Muslims, Markets & Mayhem

Family Ties

If someone were to ask me “name two names that come to mind when I say ‘9/11,’” the first two I would name are Bush and Bin Laden.

The reasons for this are fairly obvious.

What isn’t fairly obvious is that the relationship between these two names goes deeper than George and Osama and starts well before 2001.

Osama’s parents were investors in the Carlyle Partners II fund in 1994, as the family had amassed an enormous fortune and did business around the globe.

His father Muhammed moved from Yemen to Saudi Arabia with nothing but a few coins in his pocket but was able to start a construction company that began to do fairly well.

The turning point was when he won favor with the king and began to build palaces for the royal family, as the company was able to win exclusive contracts to expand sacred mosques at Mecca and Medina.

With this newfound wealth, Muhammed was able to provide a comfortable life for every single one of his 54 children.

Yes, 54 children (from 22 wives).

The most notable of those 54 was, of course, Osama.

Osama’s path originally seemed to be typical of most wealthy kids: a pampered childhood, the highest quality education, and eventually helping run the family business.

However, the combination of his father’s sudden death in a plane crash and the Soviet invasion of Afghanistan changed the trajectory of his life forever.

After the 1979 invasion, Osama felt the call to counter Soviet influence in the region, as the Soviets were propping up the rising communist government.

He utilized his resources of capital and connections to fund and organize the mujahideen resistance, helping establish Maktab al-Khidamat, which recruited and trained fighters to join the Afghan resistance. The role he played in the conflict helped build up the reputation that would help him form Al Qaeda in the late 1980s.

Interestingly enough, Osama wasn’t the only one funding the mujahideen resistance.

The CIA’s Operation Cyclone was a covert operation that funneled weapons, money, and training to the mujahideen through Pakistan’s intelligence agency, the ISI.

Given this was at near the height of the Cold War, the US would team up with just about anyone to oppose Soviet influence, even if it meant allying with Satan himself.

In other words, the US government helped create a “problem,” proceeded to blabber about how much of a problem it is, and then funnel billions of dollars trying to (always unsuccessfully) fix the problem.

Oldest trick in the playbook.

Spinning back to The Carlyle Group, the company is not just any other large private equity shop.

Two differentiating factors between this buyout firm and others like KKR, Apollo, and Blackstone, are its proximity and connectivity to DC’s elite and its focus on defense and aerospace investments.

Not only is the company’s physical headquarters on Pennsylvania Ave, a short distance from the Capitol, White House, and FBI headquarters, but the revolving door between it and the DC swamp are astounding.

The firm’s longtime chairman Frank Carlucci was Ronald Reagan’s Defense Secretary from 1987 to 1989.

James Baker, former US Secretary of State and Treasury Secretary, took on a senior counselor role after his DC tenure.

Donald Rumsfeld had several ties to Carlyle through both work at the firm and his position of board member of the fund’s portfolio company DynCorp.

Dick Cheney became an advisor for the company, adding to the list of potential conflicts of interest, as he was the former CEO of Halliburton, a major defense contractor.

Last, but not least, is the 41st President of the United States George H.W. Bush. After his presidency, he also served as an advisor to Carlyle, providing his unmatched expertise in LBO modeling and dividend recapitalizations.

All jokes aside, his value-add came from his expansive international network, with one pertinent example being the Bin Laden family. On numerous occasions, Bush visited the Bin Ladens in Saudi Arabia on Carlyle’s behalf.

The Bin Ladens were by no means the fund’s anchor or a major investor, as they committed roughly $2M of the company’s $1.3B fund, or just 0.15%.

The fact that the Bin Ladens were investors in the fund isn’t too surprising—wealthy families abroad invest in America’s private markets fairly often.

What is astonishing is that the Carlyle annual investor conference took place on September 10th, 2001, just one day before the tragic attacks.

Even more jaw-dropping is that Shafiq Bin Laden, half brother of Osama and representative of the Bin Laden family at the conference, was bestowed with the guest of honor title at the conference.

How this fact was not more publicized is beyond me.

Perfect Timing

One strange story with similar levels of coincidence that did receive attention was Larry Silverstein and his well timed insurance purchase.

In July of 2001, Silverstein, a wealthy New York real estate developer, signed a 99 year lease for the World Trade Center complex from the Port Authority of New York and New Jersey.

The transaction was valued at $3.2B and gave him control the WTC buildings, including the Twin Towers.

Silverstein soon insured the buildings, buying a policy worth roughly $3.55B.

The fact that he insured the buildings is not the weird part—it’s that he specifically bought a terrorism coverage package just a few weeks before the attacks.

Silverstein insisted he had no foreknowledge of the attacks and did so as a purely logical move given the property’s high profile status.

Interestingly enough, Silverstein actually tried to claim double the insurance amount given that the two planes crashing into the Twin Towers technically constituted two separate attacks.

The insurance companies obviously disagreed.

In 2004 and 2007, the courts ruled that some insurers had to pay double while others only had to pay for one, bringing Silverstein’s total payout package to $4.55B.

I guess I’ll take Silverstein’s word for it and trust that he had no prior knowledge of the attacks.

Someone who did know was his good friend and current Prime Minister of “America’s greatest ally.”

In Netanyahu’s eyes, the 9/11 attack was imminent.

Apparently Netanyahu wasn’t the only one who could see the future.

Mysterious actors in the financial markets seemed to have a hunch as well, as there was suspicious option activity surrounding American and United Airlines, the two hijacked airlines, leading up to September 11th.

On September 10th, American Airlines put trading exceeded call trading to such an extent that the following week, a CBS Evening News report explained they had never seen that kind of imbalance before.

University of Chicago finance professor George Constantinides asserted that the option trading that day was so striking, it seemed nearly impossible to attribute it to pure chance.

Columbia and Duke Law professors John Coffee and James Cox, respectively, proclaimed that some investors indubitably had foreknowledge of the attacks and were able to use this information to their advantage.

The list goes on and on.

After SEC and FBI investigations, the agencies concluded there was no conclusive evidence that traders had foreknowledge of the attacks.

While concrete evidence is purposefully shielded from the public, the chances of financial institutions or its notable members having knowledge of the possibility of attacks is not as low as people may think.

It is common knowledge that the highest members of the financial totem pole have deep ties to intelligence networks not just in the US but around the world.

These are the same people who are members of exclusive organizations like the Bildeberg Group, Trilateral Commission, Council on Foreign Relations, Club of Rome, and most notably, the World Economic Forum.

These organizations hide behind their seemingly altruistic slogans when in reality they are simply the world’s elite openly conspiring.

Conspiring to do what exactly?

That’s for a different day.

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Thanks for reading and until next time.

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