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Part 7 — Naked Shorts — $75,000 For Cracking the Wall Street Cover-up REDUX
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by RoryKearney | July 29, 2008 at 04:13 pm
2158 views | 0 Recommendations | 1 comment
Part 8 — Naked Shorts — $75,000 For Cracking the Wall Street Cover-up REDUX
http://www.nowpublic.com/world/part-8-naked-shorts-75-000-cracking-wall-street-cover-redux
Part 6— Naked Shorts — $75,000 For Cracking the Wall Street Cover-up REDUX
by RoryKearney | July 26, 2008 at 08:03 am | 324 views | 2 comments
http://www.nowpublic.com/world/part-6-naked-shorts-75-000-cracking-wall-street-cover-redux
Part 1 — Naked Shorts — $75,000 For Cracking the Wall Street Cover-up
by RoryKearney | July 11, 2008 at 07:13 am | 3997 views | 33 comments
http://www.nowpublic.com/world/naked-shorts-75-000-cracking-wall-street-cover
______________
The Federal Reserve is considered an independent central bank because its decisions do not have to be ratified by the President or anyone else in the executive or legislative branch of government, it does not receive funding appropriated by Congress, and the terms of the members of the Board of Governors span multiple presidential and congressional terms. However, the Federal Reserve is subject to oversight by Congress, which periodically reviews its activities and can alter its responsibilities by statute. Also, the Federal Reserve must work within the framework of the overall objectives of economic and financial policy established by the government. Therefore, the Federal Reserve can be more accurately described as "independent within the government."
The Federal Reserve is considered an independent central bank because its decisions do not have to be ratified by the President or anyone else in the executive or legislative branch of government, it does not receive funding appropriated by Congress, and the terms of the members of the Board of Governors span multiple presidential and congressional terms. However, the Federal Reserve is subject to oversight by Congress, which periodically reviews its activities and can alter its responsibilities by statute. Also, the Federal Reserve must work within the framework of the overall objectives of economic and financial policy established by the government. Therefore, the Federal Reserve can be more accurately described as "independent within the government."
http://www.federalreserve.gov/generalinfo/faq/faqfrs.htm
Secrets of the Federal Reserve
http://www.apfn.org/apfn/reserve.htm
The Money Masters - How Bankers Gained Control of America
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http://www.deepcapture.com/the-story-of-deep-capture-by-mark-mitchell/
To enter our $75,000 "Crack the Wall Street Cover-up!" contest read to the bottom of this (very long) story.
The Columbia School of Journalism is our nation’s finest. They grant the Pulitzer Prize, and their journal, The Columbia Journalism Review, is the profession’s gold standard. CJR reporters are high priests of a decaying temple, tending a flame in a land going dark.
In 2006 a CJR editor (a seasoned journalist formerly with Time magazine in Asia, The Wall Street Journal Europe, and The Far Eastern Economic Review) called me to discuss suspicions he was forming about the US financial media. I gave him leads but warned, “Chasing this will take you down a rabbit hole with no bottom.” For months he pursued his story against pressure and threats he once described as, “something out of a Hollywood B movie, but unlike the movies, the evil corporations fighting the journalist are not thugs burying toxic waste, they are Wall Street and the financial media itself.”
His exposé reveals a circle of corruption enclosing venerable Wall Street banks, shady offshore financiers, and suspiciously compliant reporters at The Wall Street Journal, Fortune, CNBC, and The New York Times. If you ever wonder how reporters react when a journalist investigates them (answer: like white-collar crooks they dodge interviews, lie, and hide behind lawyers), or if financial corruption interests you, then this is for you. It makes Grisham read like a book of bedtime stories, and exposes a scandal that may make Enron look like an afternoon tea.
By Patrick M. Byrne, Deep Capture Reporter
NEW! Download the Story of Deep Capture in .pdf format.
By Mark Mitchell, with reporting by the Deep Capture Team
Introduction - by Mark Mitchell
I began working on a version of this story. . .
Crack the Wall Street Cover-Up Contest!
You, the Community, decide who wins
1st place = $30,000
2nd place = $20,000
3rd place = $10,000
4th place = $6,000
5th place = $4,000
6th - 10th place = $1,000 each
Total = $75,000
From “The Story of DeepCapture” you understand the crime and cover-up. Now you can win up to $30,000 for thinking of a clever way to crack the cover-up. Here’s how:
1) Crack the cover-up: do something to help the public discover DeepCapture’s exposé of Wall Street and the financial journalists who “tried to be players but became pawns.”
2) What you do is your choice: you may simply write newspapers and politicians (here is a page providing ways to do that quickly and easily), and get others to do the same. Maybe you’ll do some PR stunt (such as this). Maybe you’ll write letters to the editor, or do Youtube videos, or think of something entirely new and original (we hope you do).
3) Whatever you do must be legal. Click here for full contest rules.
4) Use the widget below to tell us what you did. That becomes your entry. Your entry can and should link to blogs, videos, audio files, letters to the editors, newspaper articles, etc. that document your efforts to crack the cover-up.
5) Multiple entries are allowed.
6) To crack the cover-up you may find it useful to learn more about this issue. The links within Mitchell’s piece are a good starting point. More detailed pieces appear on DeepCapture.
7) The community will determine the winners by continuously voting entries up and down.
8 ) At midnight, October 1, 2008, entries will be frozen and prizes awarded.
Good luck, and remember to tell your friends to come vote for your entry!
___________________
Deep Capture
The Movie
http://www.deepcapturethemovie.com/
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Glick report on naked short selling 7/29/08
Interview with Patrick Byrne by Alexis Glick
Great comments already up at her site (22 posted so far). Keep 'em coming!
http://glickreport.blogs.foxbusiness.com/2008/07/29/the-sec-and-naked-shorting/
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Baker Chanos connection
http://www.outsidethebeltway.com/archives/2008/01/baker_passes_go_collects_1_million/
Chanos and Baker jointly sending letters to the SEC to protect the fraud... http://sec.gov/comments/s7-20-08/s72008-30.pdf
David Patch, of Investigate The SEC.com letter to the SEC (below)
http://sec.gov/comments/s7-19-07/s71907-1189.pdf
July 22, 2008
Securities and Exchange Commission
100F Street NE
Washington, DC
Mr. Chairman & Commission Staff,
It has been a long 8+ years of my life spent trying to educate you on the destruction of our capital markets by short sale abuses. In this near decade of time spent in the education process I have witnessed the SEC migrate from a position where naked short selling does not exist, to it exists at a very finite level, to naked shorting being a serious and abusive process, and finally to where we are today, and emergency order to protect the most liquid financial institutions from the abuses.
Congratulations on having somebody at the SEC have the light go on upstairs.
Unfortunately that lit is not well lit as many within the agency remained entrenched in the position that short selling is good for the markets at any cost. Short selling provides liquidity and price discovery and thus should not be constrained in any manner.
Those within the agency who continue to believe that short selling should remain unconstrained need to have their employment status re-evaluated. Bear Raids, market manipulation, and the ultimate destruction of technology, jobs, and community stability have all been the negative impacts of an unconstrained investing process.
This reform up for re-submission for public comment has received better than 640 new comments in the past 2 weeks alone. Not one supports any alternative but the complete abolishment of the Options Market making exemption.
If history repeats itself, industry members will submit a few comments on the last days asking that the Commission forgive the rights and opinions of the general investing public and that these exemptions remain intact in order to provide liquidity for the options markets.
Options Market Makers will threaten the Commission with rhetoric about how they can not support their business model without the exemptions. Not one of the memos will contain any evidence or analysis to support such claims. Not one memo will provide evidence that alternative approaches were investigated and found insufficient. Not one will provide the very empirical data that was requested of the SEC and is presently responsible for this delay once again.
Instead the industry will demand the Commission to support their rights to unrestricted revenues at the expense of the investing public, the public companies, and our local communities that house those employed by these companies.
Despite the public comment, private communications continue to exist between the commission and industry lobbyists. The Securities Industry and Financial Markets Association (SIFMA) lobbying on behalf of Wall Street and the Managed Fund Association (MFA) lobbying on behalf of short selling hedge funds used their political connections to address the Commission in private.
Fortunately not all stays private and the public is exposed to a glimpse of how conflicted such meetings and communications can become.
Former Congressman Richard Baker, now CEO of the MFA along with short seller James Chanos drafted a memo to Chairman Cox, likewise a former Congressman hoping that the political connections of Congress can persuade an outcome beneficial to his clients – Wealthy Hedge Fund Managers.
It is the “political juice” connection all over again.
The memo however portrays appearances that go well beyond that of conflict of interest, this memo actually illustrates the expectation of separate rule making for hedge fund investors and illustrates the very fraud I have lobbied against these past 8+ years. I will highlight some of the admissions herein:
Mr. Chairman, the emergency order enacted by the Commission simply forces the investing public to guarantee that in the execution of a short sale such trade will meet the full intent of Rules 15c3-3 and 15c6-1. These rules require that no trade be executed without the express intent to settle within 3-days. To any short seller who must execute a pre-borrow this will insure that such will happen.
Unfortunately, instead of addressing the commitment to settle Chanos and Baker blame the corporate officers for their right and expectation to a fraud free trading environment. How can a market have fundamental transparency and integrity when the short selling activities taking place are not published daily or real time but instead delayed and infrequent?
Daily publication of short interest levels would allow long investors to adjust their positions based on the transparency of whether a selloff was short sale induced or long sale induced would create such interaction but does not happen. Short sellers do not want their interest made public. A short seller participating in this market has full visibility on how their individual investments impact a market but the long investor is unaware of the mechanics to such a selloff. Likewise, transparency of short sale activity relative to settlement activity is not real time but delayed months; well after a market cycle has taken place.
Mr. Chairman, this section of dialogue by Chanos and Baker illustrate fully the expectation by each that a short sale does not have to settle properly. I contend that this opinion is not limited to Chanos and Baker but has become standard industry practice despite such being illegal.
Before a short sale is executed every market participant must enter into such transaction with full 100% certainty that the trade will be settled within 3-days. There are no afforded options under the securities laws in meeting 25%, 50%, 75% settlement coverage. The law requires 100% and requires 100% within 3-days. And expectation of failure is a violation of Rules 15c3-3 and 15c6-1. The fact that avoidance of such coverage is based on expense is not an excuse for failure. Certainly excuses regarding expense of trade can not be considered when such funds reap ungodly profits and fund managers are being paid obscene annual compensation.
Expense is all part of the risk factor to trade and no investor whether it be a short seller, long investor, or broker-dealer entering into a bona-fide market has the right to a riskless trade.
The expectation by the industry that a short seller has the right to short at whatever level they choose is inaccurate and if done would not only violate trade rule but could be the very manipulation that we now face under the bear raids before us.
Again this commentary alludes to much more than where Chanos and the MFA want to go regarding short sale regulation but where they presently stand in trade today.
No short seller has the right to enter into a trade without the express intent on trade settlement throughout the duration of a short position. Choosing to enter into a convertible bond investment is the right of any investor and which such right come risk. This memo implies that such risks are presently being hedged through the short sale process where some or the entire sale does not settle due to a cost to borrow expense. Dialogue such as this is an admission of fraud by those who engage in such activities. Trade risk and cost of trade are not an excuse to fail in meeting the obligations of a trade contract.
The memo presented by James Chanos and Richard Baker is a threat against the agency. The memo never quantifies what additional cost would be incurred or has been incurred since the emergency order was imposed. Likewise, the memo never substantiates what capital investment levels would dry up if investors found it difficult to short hedge such investment. Theoretically, unless the company is on a hard to borrow list such commentary is trivial.
In the end I find this memo by Chanos and Baker to be extremely enlightening and extremely dangerous at the same time.
I am enlightened in the fact that the opinions and preferential expectations of the short seller are now public and available in black and white. That this investor class has found solace in that these markets are here for their personal pleasure and that there are no laws to abide by when such laws find way to create the burdens of expense to their bottom line.
The danger in this memo is that it was drafted by a former US Congressman and Chairman of the House Financial Services with oversight over our Capital markets. That this former Congressman has outlined how and why naked shorting takes place and does not grasp what impact such has on the millions of investors and thousands of public companies that put faith in the safety of these public markets.
How many more are out there with this thought process.
Mr. Chairman, the memo delivered is an admission that fraud takes place in our capital markets and that failure to settle trades is a strategic component to that. The memo rationalizes why short sales should be unconstrained and that the cost of settlement is of lower significance to the short sale execution itself.
I urge the Commission enforcement staff to initiate a sweeping investigation into the types of trading activities addressed in the memo looking for the blatant failure to properly locate, borrow, and settle trades as required by law. Since Mr. Chanos is an author to such memo I would urge that his fund be one of the first under investigation.
“How Much Fraud are you Willing to Accept for Liquidity” William Donaldson before Congress 2004
David Patch
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http://online.wsj.com/article/SB121728651034091275.html?mod=todays_us_opinion
Excerpts
Fannie Mae's Political Immunity
July 29, 2008
President Bush is poised to sign the housing and Fannie Mae bailout bill, after the Senate passed it with 72 votes on the weekend. But an underreported part of this story is that Majority Leader Harry Reid refused to allow a vote on Republican Jim DeMint's amendment to bar political donations and lobbying by Fannie and its sibling, Freddie Mac.
.....
![[Fannie Mae's Political Immunity]](http://s.wsj.net/public/resources/images/ED-AH952_1frien_20080728182024.gif)
We believe in the right of individuals and businesses to lobby Congress. But with Fan and Fred now explicitly guaranteed by taxpayers, letting them ladle cash all over Washington amounts to using government-guaranteed profits to lobby for continued government protection. Congress sets the rules in favor of Fan and Fred, which then repay the Members with cash from their rigged profit stream. This is the government lobbying itself for more government.
And, oh, what a stream of political cash it is. First, there are Fannie and Freddie's political action committees, which have already distributed roughly $800,000 to U.S. House and Senate Members this election cycle. Nearly half of the Senators have received funds and almost all of the money is directed to incumbents. Fannie gave $10,000 to Speaker Nancy Pelosi, $10,000 to third-ranking House Democrat Rahm Emanuel, $5,000 to Barney Frank, $10,000 to Republican House whip Roy Blunt, $8,500 to Majority Leader Steny Hoyer and $7,500 to Minority Leader John Boehner and . . . you get the picture.
![[nowides]](http://s.wsj.net/public/resources/images/nowides03202003164521.gif){kind=small}
FANNIE MAYHEM: A HISTORY
Click here for a compendium of our recent Fannie and Freddie coverage.
Then there are the "charitable" foundations. Freddie Mac's foundation handed out $25 million to political groups, think tanks and other Beltway outfits in 2007 alone, more than any other foundation in the country, according to the Washington Business Journal. Guess which foundation ranked number two? Yep, Fannie Mae's, which gave out $21 million. The foundations grew thanks to gifts of stock during the companies' heyday before their accounting scandals and the housing bust. Last year, as political scrutiny increased, Fannie closed down its foundation and now runs its tax-deductible donations through the company itself.
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http://www.fool.com/investing/international/2008/07/29/mark-cuban-should-be-better-than-this.aspx
Mark Cuban Stock Manipulation Ticks Off The Motley Fool,
A broader point
Short-sellers have come under fire recently. Overstock.com (Nasdaq: OSTK) founder Patrick Byrne famously attacked them a few years ago; David Einhorn became a target of Allied Capital (NYSE: ALD) for presenting his short case for that stock; and we've recently seen the SEC enact a 30-day rule to prevent "improper short selling" in financial stocks such as Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE).
But let us be clear: We are not against short-selling. It is an absolutely crucial part of healthy and functioning markets.
Rather, we're against individuals benefiting -- on either the long or short side -- from action that they caused through a published report, a lack of disclosure, or any other means. Mark Cuban and Chris Carey are better than that.
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http://www.caycompass.com/cgi-bin/CFPnews.cgi?ID=1032364
US Senate takes aim at Cayman
By Brent Fuller, brent@cfp.ky
Sunday 27th July, 2008 Posted: 23:34 CIT (04:34 +1 GMT)
> Comment on this story
Depending on which side of the Caribbean you’re on, a US report released about tax minimisation (or avoidance) in the Cayman Islands last week was either “hugely troubling” or a “validation” of Cayman’s financing regimes.
The US Government Accountability Office report, based on the non–partisan auditing agency’s extensive research over the past year, took a look primarily at the operations of Ugland House in George Town and the law firm that is the building’s sole tenant, Maples and Calder.
It found that the five–storey building served as a registered office for 18,857 entities as of March. According to Maples’ partners, about five per cent of those entities were entirely US–owned. About 40 per cent to 50 per cent had a US billing address, but were not necessarily owned or operated out of the US.
The GAO report noted that the Cayman Islands financial sector serves as a facilitator for US–foreign transactions and allows individuals or companies to minimise taxes, which attracts a great deal of US investment.
“This activity is typically legal,” read a statement from Michael Brostek, the director for tax issues at GAO, “such as when pension funds and other US tax–exempt entities invest in Cayman hedge funds to maximize their investment return or minimize US taxes.
“Nevertheless, as with other offshore jurisdictions, some US persons may use Cayman Island(s) entities to illegally evade income taxes or hide illegal activity.”
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We are growing old waiting.
http://www.investorvillage.com/smbd.asp?mb=3532&mn=22193&pt=msg&mid=5296816
SEC's Cox: Expect 'Will Take Action' Before Order Expires
July 29, 2008: 04:01 PM EST
WASHINGTON -(Dow Jones)- Securities and Exchange Commission Chairman Christopher Cox said Tuesday that he expects the agency to take action before an emergency order restricting short sales in 19 stocks expires at midnight.
"You should expect that the commission will take action prior to the expiration of the order," Cox told reporters after a press conference to announce the signing of a memorandum of understanding between the SEC and the Labor Department. The emergency order, which may be extended only through mid-August, covers 17 Wall Street companies that act as primary dealers in U.S. Treasury debt, along with federally sponsored housing-finance giants Fannie Mae (FNM) and Freddie Mac (FRE).
Cox said the SEC is analyzing economic data on the effect of the temporary restrictions, which took effect July 21, and is hearing that it has "helped to control illegitimate rumor-mongering and other techniques of market manipulation."
The SEC chief cast doubt on suggestions that the order might be extended beyond the 19 stocks it currently targets, saying the SEC intends to consider rules "at the earliest possible time" to extend similar restrictions "across the entire market."
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http://seekingalpha.com/article/87653-illegal-short-sellers-may-face-rico-indictments
Excerpts
Illegal Short Sellers May Face RICO Indictments
Illegal Short Sellers May Face RICO Indictments
by: R.J. Chopin posted on: July 29, 2008
Racketeering Influenced Corruption Organizations Act, the law Rudy Guiliani used to bring down Michael Milken, and other Wall Street crooks, could be revisited in the SEC's struggle to clean up Wall Street's growing threat to the financial markets.
The SEC's crackdown against illegal naked short selling and rumor-mongering resulted in more than 50 hedge funds being slapped with subpoenas last week, according to the Wall Street Journal. Conspiracy theorist and CEO of Overstock.com (OSTK), Patrick Byrne, has embarked on a crusade to expose the nefarious hedge funds that practice illegal short selling. Byrne's web site, Deep Capture.com, has compiled a plethora of facts documenting, names, dates, times and videos of the players and their schemes.
.....
Clusterstock.com, reported, "the SEC is demanding both trading records and email correspondences" from subpoenaed firms. The inclusion of cell phone and text messaging records will undoubtedly be scrutinized. Concurrently, the NYSE Regulation Inc. is also investigating how some of its largest firms comply with false and misleading rumors that could undermine a stock's price. This is going to intensify.
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March 24, 2005!
The Naked Truth on Illegal Shorting
http://www.fool.com/investing/high-growth/2005/03/24/the-naked-truth-on-illegal-shorting.aspx
Excerpt
In other words, every single outstanding share of the company somehow changed hands nearly 60 times in the course of two days, despite the fact that the company's entire float was located in Simpson's sock drawer. In fact, even as recently as last Friday, 930,872 shares of Global Links still traded hands. If Simpson's claim that he owns all shares is accurate, that is a staggering number of phantom shares being traded around by naked short sellers.
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http://www.cnbc.com/id/25907857
UK's FSA Arrests 8 in Insider Dealing Probe
By Reuters | 29 Jul 2008 | 10:48 AM
The Financial Services Authority, the UK's financial regulator, said eight people were arrested on Tuesday, including employees of UBS AG and J. P. Morgan Cazenove, as part of an investigation into insider dealing.
.....
Until earlier this year, it had not brought a single criminal case for insider dealing since it took over responsibility for prosecutions in 2001.
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CRIME AND NO PUNISHMENT
NEITHER ADMIT NOR DENY GUILT (search phrase) PAY THE FINE, AND ENJOY YOUR ILL GOTTEN GAINS.
Investors Await Effects of Analyst Deal - Los Angeles Times
As is standard in any settlement, the firms will neither admit nor deny guilt. But Citigroup and some other firms could be forced by Spitzer to issue ...
articles.latimes.com/2002/dec/21/business/fi-settle21
*
CSFB avoids serious damage from dot.bombs | Business | The Guardian
As part of the settlement, CSFB will neither admit nor deny guilt. The regulators will nevertheless charge that the bank handed out large tranches of hot ...
www.guardian.co.uk/business/2001/dec/13/5
*
Goldman In $2M Settlement With SEC - Forbes.com
As part of the deal, the investment bank will neither admit nor deny guilt. Click here for more from the Forbes.com Video Network ...
www.forbes.com/2004/07/01/cx_tm_0701video2.html
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Big Brown co-owner linked to mid-'90s securities scandal - Topix
"It was a very small matter that I decided to neither admit nor deny guilt and just take care of." Typical of corporate america. ...
www.topix.com/forum/source/newsday/T7J2JMM512IPNALCA
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on Martha Stewart
"In most insider-trading cases there's never a criminal charge filed," Zlotnick said. "Most of the time, the SEC would come in and say 'We think your client committed insider trading,' particularly if your client was a third party like Martha -- that is, if you're in the company, the consequences are often much more serious. But if you're simply a tippee, and you knowingly traded on insider information, normally what they do it, you come to a civil agreement, a civil settlement in which you neither admit nor deny guilt, and you return the money. Then you can often be banned from the securities industry or you can be banned from trading for a while -- but it's rare for tippees to be prosecuted criminally -- that's because they usually settle or cooperate."
He added, "..to the extent that there are criminal charges filed, usually if the person has a clean record they're not going to jail."
The fact that she didn't plead guilty right away was one strike against her, Zlotnick said.
"She went to trial, and that's the big difference. In the federal system, if you plead guilty you automatically get three points deducted from your guideline range." If she had pled guilty to lying to federal prosecutors, Stewart could've received a sentence of zero to six months, meaning she could've gotten home detention or probation, Zlotnick said.
*
Fraud Charge for Deutsche Possible - Los Angeles Times
Though firms typically neither admit nor deny guilt in regulatory settlements, the mere allegation could strengthen the legal cases of small investors who ...
articles.latimes.com/2003/apr/05/business/fi-deutsche5
*
etc etc etc
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July 30, 2008 8:45 AM
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CareToLive vs the FDA had its appeal yesterday. The crooks have naked shorted Dendreon with what seemed to have been assurances from the FDA that they would not approve (which is highly illegal) the non invasive, non toxic prostate cancer immunotherapy Provenge drug application. The FDA hadn't counted on their specially appointed outside panel of experts who made up the Advisory Committee, to vote Provenge safe 17 to 0, and substantial evidence of efficacy 13-4. The Advisory Committee was mandated by Congress, to help speed good, safe drugs to market. In an unprecedented act, the FDA delayed approval for over a year while 30,000 American men die from late stage prostate cancer each year.
The FDA had to take some insidious steps first. Two of the naysayers on the panel, heavily connected to the oncology field, were brought on the panel by Richard Pazdur, cancer czar for the FDA's CDER division, even though the decision was with the biologics division of the FDA's CBER. They fussed and tried to get the other members of the panel to see it their way during the Advisory Commitee, especially Maha Hussain, who escaped to come here from Iraq, to save her life, and ended up sentencing men with end stage prostate cancer to die without hope.
I recently spoke to the PR man at the FDA, who they schluffed me off on, and once they have their agenda in place, they are not interested in the facts. Although the question was changed at the Advisory Committee, from the congressionally mandated question of "substantial evidence of efficacy" to absolute efficacy, which no drug ever has to meet as it would be impossible, and then the question was corrected and changed back to the correct question, where it was voted 13 to 4 substantial evidence, the tampering of the question was thrown in my face as if they had to give us a lower threshold. In other words, somebody at the FDA bastardized the correct question, it was changed back to the correct question during the vote as the panel was having trouble answering "absolute efficacy", and then it was used against Provenge that the wrong question was originally used.
The whole process was a sham. The FDA admitted it does not have the money to keep up with the new science. Immunotherapy is new science. The Advisory Committee was assembled at a cost of hundreds of thousands of dollars, to help the corrupt FDA decide the fate of Provenge. The Panel spoke and the FDA did whatever it wanted to with no transparency. We are still waiting for them to turn over other Freedom of Information documents, which they are fighting us tooth and nail over. WHAT ARE THEY HIDING?
There were also many undisclosed conflicts of interest by the two naysayers, Drs. Hussain and Scher. No matter how many thousands of letters we wrote, and we did write thousands, "the fix was in" and Wall Street had their way with the lives of the men.
Where are the cancer advocacy groups? SILENT! More money for research, shaking a cup in your face everywhere, yet here is a treatment, ready, willing and able to be brought into use, and the big mouths have lost their voices. Trust me folks, it ain't about curing cancer, it is about keeping the cash cow giving milk.
Maha Hussain and Howard Scher, two of the naysayers, allowed the FDA to leak letters to The Cancer Letter, another highly illegal act imo, to derail Provenge. It was used as the excuse for the delay. None of the doctors who voted for approval knew they were allowed to leak letters to an outside source, coincidentally the same source that ended up tipping off Sam Waksal and Martha Stewart, after the FDA's Richard Pazdur, once again, derailed the Imclone approval, which was approved not too much later, and Wall Street was allowed to profit handsomely on shorting Imclone knowing it would be delayed and then the cleaning up after they went long for its approval.
It's a great job if you can get it. Dr. Sam Waksal, who helped bring Imclone to market, is still rotting in jail for panic selling his Imclone stock when he got the tip off, and Martha served some time for obstructing justice, and Wall Street got a few more McMansions in the Hamptons, and lamborginis to buzz the beach.
The good news in this morning rant, is that we have Kerry Donahue. Men like Kerry and Patrick Byrne and Mark Mitchell, and David Patch, and many more unnamed heroes. People who will stand up and be counted and fight for what is right. Why can't we get people like these elected to office.
I was watching CNN last night and they had Ed Rollins on and he was speaking about Ted Stevens of the Senate getting caught with his hand in the cookie jar. I swear I heard Ed say, Ted should have just told the lobbyists he needed money and there would have been bags of cash left on his doorstep.
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Sen. Ted Stevens of Alaska indicted over gifts from lobbyist
WASHINGTON - Sen. Ted Stevens, the nation's longest-serving Republican senator and a major figure in Alaska politics since before statehood, was indicted yesterday on seven felony counts of concealing more than a quarter of a million dollars in house renovations and gifts from a powerful oil contractor that lobbied him for government aid.
The indictment further damages Republican prospects in the November election, as Senate Democrats, who now hold a 51-49 majority, try to capture a filibuster-proof 60-vote majority.
Stevens faces both Democratic and Republican challengers who are trying to capitalize on his legal woes.
The Justice Department accused Stevens of accepting expensive work on his home in Girdwood, Alaska, a ski resort outside Anchorage, from oil services contractor VECO Corp. and its executives. VECO normally builds oil processing equipment and pipelines, but its employees helped do the work on Stevens' home.
Prosecutors said that work included a new first floor, garage, wraparound deck, plumbing and electrical wiring. Stevens also is accused of accepting from VECO a Viking gas grill, furniture and tools, and of failing to report swapping an old Ford for a new Land Rover to be driven by one of his children.
From May 1999 to last August, prosecutors said, the senator concealed "his continuing receipt of hundreds of thousands of dollars worth of things of value from a private corporation." If convicted, Stevens could face up to 5 years in prison for each of the seven counts, although cases like this often result in lighter penalties.
Stevens said in a statement: "I have proudly served this nation and Alaska for over 50 years. My public service began when I served in World War II. It saddens me to learn that these charges have been brought against me. I have never knowingly submitted a false disclosure form required by law as a U.S. senator."
He said that in line with Senate GOP rules he was temporarily giving up the ranking positions his seniority has given him. If the Republicans were to take over the Senate, the party's most-senior senator would be in line to become president pro tempore, a mostly symbolic title but one that would make him third in line for the presidency after the vice president and speaker of the House.
Stevens was expected to turn himself in, prosecutors said. The case was assigned to U.S. District Judge Emmet G. Sullivan, who was appointed by President Bill Clinton, a Democrat.
http://www.newsday.com/news/printedition/nation/ny-usstev305782304jul30,0,5805275.story
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From The Great Gatsby by F Scott Fitzgerald, "They're a rotten bunch," Nick shouts to Gatsby. "You're worth the whole damn bunch put together."
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Kerry put a post on the IV dndn board last night. (below)
http://www.investorvillage.com/smbd.asp?mb=971&mn=207986&pt=msg&mid=5299574
"More tomorrow
Judge Zouhary asked FDA Counsel whether he agreed with the Trudeau case that said agency action does not need to be final for a Court to review it (have jurisdiction).
That is a reference to Trudeau v. Federal Trade Com'n. 456 F.3d 178, 184, 372 U.S.App.D.C. 335, 341 (C.A.D.C.,2006) which was referenced in CareToLive’s brief and which stated:
In Reliable Automatic Sprinkler Co. v. Consumer Prod. Safety Comm'n, however, we made clear that, where “judicial review is sought under the APA rather than a particular statute prescribing judicial review, the requirement of final agency action is not jurisdictional.” 324 F.3d 726, 731 (D.C.Cir.2003) (emphasis added). And in a case decided just last month, we followed Reliable, reaffirming that the APA's final agency action requirement is not jurisdictional. See Center for Auto Safety v. NHTSA, 452 F.3d 798, 805 (D.C.Cir.2006) (citing Reliable, 324 F.3d. at 731).
The lower Court case was dismissed on the basis of a 12(b)(1) motion which ruled that the Court lacked jurisdiction to review the matter. One of the arguments in Appellant CareToLive’s brief, was that the final agency action requirement of the APA was not jurisdictional which would change and invalidate the method used by the lower Court to evaluate the jurisdiction issue.
I believe it went well today and will report more tomorrow. Please understand that while the oral argument is limited in duration the preparation is considerable because you have to prepare for every question you might get. The presentation is more question and answers by the Judges then it is speech. Also please understand that prior to the argument that the Judges have reviewed Appellant’s final brief, Appellee’s final brief, and Appellant’s reply brief. They also have access to most of the lower court record to the degree they care to review it. Oral argument is not a time to restate all the previous arguments rather it is more of a time to try to highlight important points of your arguments and answer the Judges questions.
I went in with the goal to highlight the need for the FDA to have greater transparency and accountability particularly with regards to the patients it is sworn to help. If the FDA continues to operate without any affective oversight, as it has been doing, it will only be emboldened to deny other applications the fair and timely due process it owed, yet denied, this very important BLA. I stressed the FDA’s apparent uncaring and unresponsive attitude toward patients.
http://www.fda.gov/oc/opacom/fda101/sld001.html
Stated most simply, FDA's mission is:
- to promote and protect the public health by helping safe and effective products reach the market in a timely way,
Judge Gilman did ask FDA Counsel why the FDA ignored its advisory committee and expressed concern for the untimeliness of FDA action.
I also argued that the decision was suffiently final for review for several reasons and that it was clearly final for 30,000 men so far, including CareToLive members John Fish, Stephen Study and Richard Ripp.
More tomorrow when I am reenergized……"
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Mark Mitchell wrote a post clearing the record, on the IV OSTK board last night, after convicted felon Sam Antar, of Crazy Eddie infamy, smeared him in one of his Overstock stalking blogs.
http://www.investorvillage.com/smbd.asp?mb=3532&mn=22231&pt=msg&mid=5300455
"Hi folks.
Don't pity me. There's some glory in this. I get to tell my friends that "I got slimed by that guy from Crazy Eddie appliances."
But do pity the people whose companies and savings have been destroyed by these creeps.
For the record, I wasn't escorted out of CJR. I wasn't frog-marched. I wasn't fired. I wasn't asked to resign. Sam Antar lied. He does that sometimes. It's his way of saying that our reporting is right.
All the best,
Mark Mitchell"
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Stop by Alexis Glick's Blog where she interviews Patrick Byrne. There are now 44 comments.
http://glickreport.blogs.foxbusiness.com/2008/07/29/the-sec-and-naked-shorting/
Here's a comment by David Patch
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The Easter Bunny's 8 Rules for Hedge Fund Managers
23 Commments
http://www.thesanitycheck.com/BobsSanityCheckBlog/tabid/56/EntryID/704/Default.aspx
A Survival Guide For Persecuted (or Prosecuted) Hedge Fund Managers
So many bad examples have abounded in the hedge fund game of late, that I felt it was only fair to give a step by step primer for multi-billionaire hedge fund managers who are facing long odds, or for whom cuffs and bars seem the most likely vacation accessories in the near future. Use it in good health. Results may vary depending upon jurisdiction and prosecutor.
1) Start a foundation. Prostate Cancer is good, although Milken beat you to the punch on that one. More obscure ones can create a helpful smokescreen – but be careful to find something sympathetic. Shingles, scabies, psoriasis, elephantitis, priapism, all could use more time and attention, but they don’t create a lot of warmth and empathy. Stick to the terminal conditions affecting the majority, and you can’t go too wrong. If you want to get more creative, you can move to the obscure but deadly or disabling – Flesh Eating Bacteria, Bird Flu, Spinal Meningitis, Diverticulitis…sky’s the limit. But make sure you at least know how to spell it, and claim to have had years of interest in whatever it is you're now crusading for, or against.
You could also do a Milken, and embrace inner-city youths or handicapped children or battered women as a tangential play. Don’t worry if you’ve never met or been near any before – he sure as hell hadn’t, and that didn’t stop the love.
2) Declare yourself to be a victim. Blame all the evil rumors and persecution on jealous competitors, regulators searching for a scapegoat, malcontents looking to bring down a guy who made it to the top on his own steam, CEOs trying to deflect deserved criticism, etc. Carefully avoid discussion of how you could earn 40% or greater yields year in and year out without running a mafia or trafficking in heroin. Broad strokes here will serve you best.
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I wonder how many were in cahoots with the hedge funds. Bankruptcy means never having to pay any taxes on your gains. *slap*
Billion-dollar bankruptcies highest since 2003
http://www.reuters.com/article/ousiv/idUSN2935365120080729
Excerpts
By Emily Chasan
NEW YORK (Reuters) - Billion-dollar bankruptcies are at their highest in five years only half way through 2008, according to bankruptcy filing tracker BankruptcyData.com.
A total of seven U.S. companies with more than a billion dollars in assets have filed for bankruptcy protection so far this year, it said.
.....
"We seem to be in the midst of a 'perfect storm' leading to more bankruptcies: high levels of debt, high energy and raw materials costs and weakness in the U.S. economy," George Putnam, III of New Generation Research, which publishes BankruptcyData.com said in a statement.
He forecast bankruptcies could peak as early as the middle of 2009 or continue rising well into 2010.
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http://antisocialmedia.net/?page_id=87
"But it’s a fun game and it’s a lucrative game. You can move it up and then fade it. That often creates a very negative feel. So let’s say you take a longer-term view intraday and you say, “Listen, I’m gonna boost the futures, and then when the real sellers comes in, when the real market comes in they’re gonna knock it down and it’s gonna create a negative view.”
That’s a strategy very worth doing when you’re evaluating on a day-to-day basis. I would encourage anyone who’s in a hedge fund to do it, because it’s legal."
.....
You can’t create yourself an impression that a stock’s down. But you do it anyway ‘cause the SEC doesn’t understand it. That’s the only sense that I would say this is illegal. But a hedge fund that’s not up a lot really has to do a lot now to save itself.
Jim Cramer
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http://cityroom.blogs.nytimes.com/2008/07/29/paterson-warns-of-economic-crisis/index.html?hp
Paterson Warns of Economic Crisis
Updated, 7:12 p.m. | In a rare, brief televised address, Gov. David A. Patersonannounced on Tuesday afternoon that he would call the Legislature into an emergency session on Aug. 19 to address what he called an economic and budget crisis confronting New York State as a result of plummeting revenues and rising costs.
“When I travel across the state, I see communities suffering,” Mr. Paterson said in his address, from the Red Room of the State Capitol in Albany. “Everywhere I go, I meet people who are losing their jobs and their homes. I meet families who are forced to pay more for gasoline and for food while their paychecks stay the same. Next winter, some of these families will have to choose between heating their homes and feeding their children. The rising cost of health care means that they cannot afford to get sick.”
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Bottomline:
I am of the opinion that we have all been the victims of the largest robbery in Human history. Computer technology allowed for the creation of electronic counterfeiting that allowed for the nearly unlimited pillaging of every form of financial instrument used in America and in much of the world. Pensions, Retirement funds, 401Ks, Money Market Funds (Government or Municipal) all gone. It’s not an “if” thing,… it is an “already happened” thing.
Now the Banking system will do its best to “control” the news, and who gets the blame, by leading the investigation of the crime that they were very much involved in and profited from.
Things are going to get much worse than I ever feared.
There is enough recent news below and some background to help us all understand much more about what happened and what is to come
http://www.freedomsphoenix.com/Feature-Article.htm?InfoNo=036120
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You Lie and I'll Swear To It
http://ftalphaville.ft.com/blog/2008/07/21/14639/markit-dtcc-team-up-to-take-over-the-world/
MARKIT and DTCC teaming up.Some are speculating this was done to try and get a handle on all of the FTD's that are out there.
Here is the Financial Times take on it:
--==--==--==
Markit, DTCC team up to take over the worldOr at least, the world of electronic trade processing.
The announcement hit inboxes this morning, although there’d been a whiff of a deal in the making for weeks. Two identical press releases, one each from Markit and the Depositary Trust & Clearing Corp: DTCC AND
MARKIT TO FORM STRATEGIC OTC DERIVATIVES PARTNERSHIP.
(ALL CAPS MEANS IT’S REALLY IMPORTANT.)
Translation: the two firms are starting a joint venture to confirm and settle electronically trades in the markets for credit, equity, interest rate and commodity derivatives.
“We’re tidying up the infrastructure [of OTC derivative trades],” Markit’s executive vice president Jeff Gooch said a press conference this morning. “We’re taking people who are on paper and making them electronic.'’
The market for such OTC derivatives is worth about $5,960bn, according to the Bank for International Settlements, and it’s growing at a rapid clip.
And there’s also room for growth in terms of electronic processing. As many as 80 per cent of trades in the equity derivatives market are processed as faxes between counterparties, Gooch said, while in the interest rate market, the figure is around 50 per cent.
The new venture - as yet unnamed - will be jointly owned by the two companies, with Gooch at the helm. The joint venture will also not include either Markit’s data and valuation services or DTCC’s trade information warehouse.
http://www.investorvillage.com/smbd.asp?mb=3532&mn=22323&pt=msg&mid=5309225
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Crooks Running The Stock Market. There is no other way to describe it.
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Part 1 — Naked Shorts — $75,000 For Cracking the Wall Street Cover-up
by RoryKearney | July 11, 2008 at 07:13 am | 3997 views | 33 comments
http://www.nowpublic.com/world/naked-shorts-75-000-cracking-wall-street-coverPart 2 — Naked Shorts — $75,000 For Cracking the Wall Street Cover-up
by RoryKearney | July 18, 2008 at 08:43 am | 394 views | 1 comment
What is NowPublic?
NowPublic lets people work together to cover news events around the world.
Comment by Dave
Jul 29th, 2008 at 9:23 pm
Alexis,
I have spent 8-years trying to expose this issue and it has taken the most recent collapse of Bear Stearns and a professional such as yourself to accurately cover what this is really about. Few of your TV peers have provided such fair and balanced coverage. Thank-you.
Now ask yourself, what is it that the short sellers are complaining about with the pre-borrow rule.
Answer: Only the rapid trading short seller, the day trading raider, cares about this rule change. A David Einhorn going short Lehman for 6 months could care less whether he borrows for delivery pre-trade or T+3 because his investment is not about short term. The added cost to him is 2 extra days of a borrow fee in a long term investment.
The rapid short trader wants to trade by computer program, fabricate a locate, and cover within the settlement period. The trade never had an intended cost of a borrow factored into the trade and thus, the day trader is using a naked short as part of a trading strategy. By not removing the share in a pre-borrow the short trader can cycle the short sale once, twice, three times in a single day using the same locate every time and using the rapid trading to create panic. Never does this investor borrow or settle a trade – the DTCC CNS system is blind to this activity because the trader is net flat.
This is what Richard Baker and the MFA is fighting to protect and the SEC considering protecting.
What the SEC has claimed is that they have not yet seen naked shorting as the issue with the financial stocks but that is ONLY because the trades never appear as a naked short because the trade (raid) is closed within the settlement window. This can be explained in the 90% drop in short sales in these 19 stocks. A long investor short seller was impacted by this rule change so why the 90% drop in short sales other than day trade – rapid trade short sales being impacted.
Emphasis must be on why the short sellers and the MFA are so opposed to settling trades. Logically, consider that when a buyer purchases shares the money is instantly removed from the account – no room for collected interest in the settlement period. In a day trade it is additionally removed immediately and inaccessible thereafter for that day. Why should the short seller not be exposed to similar restrictions?
Dave Patch
http://www.investigatethesec.com