now it's time for an amazing story of how
some banks wind up controlling our markets and driving up prices
and totally screwing you over that's fun I will show you
what they do and how they do it which is really interesting so stay tuned for
that
so its gonna start with their crazy story about aluminum Goldman Sachs I did
they're gonna buy
Metro international trade services there in the aluminum business
and they're gonna do something fascinating basically they're gonna slow
down
how quickly they got aluminum to the end users like the beer companies coca cola
et cetera
and by doing that they would make billions have doubts
how alright let me explain so for small a
when the bottom there was about 50,000 tons of aluminum
in 2008 that they stored this company did right
abt in by 2010 they had made that 850,000 tonnes
and now it's one and a half million tonnes now
why are they bothering to store so much aluminum and how
well it turns out the more aluminum that they have access to
the more they can control the markets and in fact
they give incentives for people to store the aluminum
in their warehouses up to two hundred thirty dollars extra per tonne
so people go okay fine take my aluminum so what their weight losing money with
those incentives
how they gonna make it up well there's other gonna make it up they have 27
industrial warehouses in the Detroit area and
they have they move about fifteen hundred pound bars
a metal each day but
they don't move them from the warehouses to the end-user
no they move them warehouse to warehouse the warehouse
they keep moving in between those 27 warehouses thing guys
their work in the area interviewed by The New York Times the same me look we
sued up it's a job
newburgh we say hi to each other on the way to warehouses
and then we take go back and we're going in circles and circles and circles
so what's new result left three years ago before Goldman Sachs had bought this
company
the amount of time it took for someone who bought
aluminum to actually receive your shipment was six weeks
okay I make sense today its s60 not week
it's a 16-month wat 16 months
so why well it turns out that when you of course no one surprised by this
decrease artificially decrease the supply of aluminum in the market
what happens the price goes up only goes up by a little bit
it goes up by one tense uva sent
one-tenth of a cent for every aluminum cans purchase price
but it does seem like much and often goes unnoticed
except of course for the bottom line a Goldman Sachs
so how many a kansas head about affect ninety million aluminum cans
are used each year in the US bike is not the only things that are
are you that use aluminum there are tons of aluminum is used in cars electronics
how citing et cetera so
that cost the additional cost
to the consumers because about one-tenth of 1 cent in each can
for example is two dollars for every 35 pounds of aluminum used to make a
thousand pants
but this is interesting for every car there is an additional 12 dollar-cost
that was not there before because the aluminum use the car
they already had aluminum price in the car this is twelve dollars extra on top
of that
because Goldman Sachs slow down the shipping a voluminous
just a tenth of a cent per can makes it giant
difference how much of a difference in the end
over these last three years ago miss X has been just running that company
that all they do is store that aluminum
5 billion dollars they made over the last three years
from just this Kim why billion dollars
that's five billion dollars extra all of us paid
to them for no reason the price of aluminum
was not actually higher in terms of the production costs
there's no reason why should I pay that just oh sorry we can't get the aluminum
to you
you have to pay a little more so
I even the managing director at Harbor aluminum intelligence on a mix that this
was a company
says it's a totally artificial cost
is a drag on the economy and everyone pays for
so that's not the only way they made money I love this a
interesting what I keep calling a skank as it is it's not
all they had to do because a production costs it some it's a decision they
artificially made
to screw ya to money but it's not illegal that's the funny part
not a legal we'll show you how they did it in a second but on top of that not
only do they make money by increasing the price of aluminum
they also this is their banks bed on the commodities market
but they have the information because they're in the commodities market
and just so you know getting used to be this way
they deregulated the bank to let them buy whatever they want in the past
a bank couldn't bet on the commodities market and
own a piece in the commodities market they give them an artificial
a advantage is basically like insider trading now let me let
the New York Times explain here they say by controlling warehouses pipelines
and ports Banksy invaluable intelligence
market intelligence invest now say that in turn can give them
and edge when trading commodities they make money from
back extra production costs that they artificially inflated
they make money from the trading because they have the insider information on it
they just keep making money now wait a minute ok with this summer this was a
lookout for us on this right
this post is also a regulation well who does the regular regulation in this
industry
is the London Metal Exchange so how did they get them to play ball
and this is brilliant the London Metal Exchange which oversees 719 warehouses
around the globe
has not always been an impartial arbiter it receives
1 percent the rent collected by its warehouses worldwide
until last year it was owned by members including Goldman
Barclays and Citigroup
well that's prolly they bought their regulators
and they cut him in on the deal say and now whenever they go to make a
regulation change
and those three banks one up selling it to another interest
and now even that new person who runs the London Metal Exchange a new company
psych manana no man 1 percent of our monies a lot among its millions of
dollars
we actually do our job and we regulate them lose that money
brilliants brilliant okay
Sonik man the chief procurement officer for one lane largest aluminum
um purchasers no velez to the situation
illustrated the perils of allowing industries to regulate themselves
to which of course I say
told you so but now if I leave his other companies because they're also getting
screwed say
way I met a who benefited we said we should regulate ourselves
not espresso with the bank's regulate themselves
they not only school the consumers but they also screw over
other companies in fact now according to the estimates
above the um the beer companies
and and other companies that are you that make aluminum cans
the cold cost them three billion dollars a year
so they're very unhappy about to try to get congress actually change the rules
so that these banks are regulated but of course are good luck to you because as
dick Durbin was famously said
and he's the second Democrat in leadership on the senate side
%uh the bank's up frankly run this place
they own capital hill so it's not just the aluminum is just a wonderful example
the reality is the banks are now
but in these me markets end to speculation on these markets
oil wheat cotton coffee and also comprar get the copper in a second
but the most damaging is actually oil
back in 2011 this is awesome music actually comes
from an intern or Goldman Sachs memo this is them
admitting what their actually doing as an industry and then
and as part of that industry they say the speculation
accounted for warn the third of the price
a barrel of oil we're not just talking aluminum cans anymore
one-third you know what that means for the average american
when you fill up your gas tank you paid and extra
ten dollars that you didn't have to pay
every time you filled up every time you build up
they stole ten dollars out your pocket in bio is just like the aluminum skin
what they do is they buy the refineries the warehouses even by the ships that
the oil or it
and and the Koch brothers are part of that scam as well so they do is a doctor
ships
offshore and they won't deliver the oil
and I like Who I guess there's a limited supply of oil
price is going to have to go up what can we do and then once the price goes up
the dot they doctor ships as one of many examples of how they do this
speculation the prices are higher you pay a third more
10 also how much is ten dollars per fill up
up for the year for everybody
this and this is not our estimate is Goldman Sachs SMS
and extra two hundred billion dollars a year
they took out your pockets base on the oil scam alone
now there's a loyal scammed as aluminum scam and now
there's the copper scare JP Morgan without anyone realizing it
cook went and made a one and a half billion dollar purchase
in copper in fact just three banks
cornered the copper market and got eighty percent of it
now you think maybe they might do limited supply of copper
and hers at the copper prices go up we've seen this movie before right
so it's okay it's okay cuz %uh the Securities Exchange Commission
a is the ones that are regulating them so I'm sure they won't allow this
San obvious monopoly type of situation or dog Opole
as these banks have done over and over in these different field so
New York Times reports after intensive lobbying campaign by the banks Mary L
shapiro the SEC's
chairwoman approved a new copper funds last december
during her final days in office
what a coincidence and I'm sure this you will not get a job
all that somehow pay czar but through the bank's
out whether it's a lawyer representing the banks are you all think or imp
lobbyists or directly working for the most I'm sure that won't happen at all
let's never having formed by the way the person to replace our Mary Jo white
where did she use to worry for at a law firm representing the bank's
gee I wonder how this game is played so yes it was magically up
approved and then I love this last part SEC officials
concurred with the firm's contention disputed by some economists
that reducing the amount of coke copper on the market would not drive up prices
ok well of time anyone who's ever taken any economics
that includes conservatives liberals libertarians it doesn't matter at all
where your politics is you have you have a limited supply
of golf carts praxis go out it's an economic
fact and now the SEC says
no I don't see that economic 5.0 you're talking about good banks take a deeper
so the copper market
how about an aus
aluminum copper wheat coffee oil
it doesn't matter the bank's run the place
and they set the rules they set their own regulations
they hire the regulators and in the end we get screwed outta
billions of dollars our system of government is completely broken
and taken over by these corporate us and by the way
in the process there also destroying capitalism
because this is supposed to be a free market where we have actual competition
not all da please not monopolies instead
this is crony capitalism where they've taken over the government
they've bought the government to give themselves an unfair advantage
though so they screw over the competition this coup over other
industries
and finally the school over the american taxpayer
if you keep let them do it pick me keep taking your money