Standard & Poor's and the Bilderbergers: All Part of the Plan?
by: Ellen Brown, Truthout
WHAT JUST happened in the stock market? Earlier this month, the Dow
Jones Industrial Average rose or fell by at least 400 points for four
straight days, a stock market first.
The worst drop was on Monday, August 8, 2011, when the Dow plunged 624
points. Monday was the first day of trading after US Treasury bonds
were downgraded from AAA to AA+ by Standard & Poor's (S&P).
But the roller coaster actually began on Tuesday, August 2, 2011, the
day after the last-minute deal to raise the US debt ceiling - a deal
that was supposed to avoid the downgrade that happened anyway five
days later. The Dow changed directions for eight consecutive trading
sessions after that, another first.
The volatility was unprecedented, leaving analysts at a loss to
explain it. High-frequency program trading no doubt added to the wild
swings, but why the daily reversals? Why didn't the market head down
and just keep going, as it did in September 2008?
The plunge on August 8, 2011, was the worst since 2008 and the
sixth-largest stock market crash ever. According to Der Spiegel, one
of the most widely read periodicals in Europe:
Many economists have been pointing out that last week's panic
resembled the fear that swept financial markets after the collapse of
US investment bank Lehman Brothers in September 2008.
Then as now, banks stopped lending each other money. Then as now,
banks' cash deposits at the central bank doubled within days.
On Tuesday, August 9, however, the market gained more points from its
low than it lost on Monday. Why? A tug of war seemed to be going on
between two titanic forces, one bent on crashing the market, the other
on propping it up.
The Dubious S&P Downgrade
Many commentators questioned the validity of the downgrade that
threatened to collapse the market. Dean Baker, co-director of the
Center for Economic and Policy Research, said in a statement:
"The Treasury Department revealed that S&P's decision was
initially based on a $2 trillion error in accounting. However, even
after this enormous error was corrected, S&P went ahead with the
downgrade. This suggests that S&P had made the decision to downgrade
independent of the evidence. [Emphasis added.]
Paul Krugman, writing in The New York Times, was also skeptical, stating:
[E]verything I've heard about S&P's demands suggests that it's
talking nonsense about the US fiscal situation. The agency has
suggested that the downgrade depended on the size of agreed deficit
reduction over the next decade, with $4 trillion apparently the magic
number. Yet US solvency depends hardly at all on what happens in the
near or even medium term: an extra trillion in debt adds only a
fraction of a percent of GDP to future interest costs....
In short, S&P is just making stuff up - and after the mortgage
debacle, they really don't have that right.
In an illuminating exposť posted on Firedoglake on August 5, Jane
It's becoming more and more obvious that Standard and Poor's has a
political agenda riding on the notion that the US is at risk of
default on its debt based on some arbitrary limit to the debt-to-GDP
ratio. There is no sound basis for that limit, or for S&P's insistence
on at least a $4 trillion down payment on debt reduction, any more
than there is for the crackpot notion that a non-crazy US can be
forced to default on its debt....
It's time the media and Congress started asking Standard and Poors
what their political agenda is and whom it serves.
Who Drove the S&P Agenda?
Jason Schwarz shed light on this question in an article on Seeking
Alpha titled "The Rise of Financial Terrorism." He wrote:
[A]fter the market close on Friday August 5th, we received word
that S&P CEO Deven Sharma had taken control of the ratings agency and
personally led the push for a US downgrade. There is a lot of evidence
that he has deliberately tried to trash the US economy. Even after
discovering that the S&P debt calculations were off by $2 trillion,
Sharma made the decision to go ahead with the unethical downgrade.
This is a guy who was a key contributor at the 2009 Bilderberg Summit
that organized 120 of the world's richest men and women to push for an
end to the dollar as the global reserve currency.
[T]hrough his writings on "competitive strategy" S&P CEO Sharma
considers the United States the PROBLEM in today's world, operating
with what he implies is an unfair and reckless advantage. The brutal
reality is that for "globalization" to succeed the United States must
be torn asunder ...
Also named by Schwarz as a suspect in the market manipulations was
Michel Barnier, head of European Regulation. Barnier triggered an
alarming 513-point drop in the Dow on August 4, when he blocked the
plan of Hans Hoogervorst, newly appointed chairman of the
International Accounting Standards Board, to save Europe by adopting a
new rule called IFRS 9. The rule would have eliminated mark-to-market
accounting of sovereign debt from European bank balance sheets.
We all should be experts on the dangers of mark-to-market
accounting after observing the US banking crisis of 2008/2009 and the
Great Depression in the 1930s. Mark-to-market was repealed at 8:45 a.m
on April 2, 2009, which finally put a stop to the short term liquidity
crisis and at the same time ushered in a stock market recovery. Banks
no longer had to raise capital as long term stability was brought back
to the system. The exact same scenario would have happened in 2011
Europe under Hoogervorst's plan. Without the threat of failure by
those banks who hold high amounts of euro sovereign debt, investors
would be free to move on from the European crisis and the stock market
could resume its fundamental course.
Schwarz notes that Barnier, like Sharma, was a confirmed attendee at
past Bilderberger conferences. What, then, is the agenda of the
The One World Company
Daniel Estulin, noted expert on the Bilderbergers, describes that
secretive globalist group as "a medium of bringing together financial
institutions which are the world's most powerful and most predatory
financial interests." Writing in June 2011, he said:
Bilderberg isn't a secret society.... It's a meeting of people
who represent a certain ideology.... Not OWG [One World Government]
or NWO [New World Order] as too many people mistakenly believe.
Rather, the ideology is of a ONE WORLD COMPANY LIMITED.
It seems the Bilderbergers are less interested in governing the world
than in owning the world. The "world company" was a term first used at
a Bilderberger meeting in Canada in 1968 by George Ball, US
undersecretary of state for economic affairs and a managing director
of banking giants Lehman Brothers and Kuhn Loeb. The world company was
to be a new form of colonialism, in which global assets would be
acquired by economic rather than military coercion. The company would
extend across national boundaries, aggressively engaging in mergers
and acquisitions until the assets of the world were subsumed under one
privately owned corporation, with nation-states subservient to a
private international central banking system.
The idea behind each and every Bilderberg meeting is to create
what they themselves call THE ARISTOCRACY OF PURPOSE between European
and North American elites on the best way to manage the planet. In
other words, the creation of a global network of giant cartels, more
powerful than any nation on Earth, destined to control the necessities
of life of the rest of humanity.
... This explains what George Ball ... said back in 1968, at a
Bilderberg meeting in Canada: "Where does one find a legitimate base
for the power of corporate management to make decisions that can
profoundly affect the economic life of nations to whose governments
they have only limited responsibility?"
That base of power was found in the private, global banking system.
Estulin goes on:
The problem with today's system is that the world is run by
monetary systems, not by national credit systems.... [Y]ou don't want
a monetary system to run the world. You want sovereign nation-states
to have their own credit systems, which is the system of their
currency.... [T]he possibility of productive, non-inflationary credit
creation by the state, which is firmly stated in the US Constitution,
was excluded by Maastricht [the Treaty of the European Union] as a
method of determining economic and financial policy.
The world company acquires assets by preventing governments from
issuing their own currencies and credit. Money is created instead by
banks as loans at interest. The debts inexorably grow, since more
money is always owed back than was created in the original loans. (For
more on this, see here.) If currencies are not allowed to expand to
meet increased costs and growth, the inevitable result is a wave of
bankruptcies, foreclosures and sales of assets at fire sale prices.
Sales to whom? To the "world company."
Battle of the Titans
If that was the plan behind the market assaults on August 4 and August
8, however, it evidently failed. What turned the market around,
according to Der Spiegel, was the European Central Bank (ECB), which
saved the day by embarking on a program of buying Spanish and Italian
bonds. Sidestepping the Maastricht Treaty, the ECB said it would
engage in the equivalent of "quantitative easing," purchasing bonds
with money created with accounting entries on its books. It had done
this earlier with Greek and Irish sovereign debt, but had resisted
doing it with Spanish and Italian bonds, which were much larger
obligations. On Tuesday, August 16, the ECB announced that it was
engaging in a record $32 billion bond-buying spree in an attempt to
appease the markets and save the eurozone from collapse.
Federal Reserve Chairman Ben Bernanke was also expected to come
through with another round of quantitative easing (QE), but his speech
on August 9 made no mention of QE3. As blogger Jesse Livermore
summarized the market's response:
... [T]he markets sold off rather rapidly as no announcement was
made about QE3.... It wasn't until ... the last 75 min of market
activity [that] the DJIA gained 639 pts to close at a day high of
11,242. That begs the question, where did that injection of capital
come from? The President's Working Group on Financial Markets? Or did
the "policy tools" to promote price stability by any chance include
the next round of Quantitative Easing unannounced?
Was that QE3 Incognito, Ben?
Titanic Battle or Insider Trading?
There could be another explanation for the suspicious downgrade that
was announced despite the fact that the government had just made major
concessions to avoid default and despite the embarrassing revelation
that S&P's figures were off by $2 trillion. On August 12, MSN.Money
reported that the downgrade "wasn't much of a surprise":
Wall Street had heard a rumor early on that the downgrade was
coming. News sites reported the rumor all day.
Unless it was all a huge coincidence, it's likely that someone in
the know leaked the information. The questions are who and whether the
leak led to early insider trading.
The Daily Mail had the story of someone placing an $850 million bet in
the futures market on the prospects of a US debt downgrade:
The latest bet was made on July 21 on trades of 5,370 ten-year
Treasury futures and 3,100 Treasury bond futures, reported ETF Daily
Now, the investor's gamble seems to have paid off after Standard
and Poor's issued a credit rating downgrade from AAA to AA+ last
Whoever it is stands to earn a 1,000 per cent return on their
money, with the expectation that interest rates will be going up after
The Securities Exchange Commission announced on August 8 that it is
investigating the downgrade. According to the Financial Times, the
move is part of a preliminary examination into potential insider
Whatever was going on in the market in the first two weeks of August,
it was unprecedented, unnatural and bears close observation.
Ellen is an attorney and the author of eleven books, including Web of
Debt: The Shocking Truth About Our Money System and How We Can Break
Free. Her websites are webofdebt.com and ellenbrown.com.