The
con of the decade (Part I) involves the transfer of private debt to the
public (the marks), who then pays interest forever to the con artists.

I’ve laid out the Con of the Decade (Part I) in
outline form:

1. Enable trillions of dollars in mortgages guaranteed to
default by packaging
unlimited quantities of them into mortgage-backed securities (MBS),
creating umlimited
demand for fraudulently originated loans.

2. Sell these MBS as "safe" to credulous investors,
institutions, town councils
in Norway, etc., i.e. "the bezzle" on a global scale.

3. Make huge "side bets" against these doomed mortgages
so when they default then
the short-side bets generate billions in profits.

4. Leverage each $1 of actual capital into $100 of
high-risk bets.

5. Hide the utterly fraudulent bets offshore and/or
off-balance sheet
(not that the regulators you had muzzled would have noticed anyway).

6. When the longside bets go bad, transfer hundreds of
billions of dollars in
Federal guarantees, bailouts and backstops into the private hands which
made the risky bets, either
via direct payments or via proxies like AIG. Enable these private Power
Elites to
borrow hundreds of billions more from the Treasury/Fed
at zero interest.

7. Deposit these funds at the Federal Reserve, where they
earn
3-4%. Reap billions in guaranteed income by borrowing Federal money for
free and
getting paid interest by the Fed.

8. As profits pile up, start buying boatloads of
short-term U.S. Treasuries. Now
the taxpayers who absorbed the trillions in private losses and who
transferred trillions in subsidies, backstops, guarantees, bailouts and
loans to private banks and corporations, are now paying interest on the
Treasuries
their own money purchased for the banks/corporations.

9. Slowly acquire trillions of dollars in Treasuries–not
difficult to do as the
Federal government is borrowing $1.5 trillion a year.

10. Stop buying Treasuries and dump a boatload onto the
market, forcing interest
rates to rise as supply of new T-Bills exceeds demand (at least
temporarily).
Repeat as necessary to double and then triple interest rates paid on
Treasuries.

11. Buy hundreds of billions in long-term Treasuries at
high rates of interest.
As interest rates rise, interest payments dwarf all other Federal
spending,
forcing extreme cuts in all other government spending.

12. Enjoy the hundreds of billions of dollars in interest
payments being paid by
taxpayers on Treasuries that were purchased with their money but which
are
safely in private hands.

Since the Federal government could potentially inflate
away these trillions in
Treasuries, buy enough elected officials to force austerity so inflation
remains
tame. In essence, these private banks and corporations now own the
revenue
stream of the Federal government and its taxpayers. Neat con, and
the marks
will never understand how "saving our financial system" led to their
servitude
to the very interests they bailed out.

The circle is now complete: in "saving our
financial system,"
the public borrowed trillions and transferred
the money to private Power Elites, who then buy the public debt with the
money swindled out of
the taxpayer. Then the taxpayers transfer more wealth every year to the
Power Elites/Plutocracy in the form of interest on the Treasury debt.
The Power Elites
will own the debt that was taken on to bail them out of bad private
bets: this is
the culmination of privatized gains, socialized risk.

In effect, it’s a Third World/colonial scam on a
gigantic scale: plunder the public treasury,
then buy the debt which was borrowed and transferred to your pockets.
You are buying
the country with money you borrowed from its taxpayers. No despot could
do better.