Revolution Blog

caucuses and warehouse receipts: They Don't Count

Published on 2011-12-20
Openly Shafting the Public

Apparently the political powers that be are getting nervous that despite all their constant dissing and ignoring of Congressman Ron Paul, he might just win the Iowa Caucuses next month. But not to worry: in that case, the result wouldn't count, and in fact would serve to "discredit" the Iowa Caucuses. In other words, if the people don't anoint one of the acceptable candidates provided to them by the establishment (Gingrich, Romney, Perry, Bachman, et al) then their wishes are irrelevant. Fox News commentator Chris Wallace makes this announcement, incredible only because of its brazenness, while being interviewed(external link) by Neil Cavuto on 14 December. His justification lies in claiming that the Republican party leadership "doubts that Ron Paul will be the nominee." Eloquent proof, if any were needed, that elections are nothing but an expensive, divisive charade in which the will of the people is meant to be shaped, rather than sampled.

Into the classification of things that don't count, we must add bonded warehouse receipts for Comex gold and silver. In this Barrons story(external link), a new wrinkle is described in the ongoing story of the failure of the MF Global brokerage. Bad enough that Jon Corzine got treated with kid gloves on Capitol Hill, but now we discover that MF Global account holders who owned warehouse receipts for gold and silver slated for delivery are going to recover only 72% of the market value of their bars. The reason is that the liquidation trustee, James Giddens, has elected to lump all assets held by the firm into one big pile, and subject all creditors to the same 28% haircut. In this way secured creditors, such as those who held warehouse receipts for bars in allocated storage, are being treated the same as unsecured creditors.

Funny how the con-mingling of customer accounts with company funds, which has been so much in the spotlight, is now continuing during the liquidation. Even funnier how Giddens’ law firm has done considerable business with J.P. Morgan Chase — one of MF Global’s biggest creditors. You don't have to be a genius to figure out that if the secured creditors owed specific metal bars are given less, unsecured creditors such as JPM will be given more. So far, CME Group, owner of Comex, is refusing to backstop anyone's losses. Future litigation can doubtless be expected, whee!

It's getting to where the breakdown of the supposed rule of law in the Empire is becoming total. Voters who won't be dictated to don't count. And neither do basic property rights.