Atelier No.15, article 21

Michael C. Ruppert :
(KPFA 94.1 FM, Berkeley, 12 October 2001)

                        The CIA's Wall Street Connections

(Transcript of interview with Michael C. Ruppert on Guns and Butter: The
Economy Watch with Kellia Ramares and Bonnie Faulkner)

FAULKNER: On September 29, The San Francisco Chronicle reported that
investors had yet to collect more than $2.5 million in profits they made
trading options in the stock of United Airlines before the Sept 11
terrorist attacks. The uncollected money raises suspicions that the
unidentified investors had advance knowledge of the attacks. The securities
and exchange commission is investigating high levels of short sales and
purchases of "put" options, on the stocks of United Airlines and American
Airlines in the three business days before the attacks. Short sales and put
options are bets that a stock will fall in price.

Meanwhile, the Interdisciplinary Center, a counter-terrorism think tank
headed by former Israeli intelligence officers, has issued a report on
Osama bin Laden's finances, saying insiders profited by nearly $16 million
dollars on transactions involving the two airlines and the investment
banking firm Morgan Stanley, which occupied 22 floors of the World Trade
Center. And that report excluded other unusual trading activity involving
insurance companies with significant exposure to damage claims resulting
from the attacks.

Joining us by phone from Southern California is Michael C. Ruppert.
Ruppert is a former Los Angeles Police Department field officer and
narcotics investigator whom the CIA twice tried to recruit.

In the course of investigations in the mid 1970s, he came across
information the CIA was trading drugs in order to fund covert operations.
He was forced out of the LAPD in November 1978 after being shot at and
threatened for speaking out about CIA drug activity.

At a Town Hall meeting on November 15, 1996, Ruppert publicly confronted
then-CIA director John Deutsch with information about three specific CIA
drug operations.  The confrontation led to an invitation to appear before
the Senate Select Committee on Intelligence, where he spoke and presented
written evidence concerning the CIA's infiltration of and illegal
relationships with a number of police departments throughout the country.

Michael Ruppert publishes "From The Wilderness," a magazine which deals
with the effects of illegal covert operations on our society.

He's here today to discuss his latest article for that magazine...about the
CIA's knowledge of, and connections to, the suspect trading that occurred
in the days prior to the attacks on the World Trade Center and the Pentagon.

Michael Ruppert, welcome to "Guns and Butter:  The Economy Watch."

RUPPERT: Good to be here.

FAULKNER: Good to have you. Do you think the CIA had advance knowledge of
the attacks? Did they know a specific attack was coming?

RUPPERT: I am absolutely convinced that the Central Intelligence Agency had
complete and perfect foreknowledge of the attacks, down to date, time place
and location, yes.

FAULKNER: Tell us how the CIA monitors the stock market.

RUPPERT: Well, I have written several stories about this over the years.
One of the primary functions of the Central Intelligence Agency by virtue
of its long and very close history of relationships with Wall Street, I
mean to the point where the current executive vice president of the New
York Stock Exchange is a retired CIA general counsel, has had a mandate to
track, monitor, all financial markets worldwide, to look for anomalous
trades, indicative of either economic warfare, or insider currency trading
or speculation which might affect the US Treasury, or , as in the case of
the September 11 attacks, to look for trades which indicated foreknowledge
of attacks like we saw.

One of the vehicles that they use to do this is a software called Promis
software, which was developed in the 1980s, actually 1979, by Bill Hamilton
and a firm called INSLAW, in [the] Washington D.C. area. And Promis is very
unique for two reasons: first of all, it had the ability to integrate a
wide range of databases using different computer languages and to make them
all into one readable format. And secondly, in the years since, Promis has
been mated with artificial intelligence to even predict moves in markets
and to detect trades that are anomalous, as a result of those projections.
So, as recently as last year, I met with members of the RCMP [Royal
Canadian Mounted Police] national security staff, who came down to Los
Angeles where I am, who are investigating stolen applications of Promis
software and its applications, and we reconfirmed at that time that, not
only the US, but Israel, Canada, and many other countries use Promis-like
software to track real-time trades in!
 the stock markets to warn them of these events.

RAMARES: Kellia Ramares here. Mike, is it possible that the terrorists
could have gotten hold of this software?

RUPPERT: Uh, no, it's, well, it is and it isn't. The key piece of evidence
around September 11 is not that the software would have had any impact. The
key evidence, as I heard you describing, was the trades themselves, the
so-called put options and the short selling of American Airlines, United
Airlines, Merrill Lynch, Morgan Stanley, and a couple of reinsurance
companies in Europe, which are just really off the maps. You wouldn't need
software to look at these trades and say, "Oh my God, this is directly
connected to World Trade Center."

RAMARES: OK, but hindsight is 20-20. United Airlines had a lot of trouble
last year: labor disputes, lots of cancellations. We were on a verge of a
recession going into the attacks and Morgan Stanley's an investment banking
firm. Some day traders could have seen some activity and joined the party
entirely innocently. How can you make a prediction of an attack?

RUPPERT: Herzliyah, International Policy Institute in Israel which tracks
counter-terrorism, also tracks financial trading. That's a clear cut sign
about how closely the two are related. And their reports are very clear
that between September 6 and 7 the Chicago Board Options Exchange, CBOE,
saw purchases of 4,744 put options on UAL, but only 396 call options. On
September 10, the day before the attacks, 4,516 put options were placed on
American Airlines, against only 748 calls, calls being bets that the stock
will go up, puts being that the stock will go down. No similar trading in
any other airlines occurred on the Chicago Exchange in the days immediately
preceding Black Tuesday. That means that someone had advance knowledge that
only the stocks of these two airlines would be adversely impacted. Had it
just been an industry-wide slump, then you would have seen the same kind of
activity on every airline, not just these two.  But what is also very
anomalous, very out of whack !
here, is the fact that the number of put options placed, that the level of
these trades was up by 1,200 percent in the three days prior to the World
Trade Center attacks.

RAMARES: Give us a brief overview, really, of the connections between the
CIA and the banking and investment community. Your article suggests there
is a revolving door between Wall Street and the CIA.

RUPPERT: Oh, indeed there is. First of all, it's very important to note
right up front that European investigators, who are tracking trades in the
insurance companies, as well as the Israeli institute, have disclosed that
the UAL put options were primarily held by Deutsche Bank-A.B. Brown. And
its very important to note that the current Number Three at CIA, the
Executive Director, a man by the name of A.B. "Buzzy" Krongard, was, until
1998, the chairman of A.B. Brown. The company went from being owned by
Banker's Trust to being owned by Deutsche Bank. But this is a man
effectively running CIA, who came from the bank that handled the trades.

Historically speaking, we go back to 1947, we look at Clark Clifford, who
wrote the National Security Act, in 1947. He was a Wall Street banker, and
a lawyer from Wall Street. He was the chairman of First American Bancshares
that brought BCCI onto US shores in the late 1980s. He was given the design
for the CIA by John Foster and Allen Dulles, two brothers: John Foster
becoming Secretary of State, Allen becoming director of Central
Intelligence, who was fired by John Kennedy. They were partners in what is
until this day the most powerful law firm on Wall Street: Sullivan
Cromwell. Bill Casey, the legendary CIA director from the Reagan/Iran
Contra years, had been chairman of the Securities and Exchange commission
under Ronald Reagan. He, in fact, was a Wall Street lawyer and a
stockbroker. I've already mentioned Dave Doherty, the Vice President of
NYSE [New York Stock Exchange] who is the retired CIA general counsel.
George Herbert Walker Bush is now a paid consultant to the C!
arlyle Group, the 11th largest defense contractor in the nation, very
influential on Wall Street.  "Buzzy" Krongard is there. John Deutsch, the
former CIA director, who retired a couple of years ago, a few years ago, is
now on the board of Citibanc or Citigroup. And his number three, Nora
Slatkin, the Executive Director at CIA is also at Citigroup. And Maurice
"Hank" Greenburg, who is the chairman of AIG insurance, which is the third
largest investment pool of capital in the world, was up to be the CIA
director in 1995 and Bill Clinton declined to nominate him.  So there is an
inextricable and unavoidable relationship between CIA and Wall Street.

FAULKNER: Michael Ruppert, this is Bonnie Faulkner. Does the CIA itself
invest in the stock market?

RUPPERT: That's unknown. What is known, and what was disclosed by hearings
chaired by Senator Frank Church in 1976, is that the CIA was known and
proven in the Congressional Record to operate proprietary companies, some
of which do trade their stock on Wall Street. One of these, Southern Air
Transport, excuse me, was  at it during the Iran Contra years. There are
others: Evergreen Air, which may or may not be a proprietary, but has
strong CIA connections; there are tons of these companies out there. It's
not known if CIA manipulates markets, although I really believe that they

FAULKNER: Is the CIA's budget public knowledge?

RUPPERT: No. By law. Under the National Security Act of 1947 the CIA's
budget is hidden in the budgets of all the other departments of government.
We've never been able to pin down, because it's a secret, exactly how much
money CIA gets. But the best estimates available-and these are from very
good sources-are that it's around 30 billion dollars a year.

FAULKNER: So I'm assuming then that no one knows where they keep their
budget. I mean, do they keep it in the bank drawing interest? I guess we
don't know.

RUPPERT: Well, no, the way it would work under the NSA-National Security
Act-is that if the budget is $30 billion , $10 billion may be in the
Department of Defense, five in the Department of Justice, three in US
Treasury. That's how they hide the funds.

RAMARES: Michael,  Kellia Ramares again. You've laid out a scenario which
would suggest that the CIA is so involved in Wall Street, they knew these
trades were happening; they knew why. Why would the CIA let such a
horrendous thing happen if they knew about it? All the loss of life, all
the economic damage that we led off our show with that's going to happen to
everyday people, state and local governments, small investors, businesses.
Why did they let it happen if they knew?

RUPPERT: Well, first of all, let's look at history. I'm a great addict of
the History Channel and all this year on "The Secrets of World War II," one
of their series, they have run maybe three, four, five times, a documentary
showing clearly that Franklin Roosevelt had absolute knowledge that the
Japanese were going to attack Pearl Harbor on December the seventh. Navy
had broken the codes. That information was made Top Secret. And Roosevelt
allowed the attacks to happen with the express purpose of bringing the US
into World War II. So there is historical precedent for this. What I have
been writing in "From the Wilderness" for more than two years, and we've
been publishing four years now, was of huge economic inconsistencies,
bubbles that were about to burst, about a pending collapse of the US
economy that was going to happen anyway.

Just two days before the attacks, I sent a bulletin to my subscribers
saying there's a monstrous derivatives bubble, to the tune of about 20
trillion dollars that's about to burst. The price of gold has been
manipulated, and the stock market's ready to crash. And in fact, we had
seen the Dow drop by almost 900 points in the three weeks prior to the
attack. So, in point of fact, the economic crash was going to happen
anyway. As a result of the attacks, now there are two benefits for the
government: Number One, there is a convenient enemy upon whom to place the
blame for the economic crash. And second, the legislation passed by
Congress has unleashed a torrent of short term, and what are going to be
extremely expensive, solutions which are keeping the US economic bubble
inflated. This incentive: now it's about 100 billion dollars so far I
believe, between 40 for the military and another 60 in tax cuts, is robbing
Peter to pay Paul. And I am absolutely convinced that Social Secur!
ity is toast and this was their way to get their foot in the door on that.

RAMARES: Yes, but what about their plans to privatize Social Security? I
don't want my retirement in the stock market after what you've said and
even what I saw before.

RUPPERT: I sure don't either. You have to remember that the current Bush
administration is a reincarnation of the administration we saw during
Iran-Contra, and during the years of President Bush's presidency from '89
to '93. These are the people who brought us the savings and loan crisis,
which took $500 billion dollars out of US taxpayer pockets. These guys know
how to loot an economy.  There are very credible, well-documented stories
from GAO [General Accounting Office] that have been written even in the
Washington Times [a very conservative newspaper] showing that the
Department of Defense has, and this is the right word, has lost more than
three trillion dollars in the last two years. That money is not lost; it's
been stolen.

More than 59 billion dollars has been taken out of HUD [US Department of
Housing and Urban Development]. There are monstrous economic costs which
are going to fall on the American taxpayer. But they will not fall on the
administration or its allies on Wall Street.

RAMARES: Speaking of Wall Street, it doesn't feel like it's a level playing
field for the small investor, the person who has their kid's college fund
in something in Wall Street to try to make it grow.

RUPPERT: No. It absolutely is not. In 1929, some 15 percent of all the
stock in circulation was owned by households. In 2001, 75 percent of the
stock in circulation was owned by households. That tells you who's carrying
the burden.

If you look at some of the market activity in recent years, for example,
two years ago, Goldman Sachs went public. And that means that households
bought their stock but Goldman Sachs took the money and cashed out. There
has been a strong trend in the movement of money by the very rich offshore,
out of the country, into safe havens, so that when the bubble does break,
it'll be the taxpayer holding the bag.

RAMARES: Is Congress knocking on your door to look more into this? Are we
going to see congressional hearings into possible knowledge of the CIA of
the attacks? I mean we're talking about they let mass murder happen.

RUPPERT: Yes...I have spoken confidentially to two members of the House of
Representatives. And I have to tell you that my take on their view, and
these are members who I consider to be allies and very progressive and
awake: they're basically frightened. The climate is one of near hysteria.
There is an overwhelming attitude in the general public of wave the flag
and kill the bad guys. And it's not politically wise, I guess, in their
viewpoint, to risk their careers by raising questions. But some of them
have to and some of them must.

Everyday, there are more and more holes in all of the stories surrounding
September 11, and this avoids people from looking at a broader agenda in
Central Asia, which has to do with the drug trade and the oil. Bear in mind
that Senator Carl Levin (D-Mich.) has documented that 300 billion dollars a
year in drug money moves through the US banking system. And that was in a
minority report to the Senate Banking Committee released this February, I
believe it was. But that money is now an integral component to sustaining
the bubble. And that's why we're seeing CIA operatives moving willy-nilly
into Uzbekistan, to give us immediately another Laos, just like we had in
the Vietnam era with Air America planes flying with tons of heroin to
markets in the US and Western Europe. And that's what's coming out of this.
Also, there's a huge grab for oil and a major pipeline to run from
Uzbekistan down to the Pakistani coast, which will weaken Russia's grip on
the region. And I believe, long te!
rm, the economic motive is to Balkanize Russia.  But members of Congress
now faced with this are kind of overwhelmed. There have been a few voices
speaking up here and there to oppose civil rights legislation that was
punitive, to address issues of the war-making powers. But Congress needs to
find its legs and its lungs real quickly.

FAULKNER: Michael Ruppert, this is Bonnie Faulkner. We have one minute
left. You've mentioned when the bubble is going to burst.  A lot of people
think that the bubble has already burst...


FAULKNER: What do you expect to see?

RUPPERT: I was already predicting that the Dow would be at 8,000 or below
by the end of October. Now the...who knows what the short-term impacts of
all of the money that's being poured out of the Treasury are going to have.
But bear in mind there is still a huge bubble. According to Russian
economists-I was in Russia in March-there's 300 trillion dollars in
derivatives waiting to pop. Now what that means is one more good terrorist
attack and we could really understand what a bubble is.

RAMARES: And the FBI has said watch out for terrorist attacks in the next
few days and the CIA says that we're at 100 percent risk of terrorist
attacks. Give us your web site and little bit about your magazine for those
who might be interested in learning more.

RUPPERT: OK, the web site is www dot cop v like in Victor CIA dot com. "From the Wilderness" is a newsletter we publish 11 times a
year. We're read in 17 countries, by 16 members of the US Congress,
including the Intelligence Committees of both houses, as well as by
professors at 11 universities in the US and Canada.  It's a monthly
subscriber. The web site is free; the subscribers get a little more
information and a little newer. But we take great pride in the fact that we
document everything that we publish so we don't ask anybody to take
anything on faith.

RAMARES: OK, Thank you very much for joining us. You have been listening to
Michael C. Ruppert, publisher of "From the Wilderness" magazine and author
of an article on the CIA, the stock market and the terrorist attacks. Again
his web site is Again, thank you for joining us.

RUPPERT: My pleasure.