Jim Willie: “Central Bank Gold Rehypothecation Scandal to take Gold to $5,000/oz.”

Source: Jim Willie’s Hat Trick letter @ Silver Doctors

  • The battle is on for delivery and verification for official gold accounts
  • Evidence grows that much of it is gone, and when demanded, replaced with urgency
  • It is soon to transform into a global gold war
  • The German Govt gold demand to the London and NY City bankers represents a big escalation in the gold war
  • The central bank coordinated QE to Infinity has brought questions of gold account location and integrity
  • The Allocated Gold Account scandal is a natural event to follow the LIBOR banker scandal
  • QE3 will assure a gold rise past the $2000 mark, but the new scandal will take the gold price to $5000
  • The powerful gold factors are aligned and in place, led by permanent ZIRP and unlimited QE

A nasty Golden Harp could soon have its cords plucked, with the resonance working to shake loose the bankster cover of improper illicit duplicitous and probably highly illegal usage of Allocated Gold Accounts. When diverse scattered accounts are pilfered and depleted without authorization in Switzerland, resulting in several multi-$billion class action lawsuits in Zurich, all kept dutifully out of the news, that is one thing. But when a few key official government gold accounts are ransacked in systematic fashion from established trusted locations, defying and betraying the trust of the German Govt and other national governments, that is quite another.

To be sure, the system can tolerate ransacking and replacing with scurried harried efforts the Venezuelan gold account like in 2011. The media told the story with creativity and aplomb, avoiding the truth, inventing a tale, but finding a credible pile of dung to feed the public, which swallowed it whole. The global monetary war has been raging for four years, ever since the Lehman Brothers firm was targeted and destroyed with planning and motivated execution, for the benefit of Goldman Sachs full CDS redemptions and exploit by JPMorgan in war chest reload under cover of bankruptcy court orders. The media prefers regularly to refer to the global financial crisis incorrectly and improperly. A crisis passes after a year or so. This war lingers like WWI and WW2 and Vietnam, with a clear emerging agenda to defend the USDollar regime from global isolation shun, to conceal the US Treasury Bond support mechanisms in derivatives, to avoid the US banking system from grotesque insolvency but kept afloat by grand money laundering channels, and to motivate an endless war to secure resource thefts and control that center on oil fields and the poppy fields. Witness the slow gradual inexorable collapse of the global monetary and financial system.

Continue Reading @ Silver Doctors…

JPMorgan Sued By NY AG Over “Shit-Breathing” Bear Stearns RMBS Fraud

Source: Zero Hedge

NY Attorney General Eric Schneiderman is suing JPMorgan over “multiple fraudulent and deceptive acts” in selling mortgage-backed securities causing losses of over $20bn. The suit appears to be related to conduct at Bear Stearns and is on the back of the monoline insurer lawsuits, and whistleblower affidavits such as the following

In connection with the Bear Stearns Second Lien Trust 2007-1 (“BSSLT 2007- 1”) securitization, for example, one Bear Stearns executive asked whether the securitization was a “going out of business sale” and expressed a desire to “close this dog.” In another internal email, the SACO 2006-8 securitization was referred to as a “SACK OF SHIT” and a “shit breather.”

While we hope this would effectuate some real change, the likelihood is that it will at best result in a $300mm civil-lawsuit slap-on-the-wrists and brownie points for Schneiderman while nothing changes.

JPMorgan is of course contesting the shocking allegations.

 Via NY Times:

The complaint contends that Bear Stearns and its lending unit EMC Mortgage defrauded investors who purchased mortgage securities packaged by the companies from 2005 through 2007. The firms made material misrepresentations about the quality of the loans in the securities, the lawsuit said, and ignored evidence of broad defects among the loans that they pooled and sold to investors.

Moreover, when Bear Stearns identified problematic loans that it had agreed to purchase from a lender, it was required to make the originator buy them back. But Bear Stearns demanded cash payments from the lenders and kept the money, rather than passing it on to investors, the suit contends.

Unlike many of the other mortgage crisis cases brought by regulators such as the Securities and Exchange Commission, the action does not focus on a particular deal that harmed investors or an individual who was central to a specific transaction. Rather, the suit contends that the improper practices were institution-wide and affected numerous deals during the period.

Affidavit of Whistleblower from Clayton + Watterson Prime (Mortgage Due Diligence Firm) in Ambac vs. EMC:

Many of my colleagues at Clayton also lacked underwriting experience and a number of them had held no previous positions in the mortgage industry. I noticed that many senior Clayton employees, such as Deb Medina, hired many of their family members to work as due diligence underwriters, even when they had no experience in the mortgage industry.

…Because of the time pressures, however, many due diligence underwriters at both Clayton and Watterson entered information directly from the loan application (also known as the “1003 form”) or underwriting worksheet (the “1008 form”) without verifying the information by examining supporting documentation. This was known as “1008 underwriting.” In addition to the time pressures, another reason that many Clayton and Watterson due diligence underwriters engaged in 1008 underwriting was because they lacked the experience to question the information on these forms.

In fact, Clayton leads instructed us not to question what was on the 1008 form: “The loan’s already closed. You can’t do anything about it at this point.” I received similar instructions from leads at Watterson, who often told us: “It’s closed. Just approve it and move on, They’re already in the house.” From these instructions, I understood that Clayton and Watterson supervisors wanted me to approve loans without questioning any inaccuracies or departures from the underwriting guidelines.

As a result, due diligence underwriters like me knew that we could avoid having supervisors examine our work so long as we graded the loans as 1s. If we graded loans as 2s or 3s, quality control personnel and leads scrutinized our work and, oftentimes, publicly berated us for assigning that grade. Deb Medina, a Clayton lead, frequently yelled at due diligence underwriters for grading loans as 3s in public. Watterson leads instructed us, “Pass the loan and keep it moving.” By this I understood that I was supposed to approve loans and could quickly move on to the next loan.

Clayton and Watterson leads instructed us to avoid grading loans as 3s. This was true for numerous clients, but especially true on Bear Stearns jobs… due diligence underwriters at both Clayton and Watterson often used the phrase “Bear don’t care.”


 …I frequently reviewed loan files that contained documents that appeared to be fraudulent. For example, I reviewed many pay stubs that I believed were fraudulent because they were obviously altered. When I raised this issue to leads at Clayton, they instructed me: “This is not fraud review. Just take it from there.”


Exhibit 15 — Whistleblower Affidavit (Redacted)

Michael Pento: “I give it a 99% chance that QE3 will be announced on Thursday.”

Source: King World News

Today Michael Pento surprised King World News when he said that he expects gold to hit new all-time highs, and continue moving to the $2,300 level early next year.  Pento, of Pento Portfolio Strategies, also discussed what to expect from central planners this week and how it will impact key markets. Here is what Pento had to say about gold and the Fed: 

“I would expect that we are going to march our way to a new nominal high.  I give it a 99% chance that QE3 will be announced on Thursday.  There will be some form of quantitative easing announced on Thursday.  That will be some combination of ceasing to pay interest on excess reserves or an outright schedule of monetary purchases.”

Pento Continues:

“If that occurs, I think gold approaches its nominal high of $1,920 an ounce, and it inexorably rises close to $2,300 an ounce by early 2013.  I do not measure the value of the US dollar against another flawed fiat currency like the euro.  The ECB has already announced a ‘sterilized version’ of unlimited purchases of sovereign debt.

Now as I went into my (latest) piece on King World News, these purchases will not be completely sterilized….

Continue Reading @ King World News…

Gold Expert Jim Sinclair: “Coordinated Central Bank Stimulus Taking Place”

Source: JSmineset.com

My Dear Extended Family,

If you have eyes to see, coordinated central bank monetary and fiscal stimulation action is taking place.

Yesterday was “Draughi Day.” Today the Chinese officially released massive fiscal stimulus on top of the already monetary stimulus. Watch for the US Fed to chime in.

QE to infinity MOPEd as sterilized is falling into place. Please review my post from last weekend to you on the illusion of monetary sterilization.

Gold is going to and through $3500. The approach some long term gold bulls took toward gold, initiating a temporary short directly after Labor Day, is now in the process of backfiring badly.