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Australian National Review – The Great Bond Bomb Was Ticking So Loudly No One Could Hear It Over Its Own Noise
The Great Bond Bomb was Ticking So Loudly No One Could Hear it over its Own Noise
By David Haggith
Now that the Big Bond Bust has happened, as promised here, everyone wants to know how it happened. I want to know how on earth so many of them didn’t know it was going to happen — especially those who were supposed to be watching for this … including the regulators who were actively causing it?
What follows are some of the reasons:
Their hubris
SVB had well over a year to prepare its portfolio to engage with the Fed’s decision to lift the yields on Treasuries, but it took no action to do so. At the time of its collapse 55% of its assets were still invested in bonds, mostly at low-interest rates available over the time when they acquired those bonds that are impossible to sell without a loss when interest rates rise. 47% of SVB’s assets were in long-term bonds (over 5 years to maturity) — the kind that fare worse when you have to trade them during a time when rates have risen!
Tim Gramatovich, chief investment officer at Gateway Capital, told Insider that even though the Fed has been raising interest rates for a year, it was as if a higher-interest-rate landscape came as a surprise for SVB.
“For a $200 billion bank to have no interest rate risk controls is staggering,” he said. “And of course the regulators and rating agencies are allegedly engaged here too. Doing what, we aren’t sure.”
“The Fed says it will investigate its oversight of Silicon Valley Bank following the biggest bank failure since 2008”
And, yet, they took no risk measures at all. SVB could have started to sell off its longer-term bonds in January of 2022, when the Fed made it clear to the entire world it would begin raising interest rates, and then reinvested the money in short-term bonds of ninety days or less. Why didn’t it?
One explanation would be arrogance. In a word, like so many investors over the past year that took heavy losses in bonds and stocks, they believed in the “Fed Pivot” narrative. (OK, that’s two words, so “arrogance.”) They weren’t reading this blog obviously, so they didn’t get it pounded into their heads that the Fed would “not pivot.” And it did not occur to them they could be wrong about that and, so, should take some conservative measures just to be on the safe side. They had a higher percentage of the wrong stuff on their books than anyone. That’s one big reason SVB was first to fold under the Fed’s new tightening regime.
Surely these people, whose job it is to deal daily in the US bond market and to work daily with the Federal Reserve System, were not ignorant enough to not realize bond prices would crash as the Fed raised rates. So, they must have believed the Fed would chicken out. So overconfident were they, they would actually “fight the Fed” as bankers because they believed they could, through sheer testosterone, keep doing as everyone believed in this era they could do in stocks as well — force a different reality because they were indomitable, indestructible and investment geniuses.
Of course the “Fed has our backs” narrative was part of the moral hazard that led so many to ignorantly believe the Fed would chicken out as soon as stocks fell 20%. Then 25%. Then? It was the now infamous “Fed pivot” narrative that addled their brains.
I know I couldn’t convince anyone who wanted to believe otherwise because they all knew they were right, too. The only ones convinced as they read anything I wrote were those already open to consider the fact that the Fed, like a slug, has laid a long slime trail of economic failures through its hundred-plus-year history. The Fed pivot-heads, who have been the vast majority, ignored the obvious fact that the Fed has a legal mandate to fight inflation, which clearly made this time different from all the times when there was virtually no inflation in the Fed’s environs. Many argued with me on a variety of sites that it was always ridiculous at all times to say, “This time is different.”
Well, it was different.
Team SV was also arrogant in that some employees informed the higher-ups of the considerable (obvious) risk from non-diversification, but the highly successful, much-lauded higher-ups didn’t listen to their lessers. They failed because of their arrogance.
When I’m talking with friends about what to do, they would say to me, ‘well, would you just let these companies fail?’
That’s the wrong question. These companies have already failed.
It’s not for me or anybody else to interfere with that – they have failed.
—Joseph Calandro, Jr, November 7, 2009
Their greed
Longterm bonds get better rates than short-term bonds, as a rule, so SVB’s elite kept piling them in, even as the Fed moved into its tightening phase, when they should have been selling them in a more cautious stance, especially given that they held a higher percentage of their assets in such bonds than anyone else:
They suffered from FOMO, the fear of missing out on better yields, and chose to risk their depositors money (as well as their own) by continuing to chase higher yields while ignoring one of the most obvious risks foreseeable (not simply “imaginable”) for banks — a risk so easy to see it doesn’t take a single drop of Elizabeth Warren’s proposed intensified regulations for the regulators who oversaw SVB under existing laws and for the bank, itself, to identify the risk and for those regulators to force the bank to diversify if it was too greedy to do so on its own for its own good.
That recalls to mind Alan Greenspine’s rubric that banks will regulate themselves because it was in their best interest to do so.
Both parties — the bank and its regulators — are completely without excuse, but they will certainly make plenty of excuses.
Their lies
Janet Yellen said she did not see any possibility of systemic risk in Silicon Valley Bank and then Gramma Yellen and Papa Powell built a Fed “facility” overnight to stem the possibilities of systemic risk they didn’t see any possibility of. The ludicrous nature of her lie is self-evident from her actions.
As pointed out in my recent article, “CONTAGION: Terrorist Fed Wipes out Banks,” former FDIC Chair Sheila Bair also dismissed the problem at SVB by claiming,
This is a $200B bank in a $23T banking industry. I think it’s going to be hard to say that this is systemic in any way.
No.
In a word, NO! It would not be hard to say that at all.
Hence, the emergency creation of a new Fed facility to manage the systemic risk.
Those who created the new Fed “facility,” including the FDIC where Ms. Bair used to be in charge, even called their rescue plan for the recently failed banks “systemic”:
“We are also announcing a similar systemic risk exception for Signature Bank, New York, New York, which was closed today by its state chartering authority,” Treasury, Federal Reserve, and FDIC said in a joint statement Sunday evening.…
I don’t suppose you make massive “systemic risk exceptions” for something that is not systemic. They called their bailout plan that because the FDIC has been given special powers by congress for “systemic risk exceptions” — powers that let them bail out rich people and companies who are above the 250,000 FDIC limit if it is a “systemic” emergency. Maybe it is “systemic” when they need it to be, but not when they don’t want to admit it to be because it was under their watch. Otherwise, how dumb do you have to be to get promoted to lead the FDIC? Since Bair probably cannot be that stupid, she lied, and everyone can plainly see (if they are honest at heart) that she was lying.
It also proved to be systemic by the number of banks that started sliding badly with six being downgraded by Moody’s with a “watch” warning on the their credit ratings in the past twenty-four hours. Worse still in terms of systemic breadth, Moody’s downgraded the ENTIRE US banking system outlook to “negative.”
It’s so systemic that it crossed the ocean to Europe. Credit Suisse joined the global stock plunge … again … taking down the euro, the pound Sterling, and the Swiss franc and leading global stock markets down another day. I’d say that felt pretty systemic!
The black heart at the center of BlackRock, CEO Larry the Fink, said the collapse of SVB reveals cracks in the US financial system, affirming Moody’s downgrade of the entire US banking industry; while Carl Icahn opined, “Our system is breaking down…. We absolutely have a major problem in our economy today!“
(All as reported in Wednesday mornings Daily Doom headlines. See the special FREE edition.)
I’d say those are some pretty “systemic” statements and some pretty systemic rating changes by Moody’s and a pretty systemic trans-Atlantic impact. So, Bair was lying through her teeth. When bankster buddies have to assure you all is well, you should probably figure it is not, or they wouldn’t have to make such assurances.
The whole system weakens itself because it gets caught in this big lie that says we have to pretend that Deutsche Bank is a bank instead of a criminal enterprise.
— Bill Black, 2018
Fleeing rats
A couple of weeks before SVB’s big bust, its CEO dumped a major load of stocks. Insider trading? You tell me. I’m sure the Department of Justice or the SEC will soon enough be telling all of us.
Oh, and Wednesday morning’s Daily Doom headlines, also revealed other rats of note. Turns out Signature Bank, which was just seized by the Fed/FDIC (they work in tandem) in a way that looks like the Fed is turning them into an anti-cyrpto poster child for the sake of launching its own central-bank digital currency this year (See my article yesterday, “To be Frank, Barney Bank…“), was already under investigation for money laundering.
Yes, that’s Barney’s Bank. Head banking-regulation legislator, Barney Frank — the guy whose signature and name is on the nation’s big banking regulation bill — sits on Signature Bank’s board. Now the regulators are investigating whether or not Barney’s buddies know how to run money washing machines.
Blind bats
We all clearly saw how Papa Powell and Janet Yellen didn’t see it coming as they reported only hours ahead of the major incidences that all was well on the banking front. Yet, anyone inside those banks and inside the Fed should have seen it coming in the case of these particular banks, and anyone could see it coming in general as part of the bond bust — that it was going to eventually hit banks just like the Repocalypse did in 2019 as reserves get drained down (the part we haven’t quite seen yet) and as bonds get devalued (the part we just saw in this major crash event — the kind of predictable event where I’ve explained you can tell how big it was by how big and exceptional the Fed’s response is).
As Silicon Valley Bank’s red flags were flying, the Fed was AWOL
On Jan. 18, William C. Martin, a short-seller and former hedge fund executive, warned his Twitter followers that they were missing something important about Silicon Valley Bank.
SVB’s shares had lost about 65% of their value over the previous 12 months. Investors had been “rightly fixated” on the bank’s exposure to the venture world, which was getting hammered by the rapid run-up in interest rates, he wrote.
“However, dig just a little deeper, and you will find a much bigger set of problems,” he wrote.
LA Times
William C. Martin saw it coming, but the Fed didn’t. Apparently the regulators don’t believe in digging deeper because January 18 was far enough back that, if this guy could see it from the periphery so clearly, the regulators had plenty of time to dig are without excuse for being so blind.
What Martin had spotted was a plunge in the value of securities in the bank’s portfolio of “held to maturity” securities — Treasury bonds and government-backed mortgage securities that it owned as a backstop to its deposits.
And that is an “uh duh” observation, but no one noticed that bank held so many of those securities as to become a major problem, should it need to actually use its reserves for what reserves are for — making good with depositors should a bunch want their money back all at once — the kind of thing one should also easily have seen as a likelihood in a bank so loaded with the deposits of crypto users and crypto companies who might need to access their cash in the outfall from the Cryptocrash the summer before.
Better not hire the Fed to paint the side of your barn. They can’t see it.
The value of the HTM holdings had declined as interest rates rose. That’s a natural phenomenon: Fixed-income securities always decline in value as rates rise, and rise in value when rates fall.
Exactly. It’s given. That’s why I warned about it here many months ago in my Patron Posts: We’d have a major bond bubble bust that would damage banks once the Fed took interest rates up enough to push bond values down enough.
If the bank were forced to sell off those holdings before maturity, Martin observed, it would be “functionally underwater.”
Indeed. These are observations so simple they don’t even require a stress test.
SVB hadn’t kept this issue a secret. In its financial disclosure for the third quarter that ended Sept. 30, 2022, which was Martin’s source, it reported that its $93.3-billion held-to-maturity portfolio was worth only $77.4 billion in real time
That is true generally at all banks right now. Hence, Moody’s outlook downgrade to “negative” is just catching up with the problem now that it is obvious by making the outlook downgrade it should have made months ago. (It is not as if the problem suddenly changed last week when it surfaced. It is just that blind bats in the regulatory and ratings agencies didn’t see it forming. Now, they do, so it’s CYA time. Time to rate the obvious risk now that everyone knows about it and has seen how quickly the damage can accrue.)
Guys who can’t get a job on Wall Street get a job at Moody’s,” as one Goldman Sachs trader-turned-hedge fund manager put it.
— The Big Short
-or-
The fact that SVB’s problems were hiding in plain sight, right up to the point Friday when the bank was taken over and shut down by California and federal authorities, is certain to be near the top of the agenda as lawmakers, shareholders, customers and regulators examine the disaster.
LA Times
Thank God Moody’s saw the train coming just after it hit them! Just like in 2008, they’re all over it now. I’ve been warning for two years about the Big Bond Bust that was definitely going to happen and its effect on banks just so they cannot say, “No one could have seen this coming.” Yes, you could see it coming, but the blind bats couldn’t see this train until it was shoving their car down the tracks sideways. Apparently they didn’t want to see it; yet, everyone in finance would rather trust credentialed experts than read logical opinions like I hope people will find here.
As the bank’s primary regulator, it was the Federal Reserve’s responsibility to recognize its growing problems and ensure it continued to meet standards of safety and soundness and financial stability, says Dennis Kelleher, chief executive of Better Markets, a Washington-based watchdog over financial institutions and government regulators.
They’ll pass the buck or use the familiar canard, “No one could see this coming.” They must read in all the wrong places.
The bank’s operations bristled with “screaming red flags,” Kelleher told me. These included a “hyperconcentration” of uninsured depositors from a narrow business sector — chiefly high-tech and biotech startups — as well as a dramatic mismatch between assets (that is, loans and investments) and liabilities (deposits) and the mounting tide of unrealized losses on its books.
“These were visible to anyone who wanted to look,” Kelleher told me. “But apparently, the Fed was AWOL.”
Alarm lights, red flags and sirens! It practically looked like a five-alarm fire, but the Fed didn’t see it coming. None of the experts saw it coming. Crazy Cramer even recommended the stock as a bargain buy a month ago as I showed in a video in my “CONTAGION” article.
Everyone who mattered was AWOL. Even the ratings agencies that are now playing CYA, changing their ratings to what everyone now already knows. Even the Fed head and top Treasury toady told us all was well on the banking front.
And such a familiar story this is:
Eisman and his team were so certain the world had been turned upside down that they just assumed Raymond McDaniel [CEO of Moody’s] must know it, too. “But we’re sitting there,” recalls Vinny, “and he says to us, like he actually means it, ‘I truly believe that our ratings will prove accurate.’” And Steve shoots up in his chair and asks, ‘What did you just say?’–as if the guy had just uttered the most preposterous statement in the history of finance. He repeated it. And Eisman just laughed at him. “With all due respect, sir,” said Vinny deferentially, as they left, “you’re delusional.” This wasn’t Fitch or even S&P. This was Moody’s. The aristocrats of the rating business, 20 percent owned by Warren Buffett. And its CEO was being told he was either a fool or a crook, by Vincent Daniel, from Queens….
Once, [Eisman] got himself invited to a meeting with the CEO of Bank of America, Ken Lewis. “I was sitting there listening to him. I had an epiphany. I said to myself, ‘Oh my God, he’s dumb!’ A lightbulb went off. The guy running one of the biggest banks in the world is dumb!”—The Big Short
Nowhere do they appear dumber, however, than at the top of the top of banking. The Fed HAD to know full well that raising interest rates would imperil the liquidity of banks who hold a great part of their reserves in the Treasuries the Fed was forcing to plunge in value. Therefore, the Fed should have and could have done an easy rundown on how many such bonds every bank held and ordered banks that held a risky balance to rebalance before it even got started with its rate hikes.
Was the Fed dumb? Lazy? Corrupt and wanted the banks to fail? Different people will gravitate toward different answers, but ONE answer is very clear. It is entirely without excuse. If I can figure out in general such a problem has to be coming from repricing bonds and will be the nation’s greatest bond bust and William C. Martin can see it is a problem at SVB in particular, it is hard to conceive that the Fed would be this blind.
So, let’s conclude they are not blind bats; they are …
Blind rats
To that screen title, I say, “Um, OK, sure. Whatever you say.” How are you going to keep fighting the inflation you fueled — and must fight by law — and not bust more banks? “I see no problem here,” Yellen is proclaiming. (Like all the other things she’s wrongly proclaimed in recent years.)
She was running the SF Fed when the following happened, so high up in the Fed that didn’t see this problem coming after other smaller problems had erupted:
As Countrywide and other institutions struggled, senior officials at Lehman Brothers pronounced their company safe and healthy. They said Lehman hadn’t made the kinds of bad choices that had sunk other financial firms. After posting another record year in 2006, pulling in $4 billion, it eclipsed its own record in 2007, reporting nearly $4.2 billion in profits. “We believe we have done a good job in managing our risks,” a top Lehman executive said.
from The Monster: How a Gang of Predatory Lenders and Wall Street Bankers Fleeced America by Michael Hudson
Um, OK, sure. Same song different verse. None of these people, Chief Yellen included, saw Lehman coming, even after Bear Stearns had collapsed, Countrywide and other large institutions were erupting with big zits o their noses, etc.
Now Fannie, Freddie Mac and Ginnie Mae have proved the point. The former two collapsed in bankruptcy in 2007, and they’ve now joined Ginnie Mae as departments of the U.S. government, and are sustained purely on taxpayer guarantees
Chris Maloney, MBS strategist at Bank of Oklahoma Capital Financial Markets
History lesson never learned. (Actually, they collapsed in 2008, but the crisis that led to their collapse started in 2007. But, the point is Bear Stearns had already collapsed in March of 2008. Fannie May and Freddie Mac had already been rescued by the government in July, and STILL no one saw Lehman’s September crash coming! It got away with all of its glowing reports, and no regulator called it out! You’d think they might have been digging deep beneath every hood by then.)
From tech stocks to high gas prices, Goldman Sachs has engineered every major market manipulation since the Great Depression — and they’re about to do it again
But in his book, Bailout, Barofsky says that Paulson told him that he believed Morgan Stanley was “just days” from collapse before government intervention, while Bernanke later admitted that Goldman would have been the next to fall.
– Matt Taibbi, Secrets and Lies of the Bailout, January 2013
Ah, but who cares? What are a few bailouts among friends at the club but occasions for cigars and martinis? Somebody gets richer. That’s the whole point of my own little book, “DOWNTIME: Why We Fail to Recover from Rinse and Repeat Recession Cycles.“
After all, wasn’t Barney Frank in the bankster club? I mean, here he was the head legislator behind our major bank regulatory reform, and he was leading Signature Bank as one of its board members since 2015. Couldn’t he see any problems coming from the bond bomb?
No problem with Zombie banks as far as the eye can see:
Bet you couldn’t see that coming!
Every Christian in America is a Target Now
By Michael
This is what happens when you systematically suck all of the values out of a society. There is utter lawlessness in the streets, and violence can literally erupt anywhere. On Monday, a mass shooter ruthlessly gunned down six Christians at a private Christian school in Nashville, Tennessee. The shooter once attended the school, but after leaving the school the shooter developed a deep hatred for the Christian values promoted there. Unfortunately, this incident is a microcosm of what is going on in our society as a whole. Countless voices are stirring up great hatred for the Christian faith, and all of that hate was inevitably going to result in great violence.
When I was growing up, I never imagined that someone would come in to a Christian gathering and start shooting.
But now every Christian in America is a potential target.
If you are a Christian, you will need to be on guard whenever you attend any type of a Christian event from this point forward.
I wish that this wasn’t true, but ignoring the reality of the world that we live in now could get you killed.
Prior to Monday, I am sure that most of those that worked at The Covenant School in Nashville never imagined that something like this would ever happen. The following comes from NBC News…
Three children and three staff members — whose ages ranged from 9 to 61 — were killed at a private Christian school in Nashville on Monday before the shooter, a heavily armed 28-year-old woman, was killed by police, authorities said.
The shooting unfolded at The Covenant School on Burton Hills Boulevard where officers “engaged” the attacker, described by Metropolitan Nashville Police Chief John Drake as a former student at the school.
Actually, NBC News is guilty of “misgendering” the shooter, because “Aiden” has not identified as a woman for quite some time…
BREAKING: Audrey E. Hale, the 28-year-old woman who identifies as he/him and uses the name “Aiden,” is identified as the now-deceased suspect who shot up a Christian school in Tennessee, killing 6, including 3 children. The killings follow the state banning the medical… pic.twitter.com/Sp4RfGwcUj
— Andy Ngô
(@MrAndyNgo) March 27, 2023
And it is also being reported that the shooter “had a manifesto and detailed maps of the school”…
Police said the “lone zealot”, who lived in Nashville, was armed with two assault-type rifles, a pistol and a handgun.
Hale had a manifesto and detailed maps of the school, and entered the building by shooting through a door before the killings.
Video: https://t.co/Er4KpMB4Mg
— Tom Elliott (@tomselliott) March 27, 2023
I can guarantee you that this story will disappear from the news cycle faster than other mass shootings, because it is not a story that the corporate media will be eager to tell.
But the truth is that violence against Christians and Christian institutions is on the rise.
The corporate media is always trying to convince us that political violence from the right is such a threat, but the numbers tell us that political violence is far, far more likely to come from the left. Here is just one example…
There have been 22 times more attacks against pro-life groups since the leak in early May of a draft Supreme Court opinion overturning Roe v. Wade compared to attacks on pro-choice organizations, new data show.
“The overwhelming narrative in the media is the claim those on the right are responsible for most of the politically motivated violence in the U.S. It has been a theme in the news media after the Supreme Court’s Dobbs decision was leaked, with many claiming that there was disproportionate violence against pro-choice providers. But a review of cases shows over 22 times more violence against pro-life advocates,” John Lott, the founder and president of the Crime Prevention Research Center (CPRC), told Fox News Digital on Monday.
In recent years there have been hundreds of attacks on police by radical leftists, and one lunatic actually put a “bounty” on more than 9,300 Los Angeles police officers…
Three Los Angeles police officers are suing the owner of killercop.com, accusing him of publishing their photos on his website and putting out a “bounty” on them.
It is the first legal action stemming from the Los Angeles Police Department’s release of the names and photos of almost every sworn officer — more than 9,300 officers, including some who work undercover — as part of a public records request. A police watchdog group posted the images online last Friday.
But these days attacking those that are promoting traditional values has become even trendier than attacking the police.
Sadly, this is happening all over the western world. Just check out what happened when Posie Parker attempted to hold a public event in New Zealand the other day…
#WATCH RNZ’s Jordan Dunn captured the moment that Posie Parker was escorted away from the rally.
The counter-protest crowd gathered in Albert Park this morning before Parker’s speech, and made a cacophany of noise to drown her speech out.
https://t.co/a9ZWNhKuDn pic.twitter.com/yFQm9yrJ7A
— RNZ (@radionz) March 25, 2023
So what was her crime?
She believes that a “woman” is a biological woman.
If you don’t agree with her, then make your case.
But don’t get violent.
Sadly, the “woke crowd” has become so angry and so violent that you can’t even have a rational discussion with them about any of these issues. I really like how this guy put it…
Sean absolutely nails it.pic.twitter.com/b2VWwNrVbg
— James Melville (@JamesMelville) March 26, 2023
If you do not go along with their agenda, they will seek to punish you however they can.
In fact, a bill that has just been introduced in the Minnesota legislature would actually take children away from parents that do not allow their kids to get “gender-affirming health care”…
Minnesota lawmakers have advanced legislation introduced by a transgender representative that could strip custody from parents who do not support their child changing genders.
The bill, HF 146, moved forward with a vote of 68-62, along party lines.The bill says that the state can claim temporary emergency jurisdiction over a child if they are in the state and “the child has been unable to obtain gender-affirming health care.” It is meant to prevent law enforcement from removing a child from parental custody based on an order made outside the state.
This is what we are becoming as a nation.
And the values that this nation was founded upon are rapidly disappearing…
Patriotism, religious faith, having children and other priorities that helped define the national character for generations are receding in importance to Americans, a new Wall Street Journal-NORC poll finds.
The survey, conducted with NORC at the University of Chicago, a nonpartisan research organization, also finds the country sharply divided by political party over social trends such as the push for racial diversity in businesses and the use of gender-neutral pronouns.
People often wonder why I talk about “values” so much.
This is why.
Our country is decaying from within, and most people don’t seem to care.
But if we don’t stand up now while we still can, eventually just about everything that we love about America will be completely gone.
The Trump Campaign’s Collusion With Israel
By James Bamford
While US media fixated on Russian interference in the 2016 election, an Israeli secret agent’s campaign to influence the outcome went unreported.
“Roger, hello from Jerusalem,” read the message from the Israeli secret agent. Dated August 12, 2016, it was addressed to Roger Stone—at the time a key player in Donald Trump’s presidential election campaign. “Any progress? He is going to be defeated unless we intervene. We have critical intel. The key is in your hands! Back in the US next week.” Later, the agent promised, “October Surprise coming!”
While the American media and political system fixated on Russian President Vladimir Putin and his armies of cyber warriors, trolls, and bots, what was completely missed in the Russiagate investigation of 2016 was the Israeli connection. No details of it were ever revealed in the heavily redacted Mueller Report. Nor was there any mention of an Israeli plot in the similarly redacted Senate Intelligence Committee Report on collusion charges in the 2016 election, or in any of the indictments or trials stemming from the Russia charges. Nor did any mention of Israeli involvement ever leak into the press. Yet I can reveal here the details of an elaborate covert operation personally directed by Prime Minister Benjamin Netanyahu that aimed to use secret intelligence to clandestinely intervene at the highest levels in the presidential election on behalf of Trump.
Shadowy hints of the plot only became visible with the little-noticed release in 2020 of a heavily redacted May 2018 FBI search warrant and its accompanying affidavit. As part of the Mueller investigation, the bureau had conducted an extensive search for any foreign interference in the 2016 election, and the warrant was directed at securing the Google accounts of a mysterious Israeli agent acting under the direction of someone identified as “PM.” The FBI agent who wrote the affidavit noted, “I believe ‘PM’ refers to the ‘Prime Minister.’”
In the spring of 2016, no issue was more important to Benjamin Netanyahu than Donald Trump winning the White House. The GOP presidential candidate was key to everything he was after, from ending the Iran nuclear agreement, to recognizing Jerusalem—rather than Tel Aviv—as Israel’s capital, to continuing the occupation of Palestine. But November was months away, and there was no guarantee Trump would win. In the meantime, Netanyahu was under mounting pressure from President Barack Obama to finally resolve the issues surrounding Palestine. Leading the charge on behalf of Obama was Secretary of State John Kerry, who was equally determined to find a solution after many years of trying.
Kerry was not alone. The Middle East Quartet, a group formed to mediate the Palestine-Israel peace process that included representatives from the United Nations, the European Union, the United States, and Russia, was also seeking a solution to the issues surrounding the occupation—and it was about to release a report that was expected to be highly critical of Israel. With so much on the line, Netanyahu appears to have made a drastic decision. He would dispatch a discreet, highly trusted aide, armed with critical intelligence, to covertly “intervene” in the US election to help put his man Trump in the White House. Based on the FBI documents, the intelligence appears to have consisted of advance knowledge of Russia’s hacking of the Democratic National Committee (DNC) and Hillary Clinton’s presidential campaign, and it may have included confidential details from the stolen e-mails. It was likely obtained by Israeli eavesdropping operations that were targeting secret Russian communications, as well as those of WikiLeaks.
Although the affidavit did not specify any individual defendants, the numerous potential criminal charges laid out in the FBI documents spoke to the seriousness of the Israeli plot. They included violation of the foreign contributions ban, which prohibits foreigners from contributing money or something of value to federal, state, or local elections. Other charges included aiding and abetting, conspiracy, wire fraud, and attempted conspiracy to commit wire fraud. Still another charge, “unauthorized access to a protected computer,” indicates Israel may have conducted illegal hacking operations. Based on the e-mails and text messages contained in the documents, the conspiracy began in the late spring of 2016, when it was beginning to appear that Trump had a good chance of winning the Republican nomination.
This was also when the FBI and the media began focusing heavily on possible Russian collusion with the Trump campaign, as a result of Moscow’s hacking of the DNC and the Clinton campaign. But while the Mueller investigation was never able to conclusively demonstrate any collusion with Russia, the FBI did uncover hard evidence of extensive collusion between close Trump associates and the highest levels of the Israeli government.
Common cause: Donald Trump speaking at a campaign press conference at the AIPAC Policy Conference in Washington, DC in 2016.
On the sixth floor of a concrete-and-glass high-rise just south of Tel Aviv, behind a door marked “Unit 17” in Hebrew, political operatives plot newer and more creative ways to use fraud to win elections across much of the planet. The 16-story Azrieli Business Center in Holon is home to Archimedes Group, a private intelligence company that boasts that it can “change reality according to our client’s wishes.” Those clients stretch from Africa to Latin America to Southeast Asia.
In Nigeria in 2018, the company’s campaign of lies and misinformation helped reelect former military coup leader Muhammadu Buhari as president. Hired by other would-be presidents and politicians around the world in at least 13 countries, Archimedes soon had 3 million people following its phony Facebook and Instagram accounts. It even created bogus “fact-checking” accounts to lie about its fake news stories, claiming they were based on solid facts.
But in May 2019, Facebook caught on to the various scams and removed 265 Facebook and Instagram accounts from the orbit of the Archimedes operation. “Archimedes Group,” it said, “has repeatedly violated our misrepresentation and other policies, including by engaging in coordinated inauthentic behavior. This organization and all its subsidiaries are now banned from Facebook, and it has been issued a cease and desist letter.”
Archimedes is hardly alone. An Israeli government official told the Times of Israel that outsourcing fake news and voter manipulation is a growth industry in Israel because many young Israelis who serve in intelligence units in the army are trained in the use of “avatars,” or fake identities, on social media. The Israeli government appears to have made no effort to halt or even curb the activity. Such inaction may be deliberate, since a number of the groups that engage in voter manipulation have close ties to the intelligence and defense agencies, possibly providing Netanyahu an opportunity to secretly manipulate foreign elections to Israel’s benefit.
In fact, a recent multinational journalistic investigation revealed that Israel has become a world center for the export of election fraud, fake news, hacking of private e-mails, and disinformation. Connections were discovered between private intelligence firms and both Israel’s Ministry of Defense and the firm Cambridge Analytica, which illegally collected data from more than 87 million Facebook users for use in the 2016 presidential campaigns of Donald Trump and Ted Cruz.
The eight-month international collaborative project involved journalists from 30 news outlets, including Israel’s Haaretz, the UK’s Guardian and Observer, France’s Le Monde, Germany’s Der Spiegel, and Spain’s El Pais. They discovered an Israel-based “global private market in disinformation aimed at elections,” according to The Guardian. Among the individuals unmasked was Tal Hanan, a former Israeli special forces operative and the head of a secretive organization with the code name “Team Jorge” whose specialty was weaponizing disinformation worldwide “to covertly meddle in elections without a trace,” said The Guardian.
Hanan told the undercover reporters that his services had been used in Africa, South and Central America, the US, and Europe, and that his company had completed “33 presidential-level campaigns, 27 of which were successful.”
What was not revealed in this investigation, however, was the separate and far more covert operation undertaken by Netanyahu and his secret agent to clandestinely manipulate America’s 2016 presidential election for Netanyahu’s own political purposes.
A discreet man: Jerusalem attorney Isaac Molho is one of Netanyahu’s oldest and most trusted advisers.
For years, the man Netanyahu relied on to do battle with Kerry and the Quartet was his top personal aide, Isaac Molho, a secretive and shadowy private attorney who was trusted with the prime minister’s most sensitive missions. “There has probably never been a person in the history of this country in such a desirable position as Isaac Molho,” Haaretz noted. “He enjoys almost complete silence from the media…. On Prime Minister Benjamin Netanyahu’s instructions, Molho undertakes sensitive missions to countries with which Israel has no diplomatic ties. The Mossad supplies him with logistical backing, security and transport.”
Some of Molho’s assignments are too sensitive even for the Mossad—a fact that has at times frustrated those at the spy agency. “The Mossad gritted its teeth over the past eight years while watching the diplomatic missions carried out by Isaac Molho, without any requirement to take a polygraph test and as a private citizen with business and other affairs that are not subject to civil service regulations,” Haaretz said. In addition to national loyalty, Molho, whose wife is Netanyahu’s cousin, may even be acting out of family loyalty.
Although the secret agent’s name was redacted from the FBI’s search warrant, his profile, as outlined in the accompanying affidavit, is strikingly similar to that of Isaac Molho. Like Molho, who was described by Haaretz as a “discreet man for sensitive missions,” the secret agent is described as highly trusted and very close to Netanyahu. Most important, at one point, according to the affidavit, the agent was summoned from the US to Rome at a moment’s notice to be by Netanyahu’s side on a date the Israeli prime minister was conducting negotiations with John Kerry in the Italian capital over Palestine. This critical role was for many years played exclusively by Molho. In addition, the agent referred to in the warrant had enough clout and authority to direct the actions of two other high-ranking Israeli officials involved in the clandestine operation to influence the results of the US election. Molho did not respond to The Nation’s request for comment.
The key for the Israeli agent was finding a back door—a covert channel—to Trump. Roger Stone, long a key Trump aide, fit the bill. Although Stone had formally left the campaign, he and Trump spoke frequently and confidentially. For these calls, Trump would often use the phone of his security director, Keith Schiller, “because he did not want his advisers to know they were talking,” according to Sam Nunberg, a political adviser who served on Trump’s 2016 election campaign. Stone energetically supported Israel’s harsh occupation of the Palestinian territories and its bellicose stance toward Iran; following Trump’s speech at an American Israel Public Affairs Committee (AIPAC) conference in March 2016, Stone noted approvingly that “Donald Trump is a radical Zionist.”
Another Trump aide heavily involved in the conspiracy, according to the FBI documents, was Stone’s associate Jerome Corsi, who appears to have been the original contact who connected the Israelis to Stone. An ultraconservative journalist with a doctorate in political science from Harvard and the author of a shelf of books harshly critical of liberals and Democrats, Corsi was a leading literary light of the extreme right. He gained fame in 2004 for his “swiftboating” attacks on the military record of then–presidential candidate John Kerry. The secret agent was particularly drawn to Corsi’s adulation of Israel and support for its belligerence toward Iran.
Hiding behind his online pseudonym “jrlc,” Corsi was also a virulent Islamophobe. Posting on the conservative forum FreeRepublic.com, he has called Islam “a virus” and “a worthless, dangerous Satanic religion” and has written that “Islam is a peaceful religion as long as the women are beaten, the boys buggered, and the infidels killed.”
After Corsi provided contact information to Stone, the secret Israeli agent and Stone connected. Then, on May 17, the agent wrote, “Hi Roger, I hope all is well. Our dinner tonight for 7PM is confirmed. I arrive at 4PM. Please suggest a good restaurant that has privacy.” The original plan was for Stone and the agent to meet alone, but Stone wanted to bring Corsi along as backup. “I am uncomfortable meeting without Jerry,” Stone wrote, and then rescheduled the dinner for the next day.
According to the FBI warrant, the same day that Stone communicated with the Israeli agent, he began Googling some very strange terms, including “guccifer” and “dcleaks.” It would be nearly a month before those same terms would make headlines around the world. On June 14, The Washington Post reported that the DNC had been hacked by Russian government agents. The next day, someone calling himself “Guccifer 2.0” took credit for the attack. He claimed to be an American hacktivist, but according to a Justice Department indictment in July 2018, he was actually a Russian GRU employee. Soon afterward, the website DCLeaks—another front for the GRU—began releasing hacked Democratic Party documents.
The timing implies that the Israeli agent was Stone’s most likely source of confirmed details of a Russian cyberattack on the DNC, a month before it became known to anyone outside of the Kremlin and the GRU. If that’s the case, there are two critical questions: How did the Israeli agent know, and why was he revealing the details to a close associate of Trump rather than to the Obama administration, Israel’s supposed ally?
On May 18, the day after Stone’s Google searches, Stone, Corsi, and the Israeli agent met for dinner at the 21 Club on 52nd Street in New York City. The restaurant, which features a balcony lined with painted iron lawn jockeys, was a regular Trump hangout. At the top of the agent’s agenda was getting Stone to quickly set up a confidential meeting with the candidate. The next day, the agent pressed Stone in an e-mail: “Did You Talk To Trump This Morning? Any News?” But Stone was coy. “Contact made—interrupted—mood good.”
Then, in early June, according to the Senate Intelligence Committee Report, Stone learned that Julian Assange, the head of WikiLeaks, was about to release something “big.” Stone relayed the details to Rick Gates, Trump’s deputy campaign manager, and told him that Assange appeared to have Clinton’s e-mails. Yet it wasn’t until later, on June 12, that Assange would publicly announce that WikiLeaks had “emails relating to Hillary Clinton which are pending publication.”
These were the first of many tips to Stone that appear to have come from his new Israeli friend. Two days later, the DNC announced that it had been hacked by Russia. The day after that, Stone again Googled “Guccifer” and “dcleaks,” hours before Guccifer 2.0 publicly claimed responsibility. On June 21, as Guccifer released more documents, the Israeli agent notified Stone that he was in New York accompanied by a senior official and would like a meeting with Trump. “RS: Secret,” said the message, according to the FBI documents. “Cabinet Minister [redacted] in NYC. Available for DJT meeting.”
Other parts of the message were also redacted, but in the affidavit the FBI revealed the cabinet minister’s official title: “According to publicly-available information, during this time [redacted] was a Minister without portfolio in the [redacted] cabinet dealing with issues concerning defense and foreign affairs.” At the time, the only minister without portfolio in the Israeli government was Tzachi Hanegbi, one of Prime Minister Netanyahu’s oldest and closest confidants, and Wikipedia (the likely source of the FBI agent’s “publicly- available information”) uses nearly identical language to describe him. Israeli press reports at the time indicated that Hanegbi was in the United States on that date as part of a delegation attending the unveiling of Israel’s new F-35 stealth fighter jet.
Married to an American from Florida and fluent in English, Hanegbi previously held a post as minister of intelligence supervising Mossad and Shin Bet, the Israeli internal security service. The question is, why would a high-level confidant of Netanyahu’s, with an intelligence background and close American links, seek a secret meeting with a US presidential candidate?
Trump had been busy, hustling from city to city on the campaign trail and hitting several rallies a day. Taking valuable time to meet a couple of Israeli contacts was not a high priority, especially without any idea what the meeting would be about. So, on June 25, Hanegbi returned to Israel. “Roger, Minister left,” said the Israeli agent. “Sends greetings from PM. When am I meeting DJT? Should I stay or leave Sunday as planned?” The next day, Stone replied, “I would not leave as we hope to schedule the meeting mon or tues.”
One possible explanation of the agent’s sense of urgency was Obama’s and Kerry’s increasing pressure on Netanyahu to resolve the Palestinian issue. A key element of that solution would be agreeing to negotiate an equitable division of Jerusalem, since both sides claimed it as their capital. But if his secret agent could confidentially meet with Trump and get a commitment that, if elected, he would support keeping Jerusalem undivided, then Netanyahu could ignore Obama. An election win for Trump, therefore, would also be a win for Netanyahu. Especially since the candidate was already fully committed to another key issue for Netanyahu: canceling the nuclear deal with Iran.
A united front: Trump and Netanyahu participate in a joint statement in the East Room of the White House in 2020.
Suddenly, there was a change in plans. According to the FBI documents, the agent was ordered by Netanyahu to postpone the appointment with Trump and instead get on the next plane for Rome. In a last-minute effort to find a solution to Jerusalem and the Palestinian issue, meetings in the Italian capital were set up between Netanyahu, Kerry, and the European Union’s foreign policy chief, Federica Mogherini. Netanyahu wanted his aide, the agent, at his side. At the meeting, the elephant in the room was a forthcoming report by the Middle East Quartet. It was expected by all to be extremely critical of Israel for its apartheid settlement policies and its treatment of the occupied Palestinians.
The night before the meeting, Netanyahu and Kerry met for dinner at Pierluigi, a popular seafood restaurant in Piazza de Ricci, a block from the Tiber. “What is your plan for the Palestinians?” Kerry asked as the prime minister began chain-smoking a batch of thick Cuban cigars. “What do you want to happen now?” Netanyahu offered a vague response involving a regional initiative, but Kerry wasn’t buying it. “You have no path of return to direct talks with the Palestinians, or a channel to talks with Arab countries,” Kerry told the prime minister, according to Haaretz. “You’ve hit the glass ceiling. What’s your plan?” he asked again. But Netanyahu may well have had one: to use his agent, perhaps sitting with them at that very table, to help put Trump in the White House.
On June 28, after the meeting in Rome had concluded, the agent quickly dashed off another message to Stone: “RETURNING TO DC AFTER URGENT CONSULTATIONS WITH PM IN ROME. MUST MEET WITH YOU WED. EVE AND WITH DJ TRUMP THURSDAY IN NYC.”
The meeting with Trump was rescheduled for 1 pm on Wednesday, July 6, before the candidate took off for a rally in Sharonville, Ohio. The Israeli agent flew to New York the day before and checked into the St. Regis, the French Beaux Arts–style hotel on East 55th Street. The next morning, he had planned to rendezvous with Stone in the lobby for a pre-meeting discussion. “At the St Regis With Lt General. Waiting For You Thank You,” he wrote.
But there were problems involving secrecy. Stone, at his home in Florida, had come down with a bad cold and was too ill to travel, so he arranged for Corsi to make the introduction. That made the Israeli agent uncomfortable because of the sensitive nature of the discussion. “I have to meet Trump alone,” he said, and they agreed that Corsi would leave after the introduction. There was still another problem, however. The meeting was meant to be secret, but the agent was accompanied by an Israeli lieutenant general. So once again the meeting had to be postponed.
Who was this lieutenant general? Unlike in the United States, where the highest military rank is a four-star general, in Israel it’s a three-star lieutenant general, and there is only one, the chief of the General Staff, the commander in chief of the Israel Defense Forces (IDF)—the equivalent of the chairman of the Joint Chiefs of Staff. At the time, that was Lt. Gen. Gadi Eizenkot. But it’s unlikely that Eizenkot was the person waiting in the lobby of the St. Regis to meet with Trump. Eizenkot had little to do with the election—and had actually sided with Obama on the issue of Iran. In January 2016, he said that the nuclear deal “had actually removed the most serious danger to Israel’s existence for the foreseeable future, and greatly reduced the threat over the longer term.”
Instead, it may have been Eizenkot’s predecessor, Benny Gantz, who had retired as head of the IDF in February 2015 but still held the rank of lieutenant general in the reserves and was often referred to by his military title. He was in charge of the IDF during Israel’s war on Palestinians in Gaza in 2014. It was a war that produced a “vastly disproportionate” number of civilian deaths: 1,400 of the nearly 2,300 people killed in the conflict, according to Human Rights Watch. Gantz would later boast that “parts of Gaza were sent back to the Stone Age.”
In May 2020, Gantz would become the second-most-powerful person in Israel under Netanyahu, as the alternate prime minister. At the time of the canceled meeting with Trump, however, he was the chairman of Fifth Dimension, an Israeli private intelligence company run by a former deputy head of Mossad, with another former Mossad member as CEO.
Fifth Dimension wasn’t the only Israeli spy company with close ties to Israeli intelligence. Another was Psy Group, a private intelligence firm that operated under the motto “Shape Reality.” Earlier that year, on behalf of the Ministry of Strategic Affairs, Psy Group had carried out Project Butterfly, a covert operation that spied on and attacked Americans who supported the Boycott, Divestment, and Sanctions (BDS) movement. In April 2016, it offered Trump campaign official Rick Gates another secret operation, Project Rome. The subtitle of the six-page proposal clearly spelled out its objective to covertly interfere with the US presidential election: “Campaign Intelligence & Influence Services Proposal.”
Secrecy was paramount. “We recommend keeping this activity compartmentalized and on need-to-know basis since secrecy is a key factor in the success of the activity,” the proposal said. “Due to the sensitivity of some of the activities and the need for compartmentalization and secrecy, Psy Group will use code names.” Trump was called “Lion,” Hillary Clinton was “Forest,” and Ted Cruz was “Bear.” “This document details the services proposed by Psy Group for the ‘Lion’ project between now and July 2016,” the proposal noted, referring to the period of the US primaries.
The Project Rome proposal read like an official Ministry of Strategic Affairs or Mossad operational document, referring to “multisource intelligence collection,” “covert sources,” “automated collection and analysis,” and an “intelligence dossier on each target, including actionable intelligence.” “Once the information has been uncovered or extracted, it is delivered to the Influence platform for use in the campaign as needed,” the proposal said.
Project Rome’s “Influence+ process” platform involved targeting American voters through “authentic-looking 3rd party platforms”—that is, fake news sites—and also through the use of “tailored avatars,” thousands of phony social media accounts on platforms such as Facebook. “The purpose of these platforms is to engage the targets and actively convince them or sway their opinion towards our goals.” The “targets” were unwitting American voters. “The team will include over 40 intelligence and influence experts,” the document said. Then there were what internal company e-mails called “physical world ops like counter protesters, hecklers, etc.” The techniques were nearly identical to those used by the Israeli firms Archimedes Group and “Team Jorge” to secretly throw elections around the world.
The price tag for the operation was $3,210,000, with another $100,000 for media expenses and $400,000 more for “negative opposition.” It appears that Gates, wisely, passed on Project Rome. The key players behind Psy Group later formed a new Israeli company, Percepto International. Also investigated by the international journalism collaboration, it was labeled “an Israeli factory for online deception” by Haaretz.
Despite the Trump campaign’s rejection of Project Rome, covert high-level approaches to Roger Stone to get directly to Trump continued.
“Hi Roger,” the Israeli agent wrote on July 8. “Have you rescheduled the meeting with DJT? The PM is putting pressure for a quick decision.” Stone wrote back that Trump would not be back in New York until after the Republican National Convention, so the meeting would have to be postponed until then. He added, “Sorry about the fiasco last week, however you can’t just bring the General without tell[ing] me.”
As Trump stormed the Midwest for votes, Guccifer 2.0 was making final preparations for another major release of documents. On July 14, Guccifer sent WikiLeaks an e-mail titled “big archive,” with a one-gigabyte encrypted attachment. Four days later, on July 18, the WikiLeaks Twitter account notified Guccifer the data had been received and that release of the hacked DNC e-mails was planned for later in the week.
On or around the next day, Donald Trump was in his New York office venting at the press for its criticism of his wife Melania’s Republican convention address the night before. There were accusations that she had borrowed passages from a speech by Michelle Obama. At some point, however, according to Trump attorney Michael Cohen’s Senate Intelligence Committee testimony, Trump took a phone call from Roger Stone.
“Roger, how are you?” said Trump.
“Good,” Stone replied. “Just want to let you know I got off the telephone a moment ago with Julian Assange. And in a couple of days, there’s going to be a massive dump of e-mails that’s going to be extremely damaging to the Clinton campaign.”
Trump was pleased. “Uh, that’s good. Keep me posted,” he said into a small black speaker box on his desk. Sitting nearby was Michael Cohen. “Do you believe him? Do you think Roger really spoke to Assange?” Trump asked.
“I don’t know,” Cohen said. “Roger is Roger, and for all you know, he was looking on his Twitter account. I don’t know the answer.”
In the end, neither Mueller’s team nor the FBI could ever find any substantive or conspiratorial communications between Stone and WikiLeaks. He had exchanged a few innocuous messages with Guccifer, later reviewed by the FBI, but there was no indication of how Stone could have known what he knew—which left only one apparent explanation: that the information had been passed to him by Netanyahu’s agent. As in the case of the DNC hack, the information was 100 percent accurate. There was never any evidence that Stone learned of the releases from either WikiLeaks or the Russians, but during that period both he and Jerome Corsi were in contact with the Israeli agent. Israel’s version of the NSA, Unit 8200, which employs some of the most highly trained signals intelligence specialists in the world and is equipped with advanced intercept capabilities, may well have been surveilling Russia and WikiLeaks.
Three days later, on July 22, as Hillary Clinton was preparing to announce her choice of a running mate on the eve of the Democratic National Convention, WikiLeaks released approximately 20,000 e-mails stolen from the DNC. “I guess Roger was right,” Trump told Cohen. Paul Manafort, Trump’s campaign manager, agreed. Sitting on the tarmac in his plane, about to take off for his next rally, Trump delayed the flight for half an hour to work the messages into his speech. Hungry for more, he later told Manafort to keep in touch with Stone about future WikiLeaks releases.
On Wednesday, July 29, the Israeli agent was back in touch with Stone and Corsi and eager to connect with Trump now that the convention was over and he was the Republican nominee. “HI ROGER,” the agent wrote. “HAVE YOU SET UP A NEW MEETING WITH TRUMP? I PLAN TO BE BACK IN THE US NEXT WEEK. PLEASE ADVISE. THANK YOU.” Stone sent a message to Manafort about finding a time to communicate, writing that there was “good shit happening.” The next day, the two spoke on the phone for 68 minutes. The following day, July 31, Stone had two phone calls with Trump that lasted over 10 minutes.
Then on Tuesday, August 2, despite previous failed attempts to connect with Assange, Corsi was nevertheless able to send a detailed message to Stone about WikiLeaks’ future plans:
Word is friend in embassy plans 2 more dumps. One shortly after I’m back. 2nd in Oct. Impact planned to be very damaging…. Time to let more than Podesta to be exposed as in bed w enemy if they are not ready to drop HRC. That appears to be the game hackers are now about. Would not hurt to start suggesting HRC old, memory bad, has stroke—neither he nor she well. I expect that much of next dump focus, setting stage for Foundation debacle.
Corsi later told Stone that there was “more to come than anyone realizes. Won’t really get started until after Labor Day.” The details, including the first indication that Clinton campaign chairman John Podesta was a target, were coming from somewhere other than Assange.
“Roger—As per PM we have one last shot before moving on,” the Israeli agent wrote to Stone on August 9. “Can you deliver? History will not forgive us. TRUMP IN FREE FALL. OCTOBER SURPRISE COMING!” What the “October Surprise” consisted of was left unexplained, but the implication was that there would be a spectacular new release of stolen e-mails, possibly centering on Podesta.
Three days later, the agent was even more frantic. He sent Stone his “hello from Jerusalem” message, promising that his government was prepared to “intervene” in the US election to help Trump win the presidency and offering to share critical intelligence to make it happen. Stone replied cryptically: “Matters complicated. Pondering.” Then, the following week, on August 20, Corsi suggested a meeting with the secret agent to determine “what if anything Israel plans to do in Oct.”
From the messages, it appears that Israel either had its own October Surprise planned or was aware of Guccifer’s planned release of the Podesta e-mails before the election. The day after Corsi suggested meeting with Netanyahu’s agent, Stone for the first time publicly indicated that Podesta would soon become a target of WikiLeaks—thereby predicting the event six weeks before it happened. “Trust me, it will soon the [sic] Podesta’s time in the barrel. #CrookedHillary,” said his tweet. Since neither Assange nor Guccifer was a source for either Corsi or Stone, the tweet once again points to the Israeli agent who was in communication with both of them about the October Surprise.
The prospect of an October Surprise, along with the offer of critical intelligence, apparently got Trump’s attention. On September 25, he and his son-in-law, Jared Kushner, met privately with Netanyahu and Israeli Ambassador Ron Dermer in his Trump Tower penthouse. Later that day, he publicly announced that if he was elected, his administration would finally “recognize Jerusalem as the undivided capital of the State of Israel.” Since 1947, there has been virtual unanimity within the international community—and among US presidents—that the future of Jerusalem must be the subject of negotiations between Israel and the Palestinians. Now Trump was vowing to trash that consensus, along with the Palestinians, and support Netanyahu’s agenda. Whether Trump and the Israeli agent ever met in person is unclear. By late summer, Stone and Corsi were becoming increasingly concerned about potential charges, and to eliminate a paper trail they began meeting only in private with the agent. What is very clear, however, is that in the end Netanyahu got what he wanted—and so did Trump.
Around the same time, Stone had a conversation with Paul Manafort, who by then had left the campaign but stayed in communication with Trump’s political circles. According to Manafort’s later Senate Intelligence Committee testimony, Stone told him that “John Podesta was going to be in the barrel,” repeating the claim he made by tweet on August 21, and that “there were going to be leaks of John Podesta’s emails.” A few days later, on September 29, Stone called Trump, who was on the way to New York’s LaGuardia Airport in his black bulletproof limo. After concluding the call, Trump told Rick Gates, who was sitting next to him, that “more releases of damaging information would be coming.”
On October 7, WikiLeaks unleashed 2,050 Podesta e-mails that were damaging to Hillary Clinton and her campaign—just as Stone had predicted a month and a half earlier. But Stone’s concern about potential criminal charges seems to have turned into outright paranoia. Given that he had no close links to Assange or the Russians, the likely focus of his concerns were his numerous communications with the Israeli secret agent. After all, Stone had discussed clandestine foreign intervention in a presidential election, had made arrangements for Trump to meet a foreign agent, and had predicted the October Surprise. The prospect that authorities might look into any of these actions could certainly have been sufficient to rattle his nerves.
By secretly assisting Netanyahu’s agent in an attempt to make contact with a presidential candidate—aware that he intended to interfere in the US election on behalf of his country—both Stone and Corsi could have faced serious charges as agents of a foreign power under Section 951 of the criminal code, which makes it a crime to covertly assist a foreign government without registering.
Even before WikiLeaks released the Podesta e-mails in October, Stone and Corsi seemed to become nervous that someone would discover their back channel. Soon after the “Podesta’s time in the barrel” tweet in August, Stone and Corsi tried to find a way to somehow account for that unique insight. On August 30, Corsi said in his 2019 book Silent No More, “I suggested Stone could use me as an excuse, claiming my research on Podesta and Russia was the basis for Stone’s prediction that Podesta would soon be in the pickle barrel.” He added, “I knew this was a cover-story, in effect not true, since I recalled telling Stone earlier in August that Assange had Podesta e-mails that he planned to drop as the ‘October Surprise.’” The next day, Corsi said, he e-mailed to Stone “a nine-page background memorandum on John Podesta that I had written that day at Stone’s request.”
Following the Podesta dump, the cover-up became more frantic. Stone ordered Corsi to delete e-mails related to Podesta and hid his own communications with Corsi about WikiLeaks. Stone also pointed a finger at Randy Credico, a onetime friend who had a radio program in New York, as his back channel to WikiLeaks. Credico had interviewed Assange on his program, but that was four days after Stone’s tweet about Podesta’s upcoming time in the barrel. Credico denied under oath that he had acted as a back channel for Stone, and there was never any evidence to show he had.
In a predawn raid on January 25, 2019, heavily armed FBI agents stormed Roger Stone’s Fort Lauderdale, Fla., home and placed him under arrest. He was charged with seven criminal offenses, including one count of obstruction of an official proceeding, five counts of false statements, and one count of witness tampering. Later that day, Stone was released on a $250,000 signature bond. Defiant, he said he would refuse to “bear false witness” against Trump. Finally, on November 15, 2019, after a weeklong trial and two days of deliberations, Stone was convicted on all counts and sentenced to 40 months in federal prison. But on July 10, 2020, a few days before Stone was to turn himself in, Trump commuted his sentence, personally calling him with the news.
Throughout this chain of events—including the trial, the Mueller Report, and the nearly 1,000-page Senate Intelligence Committee Report—no hint of the involvement of Israel was made public. Despite the clear violations of US law and months of clandestine, high-level attempted interference in the presidential election, no details were released, and no congressional hearings or investigations took place. Nor was there ever a hint in the press, which remained transfixed by Russia.
The evidence, however, suggests that throughout the summer and into the fall of 2016, Israel illegally interfered in the US presidential election. A top agent of Netanyahu was secretly offering intelligence and other covert assistance to Trump to get him elected—all with virtually no oversight or scrutiny by the FBI or the US media, though both had numerous personnel in Israel at the time. Now Netanyahu is back in office as prime minister, and Trump is once again running for president. All the ingredients are there for history to repeat itself, unless the Justice Department and Congress conduct long-overdue investigations into the real source of secret foreign collaboration and interference in the 2016 election, and both the FBI and the media remove their self-imposed blinders when it comes to Israel.
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Australian National Review – Governance By Artificial Intelligence:The Ultimate Unaccountable Tyranny: The Elites Will Present AI As The Great Adjudicator, The Pure And Logical Intercessor Of The Correct Path; Not Just For Nations And For Populations At Large But For Each Individual
Governance By Artificial Intelligence:The Ultimate Unaccountable Tyranny: The elites will Present AI as the Great adjudicator, the Pure and Logical Intercessor of the Correct Path; Not Just for Nations and For Populations at Large But for Each individual
By Brandon Smith
It’s no secret that globalist institutions are obsessed with Artificial Intelligence as some kind of technological prophecy. They treat it as if it is almost supernatural in its potential and often argue that every meaningful industrial and social innovation in the near future will owe its existence to AI. The World Economic Forum cites AI as the singular key to the rise of what they call the “Fourth Industrial Revolution.” In their view, there can be no human progress without the influence of AI algorithms, making human input almost obsolete.
This delusion is often promoted by globalist propagandists. For example, take a look at the summarized vision of WEF member Yuval Harari, who actually believes that AI has creative ability that will replace human imagination and innovation. Not only that, but Harari has consistently argued in the past that AI will run the world much better than human beings ever could.
Harari’s examples of AI creativity might sound like extreme naivety to many of us, but he knows exactly what he is doing in misrepresenting the capabilities of algorithms. Games like chess and Go are games of patterns restricted by rules, there only so many permutations of these patterns in any given scenario and AI is simply faster at spotting them than most humans because that is what it is designed to do by software creators. This is no different that solving a mathematical equation; just because a calculator is faster than you does not mean it is “creative.”
There is a big difference between cognitive automation and cognitive autonomy. AI is purely automation; it will play the games it is programmed to play and will learn to play them well, but it will never have an epiphany one day and create a new and unique game from scratch unless it is coded to do so. AI will never have fun playing this new game it made, or feel the joy of sharing that game with others, so why would it bother? It will never seek to contribute to the world any more than it is pre-programmed to do.
The manner in which globalists hype AI is very tactical, however. When Harari claims that many people will become part of the “useless class” once AI takes over the economy, he is hinting at another globalist ideology based on elitism – Transhumanism. The goal of transhumanism is to one day merge human bodies and human minds with technology and AI, and only a limited group of people will have the resources to accomplish this (the globalists).
Are you afraid of becoming part of the “useless class”? Well, if you scrape and beg and serve every whim of the elitist establishment then maybe you will be lucky enough to get implants which allow you to interface with AI, and then your future employment and “usefulness” will be secured. Doesn’t that sound nice?
But, like all the visions of narcissists there are delusions of godhood and then there is reality. I continue to have serious doubts that AI will ever be legitimately autonomous or legitimately beneficial to humanity in any way beyond having the ability to calculate quickly within mathematical rules. Speedy data analysis can be useful in many areas of science, but it’s not really proof of autonomous intelligence, and algorithms can be predictive but not any more predictive than human beings looking at the same statistical data. There is nothing about AI that is impressive when one considers what little it actually accomplishes.
AI is a toy, a parlor trick, not a living entity with independent observations and conclusions. And, it’s certainly not a god-like being capable of showering us with scientific ambrosia or building a perfect civilization. I predict that a society dependent on AI will actually stagnate and remain trapped in stasis, never really inventing anything of much value and never progressing. It will only ever be concerned with homogenization – The merging of people with the algorithm. That is where ALL the society’s energies will go.
As a point of reference to why AI is overrated, all we have to do is look at the behavior of AI programs like ChatGPT; the algorithm has been discovered on numerous occasions to contain extreme political biases always leaning to the far-left, including biases based in beliefs not backed in any way by scientific evidence. Interestingly, ChatGPT will even at times display a seemingly hostile response to conservative concepts or inconvenient facts. The bot will then DENY it is giving personal opinions even when its responses are consistently pro-leftist.
How is political bias possible for a piece of software unless it was programmed to display that bias? There is no objectivity to be found in AI, nor any creativity, it will simply regurgitate the personal opinions or biases of the people that created it and that engineered how it processes data.
Unlike a typical human teenager that seeks to adopt the opposing social or political beliefs of their parents in order set themselves apart, AI will never metaphorically dye its hair blue, pierce its nose and proclaim itself vegan – It will always do what its creators want it to do. Another example of this dynamic is AI art, which essentially steals the stylistic properties of numerous human artists entered into its database and copies them. While imitation might be considered the highest form of flattery, it’s not the same as creativity.
This might not sound like much of a problem when it comes to a simple chatbot or the making of cartoons. But, it’s a massive problem when we start talking about AI influencing social and governmental policies.
The globalists argue that AI will be everywhere – In business, in schools, in corporate operations, in scientific enterprises, and even within government. It MUST run everything. Why? They don’t really say why other than to make vague promises of incredible advancements and previously unimaginable benefits. To date, there have been no profound innovations produced by AI, but I suppose pro-AI propagandists will say that the golden age is “right around the corner.”
The uses for AI are truly limited to helping humans with simple tasks, but there is still a cost. A self driving car might be great for a person that is physically handicapped, but it can also be a crutch that convinces a population to never learn to drive themselves. By extension, AI is in a lot of ways the ULTIMATE crutch which leads to ultimate tyranny. If people are convinced to hand over normal human processes and decision making opportunities to automation, then they have handed over their freedoms in exchange for convenience.
More importantly, if algorithms are allowed to dictate a large portion of choices and conclusions, people will no longer feel a sense of accountability for their actions. Regardless of the consequences, all they have to do for the rest of their lives is tell themselves they were only following the suggestions (or orders) of AI. The AI becomes a form of external collectivized conscience; an artificial moral compass for the hive mind.
But who will really be controlling that moral compass and bottle-necking the decisions of millions of people? Will it be the AI, or the elites behind the curtain that manipulate the algorithm?
For many people this probably sounds like science fiction. Yes, there have been many fictional imaginings of what the world would be like in the shadow of AI – I would highly recommend the French New Wave film ‘Alphaville’ as one of the most accurate predictions on the horrors of AI and technocracy. However, what I am warning about here is not some far off theoretical future, it is already here. Take a look at this disturbing video on AI from the World Government Summit:
These are the blatant goals of globalists in plain view, with a sugar coating to make them more palatable. I wrote about the motivations of the elites and their worshipful reverence for AI in my article ‘Artificial Intelligence: A Secular Look At The Digital Antichrist’. That piece was focused on the philosophical drives that make globalists desire AI.
In this article I want to stress the issue of AI governance and how it might be made to appeal to the masses. In order to achieve the dystopian future the globalists want, they still have to convince a large percentage of the population to applaud it and embrace it.
The comfort of having a system that makes difficult decisions for us is an obvious factor, as mentioned above. But, AI governance is not just about removing choice, it’s also about removing the information we might need to be educated enough to make choices. We saw this recently with the covid pandemic restrictions and the collusion between governments, corporate media and social media. Algorithms were widely used by web media conglomerates from Facebook to YouTube to disrupt the flow of information that might run contrary to the official narrative.
In some cases the censorship targeted people merely asking pertinent questions or fielding alternative theories. In other cases, the censorship outright targeted provably factual data that was contrary to government policies. A multitude of government claims on covid origins, masking, lockdowns and vaccines have been proven false over the past few years, and yet millions of people still blindly believe the original narrative because they were bombarded with it nonstop by the algorithms. They were never exposed to the conflicting information, so they were never able to come to their own conclusions.
Luckily, unlike bots, human intelligence is filled with anomalies – People who act on intuition and skepticism in order to question preconceived or fabricated assertions. The lack of contrary information immediately causes suspicion for many, and this is what authoritarian governments often refuse to grasp.
The great promise globalists hold up in the name of AI is the idea of a purely objective state; a social and governmental system without biases and without emotional content. It’s the notion that society can be run by machine thinking in order to “save human beings from themselves” and their own frailties. It is a false promise, because there will never be such a thing as objective AI, nor any AI that understand the complexities of human psychological development.
Furthermore, the globalist dream of AI is driven not by adventure, but by fear. It’s about the fear of responsibility, the fear of merit, the fear of inferiority, the fear of struggle and the fear of freedom. The greatest accomplishments of mankind are admirable because they are achieved with emotional content, not in spite of it. It is that content that inspires us to delve into the unknown and overcome our fears. AI governance and an AI integrated society would be nothing more than a desperate action to deny the necessity of struggle and the will to overcome.
Globalists are more than happy to offer a way out of the struggle, and they will do it with AI as the face of their benevolence. All you will have to do is trade your freedoms and perhaps your soul in exchange for never having to face the sheer terror of your own quiet thoughts. Some people, sadly, believe this is a fair trade.
The elites will present AI as the great adjudicator, the pure and logical intercessor of the correct path; not just for nations and for populations at large but for each individual life. With the algorithm falsely accepted as infallible and purely unbiased, the elites can then rule the world through their faceless creation without any oversight – For they can then claim that it’s not them making decisions, it’s the AI. How does one question or even punish an AI for being wrong, or causing disaster? And, if the AI happens to make all its decisions in favor of the globalist agenda, well, that will be treated as merely coincidental.
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