If you thought, hopefully, that Barak Obama was going to finally end the collusion of powerful banking interests and government, and actually give us the change we were so longing for, by now you are getting just a tad disappointed. I was a staunch Obama supporter, believing his magnetism, popularity, and intelligence would see the collapse of Wall Street Ponzi securities trading scams as the perfect opportunity to truly set this country on a new course. I was sadly disappointed to see men like Rubin, Geithner, Summers occupy key posts as economic advisors—all men bred from the Wall Street / Banking industry, and certainly destined to return home to that world once their brief public “service” ends.
But it is clear now that, regulation reforms aside, there will be no major change in how the game is played by Wall Street and the Banks. The big securities trading schemes came to a grinding halt when everyone finally realized that this was traffic in relatively worthless paper that created no real value. It was shadow wealth, traded and hoarded by shadow investors all across the globe. Instead of ending the mess and really reforming how our banking system works, we’ve thrown $14 trillion into the empty gas tank on Wall Street in a desperate attempt to restart the engine.
Why? So the banks can get back to the crap tables and roulette wheels they called SIVs, CDOs, Swaps and Derivatives? That appears to be the whole of it. Bernanke and Geithner are all about restarting that game. In the meantime, to mix metaphors, the engine of the Main Street US economy has stalled and died. We are now running on vapor. Business and consumer credit, the fuel that drove our economy, has contracted so dramatically that no one had the money to build, expand, hire or buy as they did in those halcyon days of yore we all still remember.
If the Fed manages to restart the securities game rest assured that all the good old Boyz will be back. Those that dodged the bullet in the last 6 months, the Goldman Sachs crowd, announced record bonus payouts this quarter. Isn’t capitalism wonderful? The same players and powers will take their seats around the card tables, and on we will go, because they have all been deemed “to big to fail—which was the first mistake made by Change.gov.
The notion that a bank is too big to fail is patently false. Nations have failed, empires have failed, entire species have failed. Even stars die. These same institutions and players that have brought us to ruin should be dismantled, and a new system of smaller community banks set up in their place. And when these huge insolvent banks go down they take with them all the bloated CEO salaries, "preferred" player stock equities, and hocus pocus "assets" hidden in level three accounting tables, wiping the slate completely clean. The government protects only the FDIC insured deposits, which will be a Herculean task in and of itself. The Big Boyz who made all these bad bets just take their losses. Period. Then we start over, using any funds we can then manage to scrape together to ensure proper capitalization of the new community centered banks, all under new management, and with stringent new rules and regulations to prevent this from ever happening again. It means the end of an era of greed and corruption on Wall Street and in the board rooms of the banking system that boggles the mind every time I think on it, and good riddance.
But I’m not holding my breath that this will ever happen. Change.gov has not proven itself capable of “seizing the day” thus far. It’s the same old game, with a new dealer. And that is very sad.
But it is clear now that, regulation reforms aside, there will be no major change in how the game is played by Wall Street and the Banks. The big securities trading schemes came to a grinding halt when everyone finally realized that this was traffic in relatively worthless paper that created no real value. It was shadow wealth, traded and hoarded by shadow investors all across the globe. Instead of ending the mess and really reforming how our banking system works, we’ve thrown $14 trillion into the empty gas tank on Wall Street in a desperate attempt to restart the engine.
Why? So the banks can get back to the crap tables and roulette wheels they called SIVs, CDOs, Swaps and Derivatives? That appears to be the whole of it. Bernanke and Geithner are all about restarting that game. In the meantime, to mix metaphors, the engine of the Main Street US economy has stalled and died. We are now running on vapor. Business and consumer credit, the fuel that drove our economy, has contracted so dramatically that no one had the money to build, expand, hire or buy as they did in those halcyon days of yore we all still remember.
If the Fed manages to restart the securities game rest assured that all the good old Boyz will be back. Those that dodged the bullet in the last 6 months, the Goldman Sachs crowd, announced record bonus payouts this quarter. Isn’t capitalism wonderful? The same players and powers will take their seats around the card tables, and on we will go, because they have all been deemed “to big to fail—which was the first mistake made by Change.gov.
The notion that a bank is too big to fail is patently false. Nations have failed, empires have failed, entire species have failed. Even stars die. These same institutions and players that have brought us to ruin should be dismantled, and a new system of smaller community banks set up in their place. And when these huge insolvent banks go down they take with them all the bloated CEO salaries, "preferred" player stock equities, and hocus pocus "assets" hidden in level three accounting tables, wiping the slate completely clean. The government protects only the FDIC insured deposits, which will be a Herculean task in and of itself. The Big Boyz who made all these bad bets just take their losses. Period. Then we start over, using any funds we can then manage to scrape together to ensure proper capitalization of the new community centered banks, all under new management, and with stringent new rules and regulations to prevent this from ever happening again. It means the end of an era of greed and corruption on Wall Street and in the board rooms of the banking system that boggles the mind every time I think on it, and good riddance.
But I’m not holding my breath that this will ever happen. Change.gov has not proven itself capable of “seizing the day” thus far. It’s the same old game, with a new dealer. And that is very sad.
