp drop in U.S. housing prices would send the value of those securities plummeting.
“'Goldman’s sales and its clandestine wagers, completed at the brink of the housing market meltdown, enabled the nation’s premier investment bank to pass most of its potential losses to others before a flood of mortgage defaults staggered the U.S. and global economies.'”
Wall Street On Parade
but never told the buyers it was secretly betting
Do you know what a synthetic CDO is?
"What is a 'Synthetic CDO'
"A synthetic CDO is a form of collateralized debt obligation (CDO) that invests in credit default swaps (CDSs) or other non-cash assets to gain exposure to a portfolio of fixed income assets.
"Synthetic CDOs are typically divided into credit tranches based on the level of credit risk assumed. Initial investments into the CDO are made by the lower tranches, while the senior tranches may not have to make an initial investment.
"All tranches will receive periodic payments based on the cash flows from the credit default swaps. If a credit event occurs in the fixed income portfolio, the synthetic CDO and its investors become responsible for the losses, starting from the lowest rated tranches and working its way up."
Read more: Synthetic CDO Definition | Investopedia http://www.investopedia.com/terms/s/syntheticcdo.asp#ixzz4BZUGVAUN
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Why did your heroes regard the miracle of compound interest as the eighth wonder of the world?
J. P. Morgan and John D. Rockefeller are said to have called the principle of compound interest the Eighth Wonder of the World. For them it meant concentrating financial fortunes in the hands of an emerging oligarchy indebting the economy to itself at an exponential rate. This has been the key factor in polarizing the distribution of wealth and political power in societies that do not take steps to cope with this dynamic."
http://store.counterpunch.org/wp-content/uploads/2015/08/Killing-The-Host_PDF_V7.pdf (p. 36)