Tag Archives: Goldman Sachs

Carbon Derivatives 101

19 Nov

Do not fear, dear reader. You are not about to be subjected to a boring, #JAFA-style lecture.

101 is just my shorthand for “1-on-1”.

Today we are going to compare notes. On the topic of carbon derivatives.

Whose notes?

The SMC University in Switzerland’s recent Working Paper titled, “Carbon Derivatives and their Application within an Australian context”.

And, excerpts from my numerous articles predicting and forewarning that the Green-Labor government’s Clean Energy Future legislation is nothing more, and nothing less, than a banker-designed carbon derivatives scam.

Let’s begin, shall we?

SMC Working Paper (page 8):

Risks involved with carbon markets and carbon-based derivatives are those that are typical to standard derivatives, including price, counterparty, credit, operational, spread, currency and liquidity. Again like any derivative, the value of a carbon derivative is based upon the value of the underlying commodity.

Compare Ticking Time Bomb Hidden In The Carbon Tax (Nov 2011):

[A “security interest in” a carbon unit is, quite simply, a derivative or “security” that is based on the underlying “value” of the carbon “unit”]

And compare Our Bankers’ Casino Royale – “Carbon Permits” Really Means “A Licence To Print” (July 2011):

The “creation of equitable interests”, and “taking security over them”, simply means this.  The carbon permits can be used as the basis for bankers to create other, new financial “securities”.

Carbon derivatives, in other words.

Derivatives (or “securities”) are the toxic, wholly-artificial financial “products” that were at the heart of the GFC.  The same bankster-designed “widgets” that the world’s most famous investor, Warren Buffet, spoke of as “a mega-catastrophic risk”, “financial weapons of mass destruction”, and a “time bomb”.

SMC University Working Paper (page 9):

Questions therefore arise as to how an odourless and colourless emission can be considered a commodity. For example, “…the commodity traded as ‘carbon’ does not actually exist outside of the numbers flashed up on trading screens or the registries held by administrators (Gilbertson & Reyes, 2009, pg. 12).”

Compare Our Bankers’ Casino Royale – “Carbon Permits” Really Means “A Licence To Print” (July 2011):

They are an artificial construct – “an electronic entry” – that is deemed by government decree to be a new “financial product”.

And compare Carbon Permits Do Not Even Exist (Aug 2011):

As I have said all along, the carbon permits will not even be printed on physical paper.

They will be electronic bookkeeping entries.

Electronic digits.  In a computer.

It is yet another similarity with the completely farcical EU system, where over 3 million of these “permits” – which only exist as numbers in a “Registry” computer – were stolen between November 2010 and January 2011…

From our government’s exposure draft Clean Energy Bill 2011, Part 4, Division 2 (emphasis added):

98 How carbon units are to be issued

(1) The Regulator is to issue a carbon unit to a person by making an entry for the unit in a Registry account kept by the person.

(2) An entry for a carbon unit in a Registry account is to consist of the identification number of the unit.

SMC Working Paper (page 9):

With stark disparities in existence, how can countries come to accept as true fact the admissions made by another? Further, if countries have such different approaches, how can companies across nations be asked to trade an underlying commodity that has different measuring techniques!!! As highlighted by one paper, “…this makes putting a price on carbon largely an arbitrary exercise and uncertain as predicting a price of even the most mundane commodity is at best guesswork… (Gilbertson & Reyes, 2009, pg. 13).

Therefore, due to a lack of transparency and lack of a generally accepted approach on quantification and pricing, the primary concern with carbon trading is the ability of carbon derivatives markets to be manipulated.”

Compare Government’s RIS Admits Carbon Emissions “Audits” A Propaganda Exercise (Aug 2011):

… the question still remains – how are they going to measure the “emissions”?

Answer: They are not going to measure them.

They are not even going to audit any but a very few of the very largest “emitters” either.

It is all a hoax.

Just as under the present National Greenhouse and Energy Reporting (NGER) department “system” – one that only came up with 299 companies reporting emissions in their latest Report – the companies “caught” in the system will be asked to “estimate” their own emissions…

Let us take a look at the Government’s Clean Energy Future Regulatory Impact Statement.

It is yet another telling indictment of the total fraud that this carbon pricing scheme scam actually is (emphasis added):

“Under the proposed reporting requirements liable entities will report on their own emissions. As they will also have to acquire (buy) permits to cover these emissions, they will have an incentive to underreport their emissions… It is to be expected that most (intentional) misreporting would result in an underestimation of emissions and less permits being surrendered to Government. This would have implications for the accuracy of national emissions estimates…”

SMC Working Paper (page 9-10):

…one might argue that due to carbon-based derivatives being founded upon carbon emissions and ownership is via computerised notations, it would be difficult to manipulate such a market. In other words, like more typical commodity markets, influence the price of the deliverable up the supply curve.

Whilst that is a feasible argument, it needs to be also remembered that financial-based derivatives, such as treasury notes and bonds, are also based upon computerised systems where such price manipulation still occurs. This was recently noted in 2006, where the U.S. Treasury “…observed instances in which firms appeared to gain a significant degree of control over highly sought after Treasury issues and seemed to use that market power to their advantage (Forbes, 2006).” Hence, if markets can come undone so traumatically after pricing investments which contain apparently measurable levels of risk, difficulties will easily arise in how markets can price a commodity that can hardly be seen!!!

Compare Flash Crash “Had Something To Do With Some Derivatives”, Says Goldman Trader (Aug 2011):

… it is all about preparing the way for international banking’s latest casino – carbon dioxide futures and derivatives trading. A mega-casino with trading via the bankers favourite new toy, HFT (High-Frequency Trading) – advanced computerised platforms directly linked into the stock exchanges and able to execute fully-automated trades in under 10 milliseconds…

The government’s scheme is all about putting in place the necessary laws to allow banksters the legal right to create trillions of new carbon “securities” – that is, new carbon derivatives, and futures “products”.

The kind of “products” that lead to “flash crashes” which can wipe out 98% of the sharemarket value of one of the world’s biggest mining companies in less than 4 minutes.

SMC Working Paper (page 10-11):

 It has been claimed that derivatives were a major contributing factor in the most recent Global Financial Crisis in 2008-2009, whilst also a causative in distorting energy and food market prices during 2007-2008…

Of course there has been much debate about the introduction of the Waxman-Markey Bill, much to the enormous potential it has in creating the next global financial crisis. For instance, according to Friends of the Earth, an independent organisation that aims for the establishment of environmentally sustainable solutions, “…the development of secondary markets involving financial speculators and complex financial products based on the financial derivatives model brings with it a risk that carbon trading will develop into a speculative commodity bubble. This in turn would risk another global financial failure similar to that brought on by the subprime crisis (Clifton, 2009, pg. 32).”

Compare Our “Squeeze Pop” Carbon Bank (May 2011):

And derivatives, well, they’re safe-as-houses too.

After all, the mortgage-backed derivatives market that blew up America is only a tiddling little market.

So there’s clearly no cause for concern about yet another bankster-driven scheme, to blow up a global, air-backed derivatives bubble…

And compare Doing God’s Work – Turnbull An Angel of Death Derivatives (May 2011):

To banksters, insurance companies, and superannuation fund managers, the possibility of your living “longer than expected” is considered a “risk“.

Nice.

And now, thanks to the sick, evil genius of global banksters like Goldman Sachs, this “risk” factor of you and your loved ones living longer than expected can be packaged up into a tradeable commodity.

A ‘death derivative’.

A new artificial “commodity” – exactly like “carbon permits” – that can be used to attract “investors” who want to place bets with despicable scumbag banksters like Goldman Sachs, on how long each securitised “pool” of human beings will live for…

…

Can you imagine just how many elderly (and not so elderly) people will suffer physically in the future, when current record-high electricity prices double?

From The Age, May 22 2011:

One of Australia’s largest home and business electricity suppliers, TRUenergy, has warned that household power bills will double in six years after a carbon price is introduced and uncertainty over its implementation might lead to power shortages.

That would be bad enough for older Australians.  People just like your mum and dad. Your nanna and grandpa.

Imagine the impact on elderly folk in the much-colder Northern Hemisphere, where far more of the world’s total population lives. And where, right now, 44 million (about 1 in 7) Americans already depend on food stamps for survival.  All thanks to the banksters’ GFC.

The effect of our allowing CO2 taxes / emissions trading to be enacted, is now very clear…

Thanks to carbon dioxide derivatives trading, more and more human beings will die earlier and earlier than “investors” in death derivatives have estimated.

Superannuation fund managers, insurance companies, “investors” and speculators will find that they have made the wrong bet on average life expectancies.

Meaning – the banksters will first make a killing on the trade in carbon dioxide derivatives.

And then make another killing on the trade in their new ‘death derivatives’ too.

Compare also, Bankers’ Chief – Carbon Price Is “Essentially Creating A New Market” (July 2011):

The carbon permits can be used as the basis for bankers to create other, new financial “securities”.

Carbon derivatives, in other words. Derivatives (or “securities”) are the toxic financial “products” that were at the heart of the GFC.

And compare most recently, Ticking Time Bomb Hidden In The Carbon Tax (Nov 2011):

Derivatives are a toxic, wholly artificial and unregulated financial product, created and traded en masse by the banks; they are held Off Balance Sheet so that noone really knows anything about their real activities. It was toxic derivatives over mortgages that nearly blew up the world in 2008.

SMC Working Paper (page 11-12):

Today, via the European Climate Exchange (ECX) and cleared through the Intercontinental Exchange (ICE), futures and options contracts are based upon three types of carbon-related units being European Union Allowances (EUAs), Certified Emission Reductions (CERs) and Emission Reduction Units (ERUs).6 Another derivative referred to as the European Carbon Futures (ECFs) contract, again based upon the EUA is traded via the European Energy Exchange (EEX)…

All contracts are standardised in respect to contract terms. Across either exchange, the futures contracts allow the holder the right and obligation to buy or sell 1,000 EUAs at a certain date in the future at a pre-determined price.

Compare what I said in Our Bankers’ Casino Royale -“Carbon Permits” Really Means ” A Licence To Print”, the day after the release of the draft legislation (July 2011):

Now, why have I bold underlined “borrowing“?

And why have I bold underlined “advance auctions of flexible price permits…”?

Because these are the key words from the “banking and borrowing” section. The words that tell you all you need to know.

That this SCAM is nothing whatsoever to do with the global climate.

And that it is 100% about creating a new, global, CO2 derivatives-trading market for the banksters.

The world’s biggest-ever financial cesspool.

Of toxic, intrinsically-worthless, humanity-raping financial “instruments” called derivatives.

Non-existent, digital “widgets”.

That can be borrowed from the future – ie, before these artificial carbon “widgets” are even issued – and leveraged by scum-of-the-earth banksters.

And then, traded by these parasites at multiples of hundreds and thousands of times more than the underlying, artificially-created “value” of the carbon permit.

Furthermore, the “advance auctions of flexible price permits in the fixed price period” proves beyond all shadow of doubt, that I was right.

That this “carbon pricing mechanism” is the bankers’ CPRS by another name. From Day 1.

Why does it prove it?

The advance auctions of flexible price permits “in the fixed price period” means this.

From Day 1, the government is effectively allowing the setting up of a futures trading market, for Australian CO2 permits.

Futures trading of nothing. Before the nothing is even created.

The banksters’ wet dream.

And compare Bankers’ Chief – Carbon Price Is “Essentially Creating A New Market” (July 2011):

The news gets even better for the bankers.

Because the Government’s scheme scam will also set up an “advance auction” system, during the so-called “fixed price period”, where carbon permits valid for the later “flexible price” system can be purchased in advance.

Which is essentially nothing less than a Futures trading system for the bankers and speculators to exploit…

It’s easy to see why the banksters’ are pleased right now.

The Government’s scheme allows them to:

1. Begin creating and trading in carbon “securities” (ie, derivatives of carbon permits) from Day 1.

2. Earn fees and commissions from trade in “freely allocated” permits during the “fixed price” period.

3. Earn fees and commissions from Futures trading in the “advance auctions” of “flexible price” permits during the “fixed price” period.

4. Create other derivatives products on top of the Futures trade in advance auctions of permits.

SMC Working Paper (page 14):

A number of submissions were made to the Australian Competition and Consumer Commission (ACCC), requesting that the permits within the current scheme be included as financial products. Yet counter submissions took a different route, with requests made by the Australian Bankers Association and Australian Financial Markets Association recommending that permits be regarded as commodities. Such arguments were made on the basis “…that traders are relatively uninterested in permits…”

Compare Ticking Time Bomb Hidden In The Carbon Tax (Nov 2011):

The fees and commissions on the straight trading in carbon permits … is peanuts.

The real monster action is in the unlimited, unregulated derivatives market, that sits on top of the basic carbon trading market. Just imagine an inverted pyramid, with the trade in carbon permits at the bottom, pointy end.

What the banks really want – and what this blogger predicted and forewarned of time and again leading up to the release of the draft legislation – is a mechanism that allows them to create and trade carbon derivatives.

In unlimited, unregulated quantities.

And compare I Was Right – Banks Begin Preparing Carbon Derivatives Market (July 2011):

ANZ’s head of energy trading said the value of the derivatives carbon market would dwarf the $10 billion initially raised by the government, according to the AFR.

SMC Working Paper (page 15):

It is therefore interesting to note that the scheme eventually allows freely allocated permits to be traded within the compliance year of issue. Such a statement seems to indicate a profit making opportunity not to dissimilar to the situation within the EU ETS, where power companies generated large profits. In a submission to the House of Commons by Ofgem, the energy and gas regulator in Great Britain stated that between 2008 – 2012, UK power companies could receive windfall profits approximately amounting to £9bn (House of Commons, 2008). Concerns are still being voiced about such astonishing revenues, with the European Commission further indicating that via the accumulation of excess free credits (i.e. freely allocated permits), “…the surplus is estimated to amount to 500 – 800 million allowances with an economic value of around €7bn – €12bn (European Commission, 2011, pg. 2).”

Compare A Disturbance In The Farce (July 2011):

… even the Green-Left Weekly is aware of the disturbance in the farce:

Europe’s biggest polluters have made billions out of the European Emissions Trading System (ETS). But a new briefing by Carbon Trade Watch (CTW) says the scheme will ensure industry will not have to cut its emissions until at least 2017.

The first phase of the ETS ran from 2005 to 2007. It made no dent in emissions. But power companies made about 19 billion euros by charging customers for the “cost” of permits they were given for free.

Manufacturers made about 14 billion euros in windfall profits with the same trick.

The European Commission said the scheme’s problems would be ironed out in the second phase, from 2008 to 2012. It claimed the ETS was working when emissions from the 11,000 polluters covered by the scheme fell by 5% in 2008 and 11.6% in 2009.

But CTW points out the emissions fall was due to the impact of the global recession, which caused a fall of 13.85% in industrial and electricity production in 2009.

In 2010, as the economic crisis eased, emissions shot up again by 3.5%.

The polluters stand to make more money for doing nothing in the ETS’s second phase. By 2012, power companies will make between 23 billion and 71 billion euros from passing on the cost of their free permits.

The third phase of the ETS, which will run from 2013 to 2020, won’t solve the problems. Companies will still be able to use the excess permits given out in the second phase. The World Bank has estimated about 970 million permits will be available.

This means polluters won’t have to cut their own emissions until 2017 — they can just cash in their free permits instead.

SMC Working Paper (page 15-16):

The Way Forward

Within the Australian context, what does this treatment of permits mean for carbon-based derivatives? With permits freely allocated to emitters and with the ability of permits to be price squeezed because they are allocated rather than auctioned, the possibility of carbon-based derivatives to be manipulated increases substantially. Such instances have been witnessed within the EU ETS and are one of the major criticisms levelled against derivatives as a whole (Clifton, 2009; Pirrong, 2009; Wood & Jotzo, 2010; Holly, 2011).

…

The maturity of the carbon market within Australia is still in its infancy and debate will continue about how the country should undertake its approach to CO2 emissions. At this early stage, it would seem that carbon-based derivatives will mainly be used once the fixed-price period begins…

[Compare what I have said countless times – that “our” system enables banksters to begin creating and trading carbon derivatives from Day 1.  Our government has successfully conned the Australian public (and all mainstream commentators) into believing that their scheme is a fixed price “tax” for the first 3 years, and only after three years will trading commence. That is pure deception. While “purchased” permits cannot be traded, “freely allocated” permits can; and far more importantly, banksters are enabled to begin creating derivatives based on the underlying “value” of permits, from Day 1. The SMC Working Paper confirms my warning/prediction, as does the Clean Energy Future legislation itself.]

Globally, even though a mixture of regional policies are currently in existence or are looking to come online, inconsistent methodologies across countries make it difficult for a truly global acceptance of carbon derivatives to take off.

As such, the acceptance and establishment of any true global exchange or global central bank of carbon is some time away. Simply, this retains the odour of trouble, with increased opportunities for manipulation and failure. Whilst volatility and manipulation is in no means isolated to only carbon-based derivatives, “…due to the lack of policy towards the development of an efficient carbon derivatives market and the absence of a standard pricing tool (Leconte & Pagano, 2010, pg. 3),” greater opportunities for manipulation and fraud are present.

Exactly.

Which, as I have long said and demonstrated, is precisely what the true architects of both the Great Global Warming Hoax, and its popularly advocated “solution” (carbon trading), have always wanted.

A new, bigger, rigged, derivatives casino. One that they control. With no regulation, or government oversight.

A galactically-huge speculative financial bubble.

Based on thin air.

Hot, thin air.

Guaranteed to end like this –

Next week, we will take a look at a webinar by the President of the Institute For Agriculture and Trade Policy on Carbon Derivatives: The Next Toxic Asset, where we will see how derivatives have been used by banksters to manipulate markets and drive up the price of other commodities. Especially food … wheat, corn, sugar, soybeans, and more.

And we will again consider the implications of allowing our politicians to allow greed-obsessed banksters to create wholly unregulated derivatives, thus enabling them to manipulate the prices of food (and now, power/energy) worldwide … and ultimately, as a direct result, to make yet another killing on those new ‘Death Derivatives’ they are selling, that we mentioned earlier.

Here’s a teaser –

Click to enlarge | Source: IATP

Click to enlarge | Source: IATP

Click to enlarge | Source: IATP

Click to enlarge |Source: IATP

Tags: , , , , , , , , ,

Ticking Time Bomb Hidden In The Carbon Tax

1 Nov

 

Remember when the world’s 3rd wealthiest man, Warren Buffet, called out the exotic financial product named derivatives as “a mega-catastrophic risk”, “financial weapons of mass destruction”, and a “time bomb”?

Over the next two weeks, our minority Green-Labor government is railroading a set of 19 new laws through the Senate.

They like to call those laws our Clean Energy Future.

And to date, no one in either the political class, or the media – including our “expert” economics media – have called out the ticking time bomb called derivatives that is buried carefully in the 1,000+ pages of our Clean Energy Future.

No one, except your humble blogger.

Here, dear reader, is proof positive that the government’s “carbon pricing mechanism” is not about changing the climate.

Nor is it, as the government claims, to “give effect to Australia’s international obligations on addressing climate change under the Climate Change Convention and the Kyoto Protocol”.

Nor is it to “take action directed towards meeting Australia’s long-term target of reducing net greenhouse gas emissions to 80 per cent below 2000 levels by 2050 and take that action in a flexible and cost-effective way”.

Nor is it to “to put a price on greenhouse gas emissions in a way that encourages investment in clean energy, supports jobs and competitiveness in the economy and supports Australia’s economic growth while reducing pollution.”

How can I be so sure?

Because not one of those claimed “Objects of the mechanism” requires laws that specifically permit bankers to create unlimited quantities of wholly unregulated “financial weapons of mass destruction” called derivatives (or “securities”).

They are completely unnecessary. Moreover, the ongoing GFC turmoil proves that unregulated derivatives markets represent a clear and present danger to our government-propped banking system, and thus are a sovereign risk.

And yet, this is just what our Green-Labor government is doing right now in the Senate.

Carefully buried in their Clean Energy Bill 2011 we find the ticking time bomb (underline added):

109A Registration of equitable interests in relation to a carbon unit

(1) The regulations may make provision for or in relation to the registration in the Registry of equitable interests in relation to carbon units.

(2) Subsection (1) does not apply to an equitable interest that is a security interest within the meaning of the Personal Property Securities Act 2009, and to which that Act applies.

In other words, while the regulations may make provision for registration of equitable interests in a carbon unit, they specifically (subsection 2) do not make provision for registering a “security interest” in a carbon unit.

[A “security interest in” a carbon unit is, quite simply, a derivative or “security” that is based on the underlying “value” of the carbon “unit”]

It is clear then, that the government does not want to record carbon derivatives creation and trading.

They want to permit it. Just not record or regulate it.

Indeed, they wish to ensure “avoidance of doubt” that banks are legally allowed to immediately pull the pin on creating and trading these (wholly unregulated) financial weapons of mass destruction (underline added):

110 Equitable interests in relation to a carbon unit

(1) This Act does not affect:

(a) the creation of; or

(b) any dealings with; or

(c) the enforcement of;

equitable interests in relation to a carbon unit.

(2) Subsection (1) is enacted for the avoidance of doubt.

And just in case you missed the point – and your missing the real point is, in fact, the whole point of their using such opaque language – then the truth is spelled out more clearly elsewhere.

Where?

Way down in the fine print, of course. In the Explanatory Memorandum tacked on to the end of the Bill (underline added):

3.36 The bill does not affect the creation or enforcement of, or any dealings with (including transfers of), equitable interests in carbon units. [Part 4, clause 110] This provision has been included for the avoidance of doubt. In addition, the bill does not prevent the taking of security over carbon units.

Now I ask you, dear reader.

How does the scheme’s granting permission for banks to create a secondary carbon securities trading market (ie, “security over” carbon units) help to reduce CO2 emissions?

Indeed, how does a wholly unmonitored and unregulated shadow banking market in carbon derivatives help to create a single cent in extra government revenue, for the Senator Milne-championed Clean Energy Finance Corporation to pour down the toilet of otherwise commercially unviable “green” energy projects?

Answer: It doesn’t.

The government will never see any of the profits generated by banks from their multi trillion dollar trading in wholly unregulated carbon derivatives.

But you can be certain that they (and we) will hear all about it when the banks’ multi trillion dollar derivatives betting on movements in the market price of thin air blows up too. Because that’s when – just as with the global mortgage derivatives trade that triggered GFC1 – the bankers will (again) come running to government for a bail out.

Did I say “trillions”?

Sure did.

As we have seen previously, according to the RBA our Aussie banking system already holds almost $17 Trillion worth of derivatives.  Most of these are bankers bets on movements in Foreign Exchange Rates and Interest Rates. And these derivatives are all held Off the Balance Sheet:

In just 3 months from December to March, our banks’ exposure to Off-Balance Sheet derivatives “Business” has blown out by a whopping $1.99 Trillion, to a new all-time record total of $16.83 Trillion.  That’s the biggest 3-month increase in our banks’ history.

By comparison, at March 2011 the banks have “only” $2.68 Trillion in On-Balance Sheet Assets. That’s an increase of “only” $19.9 Billion. In the same 3 months, their Off-Balance Sheet derivatives exposure blew out by 100 times that much ($1.99 Trillion)

Click to enlarge

[That’s right. Derivatives are a toxic, wholly artificial and unregulated financial product, created and traded en masse by the banks; they are held Off Balance Sheet so that noone really knows anything about their real activities. It was toxic derivatives over mortgages that nearly blew up the world in 2008.]

We have also seen previously, that our Aussie banking system is not “safe as houses”, as we are led to believe. Instead, it is a huge disaster waiting to happen. Our banks are only staying afloat – and generating ever-increasing salaries and bonuses for bankers – because of the government wholesale funding guarantee introduced in response to the GFC. Indeed, Moodys Ratings agency recently put our government on notice that it will slash our banks’ credit ratings if the government guarantee is withdrawn.

What happens when banks blow up?

The government (ie, the taxpayer) panics, and bails them out. Putting both current and future generations on the hook to pay for it.

What we have with the Clean Energy Future legislation, is a scheme designed by bankers (and their cheer-leading economists).  For the benefit of bankers.

That’s why a scheme that purports to be all about reducing CO2 emissions, has a ticking time bomb called “derivatives” hidden inside.

While ever the scheme lasts, banks will make a killing.

Not just on fees and commissions for their role in buying and selling “permits”.

Oh no, dear reader.

That trade is just the surface of the carbon pricing scam.

The fees and commissions on the straight trading in carbon permits … is peanuts.

The real monster action is in the unlimited, unregulated derivatives market, that sits on top of the basic carbon trading market. Just imagine an inverted pyramid, with the trade in carbon permits at the bottom, pointy end.

What the banks really want – and what this blogger predicted and forewarned of time and again leading up to the release of the draft legislation – is a mechanism that allows them to create and trade carbon derivatives.

In unlimited, unregulated quantities.

And that is exactly what the Greens, and the Labor Party, in cahoots with Tony Windsor, Rob Oakeshott, and Andrew Wilkie, have given the bankers.

In just a couple of little clauses. Carefully worded and buried in 1,000+ pages of bullsh!t legalese, so that noone will find it (or simply not understand it if they do).

If you want to do something practical to stop the bankers, then here’s my suggestion.

Call the Coalition Senators for your state.

Right now.

Tell them that you want them to go into the Senate policy committee hearings next week, and demand that the government explain the following:

(a) WHY their Clean Energy Future legislation specifically includes clauses permitting bankers to create unlimited, unregulated “financial weapons of mass destruction” on the back of the carbon pricing scheme;

(b) HOW their permitting banks to create unlimited, unregulated carbon derivatives will reduce greenhouse gas emissions;

(c) IF the government will guarantee the public that no taxpayer funds will ever be used to bail out a bank/s that gambles in the carbon derivatives casino and later gets into financial difficulty.

[Senators contact information here]

We know that the banks are already gleefully gearing up whole new departments for their new carbon derivatives trading casino.

Indeed, they were publicly bragging about it within a few days of the draft legislation being released:

Australian banks are eyeing opportunities to cash in on the proposed carbon tax by developing new financial products and services that capitalise on a market seen to be worth billions of dollars annually, according to a report by the Australian Financial Review.

Australian financial firms that have experience in European carbon markets, such as Macquarie Group Ltd, Westpac Banking Corp Ltd and ANZ Banking Group Ltd are particularly keen to establish their presence in the Australian market.

The initial three-year fixed carbon tax period from 2012 will serve as time to prepare for the release of ETS permits by 2015, when opportunities will really open up for banks to capitalise on the carbon market.

ANZ’s head of energy trading said the value of the derivatives carbon market would dwarf the $10 billion initially raised by the government, according to the AFR.

What did I say about an inverted pyramid, with money/profit churn from the simple carbon permit trade being only the little pointy bit at the bottom … the thin end of the wedge?

The shadow banking casino in carbon derivatives is the huge bit at the top.

And just like every inverted pyramid, the carbon pricing scheme scam is inherently unstable.

The Green-Labor Clean Energy Future is an epic financial disaster, just waiting to happen.

When it comes to pricing carbon, all you need to remember is two words.

“Bankers”.

“Derivatives”.

Tick.

Tick.

Tick.

Tick.

Tags: , , , , ,

BBC Left Speechless: “In Less Than 12 Months The Savings Of Millions Of People Will Vanish … And Goldman Sachs Rules The World”

28 Sep

Presenter: “Jaws have collectively dropped at what you have just said.”

Stunning.

The simple, honest truth is told, by an independent trader, on BBC News.

So stunning is this, it was even shown last night on Australia’s mainstream news (Channel 10).

“This economic crisis is like a cancer .. if you just wait and wait thinking this is going to go away, just like a cancer it is going to grow and it’s going to be too late. What I would say to everybody is, get prepared. This is not a time right now to, wishful thinking that the government’s going to sort things out; the governments don’t rule the world … Goldman Sachs rules the world.”

Please share with everyone you know.

Such matter-of-fact truth-telling about markets, finance, and banksters, on mainstream TV … is truly historic.

One would expect that independent trader Alessio Rastani will never get a mainstream TV interview again (h/t ZeroHedge):

Tags: , , , , , ,

Flash Crash “Had Something To Do With Some Derivatives” Says Goldman Trader

10 Aug

Rio Tinto "flash crash" - 8 August 2011

You probably missed the following little news item, lost in all the screaming red headlines of recent days.

It has important implications for our understanding of what our so-called Clean Energy Future will really look like, under the government’s carbon pricing scheme scam.

Because as we have previously seen from the details buried in the government’s official website, their “carbon pricing mechanism” is nothing whatsoever to do with “saving the planet”.

Instead, it is all about preparing the way for international banking’s latest casino – carbon dioxide futures and derivatives trading.

A mega-casino with trading via the bankers favourite new toy, HFT (High-Frequency Trading) – advanced computerised platforms directly linked into the stock exchanges and able to execute fully-automated trades in under 10 milliseconds.

From Dow Jones Newswires via The Australian (emphasis added):

Rio Tinto trades under investigation after share crash

Some trades in the Australian listing of Rio Tinto are under investigation after the company’s stock lost nearly 98 per cent in four minutes and briefly dropped to its lowest level since the 1970s, the Australian Securities Exchange said today.

A series of trades between 11:24 and 11:26 AEST are being investigated, the ASX said.

Exchange data shows a series of equity options combinations were traded at $1.43 to $1.91 between 11:24 and 11:26 AEST against a typical price of around $71.00 per share.

A total of $489,981 in shares were shown changing hands at the subdued prices, giving an average price of $1.81 per share.

However, a trader at Goldman Sachs said the stock had not actually reached that level.

“It had something to do with some derivatives and I’m sure it will be unwound later in the day,” said the trader, who didn’t want to be named.

… automated trading programs have been known to cause rapid and short-term fluctuations in the prices of securities or so-called “flash crashes”, which have become an increasingly-noticed feature of financial markets.

Hmmmmm.

“It had something to do with some derivatives…”.

Regular readers may recall my analysis of the government’s newly-announced “carbon pricing” scheme on the day after Carbon Sunday – Our Bankers’ Casino Royale – “Carbon Permits” Really Means “A Licence To Print”.

They may also recall my follow up article only a few days later – I Was Right – Our Banks Begin Preparing Carbon Derivatives Market.

To briefly summarise, this is what we found buried in the government’s new website, regarding derivatives:

The “creation of equitable interests”, and “taking security over them”, simply means this.  The carbon permits can be used as the basis for bankers to create other, new financial “securities”.

Carbon derivatives, in other words.

Derivatives (or “securities”) are the toxic, wholly-artificial financial “products” that were at the heart of the GFC.  The same bankster-designed “widgets” that the world’s most famous investor, Warren Buffet, spoke of as “a mega-catastrophic risk”, “financial weapons of mass destruction”, and a “time bomb”.

You can stop reading this piece right now if you like.

Because from that Table 6 alone, you now have conclusive proof that this is nothing whatsoever to do with the climate.

We also identified that setting up the basis for a carbon futures market is part and parcel of the “mechanism”:

Furthermore, the “advance auctions of flexible price permits in the fixed price period” proves beyond all shadow of doubt, that I was right.

That this “carbon pricing mechanism” is the bankers’ CPRS by another name. From Day 1.

Why does it prove it?

The advance auctions of flexible price permits “in the fixed price period” means this.

From Day 1, the government is effectively allowing the setting up of a futures trading market, for Australian CO2 permits.

Futures trading of nothing. Before the nothing is even created.

Now, one could try to argue that the government’s documentation quoted above and in more detail in my analyses, does not actually use the specific word “derivatives”, or “futures”.

And so, one could try to argue that I have no concrete proof.  That I have simply inferred that “creation of equitable interests” and “taking security over them” means “derivatives”, but if the government has not used those exact words, then I might just be making it all up.

Dear reader, if there is any lingering doubt in your mind that the Green-Labor government is setting up a scheme purposefully-designed to serve as the basis for carbon derivatives and futures trading, then doubt no longer.

Here is the government’s Clean Energy Future Regulatory Impact Statement (RIS): 03-Clean-Energy-Future-RIS

And here is a snippet of what it says on page 75 (emphasis added):

10.3 Advance auctioning of future vintages

In consultations undertaken on this issue for previous proposals, most stakeholders supported the auction of future year vintages as future vintages may be an alternative to the spot market and any associated derivative markets for liable entities seeking to manage future emissions obligations.

…

Advance auctions of future vintages are not required for carbon futures prices to emerge. For example, derivative markets have developed in the European Union Emissions Trading Scheme without advance auctions.

Assessment

The preferred position is that there will be advanced auctions of future vintage permits.

So there you have it.

The government’s scheme is all about putting in place the necessary laws to allow banksters the legal right to create trillions of new carbon “securities” – that is, new carbon derivatives, and futures “products”.

The kind of “products” that lead to “flash crashes” which can wipe out 98% of the sharemarket value of one of the world’s biggest mining companies in less than 4 minutes.

Brilliant, isn’t it?

And do not doubt for a moment, dear reader, just how many carbon dioxide derivatives the bankers can (and will) create.

To give you just a tiny hint of the scale, take a look at the following graph of our Aussie banks’ total Off-Balance Sheet derivatives based on Foreign Exchange and Interest Rate bets (euphemistically called “hedges”, of course), current to end March 2011:

Click to enlarge

That’s $16.83 Trillion in Off-Balance Sheet derivatives “Business” (red line), versus only $2.68 Trillion in On-Balance Sheet “Assets” (blue line) – 2/3rds of which “assets” are actually loans.

According to David Bloom, global head of HSBC Foreign Exchange, our banks are racing towards “a bigger Armageddon” in foreign exchange markets … and they are racing towards it sitting atop that monster red line mountain of derivatives bets.

Try to imagine if you will, just how many derivatives that international (and local) bankers will create on top of the underlying “value” of Australia’s $23 starting price carbon “permits”, from the moment that the Brown-Gillard economic planking platform is rammed through Parliament.

And then, think carefully about the words of that Goldman trader just a couple of days ago, when one of the world’s largest miners almost vapourised off the sharemarket in 4 minutes flat.

“It had something to do with some derivatives”.

Tags: , , , , , ,

Monckton Challenges Absolute Banker

23 Jul

h/t to Andrew Bolt:

Challenge to an absolute banker

The Viscount Monckton of Brenchley, following what the great Alan Jones has described as his “6-0, 6-0, 6-0 victory” over the director of the Australia Institute in a debate about the climate at the National Press Club in Canberra early this week, has today issued the following challenge to Malcolm Turnbull, the former leader of the Liberal/National Coalition, whom his party recycled last year for his naïve belief that “global warming” is some sort of “global crisis” –

Whereas one Malcolm Turnbull, Member of Parliament for Goldman Sachs, self-appointed leader of the Absolute Bankers’ Get-Rich-Quick, Gimme-the-Money, Subsidy-Junkies’, Profiteers’-of-Doom and Rent-Seekers’ Vested-Interest Coalition Against Hard-Working Taxpayers, has this day demonstrated wilful but indubitably profitable ignorance of elementary science by declaring that since all relevant matters of climatology are settled no one should pay any heed to a mere Peer of the Realm who dares to question the imagined (and imaginary) scientific “consensus” to the effect that unless the economies of the West are laid waste and destroyed we are all doomed;

And forasmuch as it is easy to identify the said Turnbull’s aircraft when it arrives at Canberra Airport because when the engines are turned off the whining carries on;

Now therefore I, The Right Honourable Christopher Walter, by the Grace of God and Letters Patent under the Hand and Seal of Her Majesty Queen Elizabeth the Second (whom God preserve) Third Viscount Monckton of Brenchley, do by these presents challenge the said Absolute Banker to a Debate on live television, during which each party shall have the opportunity to state his case and to examine the other’s case, with a view to informing Hard-Working Taxpayers and allowing them to decide for themselves whether the truth is being told by me or by the said Member for Goldman Sachs, upon whom I call to take up this challenge, if he dares.

Given under my sign manual this twenty-second day of July in the Year of our Lord Two Thousand and Eleven,

VISCOUNT MONCKTON OF BRENCHLEY

I’d like to see our lazy, useless, compromised mainstream media challenge The Goldman-churian Candidate on his conflict-of-interest (and possible criminality/treason) vis-a-vis international banksters Goldman Sachs.

Tags: , , , ,

Malcolm Turnbull – The Goldman-churian Candidate?

20 Jul

h/t to @JamesJohnsonCHR for inspiring the title phrase.

Regular readers of this blog will doubtless not all be Twitter users.

And so, many will not have had opportunity to bear witness to the following example of the intransigence of our politicians, when it comes to transparency concerning possible conflicts-of-interest.

In particular, that of Mr Malcolm Turnbull, who I have written of previously with respect to his past associations and their possible bearing on his long and strident advocacy for an Australian emissions trading scheme (and only an emissions trading scheme) –

Compassion For Malcolm – He Just Wants His Balls Back

Malcolm’s Motive: His ETS Lie Unravelled

Doing God’s Work – Turnbull An Angel Of ‘Death Derivatives’

“Turnbull Once Said To Me, ‘You Capitalise On Chaos'”

On Thursday 14th July, prompted by another blog article I published that day “Spread The Word – ‘Untouchable’ Turnbull Is A Goldman-Plated Turd” , the following exchange took place on Twitter between myself and Mr Turnbull, along with interjections from Twitter onlookers.

I’ll not comment with my own views as to what – if any – conclusions might be drawn from Mr Turnbull’s responses, or their implications for the present state of political honesty, transparency, and accountability in our nation.

I will simply leave readers to draw their own conclusions.

If you find it too hard to follow, then skip past this Twitter dialogue to the bottom.

There, you will find a very interesting quote from the Royal Commission into the collapse of HIH, which exonerated Mr Turnbull of any wrongdoing … in rather curious circumstances:

* Click on the bold ” @____ ” titles to view original tweets.


@TurnbullMalcolm –

@nqcowboy_@barnabyisright@getuppr barnabyisright.com is such a courageous website there is nowhere can be found the identity of the author


@BarnabyisRight –

@TurnbullMalcolm Would you care to offer FULL disclosure re Goldman, HIH, FAI, “confidential settlement” Mr Turnbull? @nqcowboy_ #auspol


(Interjection by) @gtwarrior47 –

@TurnbullMalcolm @BarnabyisRight @ Politics is a dirty game Malcom.The goal is to get the labor/green coalition off the treasury bench,


@BarnabyisRight –

@gtwarrior47 Disagree. The goal is to have an honest, open, transparent Parliament, w/out conflicts-of-interest etc @TurnbullMalcolm #auspol


(Interjection by) @makiwa –

@BarnabyisRight Agree. Without full accountability and transparency, we will only have an illusion of change! @gtwarrior47 @turnbullmalcolm


@TurnbullMalcolm –

@BarnabyisRight@nqcowboy_ and who are you? Or are you as cowardly as you are scurilous?


@BarnabyisRight –

@TurnbullMalcolm Not relevant, Mr Turnbull. What is relevant are the facts viz GS, HIH, FAI, ur “confidential settlemnt” @nqcowboy_


(Interjection by) @snowytristan –

@BarnabyisRight @TurnbullMalcolm @nqcowboy_ We would like to to know Malcolm. Sounds like Gillard and her cover-ups.


@TurnbullMalcolm –

@snowytristan @barnabyisright @nqcowboy_ ok whats the question?


@BarnabyisRight –

@TurnbullMalcolm RU willing 2 provide public w/ ALL documentation viz GS/HIH/FAI “confidential settlement”? @snowytristan @nqcowboy_ #auspol


@BarnabyisRight –

@TurnbullMalcolm RU willing 2 publish sworn affidavit that u’ve 0 obligations of any kind 2 GS/their CT interests? @snowytristan @nqcowboy_


@BarnabyisRight –

@TurnbullMalcolm RU willing 2 publish sworn affidavit that u will receive 0 benefit – financ/otherwise – from ETS? @snowytristan @nqcowboy_


@TurnbullMalcolm –

@BarnabyisRight a bit rich from someone who wont reveal his name..but I have no obligations to GS re carbon – only a paranoid wd say I did.


(Interjection by) @KeeptheBshonest –

@TurnbullMalcolm @barnabyisright MT, we understand your frustration you will never be PM of Aust but calling folks Paranoid is a bit rich!!


@TurnbullMalcolm –

@KeeptheBshonest @barnabyisright conspiracy theorists usually are. Especially when they dont have the guts to say who they are.


(Interjection by) @KeeptheBshonest –

@TurnbullMalcolm @barnabyisright No Guts is about you sucking it up and “fully supporting your leader” in the fight for govt old mate, JS


@BarnabyisRight –

@TurnbullMalcolm You are obfuscating Mr Turnbull. Ad hom. is not honest response to the 3 simple Q’s posed, implies guilt. @KeeptheBshonest


@BarnabyisRight –

RU willing to publish sworn affidavit to that effect? @TurnbullMalcolm “..I have no obligations to GS re carbon” #auspol


@BarnabyisRight –

@TurnbullMalcolm RU willing 2 provide public w/ ALL documentation viz GS/HIH/FAI “confidential settlement”? @FixNSWLegal @JamesJohnsonCHR


@BarnabyisRight –

@TurnbullMalcolm RU willing 2 publish sworn affidavit that u, family, assoc’s, will receive 0 benefit – financ/otherwise, from ETS? #auspol


@TurnbullMalcolm –

@BarnabyisRight If you are not prepared to say who you are, then I regret our interesting dialogue will have to come to an end.


@BarnabyisRight –

@TurnbullMalcolm Sir, it appears you are not prepared to openly, directly, & honestly respond to reasonable questions of public record.


(Interjection by) @NOH8ER –

@TurnbullMalcolm That’s not reasonable – what matters is the value of what is said, not who says it, Malcolm. cc.@BarnabyisRight


(Interjection by) @maatilda –

@TurnbullMalcolm This tweep has a large following and if you dont respond you condemn yourself @BarnabyisRight


@BarnabyisRight –

@TurnbullMalcolm As I iterated earlier Mr Turnbull, who I am is irrelevant to the facts. You are the public “servant”. Pls answer direct Q’s


(interjection by) @joneschris79 –

@TurnbullMalcolm @barnabyisright – don’t let it end. Best Aussie twitter 2n and fro ever. Plus…we want the answers.


@NOH8ER –

@KeeptheBshonest @TurnbullMalcolm @barnabyisright I actually wanted MT to be PM but the GS affair is unsettling.


@KeeptheBshonest –

@NOH8ER @turnbullmalcolm @barnabyisright never liked the kid who took his bat & left a game mid way through because a point went against him


@BarnabyisRight –

@KeeptheBshonest Never liked “public servants” who attack the man when asked simple, direct Q’s of national import @NOH8ER @turnbullmalcolm


@KeeptheBshonest –

@BarnabyisRight @noh8er @turnbullmalcolm you keep asking the tough q’s mate, MT lacks ticker, that’s why Libs turfed him out


@BarnabyisRight –

@KeeptheBshonest No, disagree. Think Mr @turnbullmalcolm has lots of ticker. Q’s go to issue of obligation, opportunity, not courage @noh8er


@NOH8ER –

@TurnbullMalcolm I looked forward to you as an alternative to Abbott, then I found out about the Goldman Sachs affair. @BarnabyisRight

Readers may be interested to consider the following excerpt from an article commenting on the HIH-FAI-Goldman-Turnbull affair.

It is noteworthy that Mr Turnbull’s standard defence when this topic is raised, is to point to his exoneration by the HIH Royal Commission.

Perhaps the following may assist readers who are unfamiliar with just how … questionable … the efficacy of our legal system is, in their own reflections on whether or not Mr Turnbull has anything to hide.

From nineMSN ‘Money’, 23 May 2008 (my emphasis added) –

One question [to Mr Turnbull], though, got a very terse response, suggesting it might have made its target a little uncomfortable. It was badly asked, revealing the questioner’s lack of knowledge about the issue. But the question on Turnbull’s expectations as to the timing of the HIH liquidator’s legal action against him (and a number of other respondents involved not with HIH, but the insurer it acquired in 1998, FAI Insurances) earned the questioner a firm lecture.

The royal commission report into the HIH collapse had found no wrong-doing on his part, Turnbull told the questioner. This is true. The HIH liquidator will struggle in a courtroom to make any case against Turnbull.

Turnbull’s answer at the National Press Club, and the predicament in which he finds himself, must be viewed in the context of the fact that the royal commission spent more time examining the deal in contention – HIH’s 1998 takeover of FAI – than any other transaction. For about three months, anyone even remotely connected with the takeover was grilled intensively.

In the end, the royal commissioner Neville Owen became impatient and ordered his counsel assisting to move on. Owen was obliged to find that the acquisition did, in fact, contribute to the collapse of the merged company.

Turnbull’s role as adviser to FAI in its “defence” against HIH was complicated by the fact that he and Goldman Sachs had considered leading a recapitalisation of FAI a few months before HIH launched its bid, partly using the investment bank’s own money. This proposal was called Project Firelight.

Goldman Sachs’ New York office finally canned the idea in early September 1998 for reasons that were never fully explained, but most likely because of volatile global markets at the time (very similar to recent subprime global liquidity squeeze) caused at the time by the Russian bond crisis and the Asian currency crisis.

In his subsequent role as adviser to the FAI board in relation to the HIH bid, Turnbull made a presentation to FAI directors in support of his recommendation that they accept the HIH offer, which was 47 percent above the previous FAI share price. The presentation covered three scenarios, one of which was similar to the Project Firelight proposal.

The royal commission found that he didn’t directly tell any of the board members about the earlier exercise. Turnbull told the royal commission he assumed that managing director Rodney Adler, who had hired him, had informed the board. Adler said he told John Landerer, the chairman. Landerer denied this. Who do you believe? Is it important?

After three months and millions of dollars of expenditure chasing the line that Turnbull and Goldman Sachs were somehow responsible for the collapse of HIH, this is what the royal commissioner says in his concluding remarks about their role in the FAI takeover:

“It would have been of assistance to the directors of FAI to have known that GSA had spent considerable time in the course of 1998 analysing a very similar proposal in which Goldman Sachs might invest its own money but had decided not to proceed with it.

“Such information should have been revealed to the FAI board by a financial or corporate adviser, like GSA, because it would have assisted the directors to decide whether to appoint GSA as their financial adviser on the takeover. It would also have assisted the directors in forming their opinions about the viability of the ‘break up and sell clean general insurance company’ proposal, which [was] presented by GSA as a potentially more attractive alternative than the takeover.

“The fact that these matters were not revealed to the board of FAI is regrettable. This is particularly so in light of the evidence of some directors that it might have affected their attitude to the appointment of GSA.”

Having heard months of very aggressive evidence from his counsel assisting, designed to build a case against Turnbull and Goldman Sachs, this was all the royal commissioner was prepared to say about their role.

It would be a brave person who would try to predict the outcome of a court case, given the dysfunction of the court system, but this is hardly the basis of a successful $500 million claim. Turnbull’s protests that there is no case against him have merit.

I will leave it to readers to judge for themselves whether they agree with the concluding comment by the author of that piece.

As we know, just over 1 year after that article was written, Goldman Sachs did in fact make a “confidential” settlement on Mr Turnbull’s behalf.  Meaning that he did not have to suffer the embarrassment and indignity of facing up to the charges in the NSW Supreme Court. This occurred in mid-2009.  Right at the time that Mr Turnbull as leader of the Opposition was negotiating the bipartisan agreement with Kevin Rudd to introduce an ETS in Australia (dubbed at that time, the “CPRS”).

The implications of which, given Goldman Sachs’ extremely prominent role in emissions trading and the drive for globalised emissions trading, I leave to readers to ponder for themselves.

Tags: , , , , , , , ,

Spread The Word – “Untouchable” Turnbull Is A Goldman-Plated Turd

14 Jul

The public reception to the carbon “X” is somewhat hostile.

So … quelle surprise! … Malcolm Turnbull is at it again.

From today’s Australian (emphasis added):

Liberal colleagues turn on Malcolm Turnbull over his ‘bitter’ mindset

Malcolm Turnbull is being urged by colleagues to reconsider his future in politics after his latest attack on Opposition Leader Tony Abbott.

A senior Liberal told The Australian Online that Mr Turnbull had a strong future in the party, but only if he could shake his “bitter and twisted” mindset.

Another Liberal went further, saying it was time for the former Liberal leader to resign.

“For the good of the Liberal Party and the country, Malcolm Turnbull has to leave the parliament,” the source said.

Here on barnabyisright.com, we have long covered the real background story of Mr Turnbull’s strident advocacy for Emissions Trading.

The background story that calls into question everything about Mr Turnbull’s motives, and actions:

Malcolm Turnbull, the former Goldman Sachs Australia chairman, named co-defendant in a $450+ million lawsuit, and beneficiary of a “confidential” settlement made on his behalf by his former employer, believes so strongly in Australia having an emissions trading scheme for a very good reason indeed.

But I personally harbour the gravest of doubts that “saving the planet” has anything whatsoever to do with it…

Your humble blogger has spoken with a number of persons within the Coalition, in seeking to draw widespread public attention to the above.

I believe that the public has a right to be fully informed about all the details of Mr Turnbull’s long involvement with – and possible obligations to – the international banking giant and carbon dioxide derivatives trading advocate, Goldman Sachs.

It has been made clear to me by informed sources that – in terms of our mainstream media, and this particular story – Mr Turnbull is an untouchable.

So dear reader.

It is clear that, if the truth will out, then it is up to you and me.

The people power of Australia.

To spread the word.

Because our mainstream media will not.

So, if you would like to see the Government’s carbon “X” scheme scam detonated, then I am asking for your concerted help, to make that happen.

To blow up the myth that Mr Turnbull is the politician of great integrity, standing stalwart by his beliefs in the need for an emissions trading scheme – and only an emissions trading scheme – as “the best way” to “save the planet”.

I have tried. Others have tried too. But the mainstream media will not touch this story.

In my firm view, if this story were headline news around this nation – as it should be – then the last bulwarks of public support for the carbon “X” scheme scam would collapse.

As the “conservative” hero and “preferred Liberal PM” of the green cargo cult was seen in a fuller light.

Illuminating the public to his questionable past … and present …. actions.

Please be a light of truth today.

And tomorrow.

And the day after that.

Every day, until the truth will out.

Please, share this post with everyone you know … and, those you don’t.

As a favour to your humble blogger.

To yourself.

And the nation.

Thank you.

* Other, related links to help you to be informed, and to inform –

Compassion For Malcolm – He Just Wants His Balls Back

Malcolm’s Motive: His ETS Lie Unravelled

Doing God’s Work – Turnbull An Angel Of ‘Death Derivatives’

“Turnbull Once Said To Me, ‘You Capitalise On Chaos'”

UPDATE:

Initiated by a reader and follower of my Twitter feed, the following exchange took place this afternoon between myself and Mr Turnbull, along with some interjections from Twitter onlookers.

I will leave readers to draw their own conclusions:

* Click on the bold ” @____ ” titles to view original tweets.


@TurnbullMalcolm –

@nqcowboy_@barnabyisright@getuppr barnabyisright.com is such a courageous website there is nowhere can be found the identity of the author


@BarnabyisRight –

@TurnbullMalcolm Would you care to offer FULL disclosure re Goldman, HIH, FAI, “confidential settlement” Mr Turnbull? @nqcowboy_ #auspol


(Interjection by) @gtwarrior47 –

@TurnbullMalcolm @BarnabyisRight @ Politics is a dirty game Malcom.The goal is to get the labor/green coalition off the treasury bench,


@BarnabyisRight –

@gtwarrior47 Disagree. The goal is to have an honest, open, transparent Parliament, w/out conflicts-of-interest etc @TurnbullMalcolm #auspol


(Interjection by) @makiwa –

@BarnabyisRight Agree. Without full accountability and transparency, we will only have an illusion of change! @gtwarrior47 @turnbullmalcolm


@TurnbullMalcolm –

@BarnabyisRight@nqcowboy_ and who are you? Or are you as cowardly as you are scurilous?


@BarnabyisRight –

@TurnbullMalcolm Not relevant, Mr Turnbull. What is relevant are the facts viz GS, HIH, FAI, ur “confidential settlemnt” @nqcowboy_


(Interjection by) @snowytristan –

@BarnabyisRight @TurnbullMalcolm @nqcowboy_ We would like to to know Malcolm. Sounds like Gillard and her cover-ups.


@TurnbullMalcolm –

@snowytristan @barnabyisright @nqcowboy_ ok whats the question?


@BarnabyisRight –

@TurnbullMalcolm RU willing 2 provide public w/ ALL documentation viz GS/HIH/FAI “confidential settlement”? @snowytristan @nqcowboy_ #auspol


@BarnabyisRight –

@TurnbullMalcolm RU willing 2 publish sworn affidavit that u’ve 0 obligations of any kind 2 GS/their CT interests? @snowytristan @nqcowboy_


@BarnabyisRight –

@TurnbullMalcolm RU willing 2 publish sworn affidavit that u will receive 0 benefit – financ/otherwise – from ETS? @snowytristan @nqcowboy_


@TurnbullMalcolm –

@BarnabyisRight a bit rich from someone who wont reveal his name..but I have no obligations to GS re carbon – only a paranoid wd say I did.


(Interjection by) @KeeptheBshonest –

@TurnbullMalcolm @barnabyisright MT, we understand your frustration you will never be PM of Aust but calling folks Paranoid is a bit rich!!


@TurnbullMalcolm –

@KeeptheBshonest @barnabyisright conspiracy theorists usually are. Especially when they dont have the guts to say who they are.


(Interjection by) @KeeptheBshonest –

@TurnbullMalcolm @barnabyisright No Guts is about you sucking it up and “fully supporting your leader” in the fight for govt old mate, JS


@BarnabyisRight –

@TurnbullMalcolm You are obfuscating Mr Turnbull. Ad hom. is not honest response to the 3 simple Q’s posed, implies guilt. @KeeptheBshonest


@BarnabyisRight –

RU willing to publish sworn affidavit to that effect? @TurnbullMalcolm “..I have no obligations to GS re carbon” #auspol


@BarnabyisRight –

@TurnbullMalcolm RU willing 2 provide public w/ ALL documentation viz GS/HIH/FAI “confidential settlement”? @FixNSWLegal @JamesJohnsonCHR


@BarnabyisRight –

@TurnbullMalcolm RU willing 2 publish sworn affidavit that u, family, assoc’s, will receive 0 benefit – financ/otherwise, from ETS? #auspol


@TurnbullMalcolm –

@BarnabyisRight If you are not prepared to say who you are, then I regret our interesting dialogue will have to come to an end.


@BarnabyisRight –

@TurnbullMalcolm Sir, it appears you are not prepared to openly, directly, & honestly respond to reasonable questions of public record.


(Interjection by) @NOH8ER –

@TurnbullMalcolm That’s not reasonable – what matters is the value of what is said, not who says it, Malcolm. cc.@BarnabyisRight


(Interjection by) @maatilda –

@TurnbullMalcolm This tweep has a large following and if you dont respond you condemn yourself @BarnabyisRight


@BarnabyisRight –

@TurnbullMalcolm As I iterated earlier Mr Turnbull, who I am is irrelevant to the facts. You are the public “servant”. Pls answer direct Q’s


(interjection by) @joneschris79 –

@TurnbullMalcolm @barnabyisright – don’t let it end. Best Aussie twitter 2n and fro ever. Plus…we want the answers.


@NOH8ER –

@KeeptheBshonest @TurnbullMalcolm @barnabyisright I actually wanted MT to be PM but the GS affair is unsettling.


@KeeptheBshonest –

@NOH8ER @turnbullmalcolm @barnabyisright never liked the kid who took his bat & left a game mid way through because a point went against him


@BarnabyisRight –

@KeeptheBshonest Never liked “public servants” who attack the man when asked simple, direct Q’s of national import @NOH8ER @turnbullmalcolm


@KeeptheBshonest –

@BarnabyisRight @noh8er @turnbullmalcolm you keep asking the tough q’s mate, MT lacks ticker, that’s why Libs turfed him out


@BarnabyisRight –

@KeeptheBshonest No, disagree. Think Mr @turnbullmalcolm has lots of ticker. Q’s go to issue of obligation, opportunity, not courage @noh8er


@NOH8ER –

@TurnbullMalcolm I looked forward to you as an alternative to Abbott, then I found out about the Goldman Sachs affair. @BarnabyisRight

Tags: , , , ,

Our Bankers’ Casino Royale – “Carbon Permits” Really Means “A Licence To Print”

11 Jul

I was right.

It is a scam.

A huge scam.

A clever, complicated scam.

But a scam, nonetheless.

In previous articles, I identified the two key details of the Green-Labor Alliance’s proposed “carbon pricing” scheme. The only two details that matter. Because they are the two key details which confirm whether this really is “a tax” / “like a tax”. Or, whether this is just a European ETS-imitating scheme scam:

Will the carbon permits:

(1) have an unlimited expiry date?

(2) be bankable from the commencement of the scheme?

If you’ve not read the previous articles I’ve posted about this – including my online brawl with Opposition Climate Action Onanist Greg Hunt MP about it – then you may wish to recap by reading this, this, and especially, this.

Now, if you just want the quick answers to those 2 key questions, then here’s the 30 second summary. All you need to know. Without bothering to check and understand the detail for yourself.

1. YES, carbon permits will have an unlimited expiry date.

2. NO, carbon permits issued during the “fixed price period” can not be banked. Although there will be unlimited banking after 3 years, when the “flexible price” period begins.

BUT … and (like Gillard’s) it’s a very big but … all “freely allocated” carbon permits can be traded. And – here’s the real biggie, ladies and gentlemen – from Day 1 the Government will allow securitisation of carbon permits (the creation of carbon derivatives, in other words). AND, the Government will set up an “auction” system in advance of the “flexible price period” – an advance-auction system that effectively creates a carbon Futures trading market, allowing banksters (and the lucky 500 “polluters”) to speculate gamble on the future price of the “flexible price” permits, that will replace the “fixed price” permits after 3 years.

I was right.

It is NOT a “tax”.

From Day 1, it operates as an ETS by stealth.

It is the bankers’ CPRS by another name.

And what “carbon permits” really means, is “permitted to profit”.

Or perhaps more accurately … A Licence To Print.

Want to know more? To see the proof with your own eyes … and understand it too?

Ok. Let’s get into the details.

Now that GilBrown’s Grand Design has finally been released, let’s take a look at the Government’s freshly-minted cleanenergyfuture.gov.au website. There we can see exactly what they have to say about those two key details that I identified previously.

Note that the answers are buried in the fine print.  Naturally.  You have to read the Appendices.

In this case, the “devil in the detail” is hidden in Appendix A.

First, let us look for the answer to my point #1 – Will there be unlimited expiry dates for carbon permits?

We find the answer in Appendix A, Table 6  (emphasis added):

Table 6 Compliance

Carbon permits

The domestic unit for compliance with the carbon pricing mechanism will be the ‘carbon permit’.

Each carbon permit will correspond to one tonne of greenhouse gas emissions.

The creation of equitable interests in carbon permits will be permitted, as will taking security over them.

In addition, carbon permits will:

* be personal property;

* be regulated as financial products;

* be transferable (other than those issued under the fixed price or any price ceiling arrangements);

* have a unique identification number and will be marked with the first year in which they can be validly surrendered (‘vintage year’);

* not have an expiry date; and

* be represented by an electronic entry in Australia’s National Registry of Emissions Units.

I was right.

The carbon permits will have no expiry date.

They are an artificial construct – “an electronic entry” – that is deemed by government decree to be a new “financial product”.

And, they are a personal property right (see first asterisk) of the holder of the permit. Exactly as I argued with that onanist shill for the green cargo cult, Greg Hunt MP.

Moreover, note carefully the sentence I have bold underlined.

The “creation of equitable interests”, and “taking security over them”, simply means this.  The carbon permits can be used as the basis for bankers to create other, new financial “securities”.

Carbon derivatives, in other words.

Derivatives (or “securities”) are the toxic, wholly-artificial financial “products” that were at the heart of the GFC.  The same bankster-designed “widgets” that the world’s most famous investor, Warren Buffet, spoke of as “a mega-catastrophic risk”, “financial weapons of mass destruction”, and a “time bomb”.

You can stop reading this piece right now if you like.

Because from that Table 6 alone, you now have conclusive proof that this is nothing whatsoever to do with the climate.

It is all – and only – about global bankster profits. At the direct expense of the common people of planet earth.

Now, what about my point #2. The key question of whether there will be unlimited banking of permits.

That is covered in Appendix A as well.  But we must take a bit of a journey here, as it’s a little more complicated to get to the bottom of this one.

If you are interested to understand how this scam really works more fully, then do bear with me here (emphasis added):

Scheme architecture

Table 1: Starting price and fixed price period

Fixed price period

The carbon pricing mechanism will commence on 1 July 2012. There will be a three year fixed price period.

The fixed price

The carbon price will start at $23.00 per tonne in 2012‑13 and will be $24.15 in 2013‑14 and $25.40 in 2014‑15.

The prices in the second and third year reflect a 2.5 per cent rise in real terms allowing for 2.5 per cent inflation per year (the midpoint of the Reserve Bank of Australia’s target range).

Blah blah blah. We already knew all that. These details were leaked in advance, in typical Green-Labor fashion.

Let’s get to the nitty gritty. The characteristics of the carbon “permits” themselves, and what you can (and cannot) do with them.

Especially during the initial 3 year, so-called “fixed price period”.  The period in which the government (and Opposition) have been telling you that this scheme scam “is a tax” or “will operate like a tax” (depending on what day it is):

Fixed price permits

Liable entities will be able to purchase permits from the Government at the fixed price, up to the number of their emissions for the compliance year.

Any permits purchased at the fixed price will be automatically surrendered and cannot be traded or banked for future use.

Ok.

So, the lucky 500 “polluters” can not trade, or bank, any permits that are purchased at the fixed price.

Now, that appears to eliminate point #2 of those key points that I identified, doesn’t it? The question of unlimited banking of permits.

But does it really?

Hold your horses, dear reader. There’s more to it than that.

Let us peel back the multiple layers of deception.

Yes, permits that are purchased can not be banked.

But what about permits that are handed out for free?

Permits freely allocated may be either surrendered or traded until the true-up date for the compliance year in which they were issued. They cannot be banked for use in a future compliance year.

Right.

So, just like “purchased” permits, “freely allocated” permits also can not be banked during the “fixed price period”. (However, all permits will have unlimited banking after 3 years, when the “flexible price period” begins – see Appendix A, Table 3)

But note this well.

Freely allocated permits can be traded “until the true-up date for the compliance year in which they were issued”.

In other words, with respect to “freely allocated” permits in particular – which will be handed out to “trade exposed” industries rent-seekers – this IS an emissions trading scheme.

It’s right there.  In black and white.

I was right.

“The Carbon Tax Is Not A “Tax” … It Is The Bankers’ CPRS By Another Name”.

Now, did you notice that other little word back there?

“surrendered”?

What happens when “freely allocated” permits are “surrendered”?

Is that just a case of handing back something that you got for free?

Or … is there another profit-making opportunity for our lucky “polluters” there too?

That is, a profit-making opportunity over-and-above the profit-making opportunity they have been granted, to simply jack up their prices and use the “cost” of permits as an excuse – whether they actually paid for all their “permits” or not. Just like the lucky “polluters” have done in the European scheme scam (from Green-Left Weekly May 1, 2011):

The first phase of the ETS ran from 2005 to 2007. It made no dent in emissions. But power companies made about 19 billion euros by charging customers for the “cost” of permits they were given for free. Manufacturers made about 14 billion euros in windfall profits with the same trick.

So, let’s take a look shall we, and see if there might be yet another profit-making opportunity for our hand-picked lucky 500 “polluters”, on all those “freely allocated” carbon permits (emphasis added):

Buy‑back of freely allocated permits

The holders of freely allocated permits will be able to sell them to the Government from 1 September of the compliance year in which they were issued until 1 February of the following compliance year.

Got that?

You get some-thing for nothing.

You increase your costs to customers, using the government-decreed “price” of that “some-thing” as your excuse – a windfall profit.

And then, you either trade that free “some-thing” to someone else, or, you sell it back to the government – for another windfall profit.

Brilliant!

Now that’s what I would call “transitional assistance” too, if I were one of those lucky 500 “big polluters”.

Money for nothing.

How much will you get paid for selling back your free permits … you lucky big “polluter” you?

The price paid by the Government will be equal to the price of the fixed price permits for that year, discounted to 15 June of the compliance year by the latest available Reserve Bank of Australia index of the BBB corporate bond rate, so that the buy‑back price reflects the present market value of the permit.

From 15 June onwards, the price paid will be equal to the fixed‑price permits for that vintage.

What does that mean?

It’s very simple.

Those lucky “polluters” receiving “freely allocated” permits (to profit), can either:

(a) trade them (as we saw earlier), OR

(b) sell them back (ie, “surrender” them) to the Government.

If they can’t pull a big enough profit from trading their free permits … the fall-back plan is to resell them to the Government.

Now, who do you think is going to benefit the most from all the transactions of these carbon permits?

Who is going to make money for nothing via fees and commissions, each time a “freely allocated” permit is traded, or bought from/sold back to the government?

Banksters.

The same despicable scum, the parasites who created the GFC, and have been driving the global push for CO2 emissions trading from Day 1.

Our government’s scheme scam will achieve exactly the same result as the benchmark European ETS.

Huge profits for a few.

Raped wallets for the many.

And absolutely bugger-all impact on global CO2 “emissions reduction” –

Want more?

There IS more.

Is there anything interesting to note about the subsequent “Flexible Price Architecture” (ETS)?

That wonderful “market-based” scheme scam that comes after the so-called “fixed price period” (in which trading of freely allocated permits can happen anyway, meaning it is an ETS from Day 1)?

The final destination of the scheme scam that Gillard spoke of in these words just days ago – “I have always been determined to create an emissions trading scheme … for our nation’s future”.

Is there anything about the detail of the “flexible price architecture” that might give us further evidence – if any were needed – that this really is the bankers’ CPRS by another name?

Indeed there is.

Take a look at Appendix A, Table 3 (emphasis added):

Table 3: Flexible price architecture

Price ceiling

A price ceiling will apply for the first three years of the flexible price period.

The price ceiling will be set in regulations by 31 May 2014 at $20 above the expected international price for 2015‑16 and will rise by 5 per cent in real terms each year.

If the world is on a 450 parts per million carbon dioxide equivalent (CO2-e) trajectory or higher, this will be reflected in international prices and the price ceiling will automatically be $20 above this price. The level of the international price will be examined closer to the point of transition to a flexible price period to ensure that the price ceiling reflects a $20 margin above its expected level.

In other words, our Green-Labor Alliance would (if still in power) not only allow, but indeed, “ensure”, that the CO2 price in Australia could be traded at a $20 per tonne premium to the international price.

Economic planking indeed.

And, a Paradise Now bonus for banksters.

Because this detail tells us that this is a scam whereby the government will “ensure” that there is “flexibility” for the banksters’ – market manipulators extraordinaire – to use the many dodgy means at their disposal to push the Australian CO2 trading price up, by as much as $20 more than the international market price.

In other words, if the international market price for CO2 permits (again) fell to near-zero – let’s say, $0.10 – then our Green-Labor Alliance would still happily allow our nation to suffer under a $20.10 price for CO2 permits, and the flow-on effects of that to the prices on everything.

Insanity.

But there’s more:

Price floor

A price floor will apply for the first three years of the flexible price period.

The price floor will start at $15 and rise at 4 per cent in real terms each year.

Also highly significant.

And insane.

If still in power, our Green-Labor Alliance would force the so-called “free market” price to be at least $15 per tonne. And, they would force that price to rise at a rate of 4% per annum.

Ummmmm … hello?!

That’s NOT a “free market” mechanism.

That is quite simply, a Communist-style command-economy.  Wearing a very thin veil of “free market” respectability (if you’re idiot enough to believe it, that is).

But here’s the part I really love, dear reader.

The part that – once again – confirms that this is a bankers’ CPRS by another name.

Banking and borrowing

Unlimited banking of permits will be allowed in the flexible price period.

There will be limited borrowing of permits such that, in any particular compliance year, a liable entity can surrender permits from the following vintage year to discharge up to 5 per cent of their liability.

Auctions of permits

Permits will be allocated by auctioning, taking into account transitional assistance provisions for key sectors.

The policies, procedures and rules for auctioning will be set out in a legislative instrument.

The Government will advance auction future vintage permits. There will be advance auctions of flexible price permits in the fixed price period.

Note that bit about “transitional assistance provisions” for “key sectors”. That’s Orwellian doublespeak for “freely allocated permits” for “big ‘polluters’ with the best lobbyists”.

If you are a “polluter” in need of “transitional assistance” – meaning, everyone – then you will get lots and lots of freely-allocated permits. To help you “transition” (wink wink, nudge nudge).

Now, why have I bold underlined “borrowing“?

And why have I bold underlined “advance auctions of flexible price permits…”?

Because these are the key words from the “banking and borrowing” section. The words that tell you all you need to know.

That this SCAM is nothing whatsoever to do with the global climate.

And that it is 100% about creating a new, global, CO2 derivatives-trading market for the banksters.

The world’s biggest-ever financial cesspool.

Of toxic, intrinsically-worthless, humanity-raping financial “instruments” called derivatives.

Non-existent, digital “widgets”.

That can be borrowed from the future – ie, before these artificial carbon “widgets” are even issued – and leveraged by scum-of-the-earth banksters.

And then, traded by these parasites at multiples of hundreds and thousands of times more than the underlying, artificially-created “value” of the carbon permit.

Furthermore, the “advance auctions of flexible price permits in the fixed price period” proves beyond all shadow of doubt, that I was right.

That this “carbon pricing mechanism” is the bankers’ CPRS by another name. From Day 1.

Why does it prove it?

The advance auctions of flexible price permits “in the fixed price period” means this.

From Day 1, the government is effectively allowing the setting up of a futures trading market, for Australian CO2 permits.

Futures trading of nothing. Before the nothing is even created.

The banksters’ wet dream.

Australia – you have been monumentally conned.

The Green-Labor-Independent Alliance’s plan to “save the planet”, is a gigantic scam.

It is the bankers’ Casino Royale.

Where “carbon permits” really means, “A Licence to Print”.

UPDATE:

Stock broker and licensed securities and derivatives dealer Andy Semple recognises the same point that I did above – that this is not a “free market” mechanism at all, but a Soviet-style command-and-control scheme. He has deconstructed the Government’s carbon trading scam, from a trader’s perspective. A must read –

The Clayton’s Emissions Market – “The Market You Have When You’re Not Having A Market”

Tags: , , , , , , , , , , ,

Gillard: “I Have Always Been Determined To Create An *Emissions Trading Scheme*”

1 Jul

Three days ago, I wrote an article arguing by reference to the Government’s official documentation, that the Green-Labor-Independent Alliance is not proposing a “tax”, but an emissions trading scheme with a fixed price start –

“The Carbon Tax is Not A ‘Tax’ … It Is The Bankster’s CPRS By Another Name”.

Two days ago, prompted by a reader, I wrote a detailed email to the Shadow Minister for Climate Action, Mr Greg Hunt MP, arguing the same point –

“Letter To Greg Hunt MP”.

Yesterday, I engaged in multiple correspondences with Mr Hunt, continuing to present the same irrefutable point; that the Government’s proposed “pricing carbon” scheme is not a tax, but is, and always has been, planned and intended to be an emissions trading scheme with an initial and temporary “fixed price” period –

“Letter To Greg Hunt MP” – Updates 2, 3, 4, 5.

In one of these correspondences, Mr Hunt stated the following (emphasis added):

Thur 30/6, 10:30pm –

I respect your views but the Prime Minister herself has said that it operates like a tax.

As has the Treasurer.

Cheers,

greg

I will leave it to those interested to read my detailed critical response to Mr Hunt’s statement.

Remarkably however, just a few short hours later the following was being widely reported in the mainstream media (please note carefully my bold emphasis added):

By Malcolm Farr, National Political Editor | From: news.com.au | June 30, 2011 2:38PM

Prime Minister Julia Gillard today said the imposition of a fixed price on carbon pollution will last for the minimum possible of three years before being replaced by whatever the market decides.

The decision will be a bid to take the “tax” out of the Opposition’s highly effective “carbon tax” attacks as quickly as possible.

“What (Opposition Leader) Tony Abbott likes to refer to as a carbon tax, a fixed price period for an emissions trading scheme, is a period I believe should be as short  as possible,” Ms Gillard said in Darwin.

“I’ve always been determined to create an emissions trading scheme, and I’ve always been determined that the fixed price period would be as short as possible and we would get to that emissions trading scheme.”

She said her aim “has always been to have an emissions trading scheme“.

“That’s an aim I share with (former Liberal Prime Minister) John Howard and (current Liberal front bencher) Malcolm Turnbull – an emissions trading scheme for our nation’s future,” said the Prime Minister.

And then there was this, from the ABC (emphasis added):

Jeremy Thompson, On Thursday 30 June 2011, 16:55 EST

Prime Minister Julia Gillard says she is determined to introduce an emissions trading scheme as soon as possible, amid reports the Multi-Party Climate Change Committee has agreed the transition from a carbon tax to an ETS will take three years.

It is understood the Government, Greens and independents agreed to transition from the carbon tax to an ETS in 2015 – at the early end of the stated aim of three to five years.

The Government wanted to go directly to an ETS, but the minority nature of the Parliament meant the Greens were able to insist on an initial fixed carbon tax.

“I’ve always been determined to create an emissions trading scheme and I’ve always been determined that the fixed-price period would be as short as possible and we would get to that emissions trading scheme,” Ms Gillard told reporters in Darwin.

She sought to change the nature of the rhetoric, rejecting the term “carbon tax” as a description used by Opposition Leader Tony Abbott.

I’m tempted to end this piece right now, with a triumphant “I rest my case”.

Sadly, there will doubtless be those who are to a greater or lesser degree incapable of critical thinking, who may dismiss Gillard’s remarks as not supporting my argument.

For one reason.

They no longer trust anything she says.

It is not necessary to believe that she is telling the truth now.

It is only necessary to critically examine the facts.

And the facts are these*.

The Rudd-Gillard government has always officially (ie, in written documentation) referred to their “carbon pricing” proposal as an “emissions trading scheme”.

Always.

Never as a “carbon tax“.

If those who oppose the introduction of a carbon “tax” wish to succeed in preventing it, they need to start using their brains.

It is better for everyone in the community to clearly understand that it IS an emissions trading scheme.

We should all encourage and applaud Gillard and Co in their new “bid to take the “tax” out of the Opposition’s highly effective “carbon tax” attacks”.

Why?

Because the people we need to convince are not those who already oppose the carbon “X”.

The people we need to convince – the people we need on our side against the carbon “X” – are the lefties, green cargo-culters, and others like them who go along with most every popular delusion, and are too thick to critically think for themselves.

Now believe it or not, those of us who understand the grave threat of a carbon “X” actually do share one very important thing in common with the lefties, et al.

We all – broadly speaking – HATE BANKERS.

It is vital for “righties” to understand, that “lefties” generally think that taxes aren’t such a bad thing – especially if the wise and compassionate, caring Big Government is going to “save the planet” by taxing “only” those big bad “polluters”.

But … if just once these poor deluded fools could glimpse the reality – that the governments plan is NOT a wise and benevolent Robin Hood “tax” as they imagine, but is in truth, nothing more than a grandiose scheme that is designed by, and for, the benefit of BANKERS – then we have a chance.

Then, there is hope that we can all become one.

“Leftard” and “Rightard” alike.

United in opposition  … to the banksters’ ETS.

So I say … Go for it JuLiar!

You’re on the right track now 😉

Tell it like it is.

Keep telling the world that it ‘aint no “tax”.

Keep telling us all that it is what you have “always been determined to create”.

“An emissions trading scheme for our nation’s future“

And We The People will drive home the patently obvious “bankster” connection in this grand scam for you.

________

* The Facts

References:

Garnaut Review 2011, Chapter 5 (emphasis added):

In implementing an emissions trading scheme with a fixed-price start, there are two sets of decisions to be made: the starting price and how much the price will rise in each subsequent year; and the timing, conditions and manner of transition to emissions trading with a price that is set by market exchange.

*******

Government’s climatechange.gov.au website (emphasis added):

Multi-Party Climate Change Committee

Broad architecture of the carbon price mechanism

A carbon price mechanism could commence with a fixed price (through the issuance of fixed price units within an emissions trading scheme) before converting to a cap-and-trade emissions trading scheme…

*******

Government’s climatechange.gov.au website (emphasis added):

Publications

CPRS White Paper:

Policy position 8.1

Each permit will have a unique identification number and will be marked with the first year in which it can validly be surrendered (its ‘vintage’). It will not have an expiry date.

…

8.4.1 Banking

Banking allows permits to be saved for use in future years. With unlimited banking, permits would not have an expiry date—once issued, they could be used for compliance at any future time.

… the advantages of banking are greatest if banking is continuous. For these reasons, the Government will allow unlimited banking from Scheme commencement.

Tags: , , , , , , , ,

Letter to Greg Hunt MP

29 Jun

* Shortcuts to Update 2 , Update 3 , Update 4 , and Update 5 below.

Prompted by a reader, this afternoon the following email sent to the Federal Opposition’s Shadow Environment Minister, Greg Hunt MP.

Cc’d to Senator Barnaby Joyce.

*****************************

Subject:  Why Are You Calling It A “Tax”, When It Is NOT?

Dear Mr Hunt,

I am writing to you pursuant to a recent communication between yourself and a follower of my Twitter feed – @BarnabyisRight and blog BarnabyIsRight.com

I understand that this lady questioned you concerning my recent article, which affirms that the “carbon tax” is NOT a tax, but rather, an “emissions trading scheme with an initial fixed price period”.  Exactly as per the Rudd Government’s proposed CPRS.

I also understand that your response contradicted this, instead arguing that “In fact the tax will actually morph into a tradeable right after 3 years”.

Mr Hunt, you are wrong. And I firmly believe that both yourself, and the Federal Opposition more broadly, are guilty of doing the electorate a grave disservice by continuing to falsely attach the moniker “tax” to the government’s proposed scheme.

In proof of this, I refer you to the following quotations and links. They are all from this blog article that I published recently, which has attracted considerable attention. The lady in question advises me that she did not feel comfortable sending you a link to the article, given that it contains some “florid” descriptors.

All but one of these quotes and links are from the government’s own handpicked sources.

I would ask that you please respond to my email, by specific reference to these evidences –

Julian Turecek of Cleantech Ventures, writing for MacroBusiness in May 2011 (emphasis added):

The current government has not yet give its policy a formal name. So the Opposition has obliged* and chosen one for them: a carbon tax.

Now this has got a lot of people, mainly tax advisers and accountants, barking up the wrong tree. It’s not actually a tax…

The current proposal is not a tax, but a fixed price emissions trading scheme. This is exactly the same as the CPRS, which also had a fixed price at the start.

[* Please think back carefully. When Gillard announced that she would introduce a “price on carbUon” after all, she and the government initially denied the Opposition’s “great big new tax” claim. But they have since allowed, and encouraged, this false meme to become entrenched into the public psyche. I believe that is because calling it a “tax” sounds more simple and less threatening, and most importantly, it does not so clearly highlight the banker-driven “trading” aspect than if they had instead called it what it is, and always was ultimately intended to be right from the beginning … an Emissions Trading Scheme.]

Garnaut Review, Chapter 5 (emphasis added):

In implementing an emissions trading scheme with a fixed-price start, there are two sets of decisions to be made: the starting price and how much the price will rise in each subsequent year; and the timing, conditions and manner of transition to emissions trading with a price that is set by market exchange.

The government’s own climate change website on the topic (emphasis added):

Broad architecture of the carbon price mechanism

A carbon price mechanism could commence with a fixed price (through the issuance of fixed price units within an emissions trading scheme) before converting to a cap-and-trade emissions trading scheme…

Note very carefully what it says under Transition Arrangements (emphasis added):

Transition Arrangements

At the end of the fixed price period, the clear intent would be that the scheme convert to a flexible price cap-and-trade emissions trading scheme. In relation to the transition to a flexible price, it would be important to design the arrangements so as to promote business certainty and a smooth transition from the fixed to flexible price.

Ross Garnaut also reiterates the importance of the initial design promoting a “smooth transition” to a fully-floating price ETS, in his final Garnaut Review:

Investors need clarity about when and the conditions under which the transition to a floating price will occur. To support a smooth transition, the necessary institutions and supporting infrastructure should be established from the beginning of the scheme. It is important to specify rules for the scheme as soon as possible, including arrangements for auctioning permits and for acceptance of offsets and international permits.

Mr Hunt, this is where we come to the critical matter pertaining to whether there is any remotely possible justification for calling the government’s proposed “pricing mechanism”, a “tax”.

How exactly do you design a scheme to promote a “smooth transition”?

By giving those initial “fixed price” permits an expiry date that is far enough away to ensure that they can be traded when the emissions trading scheme transitions to a “floating” price. In this way, the “property rights” of those forced to purchase the initial “fixed” (and rising over “3-5 years”) price permits are safeguarded (ie, thus, “business certainty”) – they can “bank” their permits and trade them later, when the transition to a floating price occurs.

Of course, an even simpler way would be to give these permits to “pollute” an unlimited expiry date.

Which is exactly what the government’s official Policy position was under the original Rudd-Garnaut CPRS White Paper.  Which the Gillard-Garnaut “carbon pricing” mechanism aims to replicate – because that is what the bankers want (emphasis added):

Policy position 8.1

Each permit will have a unique identification number and will be marked with the first year in which it can validly be surrendered (its ‘vintage’). It will not have an expiry date.

…

8.4.1 Banking

Banking allows permits to be saved for use in future years. With unlimited banking, permits would not have an expiry date—once issued, they could be used for compliance at any future time.

… the advantages of banking are greatest if banking is continuous. For these reasons, the Government will allow unlimited banking from Scheme commencement.

Mr Hunt, in calling this a “tax”, you are misleading the Australian public.

You are focussing (diverting?) attention on to the quite unimportant details of the initial “fixed price” period, and failing to draw attention to the true end game. The Big Picture.

The Government’s plan has never changed.  They have always been pursuing a CPRS – an emissions trading scheme – with an initial fixed price period.

I should also mention that I am fully aware of the key role played by your colleague Mr Turnbull, going back to 2004 and his entry into Parliament, in the banker-driven push to include Australia in a global CO2-derivatives trading market (casino).

I am especially aware of the fact that Mr Turnbull is effectively “owned” by international bankers and CO2-trading pushers, Goldman Sachs, by virtue of their “confidential settlement” on Mr Turnbull’s behalf, to keep him out of court when Opposition Leader, in the 1/2 billion dollar HIH lawsuit in which Mr Turnbull was a named defendant.  I have documented this fact on my blog as well.

This is a matter of clear conflict-of-interest / corruption of our democratic processes. One that, some day, will become widespread public knowledge. I would suggest to you that it would be very wise – for numerous reasons – for the Federal Opposition to ensure that the matter of Mr Turnbull’s highly dubious associations and obligations does indeed become widely known.

Sooner, rather than later.

I (and the rapidly growing readership of my blog and Twitter feed) look forward with considerable interest to your responses on these matters.

Sincerely,

*********

Barnabyisright.com

UPDATE:

I should mention, it is my view that the above was a complete waste of my time.

For lots of reasons.

Apart from anything else, has anyone ever seen a politician admit that they are/were wrong about a critical issue? And then, do something proactive about correcting their error?

UPDATE 2:

Mr Hunt responds (Wed 29/6, 5:42pm)-

I respect your views ******** but respectfully disagree.

A tax is a fixed price with floating volume.

That is what is being created.

After three years – five years it will then turn into a tradeable floating price and fixed volume system.

Cheers,

greg

My subsequent response to Mr Hunt (Wed 29/6, 6:42pm) –

(cc’d to Senator Barnaby Joyce … I note that Mr Hunt did not cc Senator Joyce with his response)

**********************************

Dear Mr Hunt,

Thank you for your prompt response.

You have stated that – “A tax is a fixed price with floating volume. That is what is being created.”

This is a wholly unsatisfactory response to the concerns raised at length in my previous communication.

It is not a question of our holding differing views or interpretations, Mr Hunt. It is a simple question of very clear facts and evidence, which you appear to be wilfully ignoring.

Your response is misleading and deceptive by omission.

With respect, your response suggests either a culpable ignorance, or complicity, on your part.

Your statement wilfully ignores the perfectly clear statements of the CPRS White Paper, the Garnaut Review 2011, and the government’s climate change website description of the “Broad Architecture” of the proposed “mechanism” for “pricing carbon” that I have quoted and referenced for your due consideration.

It also ignores, most importantly, the key point detailed in and evidenced by the government’s sources in my previous communication.

Mr Hunt, that key point is this.

The government’s openly professed intention, and the Garnaut Review’s consistent recommendation, is to issue carbon permits at a fixed price only for a temporary initial period, with said permits having the following key characteristics, specifically in order to “smooth the transition” to the ultimately intended fully-floating cap-and-trade scheme:

(a) Unlimited expiry date;
(b) Unlimited bankability, from Scheme commencement.

The implications of these parameters – stated previously as formal Policy Positions by Prof Garnaut and the ALP – are perfectly clear:

1. A “polluter” forced to purchase the initial “fixed price” carbon permits will be empowered to “bank” said permits, “from Scheme commencement”.

2. Due to their unlimited expiration date, the “polluters” will be enabled to trade said permits, after the temporary initial period has passed.

3. The “price” of carbon permits issued during the temporary, initial “fixed price” period, will be legislated to rise incrementally over that interim period.

Thus, it is patently obvious to any thinking person, that “polluters” forced to purchase carbon permits at (eg) the Year 1 “fixed price”, having been enabled to “bank” said permits, will be able to on-sell them after the temporary initial “fixed price” period trading restriction has passed, at the then going market rate.

Furthermore, as the price of permits will have been forced to rise by government decree during the initial period, this means that, absent a collapse in the market price upon the “floating” of the Australian carbon permit market, “polluters” will be granted opportunity to profit from the sale of carbon permits that they were forced to purchase – at lower prices – during the initial temporary period!

Indeed, those “polluters” who will be granted “free” permits will effectively be granted a free profit-making opportunity, directly arising from the nature of the proposed “initial fixed price” carbon pricing mechanism.

Mr Hunt, it is specious, an insult to intelligence, and clear cause for questioning your own integrity and motives in this matter, for you to suggest that a scheme such as that proposed – one which will guarantee an enhanced profit-making opportunity for at least some so-called “polluters (as described above) – could by any logic or rational measure be deemed a “tax”!

Sadly, I am confident that there is little to be gained in my extending on this point, by defining what a “tax” actually is, by way of reference to any external authoritative source/s.

Mr Hunt, it is also both insulting, and revealing, that you have pointedly failed to address in any way the arguably far graver matter raised in my earlier communication to you, vis-a-vis the conflict-of-interest / corruption of democracy evidenced by your colleague Mr Turnbull’s associations and manifest obligations to international bankers and CO2-trading pushers, Goldman Sachs.

Therefore, I am now directly requesting your comment on that specific matter, and refer your particular attention to the publicly available evidences linked in my previous communication to you.

Once again, despite the wholly unsatisfactory (and revealing) nature of your limited response, I do thank you for at least having taken the time to respond promptly to my and my readers’ concerns.

Sincerely,

******************

Barnabyisright.com

UPDATE 3:

Mr Hunt responds again (Thur 30/6, 10:30pm) –

I respect your views but the Prime Minister herself has said that it operates like a tax.

As has the Treasurer.

Cheers,

greg

My subsequent response to Mr Hunt (Thur 30/6, 11:14pm) –

(cc’d to Senator Barnaby Joyce … I note that, once again, Mr Hunt did not cc Senator Joyce with his response)

**********************************

Dear Mr Hunt,

Thank you again for your prompt response.

It is wholly unsatisfactory – and once again, thoroughly misleading and deceptive – for you to downplay / brush off the detailed concerns that I and my readers have raised, and/or for you to ignore the numerous government-published official documents that I/we have referenced, by merely stating that “the Prime Minister herself has said that it operates like a tax. As has the Treasurer“.

The citizens of Australia all know that the PM lies. As does the Treasurer.

The issue at hand, however, is your and your colleagues’ continued complicity in doing the same on this particular issue.

I refer your attention to the specifically stated concern that was first raised with you in my prior communication – which abundantly clear from the Subject description in these communiques:

Why are you calling it a “tax”, when it is NOT?

“I firmly believe that both yourself, and the Federal Opposition more broadly, are guilty of doing the electorate a grave disservice by continuing to falsely attach the moniker “tax” to the government’s proposed scheme.”

Mr Hunt, the concern raised directly references your and your Federal Opposition colleagues’ misleading and deceptive descriptions of the proposed policy.

Whether or not the PM – or indeed any other politician, media commentator, or individual – employs the use of the same misleading and deceptive description, does not exonerate either yourself or your Federal Opposition colleagues, for your continued use of the same.

I should not need to remind you, Mr Hunt, that both you and your Federal Opposition colleagues are elected representatives of the citizens of this nation.  You are being paid via our taxes, to represent our expressed interests, and properly and thoroughly heed our concerns.

You have failed to do so. Despite now repeated specific and detailed requests.

It is my and my readers’ expressed interest and concern, that both the Federal Opposition generally, and yourself as the responsible Shadow Climate Change portfolio spokesperson particularly, should:

(1) Formally and publicly correct the misleading and deceptive description of the government’s proposed “carbon pricing” policy; and

(2) Henceforth discontinue referring to the policy as a “carbon tax“, and instead refer to the proposed policy exclusively by way of the specific description consistently published by the Federal Government in its public policy documentation, as displayed on its climatechange.gov website and in the 2011 Garnaut Review.

I am now directly asking you, Mr Hunt, on behalf of myself and my readers, whether or not you will undertake to both heed, and act upon, this specific request from your electors.

I also note that, once again, that you have pointedly failed to respond in any way to my direct and specific request for comment on the directly associated matter of your colleague Mr Turnbull’s associations and manifest obligations to international bankers and CO2-trading pushers, Goldman Sachs. I would repeat this request by direct quotation from my previous correspondence:

Mr Hunt, it is also both insulting, and revealing, that you have pointedly failed to address in any way the arguably far graver matter raised in my earlier communication to you, vis-a-vis the conflict-of-interest / corruption of democracy evidenced by your colleague Mr Turnbull’s associations and manifest obligations to international bankers and CO2-trading pushers, Goldman Sachs.

Therefore, I am now directly requesting your comment on that specific matter, and refer your particular attention to the publicly available evidences linked in my previous communication to you.

Thank you in advance, for your choice to finally and directly address – and act upon – the specifically stated and repeated substance of my and my readers’ concerns.

Sincerely,

***************

Barnabyisright.com

UPDATE 4:

Mr Hunt responds again (Thur 30/6, 12:03pm) –

Many thanks and I respect your views but think and believe that this is a tax ands in fact the country believes it.

Cheers,

greg

My subsequent response to Mr Hunt (Thur 30/6, 1:10pm) –

**********************************

Dear Mr Hunt,

Thank you once again for responding so promptly.

Your response to my and my readers’ concerns – and direct and specific requests – continues to be appalling unsatisfactory.

Indeed, in your continuing to ignore the specific points of reference and direct requests that have been made repeatedly to you, your communications to me on these matters represent a wilful dereliction of your Parliamentary responsibilities to the citizens of this nation, to whom you directly owe your position, title, income, and power of influence.

Mr Hunt, in your latest response to me you have once again ignored all of the evidences and information that have been repeatedly submitted to you, and instead resorted to argumentum ad populum –

I … think and believe that this is a tax ands in fact the country believes it.

Argumentum ad populum is authoritatively recognised as being a fallacious argument. Your resorting to it as a singular response to the evidences presented to you, as direct quotations from the government-published official documentation on this issue, represents a (further) wilful act of misleading and deceptive conduct.

As you have once again failed to respond to any of the specific matters that I have references, I will now again repeat my previous requests to you below:

Item 1.

It is my and my readers’ expressed interest and concern, that both the Federal Opposition generally, and yourself as the responsible Shadow Climate Change portfolio spokesperson particularly, should:

(1) Formally and publicly correct the misleading and deceptive description of the government’s proposed “carbon pricing” policy; and

(2) Henceforth discontinue referring to the policy as a “carbon tax”, and instead refer to the proposed policy exclusively by way of the specific description consistently published by the Federal Government in its public policy documentation, as displayed on its climatechange.gov website and in the 2011 Garnaut Review.

I am now directly asking you, Mr Hunt, on behalf of myself and my readers, whether or not you will undertake to both heed, and act upon, this specific request from your electors.

Item 2.

Mr Hunt, it is also both insulting, and revealing, that you have pointedly failed to address in any way the arguably far graver matter raised in my earlier communication to you, vis-a-vis the conflict-of-interest / corruption of democracy evidenced by your colleague Mr Turnbull’s associations and manifest obligations to international bankers and CO2-trading pushers, Goldman Sachs.

Therefore, I am now directly requesting your comment on that specific matter, and refer your particular attention to the publicly available evidences linked in my previous communication to you.

In closing, I would ask you to please explain for the benefit of myself and my readers, exactly how it is that a scheme which proposes to grant a selected subset of the total population a new “property right” (a “carbon permit”) – a property right that has an initially fixed and then subsequently a tradeable monetary value – in exchange for a government-mandated surcharge / levy / fee for the acquisition of that same property right – can be plausibly deemed a “tax”.

My readers and I look forward to receiving your direct, relevant, on-topic response to each of the aforementioned matters.

Sincerely,

*********
Barnabyisright.com

UPDATE 5:

Mr Hunt responds again (Thur 30/6, 1:24pm) –

Hi ************,

I receive over 300 emails a day- really…and I have endeavoured to be both fast and respectful.

I have to say that you are the first person I have encountered who does not accept that the levying of a fixed rate figure on the production of a floating volume of emissions is not a tax.

This is the economic definition of a tax.

You do not have to accept this of course.  But I also accept that nothing I say will change your opinion and while I disagree with that I stand for your freedom to take a different view yourself.

Regards,
greg

My subsequent response to Mr Hunt (Thur 30/6, 2:13pm ) –

**********************************

Dear Mr Hunt,

I do thank you once again for your promptness in responding to my and my readers’ concerns.

Your statement of definition in your most recent communique is, once again, misleading and deceptive, by reason of its representing (1) a blatant “red herring” fallacy, and (2) a blatant “straw man” fallacy:

(1) “you are the first person I have encountered who does not accept that” –

Mr Hunt, this is a red herring fallacy. Whether I am, or am not, “the first person you have encountered who does not accept that” the government’s proposed scheme is not a “tax”, is irrelevant to the facts and evidence as have been demonstrated to you by way of reference to the government’s official documentation.

(2) “the levying of a fixed rate figure on the production of a floating volume of emissions is … the economic definition of a tax” –

Mr Hunt, your statement is factually untrue.

This is not the economic definition of a “tax”.

A “tax” is typically described as follows: “A fee charged (“levied”) by a government on a product, income, or activity… The purpose of taxation is to finance government expenditure”

Furthermore, the “definition” that you have stated is irrelevant, and constitutes a blatant “straw man” fallacy.

I have repeatedly drawn your specific attention to the definition of the government’s proposed scheme, as published on its official climatechange.gov website, and in the 2011 Garnaut Review.

The only definition that is relevant to the matter, is the government’s definition as published in its official documentation. And it is manifest that this does not in any way, shape, or form, define the proposed scheme as a “tax”.  Instead, it clearly and repeatedly identifies the proposed scheme as being “an emissions trading scheme with an initial fixed price period”.

Mr Hunt, your continued obfuscation, resorting to rhetorical fallacies, and above all, your refusal to directly respond to each of the points of reference and concern, and also to the direct requests that I have repeatedly submitted to you, only further evidences that you are persisting in acting in a thoroughly misleading and deceptive manner.

This is wholly unacceptable for any law-abiding citizen in right community standing, and the more especially for an elected representative of the citizens of this nation.

So much so, that I am now considering the option of enlisting the support of the several barristers and lawyers within my blog readership and Twitter following, in the potential pursuit of legal redress against you and/or your Federal Opposition colleagues, pertaining directly to the matters I have repeatedly detailed to you.

I now repeat – again – my previous, itemised requests for your direct response and action.

Sincerely,

***************
Barnabyisright.com

UPDATE 5A:

Correction – I inadvertently neglected to cc Senator Joyce on the last two (2) of my responses above (at Updates 4 and 5). Post edited to remove references.

Tags: , , , , , , , , ,

← Older Entries
Newer Entries →

Design a site like this with WordPress.com
Get started