How Many Trillions Does it Take to Put a Banker in Jail?
About to go to jury duty here in about 15 minutes...which got me thinking about the concept of justice.
I don't mind paying a lot of taxes if it goes toward creating a better society, but in California when you get toward the upper end of the tax bracket you can pay ~ 60% (federal + state + local + self employment/social security) of your income in taxes. And those tax payments probably do not even offset the handouts we are giving to bankers that gambled with trillions of dollars and lost.
News of additional bailouts via a public private partnership (that makes almost all the reward private and almost all the risk taxpayer funded) have spurred Bank of America and Citibank into buying more of the toxic assets that they allegedly need help clearing off the books.
A guy writes $7,000 in bad checks and gets a 24 year prison sentence. These bankers cost tax payers trillions of dollars. So much money stolen that they debased the currency, and they are awarded with free money for being incompetent.
I am not sure what will come of today, but if this country actually had any sense of justice then there would be at least a half dozen bankers serving a few decades in jail. The fact that none of them have been locked up yet shows how perverse our justice system is and how little you should trust the U.S. government. Politicians work for the bankers.
Obama has a poll allowing voters to ask questions about the economy. Most of the questions are about "what about me I am broke and don't know what to do" and "I need some relief" etc. And that is how they will remain until our financial system is fixed. And by fixed I mean these bankers serve the jail-time they earned and pay back their "earnings." Billions of hours of labor have been wasted propping up a ponzi scheme that promotes insider/bank traders winning on both sides of the trade, while handing you the losses.
Is there any wonder why so many people feel overextended?
These bankers put teeth in the consumer bankruptcy law (lying using bogus statistics to pass it) then they wanted a decade long ride on the free money train for their company.
What's worse is that children who have yet to be born have interest working against them starting from the day they are born. They are in the hole from their first breath, having done nothing wrong other than being born into corruption. The politicians take care of their own children, just not our children.
We are so afraid of terrorism...and financial terrorists that cost us trillions of dollars are somehow just part of how the system works. No big deal.
Sorry, but I don't need to pay for someone else's second yacht or fourth home. If anything these career criminals should be scrubbing my floors and taking out my trash. You and I are the people who are actually paying their salaries (and bonuses) through a collective billions of hours of OUR LABOR that was confiscated and handed over to the banks. This makes me angry enough to want to go unemployed and stop working and/or move to another country. I hope I get to be a juror over a banker some day. And I hope you do too!
Update: here are a couple relevant articles in Rolling Stone & The Atlantic, and a nice video.
Comments
Hey Aaron,
Long time lurker here - this post got my interest up.
I hear a lot of noise from the states at the moment about this, and it forms two groups, a bunch of people want the banker's bonuses taxed (90% tax) - as it's Government money funding it, and another bunch of people is attacking that move as unconstitutional.
Seems to me Obama is damned if he does, and damned if he doesn't.
What's your opinion on the taxation issue?
If the companies did not have taxpayer money they would be bankrupt anyhow. If the company goes bankrupt there is no bonus.
If taxpayers bailed out the companies then the US government has an ownership stake in the companies. We are the owners and dictate how the companies should be ran.
If they don't like that then they can file for bankruptcy.
I registered just to say: Yes, put them in jail! If they have actually committed a crime. It's so obscene that they expect to be rewarded whatever happens, its inefficient and just shows that big business is full of ***kheads!
Capitalism is great, as long as the main part of the economy is based on companies that are small and private.
No shortage of charges. Plus, when's the last time we brought an anti-trust suit? If a company is too big to fail, it's too big, and should be busted like any monopoly.
Republicans (and many Democrats) were so gung-ho for deregulation, and here it is--writ large. You get what you pay for...
For the record, there were people who saw this coming. So when you hear someone like John McCain or Phil Gramm saying no one could have seen this coming, do your homework. They're full of it.
Wake up people. Start linking to that article so people can see that there's proof that conservative philosophy is bankrupt.
the issue is NOT political ideology ... they both take money from the same bankers... the issue is fake deregulation,where we pretend that something is deregulated, then make the taxpayer take a losing side of the trade.
As Barry Ritholtz said, "capitalism without failure is like religion without sin."
If you support deregulation when it works then you do not backstop losing trades when it fails. Every bailout steals capital from the productive parts of the economy to create incentive for inefficient bubbles in unproductive parts of the economy.
That's a zinger there from Barry, and your following comment makes a lot of sense too (If you support deregulation when it works then you do not backstop losing trades when it fails. Every bailout steals capital from the productive parts of the economy to create incentive for inefficient bubbles in unproductive parts of the economy.)
My question is how many trillions does it take to put politicians in jail? I don't blame bankers for taking free money, I blame idiot politicians for giving it out.
I think they are all on the same team
many people from each organization belong in jail.
Why would we put bankers in jail? Should we put everyone that fails at business in jail? It is the politicians who stole money out of our pockets to give to these failed businesses that should be put in jail. Now we have these Obama-economics prevailing that say if the government pays for it, it's free. Not to mention Clinton that started the ball rolling encouraging banks to loosen up their credit.
Sure the bankers extended too much credit, but the consumer agreed to take on too much credit. I believe the average American spends 1% more than they make. That's not sustainable. Consumers need to get rid of this entitlement complex and start budgeting and saving. Then the economy needs to readjust to the new, lower spending levels.
The bankers should be put in jail for claiming that they need so much money to clear the junk off their books, then using that money to buy more of the junk that they claimed was toxic and needed removed (once they heard of yet another bailout with favorable terms for removing the junk).
That is operating outside the spirit of the bailout (or at least the spirit of the one that Bush got on the television to inform taxpayers about), and I am pretty sure there was some sort of illegal insider trading going on when they were informed of the PPIP plan by the Federal Reserve, head of the banking cartel.
Many banks were even putting up tons of help wanted ads for temporary jobs over the summer because they were informed to expect a busy summer. How can the retail investor trade against all that inside information?
There's a bit of a history in American law of discriminating against blue collar crime (like the $7000 in bad cheques you mention) while letting white collar criminals off easy. See e.g. the law that was struck down in the case of Skinner, whereby blue collar thieving got you neutered and white collar was fine, even when the amounts were the same!
Hear you Aaron loud and clear. Wish there was an answer for greed. Well, there is, but most people aren't interested... including myself most of the time.
Just who is the person aka "the banker" that you want to put in jail, Aaron? Our worsening economic mess wasn't caused by "a banker" or "a hundred bankers", nor by an economist or a president or anyone else. We are caught up in the long-term results of decisions, both bad and good, made by many people.
The decision-making process and where it goes has a lot to do with where the decision maker's head is. To oversimplify, if we are talking politicians and their appointees, we are talking about leaning left or right and doing things to match that leaning.
Who really controls where our Ship of State is headed? Remember the X Files show on tv? The ultimate guidance for the country flowed forth quietly from a large, dimly-lit, smoke-filled room full of overstuffed leather chairs. In them sat "the bankers" or whoever the people were who really decided how things would go and then pulled whatever strings were necessary.
I honestly and truly believe this to be the real-life scenario. What I don't know is what country that room is in...
Well I don't know all the depths of lies, fraud, and deceit, and I am not the jury over the entire banking system...but there are some obvious starting points, particularly the CEOs of the banks that claimed they needed bailed out from certain asset classes and then used that money to buy more of that same toxic sludge.
From there you look for illegal kickbacks and bribes to government officials and jail them too.
Perhaps a good number of people in the Federal Reserve and the US Treasury need jail time as well.
And we can look at some of the other aspects of the housing run up like appraisal fraud.
Sure one can claim that our worsening economic mess was not caused entirely by bankers, they may not have been the sole actors, but they were certainly at the center of the issue. Anytime the money supply contracts you are virtually guaranteed a recession (which is a mathematical requirement of fractional reserve banking systems). Recessions are not a bad thing, but banks leveraging up beyond reasonable levels and ignoring lending standards (along with appraisal fraud, asset ratings fraud, low central bank interest rates, and many other factors) grew money supply too quickly and (upon bust) forced it to contract quicker than it otherwise would have needed to. Giving the bankers trillions of dollars for screwing up so badly encourages further moral hazard (while stealing from all legitimate businesses and individuals that were not involved in such financial engineering fraud).
If THEY don't pay for screwing up this time, then surely WE will get stuck paying again (with compounding interest).
I have a very cost efficient proposition. Confiscate their assets, and sell them as part of the toxic assets. With the money, we can keep Guantanamo Bay Prison Opne, and have them all reside in it until they return the our money and the money of the next few generations they sqandered.
And instead of all the water sports afforded to them in their personal spas at home and their retreats which we pay for, we can introduce them to a new sport called "Water Boarding"....
Any votes on that?
I've been suggesting that Aaron rebrand his web presence, because as this post shows, he's gone well beyond the scope of SEO (or even marketing for that matter).
But that's a good thing. The more young agile minds pushing this semi-revolutionary tact, the better.
I'm on board, and I know that there are many others. It could take decades, but I refuse to give up on the idea of a revolution that won't be televised.
Though I was born overseas (Argentina) I grew up in the USA (Miami) and have a lot of love for this country. That said, it has become painfully clear that there are many fundamental ills (for-profit prison system, for-profit healthcare, for-profit drug war, Monsanto, etc, etc, etc.)
That must be dealt with.
Google has issues, but they're really just the tip of the iceberg...
I view this sort of corruption as a subset of marketing...just one that needs more marketing done to bring about awareness and context.
That's an interesting take, and one that I can rally behind.
Theoretically, even things like religion are a subset of marketing...
I love how the media never mentions that the Federal Reserve is a corporation for profit that has nothing to do with the Government. We all t would get a SEO campaign organized to make this public!
The fact that it is a part of the banking system is 100% why it must not let big banks fail and would rather pass those costs of bad trades onto tax payers. It is an organization that supports the interests of large banks at the expense of the common man.
In the book Meltdown, Thomas E. Woods wrote “Now we can either believe that this is the first and only time in history in which an interest group drafted legislation aimed more at the public good than their own benefit, or we can consider the possibility that its intent was to entrench special privileges for one particular industry at the expense of the rest of society.”
Hey Aaron,
I think you are right on the money (pun intended). These guys should be in jail. No doubt.
This article is a great read http://www.rollingstone.com/politics/story/26793903/the_big_takeover/print and should make all U.S. taxpayers want to grab their pitchforks and storm the castle (then move to New Zealand!).
Strangely enough New Zealand was on my short list...but wife thinks it is too far out in the boonies :)
Hey Aaron
Really liked that post.
You should try living in Ireland to experience a country that is truely corrupt. We have a small hub of people who own all the wealth in this country and do nothing for the good of the people.
I can never see this kind of behaviour changing. We are all motivated by money in some way and in most cases people will do anything for it.
If you can't see change happening then you are right it never will. But exposing such nonsense informs people. All important changes start with a small group or a person.
I don't need to pay for individuals desire to keep up with the Jones by living way beyond their means and taking on ever increasing amounts of debt to do so.
Look the bankers and companies that preyed on people deserve to get theirs but let's not exempt people from taking responsibility for their foolish decisions.
The line I hear a lot is that companies preyed on people and they did but using that as the sole reason for our current problems basically is saying that all people are uninformed ignorant idiots and they deserve a pass.
Which is not true, and ignorance is never an excuse anyway.
No matter what side of the argument you fall on, can anyone really deny that if you give out several trillion dollars that you don't have that eventually you will have to pay the piper?
And it won't just be the "rich" taking on the burden. It will be everyone from top to bottom.
It is a mess for sure but as marketers I think we know that running tests in our marketing efforts requires patience and enough time given to see if the test works or doesn't before moving on to the next test.
What our government is doing is performing numerous tests at the same time that all conflict and muddy the results of all the other tests so there is no way to know what is working and what doesn't so the solution appears to be throwing more money that we don't have at things hoping that something will work...completely nuts....
we would not accept such nonsense in running our own business but we rally to this foolishness when it comes to our government?
Most citizens didn't want the bailouts Jeremy. And most citizens got nothing from them (other than more debt and a currency that is a bit more debased).
I don't view myself as being on any side. I just realize there were a lot of illegal activities happening, and some people need to spend some time in jail. Last year almost 1/3 of my life was confiscated through seizing the fruits of my labor and passing that on to career criminals. I will never get that chunk of my life back, and whoever wrongfully got that money needs to spend some time in jail.
Nothing wrong with paying for roads and education, but I get really pissed off thinking about buying someone's second yacht.
I hope this time round, people will question the system & how it onlt caters to the select few.
Maybe the financial set-up will implode, & we'll just get on with our own lives.
I'm finding more time to do things now whilst unemployed. Used to worry about 'conforming' to the collective 'norms'.
Anyway Aaron, can I plug a website that promotes an alternative way at looking at life? It's at: http://idlefoundation.net/
It's a good place to chill!
I don't mind working hard. And I don't mind working long hours. I just can't justify doing both at the cost of my physical and/or mental and/or social health when most of my labor is stolen to promote some shitbag banker that doesn't know how to do his job AND is only profitable by looting the treasury and stealing from people me.
The irony of the whole situation to me is that you can flick on Fox News and listen to Bill O Reilly and his ilk decry the idea of socialism (like parts of Northern Europe for example) only to realise that America is a socialist country too. The only difference is that the socialism works in favour of the rich, so if you own a big enough/powerful enough bank (maybe car manufactuer?) you get bailed out.
If that same bank that got a bail out cuts off a small/medium sized businesses credit off then the business may go bust. Where is the bailout then??? What is Obama and co doing for the small/medium sized businessman? I shudder to think what George W, John McCain or Sarah Palin would do about this mess.
The whole idea of Capitalism as many people see it is built on a false premise. It is the material transfer of wealth (aka power) from the many to the few, and in many ways exists to actually undermine the concept of democracy and individual rights. How many politcians in the US could be elected president without the backing of the big banks? Even Obama, with all of his brilliance took a ton of cash of the banks. Do you not think they were actually buying something in exchange?
The salaries of Wall St bankers/traders are astronomical too, but how are they worth it if they can only make money ethically (not short selling) in a good market? How can society justify this massive transfer of wealth to these people when there is not even health care for the poorest and weakest in society? As a foreigner that loves America and its entrepreunerial spirit this is very difficult to understand sometimes.
Blaming a banker for this crisis is liking blaming a Pitbull dog for mauling a small child. Of course the dog did it, but realistically how can the dog know any better? It is the politicians faults for leting it happen (though they are indirectly in on it) and the peoples fault for not shouting so loudly and making themselves heard so clearly that the politicians and leaders dare not run this system in the interests of all.
The truth is that things will only change in this regard when people actually demand it, and this will only happen when people find a way for their voices to be heard. For everything great that Barack Obama represents, I am not sure that he is anything more than a symbol as opposed to any real lasting solution to these problems.
Maybe as SEOs and internet geeks, we have a small window to contribute something ourselves :)
If we view the bankers as dogs then they don't deserve bailouts.
And Fox News is the singular worst mainstream news organization in the United States. In this video Rupert Murdock publicly admits that he tries to shape the news to shift public opinion.
The solution isn't to lock people in jail who didn't do anything illegal, especially not when the government created ... the entire financial atmosphere (low interest rates, Clinton's 'help the poor buy houses' policies, etc).
The solution isn't to make sure the bankers are fail proof with more and more laws. The solution is to let nature deal with any business that sucks: let it fail, damnit.
Till we allow failure to exist, the system is going to be completely perverted and filled with self-serving special-interest bureaucrats and completely incompetent morons.
Yes, there are going to be assholes that are going to make millions screwing people over. That happens in capitalism, communism, mixed economies, and every other kind of economic system we've ever had.
The only question isn't how to screw them over -- the question is how to fix the system so they are stopped in the first place. We should let the huge institutions collapse, and have a hell of a few years, that way the businesses in the future won't play the short-game, because they know they'll be toast. The boards of directors will make sure the "short game" won't be killing them (or anyone) in the long run.
But now? Now we've bailed them out, and it's all about the short game. Why on EARTH should they care about the long term now? Congratulations, politicians -- you've created a system that will continue to mutilate itself while sucking taxpayers dry.
That said, not all banks are created equal. There are thousands of banks, including big ones, that didn't participate in the sub-prime lending scheme. Now they're getting screwed over.
When will our government learn that it's purpose isn't to protect the rich or poor from their own decisions, but to just get the hell out of the way? The government made this whole situation possible with its own policies, and we're still begging for more. It's incredible.
Wow. This rant felt good. ;-)
Btw, don't blame capitalism for this mess. The entire "bubble" was created by the Federal Reserve, as even Greenspan begrudgingly admits.
If we let capitalism do its work, AIG would no longer exist, and the "little guy" that liberals want to protect would have stepped up to the "plate" and would have taken over where big finance collapsed.
We don't have to choose between big business or big government. The two are one and the same.
Big Business = Big Government. They're bedfellows. Always have been. Always will be.
Get the government out of the economy, and you'll see small and medium sized businesses eat the "big" institutions in a matter of a months.
Both Bush and Obama are trying to use the government to pick winners and choosers, and micromanage business. Sorry, but that's not going to happen. They're just going to screw everyone in the long run by allowing a BANKRUPT institution (congress) that can't even run a railroad try to run the financial institutions that keep America pumping.
It's just so ... incredible.
Amen Shaun.
Aaron - and everyone else who has posted here on this topic of vital importance - read and think about and be afraid of what's in this article from the Rolling Stone:
http://www.rollingstone.com/politics/story/26793903/the_big_takeover/
It's called The Big Takeover, and the subtitle is this:
The global economic crisis isn't about money - it's about power. How Wall Street insiders are using the bailout to stage a revolution
Here's the opening line: It's over — we're officially, royally fucked.
The content, which is quite long but finely detailed and exquisitely written, will tell you which "bankers" ought to be put in jail. And, when you read it, remember my earlier post about our financial future being plotted in a big, dark, smoke-filled room...
Ianshark,
The third page has an essential phrase: "which were forced by regulators."
A few months ago, I read about a tribe that used to start a fire at the mouth of a canyon, with the purpose of driving all the wildlife to the other side -- where a hunting party could kill their prey.
Regulations are used like walls in a canyon by individuals who are trying to group the entire economy for the slaughter.
[New] Regulations without a bailout lead to a complete slaughter of the financial institutions -- systematically. A bailout without regulations will lead to a completely chaotic mess of radical inflation, and higher taxes on everyone to pay for the fat pigs at the top of big business.
But actually free the economy, and let nature have its way with business? The large, inefficient and bureaucrat big-businesses will get wiped out.
Remember, before this late fiasco, financial institutions were, for the most part, focused on safe investments. It wasn't until the government started a few small bailouts in the 90s, or increased "loan requirements" in order to "help" certain minorities get loans when they shouldn't have -- that's when things started to unravel.
Plus, I don't trust the government to make the right restrictions right now. Over at Reuters.com, one of the headlines is: "Bank CEOs voice support for Obama's economic plans." No wonder. We're letting the fools get a way with it. Worse? We're not letting the "good bankers" gain from the insanity.
This whole system is just a perversion of justice right now. It's so frustrating.
Absolutely Shaun. These big corporate and big government people that push free market ideals simply couldn't compete in a free and open market. And that is why they needed to co-op the government & grease politicians.
It's a game of back scratching, and everyone else in the economy is paying for all the handouts heading upwards. And for these handouts the bastards receiving them did nothing of value AND destroyed trillions of dollars worth of value. Nasty. :(
Hi Aaron
Let me express my seething rage through the medium of illustration...
http://i636.photobucket.com/albums/uu90/ppodbodd/250x250-67cellmate-THUM...
Sums up your feelings rather nicely I think....
They should pay for their crimes...its all I ask for - a bit of justice. The entire justice system is a joke until some of them spend some time in prison.
People will lose their homes, people will not be able to afford an education, people will go bankrupt, and people will starve in the streets as a result of being stretched a bit further by paying for this corruption (directly and indirectly)...the money (and labor) these people stole from the legitimate parts of the economy are real.
gee,how can we get this help for ourselves??Obama free money??I really need help big time and have worked my whole life,only now unemployment is taken me over and no jobs to be had,,,so here I am!!!And I think I could be a good Judge,,Im game anytime , just call me !!
I spent 9+ years in the US Marine Corps Infantry, AKA: the official US foreign policy debate team.
During my military career, I noticed how very little difference there was between the two major political parties here in America. I began to have "doubts" about my career, my politics and the roots of my patriotism. This sort of introspection makes a man feel rather uncomfortable.
My "great awakening" began after reading a book called "A Century of War" by John V. Denson. It left me in tears for my country. After much learning, I have come to the conclusion that change is in order. And it's going to be a bloody mess.
As to the bankers: The idiots on the left want to blame capitalism for the mess, the idiots on the right want to blame the Community Reinvestment Act and even the moderates want to babble on about "the road to socialism"...as if the 16th amendment didn't give the government a prior lien on, and arbitrary control over your property (and by extension, the means of production) many years ago.
...
Yet, no one wants to talk about what Thomas E Woods Jr ("Meltdown") refers to as the "Elephant in the Living Room;" The Federal Reserve Bank (which is neither federal, nor possessing of any reserves), arguably the single biggest criminal act visited upon the taxpayers of any country since the beginning of western civilization.
Our currency has lost 95% of its value since the federal reserve act was written by J.P. Morgan and his cronies, and voted into law by their willing accomplices in political office (read "The Big Ripoff" to find out how big government & big business collude to rob you blind). We now have a currency that is backed by nothing but fiat, and the power of the government to force the citizenry at gunpoint to pay the interest on the T-Bills. I.E. Your children & mine will be serfs in the land our ancestors bled for.
I have a modest proposal:
http://www.jonesfamily.us/ron-jones/perspective/politics/0049-american-c...
Thanks for that Ronald. Added some new books to the wishlist. If only I could take 16 months off and just read all the books that I know I should read :)
I'm Canadian and that video makes me wish I had a congressman to send a teabag to!
>These bankers cost tax payers trillions of dollars.
No, the politicians cost the tax payers trillion of dollars.
>So much money stolen that they debased the currency, and they are awarded with free money for being incompetent.
They did not steal money and they did not debase the currency. The present occupant of the White House debased the currency however by simply printing 2 trillion dollars. A tactic never before used and bound to bite us in the ass.
>I am not sure what will come of today, but if this country actually had any sense of justice then there would be at least a half dozen bankers serving a few decades in jail.
WOW- If we had a sense of justice we would jail people who broke no laws simply because we don't like the way they ran their business? That's an odd "sense of justice" you have.
>The fact that none of them have been locked up yet shows how perverse our justice system is and how little you should trust the U.S. government.
Aaron, I like you but, YOU HAVE NEVER BEEN MORE WRONG IN YOUR ENTIRE LIFE.
The fact we don't have mob rule shows how great our country is not how bad it is. You think we would be better served locking up people who don't break laws simply because they displease the government? WOW!
*What planet do you live on?*
We are a nation of laws not of men. This is why we have survived and -yes- thrived while other countries have failed. You may think mob rule and dictatorial abuses are a good thing but you're wrong. Dead. Freaking. Wrong.
>Politicians work for the bankers.
Wrong again, politicians work for the politicians.
=================================
Aaron, you're too smart for this.
If you're looking for villains, you can look a bit harder than just at the eeeevil bankers can't you?
What about the folks who bought houses for $800,000 in California then when the value went down to $700,000 MADE THE BUSINESS DECISION to walk away and take the ding on their credit to save the $100,000 in equity? Should we jail them too?
This represent about 12% of the foreclosures. (and like 50% of the value) People who had the ability to pay but walked away and stiffed the banks. Should we jail these people too? At least THEY ACTUALLY STOLE MONEY. (legally I might add)
What about the people who bought a $300,000 house when they made $40,000 a year? How much time do they serve?
What about Clinton and Barney Frank and the Dems who forced bankers thru the CRA to take bad loans from people who obviously could not repay them... Even though it was common knowledge in late 2004 that they where going to fail because of it.
Should the eeevil bankers get a month off their sentence for every bad loan they where forced to eat?
And what about the folks (like Barney Franks again) who for years blocked any reasonable controls on the Community Reinvestment Act? Here's an 8 minute video of Republicans trying to get more more regulation of Freddie and Fannie and reeling in the CRA... Watch the Democrats call them racist and heap praise on the Freddie and Fannie's CEOs. (BTW this goes back to 2004!) I dare you to watch that one.... Watch the Democrats attack the regulators. (The same Dems who are today laughingly calling for more regulation.) Even Bill Clinton blames the Democrats for that. (after he left office of course ;-) Watch that video too.
And while you're looking for villains, how on earth did these bad loans get bundled as sold as top grade paper? Because -surprise- the government screwed up the credit rating agencies by disallowing all but a chosen few to rate paper; all of whom where wrong. Do we jail the rating agencies? (they are actually the linchpin in the whole mess FYI; it is their explicit job to never let this happen. Epic fail.)
What about the regulators who tried to shut down banks who didn't buy worthless loans? Should those regulators be jailed as well? (that story is fascinating btw)
Aaron, you're too smart to fall for this... The SAME PEOPLE who where most involved with creating this mess are now telling you to hate the bankers (to distract you) and you're dutifully putting on your blinders taking the bait.
But it's easy for Politicians to play the hate card. Hitler had the Jews and Obama and the Dems in congress have the bankers. (when they aren't wasting White House time attacking talk show hosts) Hate has driven the left side of this country for 8 years now.
If you want to go thru your life finding someone to hate... well, more power too you. But you're bound to be perpetualy unhappy. Because as sure as this world isn't perfect, there's sure to be a politician playing the hate card to get your support.
Sadly, many otherwise reasonable people take the bait.
But before you get the pitch folks and the ropes for the bankers, maybe you should ask who else is to blame for this mess.
That is if you're interested in the truth and not the irrational hate.
ooops the top part is replies to your post... but the board ate my greater than signs.
1.) Trillions of dollars *were* looted from the treasury and financial terrorism *is* a crime.
2.) Many people working in the rating agencies need to go to jail.
“We rate every deal,” one S&P analyst told another who dared to question the validity of the ratings process. “It could be structured by cows and we would rate it.” - source
3.) Many people working in the appraisal industry need to go to jail.
4.) But you have to start somewhere, and nowhere is as powerful as starting with the bank CEOs.
5.) The issue is not political ideology. The issue is not regulation or deregulation. The issue is the deregulation of risk and profits while regulating that the taxpayer covers the losing bets in the banking casino that is entirely criminal, both in design and intent. It is easy to find a false solution and be blinded by ideology, but both political parties were involved with creating and promoting this mess. I noticed you promoted placing blame on Democrats, but one could just as easily lay blame on Republicans. Here are a couple *easy* examples
It took 12 attempts during 25 years to repeal the Glass-Steagall act. And when it was repealed many people *knew* it was going to create a bubble and a crash:
Here is Bush promoting increased minority housing ownership in 2002 through 2007, noting that down payments are a big barrier to home ownership and wanting to pump hundreds of billions of dollars into subsidizing housing programs
http://www.youtube.com/watch?v=kNqQx7sjoS8
http://www.youtube.com/watch?v=eW9viaJatpo
http://www.youtube.com/watch?v=ugeqexHzVNQ
Both political parties are bought out by the exact same bankers. Both polarized political strategies are equally incorrect, dishonest, and myopic. The real problem is the privatization of profits coupled with the socialization of losses. Or, put another way, this.
First, the Glass-Stegall act was never repealed. The primary thing Glass-Steagall did was create the FDIC. I assure you the FDIC is still around.
Second, this was the Republican's doing? From your own link:
Even Chuckie Schumer backed this bill... hardly a Republican.
Further you've been spoon fed another myth that the bill you link caused this crisis...
The bill you are referring to is Gramm-Leach-Bliley which allowed commercial banks to own investment banks. (gasp horrors)
GLB has actually credited by some experts for softening the blow because these same banks diversified their holdings... which was one of the arguments in favor of passing it in the first place. (Others disagree but the importance is probably overblown by both sides; who owned the companies played little role in the whole affair.)
I admire your passion Aaron but with all due respect you need take a look at this problem we face with a more open eyes and mind. (and read some more diverse websites, dude)
Finding someone to hate is fun and all but when that happens you're usually being used by someone.
And BTW Aaron, before you use the word depression again, you might take a look at the numbers and not the media/political hype. We've only ~officially~ been in a recession since the BEA revised their numbers on March 26. (less than 2 weeks ago)
If you think today's economy is bad it is only because you're too young to remember the Jimmy Carter years. The Carter economy lasted a full three years.
During those 3 years, we had a net GDP growth % of +0.4 and the worst 12 consecutive months was -5.3
During the last 3 years, we've had net GDP +16.2 and the worst 12 months -3.1
So
Carter: +0.4 and -5.3
Current: 16.2 and -3.1
Depression? Please. Garden variety recession.
It will only turn into depression if the 12 trillion dollars we just pissed away sinks us now instead of sinking our children.
If I where you I'd be faaaar more worried about the 2 trillion dollars we just printed than this little recession.
BTW, ya know how much money 2 Trillion dollars is? Two Trillion dollars IS THE SAME AMOUNT we've amassed in the Social Security trust fund from 1935 to today. (go ahead, google it)
Think about that... The whole Social Security Trust fund Obama just printed in his first 3 weeks in office....
And you want to lynch the bankers? Dude, open your eyes, you're missing the forest because you're hating the leaves.
Being honest and being president are mutually exclusive.
The rotten Obama economic policy is an extension of the rotten Bush economic policy. If we didn't bail out the bankers we would be *a couple trillion dollars* ahead. No bogus Iraq war would save another trillion. Then there would be no need for that printing press.
I agree with you that the printing presses are a big issue. They allow politicians to quietly steal from the financially responsible to reward the irresponsible.
Debt to GDP still has not collapsed yet and it is still @ 370%. When that begins to contract that is going to make this more like the great depression than a garden variety recession.
You can't say that Hank Paulson lobbying to soften up leverage limits had no negative effects. That helped the bubble grow faster and further.
Easy cheap credit and leverage ***always*** create bubbles. If those who created the last one are not held accountable this time then they will just create another larger one that finally bankrupts the country.
There was lots of fraud at many levels. One can chose to ignore that and say no big deal when their own currency is being debased to prop up the incompetent. Or one can assign blame to the CEOs for the action of their companies...hey they get the big rewards, so they should take the blame too.
The above mentioned person who wrote $7,000 in bad checks got 24 years jailtime. The bankers got 0. Lets look at the financial damage each did to society, side by side:
___________$7,000
$2,000,000,000,000+
One of those numbers is much larger than the other, by 28,371,428,571%.
If I acted as irresponsible as those bankers/wankers did, I would be living under a bridge somewhere or possibly in a jail.
I would rather not reward the criminally incompetent with my hard earned knoweldge, labor, and wages. You might like giving 60% to criminals. I do not.
Diversification works, until it doesn't, but math doesn't lie.
Strictly from a free market perspective could you explain any of the following:
The intent *is* criminal. I can't be any more clear than that.
Any hard working self respecting person that pays a lot of taxes *should* hate seeing their labor confiscated and handed over to career criminals.
They shouldn't. Don't blame me... Blame Obama and Pelosi.
The bankers aren't holding a gun to the Congress's head and demanding money... heck it's more often the other way.. Obama and Pelosi are demanding perfectly good banks take cash. (and them bashing them for taking it)
As for the banks with problems... let them fail. Problem solved. Will it hurt? SURE... Will pissing away 12 Trillion be a better option... lol No.
ummm... because they where required to by law?
I find it completely bizarre Aaron that you blame the bankers for taking money from congress but you don't blame the folks who wrote the laws in the first place. -- If you don't like the system how come you don't blame the people who created it?
BTW I responded twice above... sorry, I'm only slightly less passionate than you. :)
Nobody wrote a law requiring Citibank and Bank of America to buy more toxic sludge and sell it back to the government a few weeks to a few months later for more than 3X the price.
Bailouts inefficiently use capital, build bubbles, and pull capital away from legitimate uses.
Now that all these crappy bailouts are happening more scammers are jumping on the bandwagon for another taste of the juice:
The scammers are took a bite in the action on the way up, and are looking for another one on the way down.
William K. Black, the lead regulator from the S&L crisis, was interviewed on the Bill Moyers Journal recently. He noted the deception, fraud, and cover ups currently occurring...and how much illegal stuff is going on. Financial terrorism *is* illegal. Conspiracy to commit fraud *is* illegal. Government regulators not following the rule of law they are required to *is* illegal.
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