Tuesday, November 20, 2007

Daily Kos Allows Crackpot Diary

Perhaps because it is written by David Lindorff, and perhaps because it's seen as tangential to the Blackwater story, but it's 9-11 nuttery being shoehorned in.

What makes this history of particular interest is that Alex Brown was the investment bank that handled most of the suspicious short-selling "puts" that were placed on the stocks of four companies—United Airlines, American Airlines, Morgan Stanley Dean Witter and Merrill Lynch—that were pummeled by the 9-11 attacks.

As has been reported in Bloomberg Financial News Service reports and in the San Francisco Chronicle, in the several days preceding September 11, 2001, unidentified investors placed an unusual number of "puts" on the stocks of the two airlines whose planes were hijacked that day, as well as on the two investment banks, one of which occupied 22 floors of one of the World Trade Center towers and the other of which owned a building directly across the street which was significantly damaged and forced to close down.

The stocks of those four companies, following the attacks and the collapse of the Twin Towers, subsequently tanked, making the combined puts worth about $16 million.
According to the San Francisco Chronicle, no one collected the $2.5 million in profits from the puts placed on United Airlines. The identities of the investors in the put orders have never been disclosed by Alex Brown.

Incredibly, there was never any serious investigation of these peculiar and suspicious investments, though they clearly suggest that someone knew something was going to happen that would make those four companies’ stocks plunge in value.

The US corporate news media has never pursued this story or in many cases even reported it, nor was it seriously investigated by the FBI or the 9-11 commission.

Yes, the US corporate news media has never pursued this story. Well, except for Bloomberg and the SF Chronicle, which is the only reason Lindorff ever heard of it. Hilariously he repeats the silliest claim:

According to the San Francisco Chronicle, no one collected the $2.5 million in profits from the puts placed on United Airlines.

I've gone over this before. The reason the SF Chronicle reported that no one had collected the profits on the United put options is because they had not expired as of the date the Chronicle wrote their story (September 29, 2001).

These were October options, which expired on the third Saturday of that month, or October 20, 2001. And remember, according to the 9-11 Commission (which did investigate the options) the investor who bought put options on United also bought shares of American Airlines a few days before the attacks. If they'd really had warning of 9-11 wouldn't they have been short AA and not long?

More disturbing than that Lindorff repeats the usual crackpot talking points on the put options is that the Daily Kos community apparently tolerated the posting; we see none of the "Troll Diary" tags on this one, even though the first tag is 9-11.

Hat Tip: Reader Michael P.

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