NO QUARTER FOR CORRUPTION (Focussing on The Fed./FRBS)

[Telephonics]

The Circle of Greed: The Only Bull in this Stock Market is a Cash Cow
By Mark Faulk
Jan. 17, 2006


Hedge funds and brokerage firms. It's a match made in Wall Street Heaven. Brokerage firms make their money not by representing their clients, the average investor. They make their money by trading stock. It's that simple. And no one trades more stock that the hedge funds. Between the two of them, they have created some of the wealthiest individuals in America, lining their own pockets with outrageous salaries, unbelievable commissions, and massive bonuses that most Americans can only dream about. And they do it in a stock market where the average investor is still struggling to recoup even a fraction of the losses sustained in the market meltdown of 2000.


They do it by selling stock. It doesn't even matter whether that stock is real or imagined, just as long as the shares keep flowing. It doesn't matter whether the shares are delivered or not, just as long as the "customer" keeps paying the commissions for the shares that flow in a neverending stream from one hand to another. Counterfeit or real, as long as the brokerage firms collect their fees, they'll continue to buy and sell, sell and buy.


In a New York Times article last Thursday, they announced the yearly bonuses doled out by Wall Street by opening with the sentence, "Ferrari dealers, get ready. Wall Street bonuses are in and they are big." It wasn't an exaggeration. According the Times article, "Those bonuses were driven by record profits at many of Wall Street's major investment banks, including Goldman Sachs, Bear Stearns and Lehman Brothers."


Record profits on Wall Street. So what drove those profits? Did Wall Street deliver record returns to their clients to go along with those record profits? Isn't that the job of the brokerage firms, to make money for the millions upon millions of investors that they represent? So it stands to reason that investors across America shared in the banner year that lined the pockets of Wall Street, that gave literally thousands of Wall Street executives bonuses of well over a million dollars each.


Not so fast. According to the same article, "the bulk of Wall Street's profits continue to come from trading," and Alan Johnson, managing director of compensation consulting firm Johnson Associates, put it more bluntly, "The trading business, which drives Wall Street - it's not investment banking - continued to be extremely strong, even though interest rates went the wrong way."


So there you have it. The brokers get rich, not just rich but obscenely rich, by trading stock, and the hedge funds generate nearly half of all trades in the stock market. Real or counterfeit, every trade is money in the bank for both the brokers and the hedge funds. It's criminal, and it's a financial scandal so massive in scope that it's unimaginable that the major media still isn't reporting it, and in fact appear to have duct tape across their collective mouths when it comes to speaking out for the American investor.


Why isn't the media covering this issue? As always, it always comes back to the Circle of Greed, to power, to control, not just the control of our ideology or our politics, but control of something far more important to those at "The Top" - control of the flow of money, specifically the flow of money from the Middle Class to the Ultra Wealthy.


To read the rest of this article, go to: http://www.faulkingtruth.com/Articles/Investing101/1049.html


Mark Faulk is the Editor of The Faulking Truth, and the author of the upcoming book entitled "The Naked Truth," due out in June, 2006. For more information on the book and on the stock market scandal, go to http://www.faulkingtruth.com , and to pre-order your copy, go to http://www.theownersgroupinc.com/cart/