fwdATXecon

Econ nerd, regional Fed watcher, inflation truther, commodity-curious, Austinite

[fwdATXecon @fwdATXecon]

@WaqarVick Make Boolean search great again.

[fwdATXecon @fwdATXecon]

For the most part, the DC suburbs aren’t really that wealthy compared to a lot of other areas. What they do have is a high median income, which, yes, are heavily driven by the govt-adjacent contractors, lawyers, lobbyists, etc. But (1) that’s not where the real money is and (2) those people (mostly) pay taxes, especially the professionals. Where the real money is, and either does not pay taxes or affirmatively gets huge tax credits, are largely tech and finance. The people the lobbyists and lawyers work for. They are courtiers. Not the numerous barons and dukes who really live off of the deficit spending while others pay taxes.

[fwdATXecon @fwdATXecon]

@Gil_Topaz Because laws don’t apply to tech companies.

[Everett Stern @EverettStern1]

Dear Secretary Bessent @SecScottBessent,

My name is Everett Stern. In 2010 I was a compliance officer at @HSBC. From a back office in New Castle, Delaware, I watched billions of dollars move to drug cartels, sanctioned regimes, and terrorist organizations. The enemies of the United States. I documented it, I escalated it, and when the bank would not act, I took it to the @FBI, the @CIA, and eventually the @SECGov.

The result was a $1.92 billion settlement. At the time, it was one of the largest in American history. It was also about five weeks of the bank’s profit. Not one banker was charged. Not one went to prison.

I paid a different price. I lost my career, my savings, and my place in the industry I had trained for. I was blacklisted. Every door in American finance closed at once. I slept on a camping cot in a 300 square foot apartment because I could not afford a bed, and I waited tables at @PFChangs to eat. I tell you this not for sympathy, but so you understand that I know exactly what it costs to do the right thing in American finance, and exactly how little the system does in return.

I made that sacrifice because I believed it would change something.

Yesterday, your department fined @BankofAmerica $1.2 billion for failing to report more than $5 billion in suspicious transactions, some of it tied by your own findings to Chinese laundering networks, narcotics, and the southwest border, alongside 475 apparent sanctions violations touching Russia, Iran, and global terrorism. The bank admitted it willfully violated the Bank Secrecy Act.

Fourteen years after HSBC. A bank with “America” in its name. And once again, not one individual charged.

Secretary Bessent, I want to say plainly what I believe you already know. The fines are not working.

A fine is paid by shareholders, absorbed by the balance sheet, and forgotten by the next earnings call. Bank of America reported earnings this morning. Nobody who set the alert thresholds, nobody who decided the 2024 cease and desist could wait, nobody who chose the backlog over the law will lose a single thing they value. Their lives are untouched. That is the entire reason the behavior repeats.

This is money laundering. This is blood money. Money that reaches a cartel buys fentanyl that kills Americans. Money that reaches a terrorist organization buys the next attack. This country has fought a war on drugs and a war on terror for decades, at enormous cost in lives and treasure, and all the while we have allowed the financing to flow through institutions we charter and regulate. Cut off the money and we win. We have never seriously tried.

There is also a question of equal justice that I cannot let go.

Before I walked into the FBI building to report HSBC, I stopped in front of the Great Seal on the wall and read the words engraved beneath it: “Justice is the defense of our liberty.” I believed that. I still want to. But every day in this country, people go to prison for crimes that are nothing next to moving money for the people who want Americans dead. A suit, a title, and a corporate badge should not be a shield from the consequences that apply to everyone else. If a street dealer goes to prison for what he sells, the banker who moved the cartel’s money should be standing next to him.

I also want to raise something that is rarely said in these conversations. Why has no one inside Bank of America come forward the way I did? The answer is that everyone in American banking knows what happened to me, and to the whistleblowers who came after. The last person who spoke up is the only policy anyone believes. That is a culture problem, and it starts with leadership, in the banks and in the agencies that regulate them.

This is not a political issue. It has spanned administrations of both parties. It is a national security issue, and I am asking you to treat it as one.

Three things would change the math overnight.

Refer individuals for criminal prosecution. Not the analyst in the queue. The executives who set the thresholds and chose the risk. One banker in handcuffs would do more than every fine in Treasury’s history combined.

End “too big to jail.” An institution cannot be too big to fail and too big to jail at the same time. If it is the first, it must be held to a higher standard, not a lower one.

And if Bank of America will not act as America’s bank, review its charter. A national charter is a privilege granted on behalf of the American people. It should be conditioned on not moving money for the people trying to kill them.

Secretary Bessent, you said yesterday that these actions send a clear message that even the biggest institutions are not above the law. With respect, the institution was never the problem. The people inside it are above the law, and they know it. Until that changes, I will keep writing letters like this one, and the next bank will keep paying the next fine.

I gave up everything I had to stop this. I am asking you to use the power you have to finish it.

Respectfully,

Everett A. Stern
HSBC Whistleblower
Founder and Intelligence Director, Tactical Rabbit

[fwdATXecon @fwdATXecon]

@riqsz5 Listening to public radio’s Marketplace about the “break the buck” money market / commercial paper event. Somehow, now, I suspect the market would manage to shrug that off.

[fwdATXecon @fwdATXecon]

@alex_verem “We” says the output?

[fwdATXecon @fwdATXecon]

@lyndonbajohnson Painting Westlake with too broad a brush. In the part of WLH I see, my current count is 16-0 on houses with D vs R signs. In 2022, it was 20-14. In 2018, it was 12-10. (I didn’t count in 2020.)

[fwdATXecon @fwdATXecon]

@DavidSKrueger @grok That legal expense figure can’t possibly be right, correct? That would be equivalent to the second biggest law firm revenue run rate by itself, or (conservatively) about 1.6 million billable hours.

[fwdATXecon @fwdATXecon]

@jared_jensen75 When my kids were little, I explained my big law partner (regulatory) job as a combination of a butler and getting permission slips for companies.

[fwdATXecon @fwdATXecon]

Everyone stopped and thought. And then sold their bonds.

[Nick Timiraos @NickTimiraos]

Bessent: "I can't control the bond market. What I can do is try to get people to slow down and think."

"What I meant by 'I am the house' is that I have superior information."

[fwdATXecon @fwdATXecon]

SI will always be sports illustrated to me.

[fwdATXecon @fwdATXecon]

@bobbyfijan Bigger problem than typical, because of Texas Robin Hood transfers.

[fwdATXecon @fwdATXecon]

When I was young, I worked with a partner who would take my draft and say “make this better.” In hindsight, I’m not sure she could have made it better herself. But it was valuable for me in the long run. My experience with AI agents, though is that, after the first try, they are equally likely to make something worse versus better.

[fwdATXecon @fwdATXecon]

Is Anthropic losing more money than any company ever has without having ever turned a profit?

[fwdATXecon @fwdATXecon]

Waiting for the return of the gold standard. Then let’s talk.

[Tobias Maximus @tmaxftw]

Imagine not buying a 150-year chart. What are you waiting for a 15,000-year bottom signal?

[fwdATXecon @fwdATXecon]

@tmaxftw The return of the goldf standard, which covered most of that time.

[fwdATXecon @fwdATXecon]

@BobEUnlimited Do you trust the next decade of BLS CPI calculations?

[fwdATXecon @fwdATXecon]

Oh yeah? I’m authorizing a $400 billion buyback. Take that, Nvidia.

[fwdATXecon @fwdATXecon]

Oh good. Consumer costs are going up, but what’s really important here is that wages are not. I was worried there for a second.

[zerohedge @zerohedge]

LAGARDE: WAGES NOT SHOWING MATERIAL RESPONSE TO ENERGY SHOCK

[zerohedge @zerohedge]

LAGARDE: WAGES NOT SHOWING MATERIAL RESPONSE TO ENERGY SHOCK