Electronic Thievery Underway

July, 2009: Electronic ThieveryLast week while I was skimming through Jim Sinclair’s web site,

I read a short excerpt about the current security status of stock certificates. If you have any kind of investment in stocks, bonds, equities, securities, or any other kind of electronic money in our US financial system, this information is critical for you to understand. Basically, you don’t own the investments, even though you think you do. Why? Before January 1, 2009, a person could own a physical stock or bond or security or equity certificate in his/her own name.

After January 1, 2009, the system was switched to electronic entry only, still in the person’s name. Then it was switched to the broker’s name only, and from there it was switched and assigned to a company called “Cede & Company” or a variation of that. Now Cede and Company is not a fictitious entity but an actual corporation that the DTCC controls. What is the DTCC? It stands for the Depository Trust & Clearing Corporation. According the Wikipedia, “DTCC is a member of the U.S. Federal Reserve System, and is a registered clearing agency with the Securities and Exchange Commission.” The Fed owns it. This is electronic thievery in disguise.

Are a few doubts and questions beginning to materialize in your mind? If I just bought, or if I already own stocks or bonds or any other investment vehicle, how did they end up in the Fed’s coffers? Good question. A little more information about the DTCC from Wikipedia is enlightening: “The DTCC is the world’s largest post-trade financial services company. It was set up to provide an efficient and safe way for buyers and sellers of securities to make their exchange, and thus “clear and settle” transactions. It also provides custody of securities.” In other words, as one prominent insurance company used to say, “You’re in good hands with ___ ___”

Wikipedia goes on, “In 2007, the DTCC settled the vast majority of securities transactions in the United States, more than $1.86 quadrillion (yes, quadrillion – trillion is still mind boggling for me) in value. DTCC has operating facilities in New York City and at multiple locations in and outside of the U.S.” One of DTCC’s subsidiaries, DTC, the Depository Trust Company, “retains custody of 3.5 million securities issues worth about $40 trillion, including securities issued in the U.S. and more than 110 countries. DTC is a member of the U.S. Federal Reserve System and a registered clearing agency with the Securities and Exchange Commission.”

Who owns the DTCC? Detailed in the Wikipedia article; it is a privately owned holding company located in New York City. The specific owners are the New York Stock Exchange (NYSE), the National Association of Securities Dealers (NASD), American Express (AMEX), banks, and brokers. Its total assets are well over $30 trillion. The Fed and all its people own, run, and control everything - electronic thievery. Were we ever so naive as to think anything else?

If you think these few scraps of information about these heavy hitters and the magnitude of their financial turf is too far fetched to be true, I would highly suggest you check out the six page Wikipedia article on the DTCC for yourself. When this country gets into a financial bind in the next few months and the government needs money to bail out their fellow thieves again, where do you think they might go to get your money? You don’t need a Master’s degree in finance or an IQ of 190 to figure that one out.

If you have anything electronic that you think you own in the clutches of the DTCC’s caring custody, I would suggest you get it out before they do. Otherwise, operate at your own peril. As I always say, possession is nine-tenths of the law. If you don’t have it in your hand in tangible form, you don’t own it, and it is not yours. Physical gold and silver in your hand is the only sure, 5,000 year-old way to preserve your wealth.

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