If you're like me you watch with wonder and revulsion at the ever-more creative uses of language that the banksters come up with, and this one - as my friend George Ann Hughes of the Byte Show likes to say - is a whopper doozie!

The Unspoken Toxic Secret at the Heat of "Self Securitization"

Now in case you missed it, here it is again:

 "'The numbers for OFIs presented in sections 2 to 4 of this report include all financial assets of Structured Finance Vehicles (SFVs), regardless of who holds the securitised products. However, in a number of jurisdictions, some of these products are returned back onto the balance sheet of the bank that originally provided the asset to be securitised. This so called self-securitisation, or retained securitisation, is defined as those securitisation transactions done solely for the purpose of using the securities created as collateral with the central bank in order to obtain funding, with no intent to sell them to third-party investors. All of the securities issued by the SFV for all tranches are owned by the originating bank and remain on the bank’s balance sheet, so that third-party investors do not own any of the securities issued by the SFV. These assets should not be included in the shadow banking figure, as prudential consolidation rules consider them as banks’ own assets and as such subject to consolidated supervision and capital requirements.

"'...  some of the assets that are currently ‘self-securitised’ by banks may at some point be sold to third parties when financial conditions improve.'

"'Wait a minute: a company is "securitizing" assets.... which it then keeps, but only after it has "obtained funding with a central bank'? What?"

This pithy summary is followed up by two graphs which display the biggest players in the self-securitization game: Australia, Canada, Spain, Italy, the Netherlands...

Anyone noticing a trend here? I mean, besides the indicators of inducements to fraud? and besides the "usual players"? And...uhm... besides the indicators of "vast hidden systems of leverage" and the creation of... oh nevermind. I could go on and on. But there is something else that bothers in the graphs... the conspicuous absense  of the USA, home of the biggest mortgage fraud, credit default swaps, and other "tranches" par excellence, and Germany.

Why Germany?

Well, maybe this is why: some German banks failed in the wake of the housing/mortgage bubble collapse in the USA, and are now suing major US banks for their losses. Why? Because those banks had been sold mortgage based securities which, they allege, the selling institutions knew to be bad paper to begin with (there's that bait-and-switch inducement to fraud again).

But notice another country is missing... Spain. The near catastrophic unemployment in Spain is masking something else, and that is, why are more mortgage defaults not showing up in Spain, given the country's extreme rate of unemployment? Check this out:

The Mystery Behind Spanish Banks' Extend and Pretend Principle

I hope you caught the two very significant paragraphs in this article:

"'The Bank of Spain, the country's central bank, began forcing banks in April to re-evaluate and disclose their refinanced loan books out of concern that some lenders had been taking advantage of relatively loose guidelines to mask the deteriorating creditworthiness of their clients. As Spain's economic slump deepened, the Bank of Spain said at the time, 'Difficulties considered to be temporary in many cases have become structural.'

"Which is the story of the New Normal in a nutshell: temporary issues revealed to be structural, and in fact worsened by ongoing, relentless central bank intervention which prevents the liquidation and cleansing of tens of trillions in bad debt from the global system. What is worse is that alongside that revelation, it is also about to be revealed that, surprise, Spain is not even close to recovery. Which will kill the only thing that matters in that insolvent continent: the latest dose of confidence."

So... in line with the high-octane speculation we indulge in here, let me tender a wild speculation: all of this, all  of it, is deeply and ultimately tied to the systems of finance designed to suck funds into the American black research projects budget, and the mechanism to do it was mortgage fraud. When the domestic (American) market was not enough for the enormous sums required, the methods were extended to "other markets," Europe being at the top of the list, and Europe's two "wonder economies" of the time, Spain and Germany, being at the top of the top.  But as the second Zero Hedge article makes clear, the scam is now being perpetuated by its own deadly inertia, in spite of its apparent failures and in spite of the growing breakdown of confidence in the whole system.

What really remains to be seen, is what is going to happen when all those scammed German banks get together with all those scammed Spanish mortgage holders, and take the whole thing to the next legal level.  My guess is, that they will find that the threads run ultimately back not just to New York, but also to the City of London, because such bubbles are not new, nor foreign business practice, to the elites of either city.

See you on the flip side.

Joseph P. Farrell

Joseph P. Farrell has a doctorate in patristics from the University of Oxford, and pursues research in physics, alternative history and science, and "strange stuff". His book The Giza DeathStar, for which the Giza Community is named, was published in the spring of 2002, and was his first venture into "alternative history and science".


  1. superscot on November 23, 2013 at 6:01 pm

    As the leading export economy in the world’s largest economic bloc (Europe), Germany was, for all intents and purposes, almost singularly instrumental in enforcing a single European currency on its nearest trading partners for one reason – domination of its market. At the very least, Germany was the main proponent. With currency union, Germany used the average value of a basket of weaker currencies (Spain, Italy, Greece, Portugal, France, Belgium, et alia) to hold down the value of its own currency. By doing so it also opened the door for expansion of the European Economic Union (as the Fourth Reich was then known) into Eastern Europe – a move for which among the member states, Germany was the strongest advocate.
    The emerging pattern therefore really seems to be that those in control of those whose consciousness tells them they have created humanity’s most advanced society (which, on balance, to their credit, they may actually have succeeded in doing) forced their currency on their neighbours (albeit with a politically acceptable change in nomenclature from Deutschmark to Euro), increased the credit supply far beyond the level it should ever have been in order to enhance demand for their exports. Thus an unsustainable bubble was created which, they alone ultimately profited from.
    This enabled Germany to take control of the situation in the aftermath by dictating terms to those who required; a) a bailout, or; b) an influx of investment when the bubble burst after the subsequent contraction. At which point, with all the consummate discretion they have learned to exercize since the lessons of the 20th Century, our German benefactors are positioning themselves for further domination by elastic means…
    With all those Reichsmarks, ahem… Euros, being thrown around by German colonialist greedsters buying up whatever they can get their hands on, particularly in light of the total absence of such speculative practices in the sanitised domestic German market, it can be little wonder they ended up buying up few stinky loans.

  2. marcos toledo on November 23, 2013 at 11:17 am

    You have to read the whole articles to get some idea what’s going on snippets only confuse the reader. Bankize anyone this makes load sharks people of honor in comparison I think fraud is the most honest definition of what this is.

  3. DEBRA on November 23, 2013 at 11:09 am

    Today’s video report from Bill Still calls attention to a lawsuit filed against Ben Bernanke and the Federal Reserve private corporation on July 18, 2013 in Missouri district court. Other Bankster “Primary Dealers” like JP Morgan are also listed as Defendants in the suit. Now … the final page of this doc says that the case was dismissed only three weeks ago “for failure to state a cause of action.” I am trying to find out now if the case will be re-filed.

    The suit, whose PDF file I have made available at the link below on my Google drive, essentially alleges that there is a SECRET HIDDEN SYSTEM OF FINANCE — gee where have we heard that before???

    It further alleges that the Fed has illegally withheld profits from the U.S. Treasury to the tune of $7 Trillion. The Fed is required by law to transfer any profit it earns to the Treasury. The suit further argues that the Treasury is entitled, by law, to now sue and collect three times that amount from the Fed. That would add up to $21 TRILLION and would be more than enough to pay off the National Debt. But that’s not all.

    The suit further goes on to explain that the Fed was created and modeled after “European systems” of finance — “Financial Vipers of Venice,” anyone???

    There is a paragraph in this lawsuit that says:

    “The economic structure [of the Fed] was modeled after historic European systems that had benefited various rulers and financiers but left the nations in financial ruin … hence the latest model conceals the perpetrators. The object of the FR [Federal Reserve] system is to embezzle the hidden profit revealed in this suit.”

    Here is Bill Still’s 4-minute video report posted just this morning:

    And here is the link to view this amended complaint filed July 18, 2013 in Missouri district court, Kansas City

    • jedi on November 25, 2013 at 6:34 am

      Its called zionism, and it was designed to destroy nations and those that profited from it..

  4. Frankie Calcutta on November 23, 2013 at 8:22 am

    The cleverness that goes into the western oligarchy’s financial chicanery truly is impressive. I don’t think they are going to get knocked from their perch for some time… maybe not at all. What a party they have provided for us here in America. More champagne on your cornflakes, anyone?

  5. DanaThomas on November 23, 2013 at 7:46 am

    Why don’t we try “discounting” our gas and power bills at the bank – as instruments of debt they should qualify for self-securitization! And with some “back to back” funding scheduled on a “rollover” basis, do a bit of algorithmic trading in “price swap derivatives” and never have to pay another bill again…

    • Joseph P. Farrell on November 23, 2013 at 12:19 pm

      Lol…I love the idea Dana! Why, we could “bundle” our self-securitized debts into tranches, and then sell derivatives on whether or not we default…. sounds like a WONDERFUL idea!

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