Japanese carrying $134 bil worth of U.S. bonds detained in Italy

[da loser]

http://www.businessinsider.com...uggled-us-bonds-2009-6

Update: The picture on the right is of the seized "bonds", via Italian site Adnkronos.

They look an awful lot like the bonds pictured in this story, about an age-old scam designed to confused seniors into buying fake bonds.

That being said, there was a period when the Treasury did issue high-denomination bonds up to $500 million.

Original post: This is a totally crazy story.

Asia Times: Italy?s financial police (Guardia italiana di Finanza) has seized US bonds worth US 134.5 billion from two Japanese nationals at Chiasso (40 km from Milan) on the border between Italy and Switzerland. They include 249 US Federal Reserve bonds worth US$ 500 million each, plus ten Kennedy bonds and other US government securities worth a billion dollar each.

The question now is whether the bonds are real or counterfeit

Karl Denninger, who discovered the story, notes that either way, this is wild:

If they're real, what government (the only entity that would have such a cache) is trying to unload them?

If they're fake, this is arguably the biggest counterfeiting operation ever, by a factor of many times. I've seen news about various counterfeiting operations over the years that have made me chuckle, but this one, if that's what it is, is absolutely jaw-dropping.

The cute part of this is that if the certificates are real Italy just got a hell of a bonanza - their money laundering laws provide for a statutory 40% penalty for failure to declare instruments and cash in excess of $10,000 Euros, which means they'd garner a close-to-$40 billion dollar windfall.

We're leaning towards counterfeit on this one. Either way, we wanna know more!





i bet an intelligence service tipped off the italians.

but who other than a government can afford to have $134b in a suitcase?

and if you were to counterfeit them, who is going to accept a $1B bond?

 

[jpeyton]

I believe we are mere minutes from discovering how you can blame Obama for this.

 

[XZeroII]

Originally posted by: jpeyton
I believe we are mere minutes from discovering how you can blame Obama for this.

Funny. Just a few months ago everyone was trying to figure out how to blame everything on Bush.

 

[boomerang]

Originally posted by: jpeyton
I believe we are mere minutes from discovering how you can blame Obama for this.

If you can't see the paranoia in that statement, you're in the minority.

 

[Phokus]

Originally posted by: XZeroII

Originally posted by: jpeyton
I believe we are mere minutes from discovering how you can blame Obama for this.

Funny. Just a few months ago everyone was trying to figure out how to blame everything on Bush.

Considering how incompetent bush was, you really didn't need to go inventing things to go blaming bush for much of our problems today.

 

[MotF Bane]

Obama's talking to the Muslims made them back down for a few days, so instead of the Jews dying at the hands of Muslim holy warriors, they were able to finish infiltration of Japanese society, and attempt to escape to Italy with the bonds. It was only by the happenstance of good Christian guards being present that the Jews were not able to complete their master plan - planting the bonds in Vatican City to spark an international incident, from which the Muslim Obama would not be able to recover. Therefore, this entire thing is Obama's fault, and the Christians are the only reason society still stands today.

I kid...

 

[LegendKiller]

Because when you're going to sell 134b in bonds, they aren't registered through the govt, and carrying them in a suitcase to cash at your local Bank of America is the only way to get rid of them.

Denninger is a fucking loon.

 

[Cuda1447]

Originally posted by: jpeyton
I believe we are mere minutes from discovering how you can blame Obama for this.

Always a partisan hack, regardless of the topic. You would find a way to bring Bush/Obama into a thread about heatsinks.


You always seem to post first and start the derailing of a thread too.

 

[spidey07]

Originally posted by: LegendKiller
Because when you're going to sell 134b in bonds, they aren't registered through the govt, and carrying them in a suitcase to cash at your local Bank of America is the only way to get rid of them.

Denninger is a fucking loon.

Didn't most of this scrutiny come from the Nazi counterfeit bond scheme from WW2? The limits on denominations, issuance, the British pound, etc? I hate to use a movie as a reference but that operation fascinated me.

I'm more curious than anything else.

 

[Evadman]

I accidentally left my suitcase in Italy. I would appreciate it if it would be returned.

Seriously, 134 billion dollars is enough to start a war over. If those are from NK or something China will not be pleased. Actually, I don't think anyone will be pleased. How in the hell does someone get their hands on 139 billion in bonds? That's more than the GDP of a boatload of countries, and enough to buy 70 B2 stealth bombers.

 

[LegendKiller]

Originally posted by: spidey07

Originally posted by: LegendKiller
Because when you're going to sell 134b in bonds, they aren't registered through the govt, and carrying them in a suitcase to cash at your local Bank of America is the only way to get rid of them.

Denninger is a fucking loon.

Didn't most of this scrutiny come from the Nazi counterfeit bond scheme from WW2? The limits on denominations, issuance, the British pound, etc? I hate to use a movie as a reference but that operation fascinated me.

I'm more curious than anything else.

AFAIK it is very rare to have physical bonds without an electronic counterpart, especially at that denomination. Additionally, AFAIK, all of the bonds are registered and a holder is recorded.

Counterfeit bonds are something a little different. However, that size of counterfeiting operations would be traced pretty easily.

Counterfeit money is pretty easy to get into the system since you can just use them in any number of transactions. However, bonds aren't so easy to cash, transact, or trade, since they are far more limited, are accepted far less often, and, overall, are controlled by banks.

 

[ebaycj]

Originally posted by: Evadman
Seriously, 134 billion dollars is enough to start a war over.

No, it's not.

 

[Fingolfin269]

Originally posted by: ebaycj

Originally posted by: Evadman
Seriously, 134 billion dollars is enough to start a war over.

No, it's not.

Actually, it is. Wars can start over the smallest of things. This is not small. And by us writing that it doesn't mean we WANT it.

 

[Pulsar]

Originally posted by: Fingolfin269

Originally posted by: ebaycj

Originally posted by: Evadman
Seriously, 134 billion dollars is enough to start a war over.

No, it's not.

Actually, it is. Wars can start over the smallest of things. This is not small. And by us writing that it doesn't mean we WANT it.

I believe ebaycj is pointing out that he believes that no amount of money should be enough to start a war over.

 

[TechBoyJK]

Originally posted by: Pulsar

Originally posted by: Fingolfin269

Originally posted by: ebaycj

Originally posted by: Evadman
Seriously, 134 billion dollars is enough to start a war over.

No, it's not.

Actually, it is. Wars can start over the smallest of things. This is not small. And by us writing that it doesn't mean we WANT it.

I believe ebaycj is pointing out that he believes that no amount of money should be enough to start a war over.

Well then he failed to use the correct words. I read that he is saying $134 billion is not enough to start a war over, and that's just not true. In reality, $134 billion can definately start a war.

 

[Fingolfin269]

Originally posted by: Pulsar

Originally posted by: Fingolfin269

Originally posted by: ebaycj

Originally posted by: Evadman
Seriously, 134 billion dollars is enough to start a war over.

No, it's not.

Actually, it is. Wars can start over the smallest of things. This is not small. And by us writing that it doesn't mean we WANT it.

I believe ebaycj is pointing out that he believes that no amount of money should be enough to start a war over.

Fantasyland idealism doesn't mean the facts are wrong. I don't think anyone writing on these forums truly wants wars started. However, what 'should' be isn't what actually happens in the real world.

 

[Phokus]

Originally posted by: LegendKiller

Originally posted by: spidey07

Originally posted by: LegendKiller
Because when you're going to sell 134b in bonds, they aren't registered through the govt, and carrying them in a suitcase to cash at your local Bank of America is the only way to get rid of them.

Denninger is a fucking loon.

Didn't most of this scrutiny come from the Nazi counterfeit bond scheme from WW2? The limits on denominations, issuance, the British pound, etc? I hate to use a movie as a reference but that operation fascinated me.

I'm more curious than anything else.

AFAIK it is very rare to have physical bonds without an electronic counterpart, especially at that denomination. Additionally, AFAIK, all of the bonds are registered and a holder is recorded.

Counterfeit bonds are something a little different. However, that size of counterfeiting operations would be traced pretty easily.

Counterfeit money is pretty easy to get into the system since you can just use them in any number of transactions. However, bonds aren't so easy to cash, transact, or trade, since they are far more limited, are accepted far less often, and, overall, are controlled by banks.

You seem to know a lot about this stuff... now we know where LK makes all his money j/k

 

[Genx87]

Didnt Don Johnson get detained with 16 billion worth of securities in the trunk of his car in Austria or Germany a few years ago?

 

[LegendKiller]

Originally posted by: Phokus

Originally posted by: LegendKiller

Originally posted by: spidey07

Originally posted by: LegendKiller
Because when you're going to sell 134b in bonds, they aren't registered through the govt, and carrying them in a suitcase to cash at your local Bank of America is the only way to get rid of them.

Denninger is a fucking loon.

Didn't most of this scrutiny come from the Nazi counterfeit bond scheme from WW2? The limits on denominations, issuance, the British pound, etc? I hate to use a movie as a reference but that operation fascinated me.

I'm more curious than anything else.

AFAIK it is very rare to have physical bonds without an electronic counterpart, especially at that denomination. Additionally, AFAIK, all of the bonds are registered and a holder is recorded.

Counterfeit bonds are something a little different. However, that size of counterfeiting operations would be traced pretty easily.

Counterfeit money is pretty easy to get into the system since you can just use them in any number of transactions. However, bonds aren't so easy to cash, transact, or trade, since they are far more limited, are accepted far less often, and, overall, are controlled by banks.

You seem to know a lot about this stuff... now we know where LK makes all his money j/k

lol. I wish. It's just a matter of being exposed to the bond world. The part I am in (securitization) is just a piece of the overall puzzle.

 

[piasabird]

It is probably a crime to move money like that accross a border without declaring it. A lot of countries dont let you move currency accross a border in large amounts because it could be a way to launder mob money (Mafia) etc.

 

[JeffreyLebowski]

Originally posted by: Phokus

Originally posted by: XZeroII

Originally posted by: jpeyton
I believe we are mere minutes from discovering how you can blame Obama for this.

Funny. Just a few months ago everyone was trying to figure out how to blame everything on Bush.

Considering how incompetent bush was, you really didn't need to go inventing things to go blaming bush for much of our problems today.

57 one to go. Who's stupid?

 

[Nebor]

Originally posted by: ebaycj

Originally posted by: Evadman
Seriously, 134 billion dollars is enough to start a war over.

No, it's not.

Ha. Of course it is. Maybe not for the United States, but for some nations it would be.

 

[da loser]

June 12 (Bloomberg) -- Italy?s financial police said they asked the U.S. Securities and Exchange Commission to authenticate U.S. government bonds found in the false bottom of a suitcase carried by two Japanese travelers attempting to cross into Switzerland.

The bonds, with a face value of more than $134 billion, are probably forgeries, Colonel Rodolfo Mecarelli of the Guardia di Finanza in Como, Italy, said today. If the notes are genuine, the pair would be the U.S. government?s fourth-biggest creditor, ahead of the U.K. with $128 billion of U.S. debt and just behind Russia, which is owed $138 billion.

:laugh:

The seized notes include 249 securities with a face value of $500 million each and 10 additional bonds with a value of more than $1 billion, the police force said on its Web site. Such high denominations would not have existed in 1934, the purported issue date of the notes, Mecarelli said. Moreover, the ?Kennedy? classification of the bonds doesn?t appear to exist, he said.

The bonds were seized in Chiasso, Italy. Mecarelli said he expects a determination from the SEC ?within a few days.?

 

[Fear No Evil]

Honestly - What are $138 billion in bonds worth these days? Might buy you a Hyundai.

 

[BuckNaked]

http://www.asianews.it/index.php?l=en&art=15505&size=A

Seizure of US government bonds from two Japanese men in Italy raises questions
Seized US bonds are worth US$ 134.5 billion. The whole affair touches a number of economic and political issues. For some the resignation of Japan?s Interior minister might be related to it.

Milan (AsiaNews) ? There have been new developments with regards to the story of US$ 134.5 billion in US government bonds seized by Italy?s financial police at Ponte Chiasso on the Italian-Swiss border, which AsiaNews reported four days ago. News about it initially made it to the front page of many Italian papers, but not of the international press. Since yesterday though, some reports have published by English-language news agencies. And some commentators are starting to link the story to reports in US press dating back to 30 March.

On that date the US Treasury Department announced that it had about US$ 134.5 billion left in its financial-rescue fund, the Troubled Asset Relief Program (TARP), whose purpose is to purchase assets and equity to buttress companies in trouble. The existence of such means that the Obama administration may not have to go to Congress for additional funds, something which is especially important since many lawmakers have vowed to oppose any requests for more money.

At the same time, Japan?s Kyodo news agency has reported that the resignation of Japan?s Interior Minister Kunio Hatoyama might also be related to the Ponte Chiasso affair. Officially the minister quit as a result of a row over who should head the state-owned Japan Post, but some sources have suggested that such a scenario is not very plausible since Mr Hatoyama was Prime Minister Taro Aso?s main ally in his rise to the prime minister?s office, and is especially unconvincing since the ruling coalition government has to face elections in just two weeks time. Indeed there are many reasons to connect the Ponte Chiasso incident to the minister?s resignation.

First of all, the men carrying the bonds had a Japanese passport. Secondly, they were not arrested. Under Italian law anyone in possession of counterfeit cash or bonds worth more than a few tens of thousands of euros must be arrested. By comparison the value of the seized counterfeit bonds is equal to 1 per cent of the US Gross Domestic Product (GDP). Thirdly, how the seizure took place is worthy of a Monty Python movie?two well-dressed Japanese men carrying a briefcase travelling in a local train usually used by Italian manual labourers who commute to Switzerland for work had as much chance to go unobserved as two European businessmen travelling in the Congo.

For AsiaNews the incident raises several questions. For example, why did Italy?s press, of every stripe, first give the matter great visibility, only to drop it as quickly? Also, if we are to assume that the bonds are real, why were they in Italy on their way to Switzerland? If these were the unused TARP funds why would they be in US Federal Reserve denomination? Would it not have been better to wait to see how they would be used before the bonds were issued? If they are authentic and owned by a foreign state, why were they not transported in a diplomatic bag, which cannot be inspected at customs? And what will the Italian government do insofar as the issue represents an offence under Italian law? Will it impose a fine of 38 billion euros, and run the risk of a row with an ally, or return the money without any penalty to the rightful owner and show the world that Italy is some kind of banana republic, a semi-colonial protectorate that violates its own laws and constitution?

Whatever the case may be, for Italy?s Prime Minister Silvio Berlusconi it is a heavy burden to bear, given the legal and criminal consequences he might face.

The only people who come out of it well are Italy?s tax cops, reason for them to show off their success on their website.