Janet Tavakoli: Life And Death On Wall Street

Financial markets and derivatives authority Janet Tavakoli returns to the podcast to discuss a number of the themes contained in her new book Decisions: Life And Death On Wall Street.

She paints a particularly informative timeline of the greed and rot that has come to dominate the modern financial system, and how its tentacles have fully penetrated and subjugated the halls of power in Washington DC.

We're in precarious times for sure. What we have done is unprecedented in the history of the United States. We got rid of the benchmark, the gold standard. We don’t have any any stable benchmark anymore. Instead, we have currencies that are being benchmarked off of each other.

If you're measuring your weight you want a scale, right? You want an actual measurement of weight, not a relative one. You don’t want to be comparing yourself a bunch of obese guys in the gym. You need a standard benchmark. So once you get rid of the benchmark, then you can eat whatever you want and exercise as little as you choose that's okay. Well it is not okay. We all know that. But that's exactly what we've done in finance. We're printing money like mad. We've created a huge distortion where, for years, savers have gotten negative real interest rates. Negative real interest rates in the Untied States for a long, long period of time, and in Europe we now have sovereigns of course who are paying both negative nominal and negative real interest rates.

This is unprecedented in the history of finance. I talked to a retired head of the Chicago Fed (so I've probably narrowed the field because I don’t know how many of them are still living) and he said None of us knows what is going on. We've never done anything like this before. They don’t know what the end game is. They're totally at sea and it's their own fault because they got rid of our scale. They got rid of our own benchmarks, and they're trying to muddle through without having any way of measuring what we are doing. 

But not all of her message is gloom. She explains how the battle between corruption and fairness is cyclical; and that history has plenty of examples where a just band of concerned agents can (over time) "kick the bums out":

Henry Kluz was somebody who saw communists in his time try the same kind of ideological subversion that we are seeing right now in the United States and they failed because there were a lot of people to push back. But he also saw people try to crash the markets when Grant was running against Horace Greeley. And he formed a group of 70 men that he got together to oppose Tammany Hall. Tammany Hall controlled New York. They – they were very corrupt. They had a lock on it. They paid off hired sons, daughters, relative of other politicians. They were getting the votes. And Henry Kluz was a financier. He was born in Britain. And he observed these people and he said, you know, none of these people really like each other. They're not bound together by blood. They're not bound together by friendship or even by a common ideology. All these people care about is making money and paying off their friends in power. That's all. Other than that, none of these people had each other’s back. And he said We can defeat them. And so his group of 70 overthrew the Tweed Ring. One by one, they knocked the pillars out from under these guys. It took a while, but they did it.

It was just people who were fed up with the corruption. Kluz did it in his time. It can be done. It's not easy, but people who really have an idea of what the country should look like can defeat people who have inveigled themselves into the system and corrupted it. Now we see the same thing in finance. I have a group of friends who are appalled at what has happened in the financial system. But their voices have been pretty well silenced. They didn’t use garrotes or daggers to the throat or shoot them in the chest (at least not in most cases), but they have silenced them by squelching them from the public view – at least for now.

So I do encourage people to read the histories of finance and to see that nothing has really changed. But things can change and this isn’t the first time we've had to fight this battle. 

Click the play button below to listen to Chris' interview with Janet Tavakoli (72m:22s).

This is a companion discussion topic for the original entry at https://peakprosperity.com/janet-tavakoli-life-and-death-on-wall-street/

Thank you for a substantial discussion.
Some thoughts

  • The art of the genius is to make the obtuse lucid. (Einstein,  I think). The gift of genius is clarity. 
I used to beat myself up for not understanding, for instance, eye glazing financial statements. Not anymore. If I don't understand what's written I assume that I am not supposed to.  It is no oddity that a prospectus is clear with bright, glossy pictures of smiling, beautiful women when they're asking for money. And as clear as mud when accounting for where your money went. Therefore,
  • Arthur's first rule. Handle your own money. This lesson cost me many years in the mines.
The second observation is that Men are much more sensitive to potential physical violence. For obvious reason. This is why both Dr. Martenson and every man in the room is focused on the threat of nuclear war. I can only appeal to the rational side of our females. 
"Ladies be aware that nuclear war is not like the old wars. You won't get to breed with the fitter survivors."
This much must be eye-rollingly obvious, but I refer you back to my first point.

Another fantastic interview. I especially enjoy the story-like presentation of the inner workings of the corrupted financial system.
While trying to put our financial system in perspective, I like to see it through the lens of the third permaculture ethic - Fair Share. I personally believe the goal of any economic system should be to return surplus (equitably) back to the people and Earth.

The current debt driven, growth addicted, exploitative and selfish financial system we have in place, is simply so far from a "Fair Share" ideal. This has to be one of the major reason that has driven a majority of our population mad.

Whether you're AIG, Deutsche Bank, Jewish, Moslem, Christian, a home owner, Democrat, Republican or whatever, make sure you examine what "your people" are telling you. History is replete with examples:


Great interviews are the ones that raise more questions than they answer and Chris is a master questionier.

  1. Is there not a paradox in that she denounces fundamentalism while in the end promotes fundamentalist Capitalism. Invest in companies that are "Good" [sic]. Am I understanding that correctly?

  2. As to her political confession, I must point out that in Germany in the early 1930's with a corrupt establishment imposing austerity and constrained by foreign banking interests with Leftist and other opposition activists militating in the streets for change and poverty starving masses, Hitler was the disrupter for change who built a military industrial complex (also known as Fascism under the banner of the Notme party).

In Mx Tavakoli's language I hear the wounds of displaced personhood (DP, refugee, migrants, etc) and this is because I am one of those. Also of northern European extraction, first born in United States of America and first to graduate collage since my grand father who was pro-rector of Vilna University and a professor of economics. Cooperative agricultural economics to be precise.

I mention this to say that I've grown up full of stories of bad times. (EX. Surviving the Dresden bombing through stark luck or "fierce grace" as Baba Ram Das would say) 

"be careful what you ask for"

This far and no further, Hail __________.

Well, that was a very good interview except for the references to the Gatestone Institute, a notorious neo-con/islamophic cess-pool whose chairman is John Bolton (yes, that John Bolton).
I thought CM did well directing the interview back into more germane territory.

Radical Muslims, Marxists/Leninists, Neocons, the DNC, National Banks, bankers, the 1/2 percent, the Russians, ISIS, greedy capitalists… the list of bad guys to keep an eye on is growing long.

My own historical paradigms have taken a severe battering since the Internet. In my dotage I realise too late that I was marinated in Propaganda. Some necessary propaganda. We had an Empire to build.
Here is how you distil the truth. Look out of your window. Do you see violence and barbarism? Or do you see people going along to get along? Then apply that measure to say, the Germans. Suddenly it strikes you. It's all balderdash.

It takes a lot of perceived injustice for us to present the other face of Janus. And that statement includes the Germans. It includes everyone. 

Injustice, like for instance, a population starving. Even then we tend to cooperation.  I have in mind the horrors of poverty in Victorian England or France. But it is inevitable that these unfortunates have nothing left to lose and everything to gain by Violence. 

And then violence it is. Let us hope that no one floridly insane gets near the Big Red Button. 

The solution to the population bomb is not arithmetic subtraction.  It is a geometric, exponential problem that requires an Exponential Solution. A small but exponentially significant decrease in fecundity. 

Therefore I am in favour of Eugenetics.

Fair? What is fair about Nuclear warfare? Or even traditional drown-them-in-mud trench warfare. Mr. Darwin never sleeps and those who got to breed after the war were those who were too unfit to be sent off to be killed. And it shows.

And he doesn't sleep now. Either we wrest control from Mr. Darwin or we continue our random and cruel evolutionary walk.

You say systemic corruption can be overcome.  In the case of civil rights and african-americans, it appears that the FBI managed to stop that by slaughtering the peaceful activists. 
From the story of Malcolm X's entourage being 1/2 undercover cops, it appears that the FBI was big into planting traitors. 
From the fact that news came out showing evidence that it was Louis Farrakhan who ordered Malcolm X's death, and nothing was done even then, it appears that Louis Farrakhan may have been among them.  He got high office.  From the fact that MLK was considered more of a threat than Malcolm X, it would be surprising if one of his right hand men didn't get high office, too.
But there's a bigger point to this:
Chris, could I ask for you and Adam to watch Netflix' "13th"?  Pay special attention to ALEC at the end.  Now consider that Bobby Scott's "SAFE" act, which is supposed to address that,

IS the ALEC supported bill.
Here's the short of it:  The companies that run prison profits want to move to a rent model:  they can put ankle bracelets on more people, and rent them down to 50 cents and hour, while making them just figure out how they'll survive, than they can hold in prisons.  It's "prison at home/slave at home". 
Please watch it, and then start talking about it.  If, for the sake of holiness, you need to close your eyes, then do so.  But listening and hearing is enough.
It appears that our government has figured out how they'll keep their growth model.
It's just that YOU won't be in it.  Sacrifices have to be made, and that means you.


Never underestimate the depths that the government will travel.


Surprised to hear such a boring, rambling conversation on FV. 
Totally unconvinced by this guest's 'expertise'. This guest presented increasingly long non-sequitors and anecdotes (of questionable relevance) to Chris' clear and concise questions and comments). 

  • The interview had loads of information. Very insightful & straight forward. Please bring her backyes
  • Going forward, it also goes to show that merely calculating the negatives of capitalism based on economic indicators caused by rampant financial engineering by a handful of unrealistic economists alone may not be the best way to gauge the efficacy or "down-time" of a system as is being witnessed today.
  • The 'consensus capitalism' has several relatable elements of unfair policies & inequalities being created out of politics, religion and culture as well. Afterall the military industrial complex thrives on disrupting these three elements which in turn fuels the economy, don't it??
  • And this is what Ms. Janet Tavakoli deliberately factored in so as to have a more hollistic point of view.
  • Despite the odd segways away from discussing 'just derivatives', which some comments here suggest they were unwarranted do make sense of the hard facts + realities of politics, religion & culture influencing world economy as opposed to merely basing it on mathematical misappropriations.
  • She made her case too and she made it well. Thank you, Chris!

Americans remain focused on Wall Street* by design.
                                                                          *and its Washington DC puppets

The syndicate(s) that dominate nowadays are global, transnational, ultra-max top-secret, only a few window dressing traces visible, e.g, Davos, Bilderberg…

A key camouflage is Bank of International Settlements where monetary policies and banking are coordinated globally via ultra-top-secret meetings Treasury Secretary and Fed Chair attend at least each season or so, and no major media dare mention.

Ms. Tavakoli may be a plant directed to spread propaganda camouflage, ultra-max false hope, if not flush out potential threats.

God only knows how many millions if not billions of participants it would take to overthrow the first-ever global Tamany psycopath imperius maximus horrificus.

Rather hard to coordinate under radar of global surveillance systems.

True Future is learning to remain as untouched by global Crooks in Charge as possible. A few examples on above link.

Blatant fear mongering paranoia from this woman, Islamic goat herders, Caitlyn Jenner and Hillary Clinton are going to destroy the USA.  Give me a break.  Why on Earth would Chris entertain this person?    
From Georgette Boele, ABN Amro…

 ‘If Trump were to become president, gold prices will likely perform well, because we expect that his policies will be inward looking and will weaken the fundamentals of the U.S. economy.’

From Bloomberg:

“If Donald Trump is elected next week, we think gold can go anywhere shy of $1,400,” Wayne Gordon, executive director for commodities and foreign exchange at UBS Group AG’s wealth-management unit, said in a Bloomberg Television interview. “If Hillary Clinton is elected, we think gold can probably fall by $20, $30. So the clear skew in this trade is to the upside.”




Among the top tier the outcome was known 2 weeks prior to the election,How?Sanjiv Rai founder of Genicai.His program is Mogia.He has correctly predicted the last 4 presidential outcomes,plus the last 2 primaries.Election night fortunes were made.The times knew at 5pm election day.Carl Icahn,took a position and bought a billion dollar position after 12 knowing the market was going to crash,Some say druck sold into the panic on the jacked up gold panic.So,when you can buy the best tech that money can buy (plus hooking up your family)profits happen…And this is how life works…