January 7, 2013

Rolling Stone profiles the banksters

From Matt Taibbi writing at The Rolling Stone:
Secrets and Lies of the Bailout
The federal rescue of Wall Street didn�t fix the economy � it created a permanent bailout state based on a Ponzi-like confidence scheme. And the worst may be yet to come.

It has been four long winters since the federal government, in the hulking, shaven-skulled, Alien Nation-esque form of then-Treasury Secretary Hank Paulson, committed $700 billion in taxpayer money to rescue Wall Street from its own chicanery and greed. To listen to the bankers and their allies in Washington tell it, you'd think the bailout was the best thing to hit the American economy since the invention of the assembly line. Not only did it prevent another Great Depression, we've been told, but the money has all been paid back, and the government even made a profit. No harm, no foul � right?

Wrong.

It was all a lie � one of the biggest and most elaborate falsehoods ever sold to the American people. We were told that the taxpayer was stepping in � only temporarily, mind you � to prop up the economy and save the world from financial catastrophe. What we actually ended up doing was the exact opposite: committing American taxpayers to permanent, blind support of an ungovernable, unregulatable, hyperconcentrated new financial system that exacerbates the greed and inequality that caused the crash, and forces Wall Street banks like Goldman Sachs and Citigroup to increase risk rather than reduce it. The result is one of those deals where one wrong decision early on blossoms into a lush nightmare of unintended consequences. We thought we were just letting a friend crash at the house for a few days; we ended up with a family of hillbillies who moved in forever, sleeping nine to a bed and building a meth lab on the front lawn.
A long read (five pages) but excellent detail presented clearly. If this was a private business and not connected to their government enablers, these asshats would be doing a minimum of 30 years each. Matt closes with this coda:
So what exactly did the bailout accomplish? It built a banking system that discriminates against community banks, makes Too Big to Fail banks even Too Bigger to Failier, increases risk, discourages sound business lending and punishes savings by making it even easier and more profitable to chase high-yield investments than to compete for small depositors. The bailout has also made lying on behalf of our biggest and most corrupt banks the official policy of the United States government. And if any one of those banks fails, it will cause another financial crisis, meaning we're essentially wedded to that policy for the rest of eternity � or at least until the markets call our bluff, which could happen any minute now.

Other than that, the bailout was a smashing success.
Fun times ahead. I am seriously looking at converting some of my money into Canadian currency -- it has been posting a steady climb against the USD as inflation keeps creeping up. Posted by DaveH at January 7, 2013 7:54 PM
Comments
Post a comment









Remember personal info?