This Week: Shut Down Wall Street, No More Suicides!


Larouche Pac

This Week: Shut Down Wall Street, No More Suicides!

With so-called “junk debt” markets plunging and experts warning of a “riot in the Wall Street casino” this week if the Federal Reserve raises rates, EIR Founding Editor Lyndon LaRouche made a very strong proposal yesterday; indeed, a demand on the elected representatives and citizens of the United States.

LaRouche said: “Close in on this and shut this Wall Street casino down, this week. Remember what is the effect on the people of this kind of crash. We cannot have more suicides, or any more of what happened in Italy last week.”

Italy is in an uproar since an Italian citizen committed suicide after an insolvent bank expropriated all his savings in an outrageous “bail-in” procedure, which also expropriated many others across four failing banks. This infamous “Cyprus-style” procedure has been repeatedly used in Europe as banks collapse, and more expropriations are coming. “People have been being murdered by their banking systems,” as LaRouche put it.

In the United States the sudden “junk debt collapse” is only a harbinger of a Wall Street collapse worse than 2008, with worse impacts on human livelihoods on a global scale.

LaRouche added:

“We cannot allow it to continue, you have worthless accounts, of so-called debt “assets” which are in collapse, and they’re being used to kill people’s income, their employment, potentially their food supply, and even to kill them. If you don’t shut down these Wall Street ‘funds,’ now, you will see what has just happened in Italy, on a grand scale.”I mean it is an ‘edge of death’ situation, if we don’t shut down those pretended assets. Close down the Wall Street system, bankrupt it as Franklin Roosevelt did during his Presidency.

“Then, countries have to create national credit for productivity and employment, again as Roosevelt did.”

It is Barack Obama who has blocked restoration of the Glass-Steagall Act, which is the key to bankrupting Wall Street and allowing productive credit to take effect on the economy.

The same Obama has brought in the “Paris climate agreement,” so-called, which — if it were to be carried out — would reduce the economy’s ability to support human life, by 80-90% in the next 35 years.

“This is a bold human genocide if allowed to occur,” LaRouche said. We can’t allow it to occur.

“That means closing out Wall Street — and that includes Donald Trump — and getting Obama out. Good people in both political parties can agree, to move the responsible authorities in Congress to get these objectives done.”

SUPPORTING MATERIAL

‘Riot in the Casino’ This Week?

That the was the forecast of former Reagan Administration budget official David Stockman, referring to the Federal Reserve’s apparent intention to raise interest rates — for the first time in 10 years — in the teeth of an accelerating junk-debt and commodity price collapse.

Junk debt (junk bonds and leveraged loans) in the U.S. economy, as a reminder, totals at least $2 trillion in “assets” mainly held by banks, although many mutual, pension, and hedge funds are also involved. The junk-debt market decline has become very sharp in December, with interest rates on middling (CCC-rated) junk bonds hitting 17.25% Dec. 10 and shooting upwards. This debt is essentially impossible to refinance. In recent weeks the ratings agencies and banks have charted a “spike” in defaults and bankruptcies of junk debtors — concentrated in oil and gas exploration and related services — and warned the “spike” will become a “wave” in January-February.

Now, two junk creditors have gone under. Two debt-invested funds have liquidated in the past few days. The first was actually a mutual fund: the $1.8 billion, “well-respected” Third Avenue Capital on Dec. 10. Its founder Martin Whitman is designated a “legendary vulture investor.” Just as that was being explained away (“it was investing in unrated debt”), the second went under on Dec. 11. It was Stone Lion Capital, a $2 billion hedge fund which was one of those investing in Puerto Rico distressed debt.

Some see a “Bear Stearns moment” — i.e., the bankruptcy of the two CLO-invested hedge funds in June 2007, which exposed the “non-containment” of the mortgage securities/derivatives meltdown. Vulture investor Carl Icahn gave a “keg of dynamite” interview on CNBC, saying “I believe the meltdown in High Yield is just beginning.”

The Wall Street Journal wrote Dec. 11, “The move is also a sign of how much the market for [all —ed.] corporate debt is deteriorating. “‘Investors have been dazzled that yields on bonds have climbed so high, even while default rates remained low,’ said … a longtime junk-bond analyst. ‘Currently, though, the ability to sell a large position is especially poor. When that tension gets especially high, you can see something snap.'”

The century-old British colonial looter Anglo American, which was making “energy-junk” loans on a large scale, is suddenly at the brink of junk itself, with Moody’s downgrading it Saturday to one step above junk for all its divisions and placing a negative advisory on all of them. Credit default spreads on both Anglo American and Glencore rate them at more than a 50% chance of default, requiring $1,000 cash up front to insure $10,000 of their debt.

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2 thoughts on “This Week: Shut Down Wall Street, No More Suicides!

  1. Interesting that LaRouche is still a major political presence after all these years. In the late 80s (prior to the Internet) the LaRouchies’ table outside Seattle’s main shopping mall was the only source of alternative information about the JFK assassination and other CIA conspiracies.

    Liked by 1 person

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