Bloomberg News is continuing with the thankless task of pushing forward with FOIA requests relative to the Fed’s lending programs, and once it eventually gets its troves of documents, having to slog through them to see what they reveal.
Bloomberg has a long article up on its site about its latest findings. And the bottom line is everybody close to the process lied like crazy. For instance:
Banks lied during the crisis. The big banks said they were in really good shape even as they were sucking tons of credit from the Fed. The ones that arguably were healthier, like JP Morgan, tried the “they threw me in the br’er patch, I really didn’t want all that money,” in fact stayed in the program well beyond the acute phase of the crisis because it liked getting all that cheap funding.
Now this sort of misrepresentation is a securities law violation, but since the regulators presumably winked and nodded and it would be hard to prove damages, no bank executive will be held to account.
Bloomberg also performs the useful task of trying to ascertain how much benefit the banks derived from the cheap funding. They come up with $13 billion, or roughly 23% of profit (they assume typical margins, when it would take a good deal of internal data to make more refined estimates). This is actually a very narrow definition of profit impact. The Fed stepping into the markets to shore up the banks by design stabilized and boosted asset prices, which surely had a significant profit impact.
Regulators lied to Congress. The article does a good job of marshaling details:
Bernanke in an April 2009 speech said that the Fed provided emergency loans only to “sound institutions,” even though its internal assessments described at least one of the biggest borrowers, Citigroup, as “marginal.”….
Judd Gregg, a former New Hampshire senator who was a lead Republican negotiator on TARP, and Barney Frank, a Massachusetts Democrat who chaired the House Financial Services Committee, both say they were kept in the dark.
“We didn’t know the specifics,” says Gregg, who’s now an adviser to Goldman Sachs.
“We were aware emergency efforts were going on,” Frank says. “We didn’t know the specifics.”…
Lawmakers knew none of this.
They had no clue that one bank, New York-based Morgan Stanley (MS), took $107 billion in Fed loans in September 2008, enough to pay off one-tenth of the country’s delinquent mortgages. The firm’s peak borrowing occurred the same day Congress rejected the proposed TARP bill, triggering the biggest point drop ever in the Dow Jones Industrial Average. (INDU) The bill later passed, and Morgan Stanley got $10 billion of TARP funds, though Paulson said only “healthy institutions” were eligible…
Had lawmakers known, it “could have changed the whole approach to reform legislation,” says Ted Kaufman, a former Democratic Senator from Delaware who, with Brown, introduced the bill to limit bank size.
Regulators continue to lie. I get really offended by the bogus accounting, such as the “banks paid back the TARP” or “the Fed lost no money on its lending facilities,” which this story annoyingly has to repeat out of adherence to journalistic convention. This is all three card Monte. So what if the banks paid back loans when the central bank has goosed asset prices vis super low interest rates? That’s a massive tax on savers. And we have the hidden subsidy of underpriced bank rescue insurance. Ed Kane estimates that’s worth $300 billion a year for US banks; Andrew Haldane of the Bank of England has pencilled the annual cost as exceeding the market cap of big banks (and that was in 2010, when their stock prices were higher than now).
The Fed is most assuredly going to have losses. It hoovered up a ton of Treasuries and MBS to shore up asset prices at time when interest rates were already low. The central bank intends to sell them when interest rates rise, to soak up liquidity. Buying when interest rates are low and selling when rates are high guarantees losses. As an old Wall Street saying goes, it’s easy to manipulate markets, but hard to make money from it.
The story contains other juicy tidbits, like bank lobbying on behalf of big banks to help them get bigger, and how Geithner told Congressmen they were too stupid to be able to shrink banks, and they should leave those questions to the Basel Committee (which has no interest in making big banks smaller). Go read it here.
The “they paid back TARP” meme will not die.
Saying banks paid back tarp is like saying an arsonist that sets fire to one home, which burns down 10 city blocks, should only pay restitution for one home. Lest everyone forget why there was a bailout in the first place – the frigging banks set the place on fire.
New formula for future econ 101 texts: leverage + OBS transactions + ZIRP + time = Depression
The current belief is this, yes. But it is not the entire truth.
Let’s back-up time:
* What tanked the economy into the Great Recession was the Credit Market Seizure of the fall of 2008, when Lehman Bros. failed, because banks would not lend to one another – a fundamental underpinning of our credit economy. So credit was much harder to get and ours is a Credit Economy. Meaning people got the message and started to pay off their outstanding credit debt – which concurrently meant lowering their consumption.
* The Seizure occurred because of the SubPrime Mess, where banks in the fall of 2008 could no longer trust one another because they knew full well that every bank was carrying worthless Toxic Waste and could go belly up at any moment.
* The banks, having taken advantage of the demise of the Glass-Steagal Act, went binging speculatively and did not have sufficient reserve funds to pay out commercial deposits if there were a run by depositors. (Which is what government SEC-head Geithner and Paulson believed at the time.)
* The SubPrime Toxic Waste was generated by an Asset Bubble, particularly in realty properties, because Americans went binging as well by accepting predatory loans in a speculative bid to “flip a condo” and make a Quick BigBuck Killing. A subprime loan is intrinsically a credit risk because non-creditworthiness checks were not being undertaken.) Between credit and realty debt, Americans were living way beyond their means.
* The bubble in credit and realty debt was triggered by foolishly low interest-rates because Greenspan thought that low rates would mean low unemployment (thus keeping Republican presidents in office). Greenspan also believed that markets were self-correcting, a notion that grossly underestimated the consequences of the SubPrime Disaster.
So, the Present Mess had many fathers. But if success has many fathers, then failure is an orphan. For the moment, no one wants to assume their part of the blame, but it can be attributed historically to more than just the banks.
The American Consumer was fully complicit in the SubPrime Mess. Had there been, perhaps, a Consumer Protection Agency, it would have been trumpeting the need to enforce the Truth In Lending Act (TILA of 1968) — and just maybe much fewer subprime loans would have been let. They were clearly fraudulent as regards that act.
Therefore, the mystery remains (imho), why are the banks not being taken to court for TILA-fraud?
No, it was the banks. It is the lender’s responsibility to assess the would-be borrower’s ability to pay back the loan. Instead, when the banks ran out of the creditworthy, they made liar’s loans so they could continue packaging the mortgages into sellable product. It was the leveraged derivatives that blew them up, not the relatively small amount of mortgages.
I did say the banks should be taken to task for the sucker-loans.
But, we were the suckers in the first place.
“Sucker loan” is quite the euphemism.
There’s that imperial “we” again. I am assuming NO collective guilt in this little debacle.
The institutional perpetrators of mortgage and securities fraud, members of what are effectively organized crime rings, should swing.
And don’t tell me we can’t figure out who they are right down to the last little local mortgage originator, sitting smug on their illegal takings, that you have to point the finger at the American public instead.
“Americans went binging as well by accepting predatory loans…”
Dozens of studies have shown around 30% of people who received predatory loans qualified for standard loans but were duped into adjustable rate mortgages because they were more profitable for the lender. That’s an odd definition of “accepting” you’ve got there.
And as everyone has pointed out, bankers took billions of dollars worth of loans and turned them into hundreds of trillions of dollars of unregulated derivatives. Unless I’m suffering from sleep-speculating, I had no part in that and neither did the American public.
That is the most spot on comment I’ve seen, ever.
Ahh, the classic “There’s plenty of blame to go around” huckster. Who cares that 90%+ of the losses were because of derivatives?
Yes, the American public went binging on cheap credit and were living way beyond their means.
If you think this is normal, then we are in for even more economic stagnation. Do you really think that China is going to keep our debt just to sell us their exports?
Think again … they let America sink before they assume that much of its debt.
Again, 90%+ of the losses from the crisis were the result of derivatives bets. I don’t know anyone who issued CDS on subprime bonds, do you?
Funny how the “there’s enough blame to go around” inevitably reduces to the “greedy borrowers” meme.
Where are those borrowers’ homes? Foreclosed. Where are the bankers who made fraudulent loans? Counting their bonuses.
Don’t give me lop-sided moralistic BS. Bankers should reap what they sow, which is uncollectable debt.
If you owe the bank 1,000 bucks, you’re in trouble. If you owe the bank 1,000,000,000,000,000 bucks, well, the bank is in trouble, isn’t it?
bit of a herp a derp.
Exactly. With so much blame to go around, who cares if it is the poorest of the poor, and the middle class house flipper that takes all the blame?
Certainly not the Biggest of Financial Concerns.
As far as jailing anyone responsible, a man who would be charged with RICO for his part in maneuvering so much Bailout monies to his buddies at AIG and at Goldman Sachs now sits pretty just down the hall from the Oval Office.
Back when he did the Bailout Maneuvers, he was the head of the NY Fed. Now he heads Treasury. If anyone had to spend life in prison for financial fraud, Tim Geithner would be my choice.
Hard to understand why people like you keep making it seem like it was a very complicate cascade of “things” that caused the disaster we are living. The reality of it is very simple: a handful of insatiable, corrupt, greedy motherfuckers, with the hands at the controls of the finance system, saw to it that they took all they could get their hands on and leave the bill for the taxpayers to pay… See? simple!!
What is complicate is to understand why no one of those who caused the disaster is being held accountable… Oh wait, could it be because they also own the people who could make this happen?
Lafayette: “The bubble in credit and realty debt was triggered by foolishly low interest-rates because Greenspan thought that low rates would mean low unemployment….”
A strong case can be made (and has been) for the Fed as first cause of the debacle. Greenspan saw a recession around every corner so was constantly goosing markets with rate cuts. His artificially low rates inevitably led to speculation as everyone chased yield.
So much for his belief in self-correcting markets. Yet if nothing else, Greenspan has at least started a discussion about the structure, the role, and even the existence of the Fed. It’s an ill wind that blows no good.
Sorry, but Lafayette is here only to make sure that nobody forgets to blame the wonderful abstraction called the Greedy and Irresponsible American Public.
I’m sure that if he’d been a prosecutor at Nuremberg, he’d have put most of the blame for Hitler’s and Goebbels’s behavior on ordinary Germans as well, after first calling Goebbels a “troglodyte” (this because he loves to trot out euphemisms whenever describing elite criminal behavior, in an attempt to make them seem more harmless, and to make it sound as though their actions were taken on the basis of “incorrect information”).
Hence the emphasis on “foolishly low interest rates”, “banks taking advantage of the demise of Glas-Steagal, (rather than acknowledging they actively lobbied to repeal it) etc. etc..
“* The SubPrime Toxic Waste was generated by an Asset Bubble, particularly in realty properties, because Americans went binging as well by accepting predatory loans in a speculative bid to “flip a condo” and make a Quick BigBuck Killing. A subprime loan is intrinsically a credit risk because non-creditworthiness checks were not being undertaken.) Between credit and realty debt, Americans were living way beyond their means.”
Not all of us did. (I say “us” because I was living in the USA during this time period and chose not to participate).
This crisis was not caused by borrowers. Banks and financial institutions had a product they wanted to sell, and they found a market for it. If people who were educated about financial matters avoided it, then they found people that could be more easily taken in, and appealed to their hopes and dreams (You deserve to own a home! It’s your right as an American!)
I don’t see any way the American public could have been collectively inoculated against this disease. A massive public education process on financial literacy that reached (and convinced) a large enough proportion of the public might have limited the damage. Even then the banks would probably have found some other way to play us.
All False Profit !!!
Plunder and Pillage is more like it.
At the time of the initial bailout, in an unrelated article, it was reported that credit card debt by Americans had just passed the trillion dollar mark. I said then that if the Fed had simply paid off all our cards, consumer spending would be so stimulated that the recession would be over instantly.
Instead, they spent way more, lied about it and we didn’t even get a lousy t-shirt.
They got their salaries, bonuses, commissions, and whatever they looted, so what’s not to like? And don’t kid yourself, that’s what it’s all about here, and that’s all that it’s about. Accounting control fraud, and letting the perps get away clean with what they stole.
“Tankless”? Quelle blague! ;^)
Another big lie: the Fed coming to the rescue of the unemployed via QE2 – just in time for the vote to extend the Bush tax cuts.
The market saw this “printing” as inflationary so longer rates rose rather than fall – at the fast rate ever recorded (a drag on the real economy). Banks reaped trading profits and higher loan rates.
“Lawmakers knew none of this.”
The takeway: Executive branch and its hand picked Regulators collude to deceive Congress.
Well, I’d hazard an opinion that “Gee, I had no clue, ” should be grounds for recall. It’s their job to have a clue as to what is going on. So they are either lazy, stupid, too busy eating at luncheons, hiring stupid and/or evil staffers, or actually colluding with the executive branch. Or all of the above.
Note: I define stupid as mundane or mediocre thinking. The kind of bureaucratic thinking that tries to reduce all problems into something already in the box of tricks. Nothing innovative or newly engineered.
And now that they do know, what will they do about it?
I’m going to guess Nothing, other than enable further looting.
Historically deception by the Executive branch has not been taken lightly by Congress. Remember Iran-Contra? Watergate? I wonder if those events are valid analogies to this secret bailout.
Yes. I remember Iran Contra and the (“In No Way are we going to hold anyone accountable”) Innoye Committee. Ollie North skated away from criminal charges because the Committee had given him immunity. Weinberger, McFarlane and Abrams got a presidential pardon from GW Bush.
Sorry — the pardon was from GHW Bush.
One can draw two conclusions; either they didn’t know the right questions to ask, or they didn’t want to ask them for fear of the answers. I favor the latter.
I believe you’re right. They could have had Bill Black come in to discuss accounting control fraud in plain English.
Gregg and Frank are letting the “truth” slide in their responses. They may not have known all the “specifics” but that doesn’t mean they were unaware of the intentions of the Treasury or weren’t directly involved, particularly Frank, in the high level discussions that gave the Fed/regulators their marching orders.
And Frank announced today he’s retiring.
I note that the article says nothing about the banks’ current borrowings outstanding from the Fed. I presume that this is because of the time lag in what the Fed is required to release. So we don’t know what benefit they are currently receiving.
I would like to show the juxtaposition of the reality concerning the financial crisis with the all too common beliefs about it. Because most of us do not understand what has happened and is happening, or people have an impenetrable ideology that will not allow facts to enter the discussion, blame is being falsely attributed to those least responsible. This allows those who are the most responsible to walk away with bags of cash. (Good thing too! There’s an election on and people to buy!) :)
Here is a letter to the editor of my newspaper: “The Occupy Wall Street protesters despise wealthy, self-made people. But chief executive officers of banks, oil companies, and small and large businesses have done a lot for this country, thanks to capitalism.
Without hard work, success, and wealth, there would be no job creators. Without wealthy persons, Carnegie Hall and the Huntsman Cancer Institute would not have been built.
Foreclosures are happening to people who never should have been given loans.
The George W. Bush tax cuts need to continue, and job creators have to stop being punished. This country has too much wasteful spending on programs that enable people to become parasites.”
Jill, you had really ought to visit here more often.
I’m not certain how to understand your response. If you like what I wrote, thank you for saying so. If you think I need to learn more about economics by coming here-you’re correct and that’s why I do read this blog.
I am representative of the general population. I am trying very hard to understand what is going on. This is difficult because I lack training in economics. I see how damaging that lack of understanding is in my everyday life. The lack of knowledge turns ordinary people against each other and keeps all of us from addressing the root causes and solutions to our imploding economy.
How unfortunate that so many of the job creators had to resort to fraud and grand larceny to achieve these lofty goals. Without the ability to circumvent existing bank regulation and laws regarding title registration it looks like there would be far fewer “wealthy persons”.
I’ll pick my parasites by the price tag thanks.
It is quite evident you don’t read this site much or you would realize how troll like your comments are. Then again maybe you have a job going around spewing this ecobabble.
If your attitude and understanding weren’t what has brought our world to this sick place it would be funny, but it is not.
Please go back to grade school and learn about sharing, then read some history about the global inherited rich that are at the top of our class based society. You are seriously ignorant and a detriment to a humanistic society.
Psychohistorian: Huh? I don’t think you read Jill’s (first) comment closely. Here’s a quote from it:
“…..blame is being falsely attributed to those least responsible. This allows those who are the most responsible to walk away with bags of cash. (Good thing too! There’s an election on and people to buy!) :)”
What’s “troll-like” about that? The part of her comment that I think annoyed you was a QUOTE from a letter to the editor in her local newspaper.
And what’s wrong with coming to this site to learn more about economics and finance? I can’t think of any better.
“Without hard work, success, and wealth, there would be no job creators…..”
That’s a cute story, who told it to you? I think you’ve seen too many movies or been subjected to too many beer & lifestyle commercials.
The occupiers do not hate or envy wealth, they just recognize a good robbery when they see one.
You may also want to put your google machine to work on the cancer “research” industry (FDA, Big Pharma, et al). Cures cut into profits. http://www.burzynskimovie.com/
Keep an open mind and read this blog before drawing any conclusions about who creates wealth and who’s a parasite to society. There are some compelling counter arguments to the “wealth creators” point to be found here. Understand that many people are outraged by the fraud that created the current economic crisis and goes unpunished to this day.
Jill, I think a few people skimmed your post and came away with the impression “a” letter to the editor was “your” letter to the editor. Clearly, you think these opinions are wrong and that “blame is being falsely attributed to those least responsible”
I’d like to apologize on behalf of my fellow posters and welcome you to the reality based community. This is a place to learn, tell your friends.
Whew, Dr. Duh, that was my take too. Thought she was posting a LTE that she disagreed with. I have seen letters like that every week in our local paper.
Obviously you caught it. I understood what she meant (and that most of the post was from a newspaper comment) and was quite baffled by the comments of those who should have known better.
Look at where the quotes begin and end guys.
Dr. Duh and others who explained what I meant–Thank you! It’s not my letter, it’s one I disagree with.
To add to the story directly I believe Neil Barofksy said taxpayers are on the hook for 23+ trillion. This quote is from Glenn Greenwald’s column: “Barofksy’s clashes with administration officials have intensified of late. Last week, he issued a report documenting that the actual amount of taxpayer money theoretically put at risk in the bank bailout — once Federal Reserve, FDIC and other programs are counted — is $23.7 trillion, not the widely cited figure of $700 billion, a report that prompted attacks from the White House and Treasury on his credibility. Separately, Barofsky has continuously disputed White House claims that it’s impossible to account for what has been done by banks with the TARP funds. Barofsky wants to compel banks to account for those funds and then publicize that information, while the administration opposes such efforts, claiming that accounting for TARP monies is impossible due to the “fungibility” of those funds. To disprove that claim, Barofsky sent out voluntary surveys to the bank which proved that those funds could be tracked (and he found TARP funds were being used by receiving banks largely to acquire other institutions and/or create “capital cushions” rather than increase lending activity, the principal justification for TARP).”
My apology. I read your comment again, your lead into to the letter it and it still looks like it could easily be construed to be your letter to me……
Yves–“tankless task” in first line, instead of “thankless”
Thinking outside the box:
Has Bloomberg compiled enough info for an anti-trust suit against the Federal Reserve and TBTF Banks?
Yeah, its impractical, but maybe OWS would have a go at it?
I also think it’s amazing that the Fed and the banks were able to maintain near-total secrecy about the details of these borrowings until Bloomberg blew the lid off with the FOIA suit. Even the military struggles to get this degree of compliance with secrecy around major initiatives. Obviously, lots of people knew the details about all of this, at both the banks and at the Fed. Yet it appears that not a single one turned over any details to the press. Amazing. Also, I don’t buy the protestations of Gregg and Frank that “We knew nothing!”. The military’s modus operandi is to bring key members of Congress at least part way into the tent so as to co-opt them. I can’t believe that didn’t happen to some extent here too.
And they say there are no conspiracies because people can’t keep a secret!
Yeah that’s just ridiculous. Most secrets aren’t released until Uncle Sam wants them released. The CIA just declassified secret documents from the First World War (from 30 years before there even was a CIA!) involving, of all things, the formula for invisible ink.
What’s interesting is that this all goes back to the anomaly of a federal agency (the Fed) that is not an agent of the President. The power to classify and declassify belongs to the President, except when it comes to the Federal Reserve.
It really is time we quit calling the Fed a federal agency. I have been a lawyer for thirty plus years and the courts have held on numerous occasions that the Fed is not part of the United States government. In fact, in one personal injury case the United States was sued and its defense was that the Fed, a private corporation, was responsible for the tort, and not the United States. The court agreed with the US government’s position and dismissed the tort claim against the government.
The Fed is not a US government agency, at least according to case law.
You know, Barney is currently cosponsoring a bill to disenfranchise all the regional Fed Banks because their votes really don’t count and they just screw up the overall plan. Etc. Don’t know where to start. This could be the beginning of nationalizing the system with the least objection. (My O that is good.) It could also be more fraud control and going even deeper into bad. One thing holds true: when trust has been shattered you do not get it back.
It’s quite disgusting listening to the lawmakers say “if only we had known how reliant these banks were on the Fed, our entire approach to Dodd-Frank would have been different!” In other words, they are suggesting they wouldn’t have watered the bill down if they knew the banks were completely bankrupt and were saved only by secret government largess.
The only problem with that story is that anyone who was paying attention knew the banks would have been bankrupt (or at least out of money with a liquidity crisis) if it wasn’t for the Fed. Having the real numbers is nice, but if you were following the news at all you knew that the holes in the balance sheet of these banks were huge. They had billions of toxic assets that they couldn’t value properly and couldn’t sell (without taking heavy losses) and they needed cash to cover margin calls and investor redemptions and the like. The Fed was providing that liquidity.
These lawmakers are just making excuses for taking the millions of dollars in lobbying money from the big banks in return for neutering Dodd-Frank. They would have done this whether or not they knew the full details of the Fed programs, as they are corporate whores who will sell out the country if it means they can fund their next election campaign easier.
The most infuriating part is that this is all too plainly obvious. It’s couldn’t be more self-evident that the banks were saved thanks to billions of dollars in below market-rate loans, and rather than show humility at that fact the banks, with Jamie Dimon as their arrogant leader, want to pretend like none of that happened. They continue to control the government and spend money on lobbying without any regard for their actions and what happened 2008/2009.
And millions of people are out of work today because they blew up the economy. Our government has trillions of dollars in addition debt on it’s balance sheet thanks to the banks. And our congressman let them get away with it. Rather than coming down hard on them, sending them to jail, and regulating the industry like it’s a utility company, they continue to craft laws to benefit the industry at the expense of the rest of the country.
One other point — these banks want this safety net and backstop but they don’t want to pay anything for it. You suggest regulation, and they get their panties tied up in a knot – many of them decrying socialism or how it’s going to cost so much money. If they want a backstop that will lend to them when no one else will (and I’d argue that is necessary for a modern financial system to operate), they should be forced to pay for it. The payment should be intense regulation. Dangerous products should be outright banned, and banks operating in America should not be allowed to use those or buy them from other countries. This too is obvious, but our Congress is so controlled by these plutocrats that they let them get away with this basic thievery.
Citigroup’s $285 Million Mortgage Settlement With SEC Blocked By Federal Judge
“U.S. District Judge Jed Rakoff rejected the settlement in an opinion released today. The judge has criticized the agreement for permitting New York-based Citigroup to settle without admitting or denying liability in the matter.”
Everyone had a hint this was coming…
“Doesn’t the S.E.C. have an interest in what the truth is?” Judge Rakoff asked, in reference to the commission’s longstanding practice of not forcing a defendant to admit any wrongdoing when settling a case.”
Link to Judge Rakoff’s ruling for everyone’s edification.
Makes me think back to the other days blog post about Yves’s PBS debate is the dissembling gibberish about how difficult it is to prosecute these crimes from the 3 other sock puppets.
Lambchop would have put up better arguments than those 3.
“Bloomberg News is continuing with the thankless task of pushing forward with FOIA requests…..”
Meanwhile, banks continue to receive the “taskless thanks” of money for nothing.
So when CDSs are triggered (I know they are pretending that volunteer hair cuts prevent this) on all that EU sovereign debt stuff and the banks cannot pull a BAC and slip this obligation under the door of the FDIC, what will happen? We’ve already melted down once.
Goldman’s ‘masters of the universe’, as receivers of CDS premium, will pony up just as much capital as needed to prop up a solution. Then they will dictate this contribution, which of course is nominal to their stake, be classified as a “voluntary” restructuring. The triggers will be thusly be called off. The “volunteers” will go along, in fear of a bigger hair cut.
The Fabulous Fab’s can’t wait to spike another one. What a great bunch of guys.
I agree with Brett. It is comical, and disgusting, to see Barnie Frank and Judd Gregg pulling their Sergeant Schultz routine: “I know notzing!” Most of their careers they have paraded around claiming to be great experts about all this stuff, but the truth is, for the right amount, they don’t see anything their corporate paymasters don’t want them to see, no matter how obvious.
Barney has bowed out of the re-election circus:
Barney Frank to Quit House After 30 Years
And I say, Good Riddance to a Bad Legislator (who-couldda-knowed, indeed!).
Quick note: Mark at fundmymutualfund.com made a nice summary of the article with a lot of BIG numbers in it…
I have to say, I’m really shocked, and I thought we should be used by now to one scandal after the other seeing the light of day.
The big question is why was TARP even necessary? Instead of the Fed loaning JP Morgan $107 billion and TARP loaning $10 billion, the Fed could have simply loaned $117 billion.
It appears TARP was about Bernanke refusing to jump off the bridge unless Congress jumped with him… a month before an election!
That alone is reason enough to end the Fed, though I prefer the “Secretary of the Navy” approach. The Fed should be subject to the supervision and control of the Secretary of the Treasury but remain separate from Tsy, just as the Marine Corps is separate from the Navy yet still answers to the Secretary of the Navy.
Yes, the Secretary of the Navy approach is advocated by the American Monetary Institute. http://www.monetary.org.
Great Idea. Private banks should not have the privilege of creating money, only the government. Treasury creates the money for our infrastructure and pays people directly without being charged interest on its own money.
Amen. Time we stopped legal counterfeiting by private persons (corporations are persons we have been told time and time again). That is unless I get to legally counterfeit as well, then of course, like any good American, I am all for it.
this is one of the worst so far. every time you think it’s bottomed, every you think they can’t go lower, they do. this one was really hard and there was nothing at all funny about it.
it’s like climbing a mountain upside down. you descened into the crevasse-enshrouded mists, into the darkness, and you think you’ve reached the inverted peak — the floor of all debauchery — and you realize in amazement that it’s just a false bottom — another crack like this one today reveals itself, a cavity in the floor, a plunging and astonishing declivity, a startlingly sightless abyss, and you realize there’s even farther down to go.
How far down can it go before it becomes hell itself? How far down before they are not just possessed by demons but the are demonic forces incarnate in human flesh and bones? And the angelic strains of psyche are but refuse sold and burned for profit.
I really don’t know. I believe Jesus can save almost anyone, but they have to want to be saved. They can’t want to consort with demons and sell their souls because they can. That’s the nadir of the descension, and Nothing there can be done but to watch in wonderment, numb with astonishment, fortified with red red wine and tranquilizers — between bouts of political activism and visits to the art museums and the bistros and long stretches of laying around wasting time innocuously without selling anything or buying anything.
But there’s no punishment
I would read anything you wrote. Likely not agree with much of it, but certainly would enjoy your writing.
Surprised that you’re surprised, though. Aren’t you familiar with human nature, as demonstrated via our records of Athens, Rome, the Vatican, Paris, London, Berlin, Moscow, Tokyo, Beijing, Phnom Penh and every other recorded seat of power known to man?