0:00:10.550,0:00:14.061 State and banks, hidden aspects of a historical hold up 0:00:14.061,0:00:16.844 Conference by Myret Zaki and Etienne Chouard 0:00:16.844,0:00:20.666 Moderation: fabio Lo Verso (La cité) 0:00:20.666,0:00:22.859 First conference 0:00:22.859,0:00:25.858 "The State, Hostage of the financial sector" 0:00:25.858,0:00:28.942 By Myret Zaki 0:00:28.942,0:00:33.072 I'll stay here taking notes because there will be an article about this topic in the next issue of 0:00:33.072,0:00:34.755 newspaper "La Cité" coming out next week 0:00:34.755,0:00:40.195 we'll come back on tonight's discussion 0:00:40.195,0:00:45.440 Thank you very much Fabio, and good evening to all of you 0:00:45.440,0:00:48.293 I am delighted to be here with professor Chouard 0:00:48.293,0:00:52.292 and to discover "l'usine Kugler" 0:00:52.292,0:00:56.890 and to work in collaboration with "la cité" newspaper 0:00:56.890,0:01:00.127 I personally work for an economics magazine called "Bilan" 0:01:00.127,0:01:03.291 I've written a few books denouncing the 0:01:03.291,0:01:06.019 drift of the financial sector 0:01:06.019,0:01:07.436 these last years 0:01:07.436,0:01:11.298 I've been following the evolution of finance the last 15 years 0:01:11.298,0:01:21.351 and I've seen how they played a central role in what we now call "the crisis" 0:01:21.351,0:01:25.968 so we are in the middle of a crisis as you probably noticed 0:01:25.968,0:01:28.758 But we don't really know why now 0:01:28.758,0:01:31.767 we suddenly said that Greece was in crisis 0:01:31.767,0:01:37.240 Can anyone tell me why, according to them, 0:01:37.240,0:01:44.633 what triggered the "Greek crisis" 0:01:44.633,0:01:47.182 that is a enormous crisis since end of 2009 0:01:47.182,0:01:49.472 What started all of that in the first place 0:01:49.472,0:01:52.767 if you tell me it is because of its debt 0:01:52.767,0:01:55.840 I will tell you that Greece has the same debt level since several years 0:01:55.840,0:02:00.702 who decided there is a crisis? does anyone know? 0:02:00.702,0:02:03.748 Nicolas Brillet who knows all the answers :-) 0:02:03.748,0:02:08.560 The bad advices of Goldman Sachs and the way they've hidden 0:02:08.560,0:02:10.461 a part of their debt has contributed greatly 0:02:10.461,0:02:15.230 ok good thread. The advices of Goldman sachs 0:02:15.230,0:02:17.315 contributed to the crisis. I agree 0:02:17.315,0:02:20.776 everything started when at the end of 2009 the notation agencies 0:02:20.776,0:02:25.332 have said that Greece was having little financial difficulties 0:02:25.332,0:02:27.326 as several countries of western Europe 0:02:27.326,0:02:30.395 Their debt rate had slightly declined lately 0:02:30.395,0:02:33.177 and that they needed to improve the way they manage their finance 0:02:33.177,0:02:34.826 that's all 0:02:34.826,0:02:37.836 rating agencies never said that Greece was in bankrupt 0:02:37.836,0:02:41.041 All they said ...(sorry I am speaking too loud in this mic) 0:02:41.041,0:02:47.533 In the coming years Greece should 0:02:47.533,0:02:49.782 try to have a better management of its finances 0:02:49.782,0:02:52.096 and that was in 2009 0:02:52.096,0:02:54.905 what did really trigger the crisis is that 0:02:54.905,0:02:59.239 there was a meeting between 5 hedge funds 0:02:59.239,0:03:04.473 american hedge funds in a restaurant in new York 0:03:04.473,0:03:08.146 an american newspaper told that story 0:03:08.146,0:03:09.730 this is not a fiction 0:03:09.730,0:03:14.794 one of the speculator present that day was Georges Soros 0:03:14.794,0:03:17.720 the man who hit the bank of england several years ago 0:03:17.720,0:03:20.088 and earned 2 billion dollars on an operation to devaluate 0:03:20.088,0:03:22.062 the british pound. 0:03:22.062,0:03:23.562 in the seventies 0:03:23.562,0:03:27.030 So george Soros and a few other american speculators have decided 0:03:27.030,0:03:31.655 now the subprime crisis is over 0:03:31.655,0:03:36.407 they needed to find a new prey to make a lot of money 0:03:36.407,0:03:41.377 It was in february 2010 precisely in a New Yorker restaurant 0:03:41.377,0:03:44.422 And those people have decided together 0:03:44.422,0:03:52.376 to attack the euro first through 0:03:52.376,0:03:56.413 Grece and then through small outlying countries 0:03:56.413,0:04:02.044 the idea is that if you sink a small countrie such as Grece, 0:04:02.044,0:04:10.652 there will be a phenomen of panic on the markets which will involve that the other neighbours countries will be contaminated too 0:04:10.652,0:04:14.965 because the investors will sell their titles too on those countries 0:04:14.965,0:04:20.226 and that those speculators we were talking about, will be able to grow rich in the infinity 0:04:20.226,0:04:23.311 on, in reality, the bankruptcy of Europe's periphery and even of the whole Europe 0:04:23.311,0:04:27.601 somewhere, G.Sorros was trying to creat the same blow 0:04:27.601,0:04:31.217 he had done and that made him billionaire in the seventies. 0:04:31.217,0:04:36.480 It hasn't been told a lot, it doesn't interest a lot of people 0:04:36.480,0:04:40.666 when you speak about it to personns working in the financial and banking sector 0:04:40.666,0:04:45.128 they say no, all this is very marginal and isn't for something 0:04:45.128,0:04:47.735 But we know very well that 0:04:47.735,0:04:51.079 those hedge funds have then massively 0:04:51.079,0:04:53.058 selled the debt 0:04:53.058,0:04:54.972 speculator earn money on the drop 0:04:54.972,0:04:57.558 of the debt or the actions of a country 0:04:57.558,0:05:01.246 you can really make money on the drop if 0:05:01.246,0:05:05.823 you bet with derivatives on the collapse of 0:05:05.823,0:05:09.181 of a market and this is how 0:05:09.181,0:05:12.482 loads of millionaires and billionaires have form themselves 0:05:12.482,0:05:15.101 during the last years with the european crisis. 0:05:15.101,0:05:17.199 It is the facts and the figures 0:05:17.199,0:05:20.593 We know which hedge funds are involve, which managers 0:05:20.593,0:05:22.847 We know them, there are mostly British and Americans 0:05:22.847,0:05:26.701 and they know perfectly the art of spectulation 0:05:26.701,0:05:38.225 They have accumulated sell positions, during end 2009 and on the begining 2010 against Grece 0:05:38.225,0:05:41.941 The Greek economic minister was touched about it 0:05:41.941,0:05:49.572 Indeed Greek gorverment can see the moves made on their debt: they asked themselves what is going on 0:05:49.572,0:05:53.449 our debt is suddenly the subject of a fierce downward bet 0:05:53.449,0:05:57.667 effectively what are these attacks going to induce 0:05:57.667,0:06:02.188 How can these attacks really sink a country 0:06:02.188,0:06:05.646 Because when you sell massively the debt of a small country like that 0:06:05.646,0:06:10.148 the interest rates that this small country must pay on his debt are explosing 0:06:10.148,0:06:18.146 Because if the country's obligations drop dramatically of its value 0:06:18.146,0:06:22.313 the interest rate increase itself automatically 0:06:22.313,0:06:26.732 this is then how suddenly Grece have to pay 7% and up to 20% recently 0:06:26.732,0:06:31.253 This is how Grece have been expulsed of european capital market 0:06:31.253,0:06:35.765 She couldn't finance herself anymore on the international debt market 0:06:35.765,0:06:41.336 It comes from markets. Grece has been in crisis through 0:06:41.336,0:06:45.971 the anglo saxon speculatives attacks. 0:06:45.971,0:06:49.563 As have Nicolas, here by present, noticed: 0:06:49.564,0:06:55.602 So, Goldman Sachs had advice Grece to adopt very complex financial tools 0:06:55.602,0:06:57.938 that Goldman Sachs had set up 0:06:57.938,0:07:01.168 to mask their real indebtedeness situation to the rest of the E.U 0:07:01.168,0:07:05.490 Goldman Sachs had in a first time from the years 2000 0:07:05.490,0:07:10.754 help Grece reduce their real debts only in appearances 0:07:10.815,0:07:12.554 What has Goldman Sachs done meanwhile? 0:07:12.646,0:07:16.340 Godlman Sachs went to see some hedge funds which were their clients 0:07:16.340,0:07:18.642 (these speculatives funds for whom they work) 0:07:18.673,0:07:22.980 and said: Hey you know what I have a very good information to share with you 0:07:22.980,0:07:27.856 Grece is much more indebt that she is in reality 0:07:27.856,0:07:31.613 'Insider trading' this is how it is called 0:07:31.613,0:07:35.066 Goldman Sachs has shared this information with her clients 0:07:35.097,0:07:38.202 which allowed speculative funds 0:07:38.202,0:07:41.151 to attack this debt by advance 0:07:41.151,0:07:46.538 knowing that the real balance figures of Grece were going to be revealed beginning 2010 0:07:46.538,0:07:51.892 So you motivate Greece to adopte misleading instruments 0:07:51.892,0:07:57.615 which will bring her to have more debts than she had 0:07:57.615,0:08:01.988 then you benefit of the problems 0:08:01.988,0:08:06.424 that are caused and you share the information with other hedge funds 0:08:06.470,0:08:11.877 And then took place a kind of butchering of the greek debt 0:08:11.877,0:08:15.314 the hedge funds went straight on it 0:08:15.314,0:08:19.444 and the other investors, like the sheeps that they are 0:08:19.444,0:08:21.712 because finnally the investement world is very herd 0:08:21.773,0:08:26.472 when they saw that there was a kind of "alert" on the Greek debt market 0:08:26.472,0:08:28.676 they all started to sell. 0:08:28.676,0:08:32.897 If you want, speculative funds act like an elite cavalry 0:08:32.897,0:08:37.561 which comes first and destabilize a country 0:08:37.561,0:08:40.898 Then come pensions funds and investissors from all over the world 0:08:40.898,0:08:46.619 who, though they do not understand anything about this story, start selling as well when they saw the risk rising up, 0:08:46.619,0:08:47.923 That is how you ruin a country. 0:08:47.954,0:08:51.644 Because a country seeing is debt collapsing like that, and which have to pay some 20% interests 0:08:51.721,0:08:56.945 can only enter in quasi-default and get out of the capital market 0:08:56.961,0:09:03.601 So, seeing that they made a so nice strike, the edge fodns didn't want to stop on a so good way, 0:09:03.601,0:09:13.158 they carried on. Then, the same happened to Portugal, then Irland, then Spain. Then it came to Belgium, then Italy. 0:09:13.158,0:09:21.894 And the last new ones have been: France, and even GERMANY. Germany which is the more solvent country in the world, the stronger country in the word 0:09:21.894,0:09:26.227 has been more or less attacked on the international debt market. 0:09:26.227,0:09:36.447 What are we talking about now? We are talking about a phenomenon which is: If you are a country which have his debt quoted on a market, 0:09:36.447,0:09:41.514 you are completely vulnarable to some attaks, some RAIDS I would even say 0:09:41.514,0:09:45.453 some real raids from some scrupleness financiers, 0:09:45.499,0:09:49.711 and, especially the most important is that these people are not regulated at all.