Blackrock: Being on both ends of a scam

The Federal Reserve on Tuesday hired BlackRock Inc. to steer tens of billions of dollars in bond purchases. Again.

The details of the arrangement, including how much BlackRock will be paid for its services, have not yet been released. But it promises to be a lucrative venture for the firm, which could also be in a position to profit from the advice it gives.

Under one of the programs that BlackRock will help lead, the Fed can buy exchange-traded funds that hold stakes in investment-grade bonds, a type of investment that BlackRock sells.

BlackRock found itself in a similar situation during the last crisis. After Bear Stearns and American International Group collapsed, the New York Federal Reserve retained BlackRock to help oversee billions of dollars in ailing assets that had belonged to them. The firm helped price and sell those assets for the government at the same time it was helping private clients buy similar assets.
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The Fed has not yet posted a copy of the contract it signed with BlackRock, though it plans to disclose more details. The central bank was slow to disclose the specific terms of its agreement with BlackRock during the last crisis, and even today the full details of what the firm earned have not been disclosed.

OK. That's bad, but the truth is actually worse.
Let's start with AIG.

For several months, BlackRock would have two teams working inside A.I.G.—one working for the company’s management, the other for the Fed.

AIG was just one of the first in a massive number of contracts.

The waterfall of government contracts attracted attention almost immediately. But when asked by members of Congress to explain what BlackRock was being paid and why it was selected without any competitive bidding, Fed officials, and Geithner in particular, revealed virtually nothing

What remained consistent was conflicts of interest.

As both the New York Times and the Wall Street Journal reported on Tuesday, BlackRock execs are now directing key elements of the government program at a time when they stand to reap great profits from the fallout of a problem they helped create...
Leading the pack of vulture capitalists profiting from the misery they inspired is the Private National Acceptance Co. (PennyMac), which BlackRock bankrolled. Stanford L. Kurland, chairman and CEO of PennyMac, is the former president of Countrywide Financial. A New York Times story in March, headlined “Ex-Leaders of Countrywide Profit From Bad Loans,” noted that Kurland’s new outfit was profiting from the misery it had helped cause: “After all, the banking behemoth (Countrywide) made risky loans to tens of thousands of Americans, helping set off a chain of events that has the economy staggering.”
...As the Times observed, “Countrywide has become synonymous with the excesses that led to the housing bubble.” Now Kurland’s new company specializes in buying back those forfeited and at-risk properties for pennies on the dollar and making money off new loans and sales.

So that was 2008-2009.
Surely they don't do these criminal deals anymore, right?

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German investigators raided the offices of finance giant BlackRock on Tuesday, several media outlets reported.
The raid is part of the country's biggest post-war fraud investigation, known as the cum-ex scandal.

What is the cum-ex scandal? The scandal came to light in 2016 when it emerged that several German banks had exploited a legal loophole which allowed two parties simultaneously to claim ownership of the same shares. This contrived "dual ownership" allowed both parties to then claim tax rebates even though both were not entitled to it. The scandal cost taxpayers billions of euros.

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snoopydawg's picture

The Fed has not yet posted a copy of the contract it signed with BlackRock, though it plans to disclose more details.

which states that a FOIA for details on who Mnuchin decides who gets the money has been exempted by congress. They learned their lesson after the last bailout when people found out that WS had received $29 trillion. That blackrock is involved in this current bailout should worry people. But since the media won't cover it they won't know about it or how bad it is. Thanks congress for shielding the banks from our scrutiny. So far very few of them have been infected......I'll stop here.

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America is a pathetic nation; a fascist state fueled by the greed, malice, and stupidity of her own people.
- strife delivery

Situational Lefty's picture

in your message.

Thanks for communicating it with us simple folk.

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4 users have voted.

The United States of America is the birthplace of Martin Luther King Jr., Harriet Tubman, Cesar Chavez and Emma Lazarus.

Lookout's picture

Shock Doctrine in action. That giant flushing sound is the remaining wealth of the US flowing to the 0.01%.

Prepare for negative interest, it is just a matter of time now.

Thanks for the corruption update gjohn!

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11 users have voted.

“Until justice rolls down like water and righteousness like a mighty stream.”

ggersh's picture

https://dailyreckoning.com/go-big-or-go-home/

Here's a little snippet

Then there’s the most massive asset bubble of all, real estate. Millions of properties delusional owners still think are worth $1.4 million will soon revert to a more reality-based valuation around $400,000, or perhaps even less, meaning $1 million per property will melt into air.

Once the market value of global assets falls by $100 trillion, the world is insolvent.

Everyone expecting the financial markets to magically return to January 2020 levels once the pandemic dies down is delusional. All the dominoes of crashing market valuations, crashing incomes, crashing profits and soaring defaults will take down all the fantasy-based valuations of bubblicious assets:

Stocks, bonds, real estate, bat guano, you name it.

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9 users have voted.

tRump amerika's last president

Prez tRumpet blows hard, nothing comes out

#J6PBailoutreadyyet?

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