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Archive for the ‘Janet Tavakoli’ Category

Janet Tavakoli has written a new book, The New Robber Barons, available in all the usual places.

Janet’s release information says:

With Trillions On the Table Nobody Plays Fair, and Everyone Plays for Keeps.

The New Robber Barons continues financial expert Janet Tavakoli’s on-going chronicle of the global financial crisis captured in her articles from the September 2008 meltdown through February 2012. Picking up where her previous book, Dear Mr. Buffett, ended, she exposes the criminogenic environment that enabled international oligarchs to solidify power.

In January 2009, Warren Buffett, CEO of Berkshire Hathaway, told Tom Brokaw: “the idea that people that move money around are some favored class…strikes me as getting pretty far away from where we should be.” Two years later he publicly excused apparent insider trading by one of his successor candidates, David Sokol.

Berkshire Hathaway officer Charlie Munger admonished law students that Americans shouldn’t be “bitching about a little bailout.”

Shortly before Congress confronted him with Goldman Sachs’s profiteering during the financial crisis, Goldman CEO Lloyd Blankfein quipped he was doing “God’s work.”

CEO Jamie Dimon told shareholders that he didn’t think JPMorgan made a mistake when it came to potential foreclosure fraud: “maybe we’ll have to pay penalties eventually to some of the attorneys general but we really think we should just continue.” Meanwhile the bank scoured 115,000 mortgage affidavits and reserved $1.3 billion for legal costs.

After MF Global’s October 31, 2011, bankruptcy a U.S. Congressman told former CEO Jon Corzine: “You’ve got thousands of hard working people around this country that feel cheated.”

Tavakoli serves up example after stunning international example of no-strings-attached socialization of losses and privatization of gains. In the words of Congresswoman Marcy Kaptur: “I believe most of us would call that theft.”

The New Robber Barons is a prequel to Tavakoli’s The Money Book coming via traditional mainstream publishing later this year. Janet Tavakoli’s fiction book, Archangels: Rise of the Jesuits, a financial thriller wherein the Jesuits usurp the Vatican’s financial power structure and take control of the church leadership, will be released in March 2012. It is a prequel to Vatican Gold, the Jesuit takeover of the global banking system.

Now here’s the thing — it’s free today on the Kindle.

That’s right, $0.00.

Just go to the Kindle Store and search for it, then “buy” it for $0.00.

If you miss it today, then buy it for real tomorrow. I’ve not yet read it, but there’s nothing Janet has written that, in my experience, hasn’t been worth reading.

For those unfamiliar, you can read here about Janet.   To say she is the world’s foremost expert on structured finance would be an understatement.

Janet Tavakoli, Tavakoli Structured Finance, Inc.

Damning with nothing faint about it….

• Shortfall estimated at $1.2 billion or more (up from $600 million)
• “Repo-to-Maturity” is a “Total Return Swap-to-Maturity,” a Type of Credit Derivative
• Probable Shortfalls Throughout 2011
• Regulators Waive Required Tests for Jon Corzine
• Jon Corzine to Credit Derivatives Head: Next Time “Double Up
  JT Note: Subsequent to this report Jim Parascandola told me that he was never told to increase the size of any position, albeit his trades were profitable.
• Questions About How MF Global Became a Primary Dealer
• MF Global Wrote Rubber Checks for some Electronic Checks for Others
• Tip-Offs for Some Customers?
• CFTC’s Gary Gensler Didn’t Act
• MF Global Debacle Damages a Key Global Market

Here’s the punchline folks, as I’ve outlined as well:

MF Global’s problematic trades were different from AIG’s, but they were also derivatives, in fact, they were a form of credit derivative. The “repo-to-maturity” transaction was just a form over substance gimmick to disguise this fact. Specifically the transactions are total return swaps, a type of credit derivative, and the chief purpose of these transactions is leverage.

A total return swap-to-maturity includes a type of credit derivative. It allows you to sell a bond you own and get off-balance sheet financing in the form of a total return swap. Alternatively, you can get off-balance sheet financing on a bond with risk you want (but do not currently own so there is no need to sell anything) and take the risk of the default and price risk. (Price risk can be due both to credit risk and/or interest rate risk.) This is an off-balance sheet transaction in which the total return receiver (MF Global) has both the price risk and the default risk of the reference bonds. In this case, MF Global had the price risk and the default risk of $6.3 billion of the sovereign debt of Belgium, Italy, Spain, Portugal, and Ireland. As it happened, the price fluctuations of this debt in 2011 weren’t due to a general rise in interest rates, they were due to a general increase in the perceived credit risk of this debt.

In short the risk doesn’t go away but it’s not on your balance sheet so it is effectively hidden.

Read the entire report folks.  It’s not pretty and, in my opinion, it is required reading from a very credible source.

For those who are unfamiliar with Janet (although regular readers of FedUpUSA should know her well): 

Janet Tavakoli is the founder and president of Tavakoli Structured Finance, Inc. (TSF), a Chicago based consulting firm providing expert experience and knowledge about maximizing value in the face of complexity and uncertainty. TSF provides consulting services to financial institutions, institutional investors, and hedge funds. Ms. Tavakoli also provides expert consulting and expert witness work including exceptional quality expert report writing and crisp, persuasive testimony. Plaintiff engagements include Bank of America N.A. et al. v. Bartmann, JPM Chase, et al. Total claims in the consolidated litigation exceeded $1.2 billion. Engagements include representatives of plaintiffs or defendants depending on the issues.

Keiser Report: Murderers & Martyrs

In response to the immediately preceding article posted below:

Hard to top this for straight talk and right to the heart of the matter from someone who knows the financial markets, and especially derivatives, better than most.

From this afternoon’s mailbag:

“Loved your commentary: ‘The American government is acting as if it is involved in a massive cover-up of a control fraud and corruption that could perhaps be the worst in its history.’

There’s no need to qualify. The government is involved in a massive cover-up of control fraud and corruption, and it is the worst in U.S. history.

We let the servants quietly steal from the wine cellar and larder (for more than a century), and after discovering that no one would check their behavior—in fact, we handed the keys to our consumables to all the servants and let them bribe the overseers—they have watered down all the wine, and they backed up the truck to the larder and replaced most of the food with jars of peanut butter.

The bad guys have won, it’s almost too late to find our food and wine (5 year statute of limitations for securities fraud). As you rightly point out, those who speak up like William K. Black are marginalized.

Perhaps the most positive thing one can do at this point is try to stay on top of the anomalies created by this mess and try to preserve and increase wealth for the few that will listen.”

Janet Tavakoli

Jesse’s Café Américain

As a follow-up to her slide-show presentation that we posted below, here is Janet Tavakoli this morning on C-Span’s Washington Journal.  (Embedding is not available for this video, please watch at C-Span.)

WATCH VIDEO

It really doesn’t get more damning than this…..

“Fraud As a Business Model”, the slides from her presentation delivered today to the Federal Housing Finance Agency’s Supervision Summit.

Unfortunately I don’t have audio… but the Powerpoint slides speak for themselves…

From one of the slides:

• Investment banks – securities fraud
• Mortgage lenders – widespread fraud
• Rating agencies – junk science
• CDO “managers” – crash test dummies & accomplices
• Certain hedge funds – shorted CDOs they “managed”
• Bond insurers – money for nothing
• Regulators – poseurs and enablers

You gotta love it… and you darn well should read it.

The presentation is brutal, it is spot-on, it encompasses it all. 

And now, with it out there under the white-hot light of the public and presented to the government’s forum on housing finance supervision from one of the preeminent experts in the world of Structured Finance, there no longer is any excuse for the lack of action on these scams – from top to bottom.

Again, where are….

FHFA1282010