The credit default swap market is a $60+ trillion paper Ponzi-scheme. The Wall Street crime syndicate claiming to “back” this insurance have nothing more than a few $billion of liquidity apiece. It is a fact of arithmetic that these fraud-factories never intended to honour these contracts.

Given the magnitude of this fraud and the audacity of the perpetrators, this alone is reason enough to abolish the Wall Street fraud-factories, abolish the credit default swaps market, and (indeed) to abolish the entire derivatives market – so that the banksters cannot perpetrate a similar crime again in the future. Indeed, credit default swaps were banned in th U.S. for many decades, based upon anti-gambling statutes.

However the CDS fraud itself only scratches the surface on the monstrous evil behind this scheme. As I have written about frequently in the past, the CDS fraud is a tool which the banksters have used to perpetrate an even greater crime: the sabotage and/or destruction of most of Europe’s debt markets.

Here is how this particular Wall Street scam operates. First of all the banksters pile on massive shorting with respect to the credit default swaps of a particular European debt-market. This drives the prices of credit default swaps sky-high. Meanwhile, the banksters’ accomplices in the mainstream media then all perform their best impersonation of Chicken Little: “the sky is falling on Greece’s economy.” At this point the third partner of this illegitimate tag-team chimes in: the ratings agencies. Based on nothing more than changes in credit default swap prices and media rhetoric, the ratings agencies downgrade the debt of these Euro markets – immediately driving interest rates higher.

This significantly raises the interest payments on these debtor economies, instantly making those economies less solvent. This is then followed by another shorting operation in the credit default swap market, more media rhetoric, and more bogus “downgrades”. And thus the perfect vicious-circle of crime is established. Through the fraudulent manipulation of Europe’s debt markets, Wall Street’s economic terrorists have been able to drive Greek interest rates as much as 50 times higher than U.S. interest rates, despite the fact that the U.S. economy is more fundamentally insolvent than that of Greece.

Now we have what should be the final nail in the coffin of what has been the largest single scam in the history of humanity: proof that this entire market is nothing but a gigantic fraud. Last week, the International Swaps and Derivatives Association issued a ruling that the 70+% write-downs on Greece’s entire national debt did not constitute a “default event”, and thus the fraud-factories who wrote up the insurance on that debt don’t have to honour their contracts.

Understand that it has been universally acknowledged by everyone: the Greek government, Greece’s creditors, the European Central Bank, and other European nations that without some “deal” that Greece would have engaged in an involuntary, 100% default within days. As an attempt to mitigate that cataclysmic event, Greece’s creditors engaged in a negotiated, voluntary default with Greece’s government, where creditors accepted an immediate 53% reduction on the principal owing to them. Including the interest accrued, these write-downs amounted to as much as 75% for some creditors, and an average write-down of approximately 70%.

Read the rest : http://bullionbullscanada.com/intl-commentary/24416-credit-default-swap-fraud-exposedconfirmed