Ron Paul’s statement:
Given that the IMF claims not to know what happened to the money and admits that the Russian central bank lied to them, we should not allow the IMF to hide behind the shallow defense that there is no evidence of wrongdoing. When using taxpayer funds, we must demand a higher standard: IMF, World Bank and U.S. Treasury officials should provide evidence that no public funds were siphoned off and that no officials profited from the conversion of the high-yield Russian GKO bonds into dollars just days before the default or from other public funds.
In the (Russian) St. Petersburg Times (“Skuratov Says IMF Billions Sold on the Sly,” September 17, 1999), Russian Prosecutor General Yury Skuratov charged in an interview that the IMF money funded profitable insider trading. He quoted from a memo President Yelstin refused to accept, “An analysis of the Central Bank�s use of the account where the IMF stabilization loan was deposited showed that $4.4 billion was sold from that account between July 23, 1998 and August 17, 1998. Of that money, $3.9 billion was sold directly to Russian and foreign banks, bypassing the trading session at the Moscow Interbank Currency Exchange.” He claimed only $571 million went to support the ruble.
I am concerned that Treasury Secretary Larry Summers cites Anders Åslund, senior associate at the Carnegie Endowment for International Peace, given his controversial views on the benefits of encouraging bribery! He clearly states in his article “Russia�s Collapse” in the current issue of Foreign Affairs, “As Andrei Shleifer of Harvard and Robert W. Vishny of the University of Chicago have observed, the best way of fighting corruption is encouraging competition in bribery [emphasis added]. August�s financial crisis was a logical outcome of the oligarchs� war, as they tried to maintain their high and dubious incomes by any means. In the end, the Russian state could no longer deliver enough cash to satisfy their ravenous appetites. The crash radically reduced the amount of money that could be made on the state–and thus the power of the corrupt businessmen.”
George Washington University professor Janine Wedel has warned about the appearance of corruption surrounding Andrei Shleifer heading the Harvard Institute for International Development (“The Harvard Boys Do Russia,” the Nation, June 1, 1998) and the effects of collusion in her book Collision and Collusion: The Strange Case of Western Aid to Eastern Europe 1989-1998. It seems the best course for avoiding any perception problems would be more transparency of the activities of U.S. officials.
One possible scheme in August 1998. Russia gets the 4.8 billion IMF loan in dollars. Then the banks in Russia sell the dollars to oligarchs for rubles. The oligarchs borrow rubbles from a bank in Russia. Then they devalue the rubble by defaulting on Russia’s debt.
Then they take part of their dollars and buy the rubles they borrowed and use that to pay back their ruble loan. If the ruble has fallen by half, they pocket half of the 4.8 billion, i.e. 2.4 billion dollars and now owe nothing.
Whether this is what happened or not is something that can be investigated further. But the Bush administration has not cooperated with Switzerland to investigate the 1998 or other transactions by oligarchs. Clinton pardoned Marc Rich. Bush Clinton together again.
It was in October 1998, during the Clinton impeachment that Clinton signed the law to make regime change in Iraq the goal of the US. That was pushed by PNAC which had Paul Wolfowitz as a member. Jacob Wolfowitz, Paul’s father died c.1981.
But Jacob Wolfowitz may have told his son Paul of academic kompromat Russia may have used in the 1970’s to try to pressure Nobel Prize nominations for Kantorovich from Arrow and Samuelson, uncles of Larry Summers. Summers with Stanley Fischer was in control of loans to Russia from the IMF in the 1990’s. This included possible plagiarism by Stanley Fischer in Fischer’s 1969 Ph.D. thesis at MIT. Paul Samuelson was on Fischer’s Ph.D. committee and also got an NSF grant for himself for a paper that may also have been plagiarism. Samuelson around 2003 said it wasn’t plagiarism.
Search: oligarchs Leach Russia 1998 default
If the oligarchs set up the above scheme to profit from the 4.8 billion, they profited from the loss by LTCM. LTCM bought Russian bonds in August 1998. LTCM had academics who know of the above history including the possible use by Russia of academic kompromat in the 1970’s to pressure Nobel Prize nominations by Paul Samuelson and Kenneth Arrow. Robert C. Merton was at LTCM and he got an NSF grant in 1969 as part of the same work at MIT as Samuelson got an NSF grant. This duplicated in part, the work of Nils Hakansson already circulated in 1966 in a completed UCLA Ph.D. thesis still in process of being published. The main paper was delayed in publication to fall 1970, just after Merton’s MIT thesis was accepted under Samuelson. The Merton NSF grant paper from 1969 was part of this MIT thesis.
Boris Berezovsky got his Ph.D. in math at Moscow State University. He then worked at the Institute of Control Sciences in the USSR. That institute did the same math as in all the above papers and as in the work done by Kantorovich for the 1975 Nobel Prize in economics. Berezovsky was the top oligarch in Russia that got the loans from Fischer and Summers.
Putin became head of FSB in summer of 1998. He would have gotten a cut of the 4.8 billion money trading scam outlined above, if it happened. Berezovsky and Yeltsin would not make Putin president of Russia if he had not personally profited from the scheme, if it happened that way. Thus Putin is part of this continuing cover-up. That is one reason he has to stay in control of Russia. There have been investigations in the U.S., Switzerland and even Russia.
When Bush Gore went to the Supreme Court in 2000, the USAO Mass was still investigating Harvard. At that point, the Clinton team may have been withholding information from the investigation. The Bush team including John Yoo from Berkeley, where Nils Hakansson is a prof, may have known that and told Scalia to get Scalia to give the presidency to Bush. They may also have told Gore not to fight it in Congress. This may be why Gore didn’t run in 2004 or 2008.
Marc Rich was involved with Russia from the 1980’s. Libby got him his pardon from Clinton after Bush v. Gore in 2001. Then Bush said don’t investigate the pardon to Republicans in Congress. When Bush said he looked into Putin’s eyes and saw his soul, he may have been thinking about all this. Libby, of course, got his pardon from Bush in 2007.
Putin is now to be Prime Minister of Russia, again. Yeltsin and Berezovsky made him that in the 1990’s before Putin became president and after Putin was head of FSB during the August 1998 transactions. Hillary Clinton wants her White House records closed as does baby Bush from Daddy Bush onwards for Bush Clinton Bush.
One reason the PNACons may attack Ron Paul, is that if he became president, he could investigate them for all the above including use of information about this in 1998 to get Clinton to sign onto regime change in Iraq. They should have exposed Russia’s activity, not used it to advance their own, if that happened. Even if Paul is not elected, just his visibility would let him raise the same issues he did in 1999 and refocus the need to investigate the neocons.
We now have a new attorney general, not Alberto Gonzales. The new AG may not be himself liable in any of this, whatever he may have heard. Thus the neocons are at greater risk now than they have been in years of this coming out.
Under Gonzales the DOJ was not supportive of investigations in Switzerland or perhaps even by USAO Mass to pursue this. Now this has the potential to change. They may hope that Romney with a Harvard MBA and JD may not want to have all this investigated. Or they hope Hillary is elected.
In summer of 1998, Long Term Capital Management, LTCM, bought Russian government bonds because it thought that Stanley Fischer and Larry Summers would have to bail out Russia. But instead the oligarchs including Putin had Russia default, although they did try for a bailout. The above scheme could have been reversed if they had needed to, and they had plenty of funny money ruble holdings to make money on if the ruble went up.
Putin got a Ph.D. in economics in the 1990’s. It was shown this was plagiarized and probably written by someone else anyhow. Berezovsky had a Ph.D. in math from Moscow State University. This is considered by Russians the top math department in the world. Russia’s bonds were registered bonds, although LTCM used Bear Stearns for clearing its trades. Russia would have known from the registrations that Bear and thus LTCM had holdings in Russian bonds. So by defaulting on the bonds, Berezovsky and Putin would make the geniuses at LTCM who won the Nobel Prize in economics in 1997, Myron Scholes and Robert C. Merton, lose money. This would prove that Putin and Berezovsky were better economists and traders than Scholes, Merton and the rest at LTCM. This would show they were smarter than them. In 1997, Scholes and Merton and LTCM got tremendous press as geniuses far above normal Nobel Prize winners.
For the Russians showing they were smarter would be very important. Berezovsky had wanted to win a Nobel Prize when he worked at the Institute of Control Sciences in the USSR. This was his way of showing he was smarter than Scholes, Merton and the rest at LTCM. The very transactions that would make Berezovsky billions would lose LTCM billions. In fact, LTCM went under. Berezovsky and Putin had proven they were the smart ones.
The same score keeping would continue. By getting Clinton to sign the Iraq Liberation Act while USAO Mass investigated Harvard and some Clinton team profs perhaps as well, the PNAC profs like Paul Wolfowitz proved they were the smart ones. Paul Wolfowitz had no achievements of the stature of his father Jacob in academic terms. Jacob contributed to some of the more important results in this overall area of math, operations research, or control sciences as the Soviets called it. Paul proved he was as smart as his father by using this to get the Iraq Liberation Act.
Then during Bush v. Gore, Paul Wolfowitz, John Yoo and George W. Bush could prove the same thing by using this to influence Scalia. Scalia could then prove he was the smart one to issue an opinion on why the Supreme Court issued a stay of vote counting in Florida. Gore had to leave. But Gore has proven he was the smart one by making a lot of money and winning his own Nobel Prize. These Nobel Prizes seem to have a lot of meaning to those who win them and those who don’t but can prove they are smarter than those who win them.
Since Scholes and Merton were smarter than most Nobel Prize winners in econ, at least in their own opinion and many others, including the press at the time, by making them lose money and at the same time making money, Putin and Berezovsky proved they were smarter than all the Nobel Prize winners. Since they were smarter than Scholes and Merton, who in turn were smarter than the others, that meant Putin and Berezovsky were smarter than all the others. Of course, if they were exposed, the world might not think that. So they have to keep this under wraps. As do Bush, Gore, Harvard, etc.
Above is all speculation and hypotheses. Restate as questions. All other disclaimers apply. This is draft and preliminary. Corrections or comments are welcome.