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Let me acknowledge at the outset that I recognize that the topic I'm about to take on is extremely complicated, and that there is the possibility (or likelihood) that I may be missing many pieces of the puzzle (as it were), when it comes down to understanding the current state of the banking system in the U.S., and its implications for the country.

So after that caveat, I'd like for the reader to understand that this is a theory I've developed based on my interpretation of events related to the financial crisis that led to the current economic downturn.

By now the understanding that what led to the late 2000's recession, and real estate and financial sectors crises was a massive fraud perpetrated by Wall Street banks, and enabled by regulators, government officials, and credit rating agencies, among other actors.  Many of the details about the wrongdoing were documented in the United States Senate
PERMANENT SUBCOMMITTEE ON INVESTIGATIONS (pdf) report: WALL STREET AND THE FINANCIAL CRISIS: Anatomy of a Financial Collapse.  The report was released on April 13th, 2011.

Here's my theory: I think that the extent of the fraud and criminality runs much more deeper than what has been reported.  I think that because of this (if true) all major financial institutions may be insolvent, and are currently operating as some sort of "zombie" banks.  If so, this may explain why even after the massive bailout of all these institutions, including the $16 trillion in secret loans the Federal Reserve made available to U.S. and foreign banks, there has been no improvement in lending.

What may be happening is that even this extraordinary amount of money used to basically bail out the world financial system to cover the loses stemming from a massive looting of trillions of dollars, may not be enough to stabilize the system.  Actually, it may be tantamount to using a bucket to pour water out of sinking ship.

Also, there is the possibility that the use of the very complicated financial instruments deliberately created as ponzi schemes, including credit default swaps, collateralized mortgage obligations, and similar securities, may have created a situation whereas the consequences may have gotten so complicated, that the financial criminals may have lost their ability to fully understand them.  This would be akin to a "Financial Frankenstein."  Some experts have said that the actual liabilities could be $60 trillion, or more.

I think Obama is an extremely intelligent person.  In fact, I believe he is easily one of the top five smarter presidents that have led the country.  For years people have been perplexed as to why he would surround himself with Goldman Sachs and Citigroup people.  Many theorize (I'm guilty of it also) that he may be in the pockets of Wall Street; that he's currying favor with them in exchange for campaign contributions.  In other words, that he's just being a politician; doing what they all do.  And that could be a very plausible explanation... And if so, then as a voter I got fooled.  But again, that's usually what happens in politics.

But another possibility (and I know I'm on thin ice here) is that being as smart as he is, once he took office, he came to understand how dire (and fragile) the situation really was.  That even after releasing almost $20 trillion dollars to these financial institutions, the financial abyss looked bottomless.

And yes, maybe there has been some manipulation by the criminal banksters whereas they may have admitted that things got out of hand, and that because of it the entire economy plunged into the Great Recession, but that things were so out of hand that the entire world financial system could collapse if regulators pushed too hard with investigations of wrongdoing.  Aggressive investigations could expose some massive problems, which could push institutions over the cliff, and then cause a domino effect, and bring down the entire world economy.

If so, it may explain why the Obama administration is working so hard to help cover up or whitewash financial crimes committed by Wall Street criminal bankers.

If one does a cursory study of what led to the 1980's Savings & Loans crisis, one could see the similarities: Influence peddling by lobbyist led politicians to deregulate the financial sector, which then allowed Wall Street and Savings & Loans executive to devise ponzi schemes ("sophisticated" financial instruments) to steal tens of billions of dollars.  The similarities are uncanny.

Now, if one considers this situation, against the backdrop of the current gangster and thuggish Republican opposition, Obama may be actually in the midst of one of the most difficult challenges any president have ever confronted.

I've been a strong critic of the president on many issues, including his apparent coziness with Wall Street banksters, and the appointment of baking executives to his economic team, and his unwillingness to push the Justice Department to investigate what is clearly criminal wrongdoing by large financial institutions.  But I'm willing to consider the possibility that he may be dealing with nothing less than trying to prevent a huge financial global meltdown.

Now, and getting into even thinner ice here, my take is that the financial system is indeed insolvent.  I think that it may unravel and create another major financial shock, and this in turn may be the issue that's going to take precedence during the 2012 election season.

If so, I think the big mistake was trying to keep afloat a financial system that had been basically taken over by a criminal cartel and is totally corrupt.  It would have been a better option to launch full investigations, and if those investigations led to the conclusions that the banks were insolvent (due to the massive looting), then the banks should have been liquidated, the criminals should have been prosecuted (and this would have strengthen the social fabric of the country), and the banking system should have been nationalized.

We'll see what happens.  Again, I think that we're in for more "big news" when it comes to the banking sector.


-------------------------------

Poll

Do you think there will be another major banking crisis before the 2012 election

44%213 votes
6%30 votes
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34%166 votes

| 480 votes | Vote | Results

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Comment Preferences

  •  Tip Jar (170+ / 1-)
    Recommended by:
    WisePiper, importer, Free Jazz at High Noon, G2geek, worldlotus, flor de jasmim, kaliope, ovals49, Creosote, drawingporno, Actbriniel, blueoasis, JanL, expatjourno, Dustbowl Observer, dkmich, mcc777c2, WoodlandsPerson, lostinamerica, some other george, Florene, whoknu, Boston to Salem, Matthew D Jones, Floande, COwoman, tobendaro, Anthony Page aka SecondComing, KateCrashes, ImagiNancy, ChemBob, Uberbah, Friend of the court, elengul, DrSpalding, jamess, readerwriter, karanja, One Pissed Off Liberal, Dallasdoc, m00finsan, nervousnellie, Sandino, Gustogirl, divineorder, CT yanqui, dotsright, gatorcog, jm214, Wheever, Dobber, Beetwasher, Proud Mom and Grandma, Eric0125, lotlizard, Zinman, SwedishJewfish, TomP, psilocynic, tidalwave1, tomjones, pat bunny, Marjmar, 3rdOption, Tam in CA, MKSinSA, cotterperson, Angela Quattrano, DixieDishrag, dirtfarmer, Thinking Fella, salmo, txdemfem, virginwoolf, solliges, Julie Gulden, middleagedhousewife, alkalinesky, side pocket, snoopydawg, KayCeSF, jguzman17, white blitz, thomask, triv33, bowtiejack, Nag, Time Waits for no Woman, johanus, MrJayTee, BeeDeeS, mikejay611, blue aardvark, sostos, Keone Michaels, Timothy J, BrazenSerpent, wonmug, basquebob, blueintheface, m16eib, DianeNYS, whenwego, NewAmericanLeft, DBunn, Grumpy Young Man, econlibVA, profh, Sun Tzu, orangecurtainlib, Joieau, lcrp, Teiresias70, notdarkyet, Getreal1246, Josiah Bartlett, LillithMc, Snud, bsmechanic, albrt, KMc, sawgrass727, vigilant meerkat, ogre, progressivebadger, banger, AnnieR, sockpuppet, carver, Amor Y Risa, Nespolo, Nulwee, ricklewsive, Sark Svemes, claude, shaharazade, appledown, Born in NOLA, ColoTim, Pompatus, millwood, trinityfly, ohmyheck, cordobes, sleipner, satanicpanic, damfino, Methinks They Lie, greengemini, legendmn, Woody, timethief, Mimikatz, happymisanthropy, Isara, Cliss, ladypockt, prfb, Siri, sailmaker, opinionated, ClickerMel, mofembot, denise b, emmasnacker, Captain Chaos, bread, terabytes, Mindmover, LA Crystal
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  •  Tipped, rec'd, and (51+ / 0-)

    I hope to hell you're wrong.

    Riddle me this: WHAT exactly would Obama lose if he were to forcefully and consistently advocate Keynesian solutions, REGARDLESS of the current impossibility of achieving Keynesian legislation?

    by WisePiper on Fri Sep 02, 2011 at 12:05:13 AM PDT

  •  Perhaps you missed breaking NY Times article (22+ / 0-)

    The DOJ is about to bring suit against TWELVE big banks.
    http://www.nytimes.com/...

    I ♥ President Barack Obama.

    by ericlewis0 on Fri Sep 02, 2011 at 12:06:03 AM PDT

  •  No, he's not all that smart. (30+ / 1-)

    Upon what do you base that premise?  Harvard?  Bush went to Harvard... and Yale.  Constitutional scholar?  Please.

    What he is is facile and articulate . . . especially in contrast to his predecessor - the Dolt - and his opponent - Angry Grampa.

    I tremble for my country when I reflect that God is just; that his justice cannot sleep forever. ~Thomas Jefferson

    by bobdevo on Fri Sep 02, 2011 at 12:18:40 AM PDT

    •  Sadly true: "facile and articulate" n/t (17+ / 1-)

      No people ever recognize their dictator in advance. ... When our dictator turns up you can depend on it that he will be one of the boys, and he will stand for everything traditionally American. Dorothy Thompson (1935)

      by DorothyT on Fri Sep 02, 2011 at 05:58:53 AM PDT

      [ Parent ]

    •  I don't handle (6+ / 12-)

      dogwhistle racism very well.

      I'm a war mongerin', torture lovin', blind followin', fact hatin' Obamabot!!!

      by mim5677 on Fri Sep 02, 2011 at 06:09:47 AM PDT

      [ Parent ]

      •  Which ones, exactly. (5+ / 0-)

        He's got a (D) next to his name. How many Ds and how many Rs next to his policies? - Jim P

        by Uberbah on Fri Sep 02, 2011 at 06:32:22 AM PDT

        [ Parent ]

        •  I think the user is saying that (4+ / 0-)
          Recommended by:
          bobdevo, GoGoGoEverton, pot, Uberbah

          if you're black, you can't be articulate?

          Or, if you're white, you can't say a black person is articulate?

          I'm only guessing in the absence of an explanation for the seemingly abusive HRs.

          More and Better Democrats

          by SJerseyIndy on Fri Sep 02, 2011 at 06:43:34 AM PDT

          [ Parent ]

        •  Lessons on the insulting use of 'articulate' (1+ / 0-)
          Recommended by:
          blueness

          can be found here. I'll uprate mim5677, for all the good it'll do. It's not as if this sort of information is hard to find. I could still remember the 'articulate' dust-up from the last presidential campaign.

          At the spiritual website Beliefnet.com, Ryan Beiler, the web editor for Sojourners/Call to Renewal, recently criticized both Biden and Bush. "Though praising a United States Senator for being 'bright and clean' may have been the most obviously offensive of Biden's words, President Bush's similar praise for Obama in an interview with Neil Cavuto the same day on Fox News -- 'He's an attractive guy. He's articulate' -- echoes more insidious underlying assumptions," Beiler wrote.

          "NEWS FLASH TO WELL-MEANING WHITE FOLKS: When you praise people of any minority or ethnicity for being 'articulate,' you're suggesting that you have deeply held stereotypes about people that don't look like you that are only overcome by what you see as noteable exceptions," Beiler wrote. "Or that 'articulate' doesn't mean, as Webster's suggests, 'able to speak; expressing oneself readily, clearly, or effectively,' but rather, 'I expected you to talk like a black person, but you speak just like I do! Way to go!'"

          There is no belief, however foolish, that will not gather its faithful adherents who will defend it to the death. -- Isaac Asimov

          by tytalus on Fri Sep 02, 2011 at 10:07:54 AM PDT

          [ Parent ]

          •  On the campaign trail Obama would praise McCain's (5+ / 0-)

            ...record of service, right before criticizing the Senator.  Does that mean that Obama was really patronizing Vietnam service?  Or how about the flack he got over 'clinging to guns and religion'?

            Are there any compliments that may be paid to Obama that someone couldn't claim were being made in a patronizing fashion?

            He's got a (D) next to his name. How many Ds and how many Rs next to his policies? - Jim P

            by Uberbah on Fri Sep 02, 2011 at 10:42:53 AM PDT

            [ Parent ]

          •  The good that it did... (2+ / 0-)
            Recommended by:
            Dallasdoc, bobdevo

            was uprate from Hiddens a comment that baselessly charges another kossack with racism and thereby deserves to remain there.

            Job well done.

            More and Better Democrats

            by SJerseyIndy on Fri Sep 02, 2011 at 01:59:16 PM PDT

            [ Parent ]

            •  Ignorance is always an option (1+ / 0-)
              Recommended by:
              blueness

              until it's remedied of course; that's why I bothered to post the clarification above. Once ignorance is no longer an option or thin excuse, you're presented with a choice. The choices I see here are interesting.

              There is no belief, however foolish, that will not gather its faithful adherents who will defend it to the death. -- Isaac Asimov

              by tytalus on Fri Sep 02, 2011 at 02:32:21 PM PDT

              [ Parent ]

          •  Can I say (1+ / 0-)
            Recommended by:
            bobdevo

            he's smart, or will that be taken to mean I'm surprised he's not stupid?

            Can I say he's handsome, or will that be taken to mean I'm surprised he's not ugly?

            Please, let me know all the positive characteristics I shouldn't attribute to him.

            We decided to move the center farther to the right by starting the whole debate from a far-right position to begin with. - Former House Majority Leader Tom DeLay

            by denise b on Fri Sep 02, 2011 at 05:52:19 PM PDT

            [ Parent ]

            •  You can say that Obama is smart (1+ / 0-)
              Recommended by:
              tytalus

              but you know when something is meant as a compliment and when it isn't.

              Facile is not a compliment in this context and neither is articulate.  

              I'm not the smartest person in the world but I know when someone is faking it.

              I'm a war mongerin', torture lovin', blind followin', fact hatin' Obamabot!!!

              by mim5677 on Sat Sep 03, 2011 at 08:58:53 AM PDT

              [ Parent ]

              •  "Facile" is usually not a compliment (0+ / 0-)

                but articulate is. As a word, it has no negative connotations. The negativity is in what you imagine the person was thinking when he said it. In this context, what you are suggesting doesn't even make sense:

                No, he's not all that smart. (30+ / 1-)

                Upon what do you base that premise?  Harvard?  Bush went to Harvard... and Yale.  Constitutional scholar?  Please.

                What he is is facile and articulate . . . especially in contrast to his predecessor - the Dolt - and his opponent - Angry Grampa.

                Paraphrased: he's a good speaker and sounds smart - especially compared with Bush and McCain, who sound like idiots - but that doesn't mean he's as smart as people think he is.

                No, it's not a compliment. But nothing suggests that the word "articulate" has other than its ordinary meaning.

                You don't have to put the worst possible slant on what people say. If you do, you're going to be wrong a lot of the time. Maybe you think it's better to suffer five imaginary insults than to let one real one go by. I think otherwise, but it's your choice.

                We decided to move the center farther to the right by starting the whole debate from a far-right position to begin with. - Former House Majority Leader Tom DeLay

                by denise b on Sat Sep 03, 2011 at 08:07:49 PM PDT

                [ Parent ]

                •  I feel pretty comfortable (0+ / 0-)

                  with my judgement considering the context.  People are smart here, they are well aware of language and it's meanings and if I myself as a person of color tell you that calling someone articulate in this context is dog whistle racism, you also have a choice.  

                  It is my responsibility...to push back when such an uncommon term is used to describe a President of these United States of America.  It is not a compliment at all it's an insult as a way to say he is many negative things going  for him but a positive is that he is articulate.  

                  Is his being articulate unexpected?  Not from where I stand but I know that it is unexpected to a lot of people coming from an african-american and that is not something I made up.  In my short life being called articulate is a term assigned to the young black person that is better than what we expected from the black community as a whole.  It's a term that has been assigned to us for a long time and you can't take that away because you don't like Obama's policies.  

                  I'm not asking you to agree with me.  What I am asking is that when someone says something that is a pretty common slight against the intelligence of black people that you stay out of it if you are not willing to accept the historical realities of racism and white privilege.

                  It's an insult with racial undertones and whether it was intentional or not makes no difference.  If the writer is unaware then let my HR be an education for the next time he/she uses an african-americans ability to articulate as an underhanded insult.  

                  I'm a war mongerin', torture lovin', blind followin', fact hatin' Obamabot!!!

                  by mim5677 on Sat Sep 03, 2011 at 10:10:35 PM PDT

                  [ Parent ]

      •  HR for false racism charge (19+ / 0-)

        I'm getting very tired of this sh!t.

        Don't tell me what you believe. Tell me what you do and I'll tell you what you believe. --Meteor Blades

        by Dallasdoc on Fri Sep 02, 2011 at 06:44:59 AM PDT

        [ Parent ]

      •  I'd like to understand (13+ / 0-)

        I truly would like to understand what you consider racism in that comment. I just don't see it and I'm looking.

      •  Erm, uprated. Your mischaracterization of this (6+ / 0-)

        comment is

        Photobucket

      •  Apparently this site doesn't handle wolf cries (4+ / 0-)

        well either.

        "However, I don't think that critiquing one precludes praising the other" - The Troubador

        by GoGoGoEverton on Fri Sep 02, 2011 at 07:59:26 AM PDT

        [ Parent ]

      •  "Smart" (4+ / 0-)

        I read President Obama's book and thought he was a brilliant writer. I listened to his campaign speeches and thought they were brilliant, also. I was somewhat alarmed when I heard him talk off-script as he didn't seem like the same person as the speech-giver. But I chose to vote for the writer and speech-giver, and give myself over to 'hope and change.'

        A person could have a high IQ, be well educated, and still come to very bad conclusions, which causes him or her to act disastrously. So I think the president probably does have a high IQ and is 'intelligent' if that is the definition that is being used here, but I don't think he's smart. To me 'smart' involves intelligence and arriving at the right conclusions and acting upon them.

        I think he presented himself in writing and in written speeches brilliantly. But being "facile and articulate" -- as I quoted from the comment that proceeded my agreement with those terms --  was a recognition of someone who I believe was deceptive. I don't go so far as to call the president a con man, but those terms exactly describe what a con man is. At the very least, I don't believe he was speaking from his inner beliefs. And his actions, and his choices of advisors, have been disastrous for the American people in many instances. So many key appointments and policies are continuations of the Bush administration.

        Just before I wrote this, I saw that his administration just backed away from EPA regulatory actions that we need.

        Anyone who sees "racism" in those terms is mistaken. There is enough real racism swirling around President Obama that it demeans our efforts to call it out and defeat those who proudly carry that banner today.

         

        No people ever recognize their dictator in advance. ... When our dictator turns up you can depend on it that he will be one of the boys, and he will stand for everything traditionally American. Dorothy Thompson (1935)

        by DorothyT on Fri Sep 02, 2011 at 09:53:25 AM PDT

        [ Parent ]

    •  What's with the HR abuse . . . (8+ / 0-)

      Mr-moderate-non-activist-bi-racial-male just because not all share your worshipful adoration?

      I tremble for my country when I reflect that God is just; that his justice cannot sleep forever. ~Thomas Jefferson

      by bobdevo on Fri Sep 02, 2011 at 06:59:18 AM PDT

      [ Parent ]

    •  Uprated to counter HR that is based on (3+ / 0-)
      Recommended by:
      bobdevo, Betty Pinson, prgsvmama26

      an unsubstantiated charge of racism. Same goes for the 1st reply.

      The Tea Party: a bent tent supported by twisted straw polls.

      by bsmechanic on Fri Sep 02, 2011 at 09:03:47 AM PDT

      [ Parent ]

    •  Bush had family connections (2+ / 0-)
      Recommended by:
      Jeff Simpson, Drewid

      President Obama got into Harvard the hard way... actually had to earn it. Head of the law review is no middling task.

      The man is intelligent. You have good reason to attack his policies, but not his intellect. Sometimes thinkers make bad presidents, but that doesn't make them stoopid.

      Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passion, they cannot alter the state of facts and evidence.

      by JHestand on Fri Sep 02, 2011 at 09:26:12 AM PDT

      [ Parent ]

    •  And oh yeah, (2+ / 0-)
      Recommended by:
      tytalus, Ray Pensador

      magna cum laude from Harvard Law, but not all that smart huh.

    •  "facile and articulate" (0+ / 0-)

      You might as well have mentioned flim-flam. Or snake oil.

      H'mm. I'm not terribly into this, anymore.

      by Knarfc on Fri Sep 02, 2011 at 11:37:03 AM PDT

      [ Parent ]

      •  Oh, you mean flim-flam like "transparency" (1+ / 0-)
        Recommended by:
        SJerseyIndy

        "ending the war in Iraq", "supporting whistleblowers", "restoring the rule of law", a "robust public option"??  That flim-flam??

        I tremble for my country when I reflect that God is just; that his justice cannot sleep forever. ~Thomas Jefferson

        by bobdevo on Sat Sep 03, 2011 at 04:32:02 AM PDT

        [ Parent ]

  •  Smart? (8+ / 0-)

    How could you tell?  Other than making double-super-fantastic speeches, as far as I can tell he could be smart or dumb as a doorknob.

    I didn't care for math, but when I first understood the concept of finding the slope of a curve at a point, I wanted to grab the first girl I saw and kiss her with wild abandon, just like in that WW II photo.

    by dov12348 on Fri Sep 02, 2011 at 12:23:02 AM PDT

  •  I'm not sure what this: (26+ / 0-)
    And yes, maybe there has been some manipulation by the criminal banksters whereas they may have admitted that things got out of hand, and that because of it the entire economy plunged into the Great Recession, but that things were so out of hand that the entire world financial system could collapse if regulators pushed too hard with investigations of wrongdoing.  Aggressive investigations could expose some massive problems, which could push institutions over the cliff, and then cause a domino effect, and bring down the entire world economy.

    If so, it may explain why the Obama administration is working so hard to help cover up or whitewash financial crimes committed by Wall Street criminal bankers.

    has to do with the President being "smart".  Any reasonably intelligent person (I recognize that leaves out a few of the Repub Presidential candidates), given all the information at the disposal of the Presidency, would  be able to understand the depths of the problem, and the risks.

    The real topic then, is not intelligence, but ethics vs. morality:

    "Do the positive ethics of punishing massive fraud and criminal wrongdoing outweigh the positive morality of softening economic hardship for the innocent masses?"

    I'm one of those lucky homos in a bi-national relationship - at the age of 49, all I had to do was give up my career, leave behind my dying father, my aging, diabetic mother, my family & friends and move to the Netherlands. Easy peasey!

    by aggieric on Fri Sep 02, 2011 at 12:33:28 AM PDT

    •  That is the relevant question indeed. n/t (7+ / 0-)
      •  What would your answer be? n/t (2+ / 0-)
        Recommended by:
        G2geek, SJerseyIndy

        I'm one of those lucky homos in a bi-national relationship - at the age of 49, all I had to do was give up my career, leave behind my dying father, my aging, diabetic mother, my family & friends and move to the Netherlands. Easy peasey!

        by aggieric on Fri Sep 02, 2011 at 12:43:14 AM PDT

        [ Parent ]

        •  The real problem is a lack of ethics and morality (3+ / 0-)
          Recommended by:
          G2geek, Floande, Cliss

          in our political and economic system.

          •  Here now, you're deflecting! :-p (14+ / 0-)

            It's not an easy answer and ethics and morality are often conflated. I would say that ethics is reason based, a process of moral decision making and that morality is a belief of what is right and what is wrong.

            If that's the case (as it is for me), then my morality as a Puritan in the early New England colonies, vis a vis sexual intercourse, is different than my morality as a Trobriand Islander.

            Under the circumstances, then, my moral compass isn't the same as someone else's - not even all of my fellow citizens', much less the masses throughout the world.  A useful example would be abortion vs the death penalty, where many of my fellow citizens say that all life is sacred, except when it isn't.

            So, what I do share with a much larger share of the world's masses, is an ethical code, based on a lot of very similar laws - not universal, but far more so than morals.

            So, I think it's morally wrong to intentionally exacerbate the suffering and misery caused by this financial crisis, but I think it's more wrong to not punish the perpetrators of this crisis, because if I don't, I'm telling the world that our ethical and legal codes are irrelevant.  And in the long term, that (not marriage equality, or atheism, or teenage pregnancy, etc., etc.) is what destroys society.

            And so, I think President Obama has now failed ethically, twice.  Once in failing to investigate and punish the criminal wrongdoings of the Bush/Cheney Administration, and now in having, at least initially, attempted to prop up, rather than punish, the financial sector for it's criminal wrongdoing.

            I'm one of those lucky homos in a bi-national relationship - at the age of 49, all I had to do was give up my career, leave behind my dying father, my aging, diabetic mother, my family & friends and move to the Netherlands. Easy peasey!

            by aggieric on Fri Sep 02, 2011 at 02:17:35 AM PDT

            [ Parent ]

        •  what I would have done: (35+ / 0-)

          Arrange to give a speech on national television, and make damn sure my Secret Service buddies were standing guard just off camera and also watching the video feeds.

          Then walk up to the podium, put aside the prepared speech, and unleashed the furies of hell:

          One, tell it like it is, all the key information from the confidential reports.

          Two, declare a national state of emergency (documents already signed in private).

          Three, close the markets, declare a bank holiday.

          Four, unleash the DOJ, send in the FBI, bearing whatever search warrants were needed to immediately grab all possible evidence including servers and desktop computers.

          Five, put the banks under "national emergency management" as a "temporary measure during the crisis."

          Six, other emergency measures such as suspension of all foreclosure actions, until the scope and depth of the mess was understood.  One such would be to partially close the borders including to private aircraft: nobody on the list leaves until the necessary arrests have been made and assets seized or placed on administrative lockdown.  

          Seven,  an emergency session of Congress similar to what happened after Pearl Harbor, with a list of specifics that would have to be passed.

          Etc. etc. all the way down the line, add your own items to the list.  

          •  I like the way you think on this topic. n/t (7+ / 0-)

            I'm one of those lucky homos in a bi-national relationship - at the age of 49, all I had to do was give up my career, leave behind my dying father, my aging, diabetic mother, my family & friends and move to the Netherlands. Easy peasey!

            by aggieric on Fri Sep 02, 2011 at 02:19:55 AM PDT

            [ Parent ]

          •  Would make a great movie script, but (1+ / 0-)
            Recommended by:
            Cliss

            it's not likely to draw an audience in DC politics.  

            "If you do not read the paper, you are uninformed. If you do read the paper, you are misinformed."--Mark Twain.

            by ovals49 on Fri Sep 02, 2011 at 02:50:11 AM PDT

            [ Parent ]

          •  And you would have been impeached (6+ / 0-)

            within a few days.

            •  Horrors! (18+ / 0-)

              A partisan impeachment effort on behalf of the big banks, perhaps the only institution in the country more hated than Congress?  An effort doomed to failure in the Senate anyway?

              Seems like we've seen a similar movie before, and it had a happy ending.

              Don't tell me what you believe. Tell me what you do and I'll tell you what you believe. --Meteor Blades

              by Dallasdoc on Fri Sep 02, 2011 at 06:47:09 AM PDT

              [ Parent ]

              •  Wouldn't have been partisan (1+ / 0-)
                Recommended by:
                Fogiv

                that's what you don't get.

                If would have included many Democrats screaming against Executive overreach, and probably WITH CAUSE.

                You do understand, for example, that even when Pelosi was Speaker, the House had more pro-life members than pro-choice, right?

                •  I don't get a hypothetical? (5+ / 0-)
                  Recommended by:
                  Timothy J, aggieric, Marie, k9disc, SJerseyIndy

                  No I don't.  How many Democrats, looking ahead to a difficult election next year, would be eager to throw their own president under the bus and join forces with the teabaggers in baying for Obama's head?

                  I don't get that at all.  You're right about that much, at least.  Sounds like more "Obama can't do that because Republicans might say mean things about him" excuse-making, to me.

                  Don't tell me what you believe. Tell me what you do and I'll tell you what you believe. --Meteor Blades

                  by Dallasdoc on Fri Sep 02, 2011 at 07:49:38 AM PDT

                  [ Parent ]

                  •  Well of course (1+ / 0-)
                    Recommended by:
                    Fogiv

                    you'd say that it sounds like that, because your entire worldview is dependent on that particular meme.

                    We don't have a dictator, and yeah, had Obama hit office grabbing the banks and restructuring society with Marshall Law and such, he'd have been run out of town on a rail, in short order.

                    Please show me where in American history such an Executive power grab was welcomed by either party in Congress.

                    Bush tried to get F&F away from Congress and the Republicans told him to shove it.

            •  Oh, the horror! (6+ / 0-)

              You would've earned the hatred you welcomed from the most hated.

              Bummer!

              FSM knows the most important thing is keeping your job while millions lose theirs...

              More and Better Democrats

              by SJerseyIndy on Fri Sep 02, 2011 at 06:48:13 AM PDT

              [ Parent ]

            •  So? (1+ / 0-)
              Recommended by:
              aggieric

              How exactly did a partisan witch hunt redefined as impeachment hurt Bill Clinton?  

              I also thank the one who rearranged deck chairs on the Titanic so those on board ship could get a better view of the iceberg.

              by NyteByrd1954 on Fri Sep 02, 2011 at 07:15:22 AM PDT

              [ Parent ]

              •  You underestimate (2+ / 0-)
                Recommended by:
                Leslie in KY, Cliss

                the power of the banks, the financials and the corporations on the DEMOCRATIC PARTY. Had Obama seized control with emergency measures, many of his own would have turned against him in short order.

                Even many here, I expect, given their level of "respect" and "loyalty" to the President.

                The anarchist brigade of Daily Kos would have backed him until the first signs of trouble, then they'd have supplied the pitchforks, tar and feathers to the Teabaggers, as they do daily.

                •  sad but true (3+ / 0-)
                  Recommended by:
                  larryrant, Leslie in KY, Cliss

                  It is always remarkable just how easy some commentors think it is, or at least that's what many comments suggest anyway. The presidency is a shit hole of a job now and for the next several terms. i have no idea where we'll end up. I used to always at least have a feeling like within a few cycles it could right itself, but not now. not after the decimation of the Bush years and the folly of economic policy by all admins for the past 30ish years.

                  •  The presidency is not (3+ / 0-)
                    Recommended by:
                    Marie, Cliss, k9disc

                    The presidency is not for the fainthearted as Obama is learning at his peril.  

                    Obama's election called for bold plans and decisive action.  He provided neither and now his reelection is in peril if not already lost.  

                    I also thank the one who rearranged deck chairs on the Titanic so those on board ship could get a better view of the iceberg.

                    by NyteByrd1954 on Fri Sep 02, 2011 at 08:03:39 AM PDT

                    [ Parent ]

                  •  Especially considering (2+ / 0-)
                    Recommended by:
                    Prospect Park, Cliss

                    how long the GOP has been building toward this moment.  They have been patient and methodical and are on the verge of destroying the New Deal and much of the Great Society legislation.

                    The big danger to them right now is a backlash because of the whacko tea partiers.  I hope it is swift and strong.

                    --

                    Republicans chap my ass

                    Me

                    by Marc in KS on Fri Sep 02, 2011 at 08:41:41 AM PDT

                    [ Parent ]

                •  The truth is (3+ / 0-)
                  Recommended by:
                  aggieric, Cliss, k9disc

                  The truth is, if Obama had come up with some decisive action, he would have retained the support of many in this community and much of his 2008 coalition.  

                  Timidity and tepidness cause the erosion of Obama's support.  

                  I also thank the one who rearranged deck chairs on the Titanic so those on board ship could get a better view of the iceberg.

                  by NyteByrd1954 on Fri Sep 02, 2011 at 08:01:31 AM PDT

                  [ Parent ]

                  •  Many in this community... (2+ / 0-)
                    Recommended by:
                    Catte Nappe, Fogiv

                    yeah, right. This place was full of Alex Bennett clones before Obama even got elected and after he was the nominee. All I have to do is go back and look at my own diaries to know that many here turned their backs on the guy BEFORE the election.

                    And reading the venom, the mocking tones, the name-calling directed at a Democratic President on this site is positively maddening.

                    30-40% of the country hated Obama from day 1 - hell, before day 1. McCain got a lot of votes, you know, even with a joke standing next to him on the platform. Talk radio has created legions of zombies ready to take out their pitchforks for ANY Democratic President.

                    You must live in a bubble equally insular to believe for one moment that the majority of Americans, or even a near plurality, would welcome someone walking into the White House and taking over. That, or you read too many myth-making books, like those of Wild West heroes, instead of actual, dirty, nowhere near the urban legend, history books.

                    Go and actually read about FDR, for example, then make a case to me that he would have survived a month on DailyHandWringerNavelGazerOhWoeIsMePowerToThe PeopleKos.

                    •  I replied to you with respect (3+ / 0-)
                      Recommended by:
                      aggieric, Marie, Dallasdoc

                      If you cannot respond in kind, I will make a special note to discount, and ignore in the future, your particular form of response.  People like you do not help the Democratic party or your cause.  

                      I also thank the one who rearranged deck chairs on the Titanic so those on board ship could get a better view of the iceberg.

                      by NyteByrd1954 on Fri Sep 02, 2011 at 08:42:14 AM PDT

                      [ Parent ]

                    •  I was cautiously optimistic until he fitted his (3+ / 0-)
                      Recommended by:
                      Cliss, NyteByrd1954, Dallasdoc

                      cabinet, and then I was fairly hostile to his policy, which meant that, to many here, possibly you, I hated him.

                      I could not champion policy that came from the people who caused the problems - the Rubinites, the Clintonistas and the Bernanke's and Gates'.

                      That was not just 'not enough in the face of doom' from the Administration, it was the wrong direction. It was using the masters of Doom to support and buttress Doom so Doom was a bit more friendly.

                      30 years of failed conservative policies have been left to stand. Government is blamed. Unions are abandoned.

                      That started immediately.

                      Peace~

                      Democracy - 1 person 1 vote. Free Markets - More dollars more power.

                      by k9disc on Fri Sep 02, 2011 at 12:36:21 PM PDT

                      [ Parent ]

                •  The thing is, we DON'T underestimate the (4+ / 0-)
                  Recommended by:
                  Marie, Prospect Park, k9disc, Dallasdoc

                  power of the banks.  That's why they need to be broken.  Your "expectations" show your hand.  The true liberals here would have cheered the "seizing" of emergency measures to break the banks.  You're blinded by your hatred of any of President Obama's progressive critics.

                  I'm one of those lucky homos in a bi-national relationship - at the age of 49, all I had to do was give up my career, leave behind my dying father, my aging, diabetic mother, my family & friends and move to the Netherlands. Easy peasey!

                  by aggieric on Fri Sep 02, 2011 at 09:08:17 AM PDT

                  [ Parent ]

                •  Deeply unfair and a lie (2+ / 0-)
                  Recommended by:
                  Marie, Dallasdoc

                  You imply cowardice and duplicity. I suggest y'all look in the mirror as well. BTW, not that those of us who oppose the President's policies are not sometimes cowardly and duplicitous--we are human, but so are all of you. I don't see a quantitative difference between the two sides in matters of virtue. Our lack of "loyalty" is due to a deep feeling of betrayal that surely you can understand even if you disagree.

                  This is way I see, in the future, a continuing fracture within society which has nothing to do with who is in public office. More reasons to believe that the future political reality we live with will be neo-feudal.

                •  Fuck them. If they are too powerful to be saved (1+ / 0-)
                  Recommended by:
                  Dallasdoc

                  from their own greed and voracious appetite for profits then they are too powerful to exist.

                  People on this thread, do not, at least I don't think, underestimate the power of the financial industry.

                  I think you overestimate their authority or underestimate the danger of the end result of their authority unchecked.

                  They must be challenged or we will all wind up slaves:

                  "...with slavery and indentured servitude for all!"

                  Democracy - 1 person 1 vote. Free Markets - More dollars more power.

                  by k9disc on Fri Sep 02, 2011 at 12:28:26 PM PDT

                  [ Parent ]

            •  In Addition, It's Just Not Such An Easy Decision (1+ / 0-)
              Recommended by:
              Leslie in KY

              Justice vs. General Welfare.

              This post is dedicated to myself, without whom, I'd be somebody else. Though I'd still be an asshole. My music: http://www.myspace.com/beetwasher

              by Beetwasher on Fri Sep 02, 2011 at 07:16:21 AM PDT

              [ Parent ]

              •  I didn't say it was easy. What I did do (1+ / 0-)
                Recommended by:
                Prospect Park

                was suggest that doing what is right and ethical is better for the long-term health of our society.  I'm open to hearing logical opposing arguments.

                I'm one of those lucky homos in a bi-national relationship - at the age of 49, all I had to do was give up my career, leave behind my dying father, my aging, diabetic mother, my family & friends and move to the Netherlands. Easy peasey!

                by aggieric on Fri Sep 02, 2011 at 09:13:11 AM PDT

                [ Parent ]

                •  Really? Allowing Millions Of Lives To Be Destroyed (0+ / 0-)

                  In an economic collapse is preferable?

                  Well, that may be the choice that you would make, but don't pretend it's an easy or simple. Especially since you will never have to hold those lives in the palm of your hand and make that decision.

                  Compassion must be a lost concept.

                  This post is dedicated to myself, without whom, I'd be somebody else. Though I'd still be an asshole. My music: http://www.myspace.com/beetwasher

                  by Beetwasher on Fri Sep 02, 2011 at 09:31:13 AM PDT

                  [ Parent ]

                  •  I'm still open to hearing logical (0+ / 0-)

                    opposing arguments....

                    I'm one of those lucky homos in a bi-national relationship - at the age of 49, all I had to do was give up my career, leave behind my dying father, my aging, diabetic mother, my family & friends and move to the Netherlands. Easy peasey!

                    by aggieric on Fri Sep 02, 2011 at 09:46:53 AM PDT

                    [ Parent ]

                  •  Ok, ok. That wasn't really fair. Your (1+ / 0-)
                    Recommended by:
                    Cliss

                    comment makes it clear that you are more interested in emotion than logic.

                    So, tell me, do you want to teach your children and grandchildren that theft, fraud, and graft are acceptable societal values?

                    I'm one of those lucky homos in a bi-national relationship - at the age of 49, all I had to do was give up my career, leave behind my dying father, my aging, diabetic mother, my family & friends and move to the Netherlands. Easy peasey!

                    by aggieric on Fri Sep 02, 2011 at 09:52:17 AM PDT

                    [ Parent ]

                    •  No, Compassion (0+ / 0-)

                      Or is that dead? I teach my children that compassion is important.

                      Justice vs. compassion.

                      Not an easy choice as much as you would like to make it seem so.

                      This post is dedicated to myself, without whom, I'd be somebody else. Though I'd still be an asshole. My music: http://www.myspace.com/beetwasher

                      by Beetwasher on Fri Sep 02, 2011 at 10:29:55 AM PDT

                      [ Parent ]

                      •  It's best to read (0+ / 0-)

                        all relevant comments before accusing me of thinking it's easy.

                        I quite clearly said, very first thing, that it wasn't easy.  I didn't use the word "compassion" but I quite clearly noted that it was a dilemma with moral implications.  So, I didn't discount those points; after weighing them, I came to a different conclusion than you apparently have.

                        Try using a different club to beat me with, yeah?

                        I'm one of those lucky homos in a bi-national relationship - at the age of 49, all I had to do was give up my career, leave behind my dying father, my aging, diabetic mother, my family & friends and move to the Netherlands. Easy peasey!

                        by aggieric on Fri Sep 02, 2011 at 10:52:20 AM PDT

                        [ Parent ]

                        •  I'm Compassionate, I'm Not Beating You With A Club (1+ / 0-)
                          Recommended by:
                          aggieric

                          Just making my point clear since even though you said that, you still insist that apparently YOUR conclusion is the only "logical" one. It's not. It depends on what you hold as more important; justice or compassion.

                          The "logical" conclusion stems from that starting point.

                          If I'm basing it on emotion by being compassionate, then you are too in your passion for justice.

                          We both start with emotion as the basis for our ultimate logical conclusion.

                          You are emotionally invested in pursuing justice. I am emotionally invested in pursuing compassionate outcomes that help the most people. The logic flow out from there.

                          This post is dedicated to myself, without whom, I'd be somebody else. Though I'd still be an asshole. My music: http://www.myspace.com/beetwasher

                          by Beetwasher on Fri Sep 02, 2011 at 10:58:23 AM PDT

                          [ Parent ]

              •  Any time you are given a this or that choice (1+ / 0-)
                Recommended by:
                Dallasdoc

                you are being manipulated.

                It is not Justice vs General Welfare. Choose one...

                It is injustice harming general welfare. How does this happen? How do we reduce injustice that harms our general welfare?

                Your binary makes a good solution impossible.

                Democracy - 1 person 1 vote. Free Markets - More dollars more power.

                by k9disc on Fri Sep 02, 2011 at 12:41:46 PM PDT

                [ Parent ]

          •  Emotionally, Yes, That Is What I Would Want (0+ / 0-)

            But then again, I don't really have the lives of billions balancing in the palm of MY hand, and aren't really the one in the position of having to actually make that decision.

            This post is dedicated to myself, without whom, I'd be somebody else. Though I'd still be an asshole. My music: http://www.myspace.com/beetwasher

            by Beetwasher on Fri Sep 02, 2011 at 07:15:20 AM PDT

            [ Parent ]

        •  The answer would depend (4+ / 0-)
          Recommended by:
          JohnnySacks, solliges, aggieric, Cliss

          upon the probability of escaping the abyss.

          2.5 years later, the abyss still looms, and elections are on the horizon.

          I do see the gray hairs a'blooming.

          Government of the people, by the people, for the people, shall not perish from the earth - Abraham Lincoln

          by Gustogirl on Fri Sep 02, 2011 at 07:10:16 AM PDT

          [ Parent ]

    •  Nice frame. But since when has choosing your (10+ / 0-)

      binary definition of "morality," over that notion that "ethcally' there should be some kind of Banksta consequences, been in any way a "softening" of the fuck job, the secret war, the draining of vitality and real wealth into the coffers of the Already-Have-Too-Much that's underway against the working people who CREATE the real wealth that gets leveraged into all those counterfeiting "wagers" in the Casino? Once faith (however misplaced and deluded) in the legitimacy of The System starts its inevitable accelerating decline, you end up with a collapse anyway. We are not trained in notions that lead to stability and sustainabilty. Our "economy" is about CONSUMPTION, our ethics and morality are about MANUFACTURING DEMAND for gasoline-powered leaf blowers to whoosh our shit onto other people's lawns and into the public streets for someone else to clean up since we are too fucking lazy to wield a rake and broom, and 5,214 advertising-differentiated kinds of toothbrushes all in the name of the Sacred Sumum Bonum of "Consumer Choice," the REAL essence of whatever kind of "democracy" we have.

      What's happening is that a relatively few individuals are feathering their own nests by plucking the rest of us, and setting up the conditions for "secure" retreats and retirement in an enormous lap of luxury. These folks mastered the notion that underlies all this shit: "I'll be gone, you'll be gone," there are no consequences. These  folks know they will get to die comfortably, in old pleasure-laden age, with the best medical care and best medications and every kind of Perfect Consumer Thing surrounding them. Farting through silk, every moment of every day.

      And so you have strings of people tied, in increasing degrees as you approach the Nexus of Obscene Wealth, to a system of behaviors that it based purely on personal benefit and gain, all working their little brains to figure out better and faster ways to strip the real wealth out of the economic ecology the rest of us have to try to live in. An ecology that is itself fraudulent at root, based on unsustainable "growth" and "consumption," that leads to these asinine arguments about how "the government" should end all business taxes, to "encourage production," or for some pundits, do diddly little shit to encourage more consumption.

      As if either one has a prayer of "reviving" into "recovery" a spectrum  of 7.5 billion people, somehow magically to be transported into a long upward rise into some Divine Consumertopia.

      "Is that all there is?" Peggy Lee.

      by jm214 on Fri Sep 02, 2011 at 07:24:17 AM PDT

      [ Parent ]

      •  Woof! Rightous rant! (1+ / 0-)
        Recommended by:
        Cliss
        Farting through silk...

        Delightfully wicked!

        Almost nothing has a name.

        by johanus on Fri Sep 02, 2011 at 08:31:35 AM PDT

        [ Parent ]

      •  Neo-feudalism my friend (2+ / 0-)
        Recommended by:
        jm214, Cliss

        is what we all must prepare for. Trust your communities be suspicious of all authority. It's going to all fragment when the chumps begin to wise up.

        •  Neo-Fuedal means that a local patriarch (0+ / 0-)

          will capitalize on and protect his peasants. A Lord is only as powerful as the collective output of his vassals.

          A Lord's vassals must be well fed to be able to protect the Lord. They must have something to fight for -  some degree of autonomy and hopeful livelihood.

          Neo-Colonial means that a foreign power will occupy and strip the value out of local communities. Colonial powers only need to maintain order so the population can be exploited. They have no real skin in the game.

          I used to think we were looking at neo-feudalism coming down the 'pike, but I think I misread the tea-leaves a bit. I now think we are looking at neo-colonialism in the near term, and as hard as it is to believe, it scares me even more.

          Peace~

          Democracy - 1 person 1 vote. Free Markets - More dollars more power.

          by k9disc on Fri Sep 02, 2011 at 12:57:46 PM PDT

          [ Parent ]

          •  Interesting point (2+ / 0-)
            Recommended by:
            k9disc, jm214

            But I want to emphasize the "neo" in the term I used. It won't resemble other systems because our world and society is radically different from any that preceded it. I think people are beginning to create networks and out of these networks I think fleshed out communities of interest will emerge some will be democratic in character others will be despotic and everything in-between. As law is breaking down people will cooperate and assemble into units that will compete with the "colonial" powers--that, to me, will be the essential struggle.

            The key to this emergent world is the breakdown of laws. Because the finance oligarchs were not penalized but rather rewarded for their blatant criminality that signals the gradual break-down of law as other privileged elites will similarly know they won't be liable to face the law--so eventually the law itself will lose credibility and the state will either have to spend nearly all of its budget on policing or just let it go and let local powers deal with justice issues from which will emerge a more sensible system of justice.

            •  Excellent followup! (1+ / 0-)
              Recommended by:
              Cliss

              The thing is that we are at once at economic war with these 'colonial' powers and dependent upon them for our livelihoods. I see the same kind of struggle.

              My problem is that the corporate Center peels too much power from the Right and Left. The corporate Center is going to support the oligarchs and 'colonial' powers out of 'reasonable-ness' and 'pragmatism'. I see it as an extremely damaging social situation.

              I'm also quite fearful that we can't compete on power terms, especially once the State visibly and entirely throws their weight behind the oligarchs.

              The breakdown of laws , if recent history is any guide, will benefit the oligarchs and only the oligarchs. I see policing becoming our national service - a blackwater-esque crew of sadists - trading a paycheck for stability - and working to put the undesirables and deadbeats into debtors prisons and forced labor camps.

              It's already happening to some degree with the TSA, although the focus is external 'security' threats and not deadbeats and undesirables. The national security state is growing by leaps and bounds and it's working for the oligarchs.

              /rambling

              Democracy - 1 person 1 vote. Free Markets - More dollars more power.

              by k9disc on Fri Sep 02, 2011 at 01:53:59 PM PDT

              [ Parent ]

              •  I see the situation as being much more fluid (3+ / 0-)
                Recommended by:
                Ray Pensador, k9disc, Cliss

                It's just too expensive to maintain a rigid police-state--certainly they are trying and have been doing that since 9/11 conveniently gave them an opening.

                We still have a chance to organize ourselves. We are not yet at the place where laws can be ignored---particularly commercial law. It is in that area that we have a chance. We can assert power by becoming commercial actors. To be precise we must start protecting ourselves by joining with like-minded people into some kind of corporate structure whether it is non-profit or commercial. Only by forming collectives and communities do we have a chance and we do have a chance. We have to let go of our narcissism to do it however and I don't see much hope of that in the short run.

      •  You know, I've read your comment (2+ / 0-)
        Recommended by:
        Ray Pensador, Cliss

        three times, and I am still confused.  I don't really think you and I are in disagreement.  I am, ultimately, a Socialist, and I completely agree with your rant.

        I think that punishing the culprits should be accompanied by nationalizing the banks, setting them aright, putting appropriate (in some cases, as in re-instituting Glass-Steagall) into effect, and making sure that there are no longer any "super rich", via taxation policy.

        Who the fuck needs a billion dollars, much less tens of billions?

        I'm one of those lucky homos in a bi-national relationship - at the age of 49, all I had to do was give up my career, leave behind my dying father, my aging, diabetic mother, my family & friends and move to the Netherlands. Easy peasey!

        by aggieric on Fri Sep 02, 2011 at 09:22:46 AM PDT

        [ Parent ]

        •  No disagreement, just some random inspiration (3+ / 0-)
          Recommended by:
          aggieric, Cliss, k9disc

          to "revise and extend" what seemed at the moment to be a too-straitened frame of a bigger-ugly continuum.

          It just does not seem to me that the range of possible behaviors available to Our Leaders is limited to that "softening" or trashing of the Average Folks that seemed implicit in the binary set postulated. Seems to me there were lots of ways to send the message to all the smart boys and girls who are inventing ever-more-obscure ways to fuck the rest of us that there would be limits that have jail time and seizures and forfeitures beyond them. I mean, look how gleefully the DEA and state and local policia use their powers to grab money and cars and houses and private jets and the rest of the trappings of filthy lucre living even when there's not even an adjudication (http://en.wikipedia.org/...) Any little kid will tell you that if there are no consequences for bad acts, there will never be a change in behavior that ends them.

          The irksome part is that great wealth concentrations allow the Visigoths who are taking the Empire down to write the laws so that all the shit they do is "not illegal."

          "Is that all there is?" Peggy Lee.

          by jm214 on Fri Sep 02, 2011 at 10:21:09 AM PDT

          [ Parent ]

    •  My take is that like LBJ, (1+ / 0-)
      Recommended by:
      Ray Pensador

      Obama is listening to the "best and brightest."  Except LBJ only used them for foreign affairs and Obama uses them for foreign and domestic affairs.

  •  Let us hope he simply put off action until we got (0+ / 0-)

    close to the election and nowhe will use these prosecutions to constantly remind the public under whoe administration this mess was created

    •  Because the public loves (3+ / 0-)
      Recommended by:
      ScienceMom, Betty Pinson, Cliss

      Because the public loves a political conniver who sits on remedies waiting for the perfect political moment while the public suffers?

      That's a recipe for losing an election.  

      I also thank the one who rearranged deck chairs on the Titanic so those on board ship could get a better view of the iceberg.

      by NyteByrd1954 on Fri Sep 02, 2011 at 07:12:46 AM PDT

      [ Parent ]

  •  Yes, but it's only money. (8+ / 0-)

    Our federal government is supposed to manage the currency and Obama is trying to take that function back despite a Congress that prefers to hand off obligations right and left.
    The practice of backing up financial institutions with insurance in case their loans go wrong has obviously not worked.  They lent to friends and cronies BECAUSE they knew they'd get bailed out, if the loans went bad.  What we had going was legal theft.  The proof, I think, can be found in the fact that they're all whining about the higher capital requirements -- i.e. that they have to have the money BEFORE they can make loans.  It's a scary new situation and has them spooked.  Lots of the people who got into finance are just like the people who get into politics -- smooth talkers who aren't too bright and get along well at the country club. They're the same kind of people as the early plantation owners--people born to money and rank who needed other people to work for them.  They certainly had no clue about how to grow rice or cotton or construct "water works" so plants have enough water and not too much.  We forget it was the Africans who brought agricultural and architectural know-how from the African continent.

    Our criminal law is based on the wrong-doer knowingly doing wrong.  It's hard to believe that the financial sector was run by incompetents and it's possible that some can be found willfully negligent, but it's my sense most were incompetent.

    Take, for example, the practice of red-lining.  The law says loans have to be made on the basis of the qualifications and experience of the person seeking the loan.  But, what if the loan officers are incompetent to make such assessments?  Wouldn't it be natural for them to fall back on a rule of thumb and go by the assumed characteristics of a demographic group--information that's readily available because that's what all the social scientist collect?

    Garbage in, garbage out.  We presume that people know garbage when they see it.

    http://www.youtube.com/watch?v=MuzZQ8LTE2c

    by hannah on Fri Sep 02, 2011 at 12:37:50 AM PDT

    •  I disagree (20+ / 0-)
      it's possible that some can be found willfully negligent, but it's my sense most were incompetent

      There's plenty of evidence that the people in charge of the decision-making at these financial institutions were fully aware of what they were doing.

      Have you watched Inside Job yet? If not, I strongly recommend that you do so.

      "I wish I could tell you, in the midst of all of this, that President Obama was waging the kind of fight against these draconian Republican proposals that the American people would like to see. He is not." -- Senator Bernie Sanders

      by Sagebrush Bob on Fri Sep 02, 2011 at 12:45:09 AM PDT

      [ Parent ]

      •  That's what "privatization" is about-- (10+ / 0-)

        to provide cover for the perpetrators and the pols.

        Congress is supposed to manage the currency, but they delegated that obligation to the Federal Reserve Bank, which sub-contracts in turn.  Getting the whole kit and kaboodle insured turned managing money into a profitable, risk-free enterprise.  No wonder the banksters are now whining about how uncertainty is preventing them from making loans.

        Taking the higher education loan program in-house served notice that the bureaucrats were serious. Getting that done as part of health insurance reform was pure genius.

        Insurance is the key to how the American people were being fleeced. Insurance is a parasitic endeavor.

        http://www.youtube.com/watch?v=MuzZQ8LTE2c

        by hannah on Fri Sep 02, 2011 at 01:09:52 AM PDT

        [ Parent ]

      •  you might also read (2+ / 0-)
        Recommended by:
        econlibVA, Cliss

        Simon Johnson's 13 Bankers. An interesting and thoughtful assessment of the financial structure, and a bit more nuanced.

        Yesterday's weirdness is tomorrow's reason why. -- Hunter S. Thompson

        by Mnemosyne on Fri Sep 02, 2011 at 07:28:28 AM PDT

        [ Parent ]

      •  yep , they were stupid or incompetent meme is not (2+ / 0-)
        Recommended by:
        Sagebrush Bob, Cliss

        good as it's not good when applied to republicans.

        bankers are evil and have a plan.  their plan is to make money even if they burn the country down.

        the republicans plan is to move the country to the right, and they think burning the country down is a legitimate tactic to achieve that goal.

        you have to treat these people like the nefarious enemies that they are.

        big badda boom : GRB 080913

        by squarewheel on Fri Sep 02, 2011 at 07:28:56 AM PDT

        [ Parent ]

    •  I think there was a tiny bit (1+ / 0-)
      Recommended by:
      dot farmer
      We forget it was the Africans who brought agricultural and architectural know-how from the African continent.
      of farming being done in Europe too.

      Sarcasm. Just one more service I provide.

      by Grannus on Fri Sep 02, 2011 at 01:04:19 AM PDT

      [ Parent ]

      •  There's a huge difference between (5+ / 0-)

        growing potatoes (in rocky soil) and growing rice and cotton in marshlands.  The latter require complex irrigation systems.  The Europeans who arrived with land grants from the crowned heads of Europe in hand and lines of credit from the merchant banks did not have agricultural expertise.  There were a few plantation owners (Jefferson springs to mind) who took the trouble to educate themselves.  Most, however, went bankrupt because they could not squeeze sufficient revenue out of the enterprise to maintain their life-styles which revolved around entertaining and vacationing on the continent.  We know that slave families were routinely broken up.  What is not mentioned often is that the reason slaves had to be sold was because the plantation owners either went bankrupt or inheritance squabbles required the assets to be sold for cash.
        The foundations of the Capitol weren't laid by slaves and the White House wasn't built by them because their owners were super generous and donated their labor.  Africans did the work because they were skilled workmen and knew how.  But, the guys with the 'idea' took the credit then, as now.  
        How many homeowners talk about the house they "built," when they didn't lift a finger?  Even in earliest colonial New England, the houses were built by carpenters.  Yes, raising the frame of a house or barn was a communal enterprise because, after all the timbers are cut and notched and the pegs prepared, it takes about a day to put the whole thing together on the ground and raise it in place in sections.

        http://www.youtube.com/watch?v=MuzZQ8LTE2c

        by hannah on Fri Sep 02, 2011 at 01:28:47 AM PDT

        [ Parent ]

    •  I agree with Sagebrush Bob, and I also disagree (8+ / 0-)

      with you on this:

      Lots of the people who got into finance are just like the people who get into politics -- smooth talkers who aren't too bright and get along well at the country club.

      The big Wall Street firms recruit in the same places all the other F500 companies recruit: the top colleges and universities.  Being "best and brightest" doesn't automatically = honest and full of integrity.  It takes bright people, not smooth talkers, to come up with devious ways to rig the system.  

      I'm one of those lucky homos in a bi-national relationship - at the age of 49, all I had to do was give up my career, leave behind my dying father, my aging, diabetic mother, my family & friends and move to the Netherlands. Easy peasey!

      by aggieric on Fri Sep 02, 2011 at 02:43:41 AM PDT

      [ Parent ]

      •  I have a daughter and son-in-law with (3+ / 0-)
        Recommended by:
        lotlizard, banger, Cliss

        degrees from Princeton and Duke and phd's from Yale.  I know what those degrees are worth without the right "connections."  Clarence Thomas makes a valid point when he says he won't have anything to do with the Ivies, even if it is extremely petty of him.

        http://www.youtube.com/watch?v=MuzZQ8LTE2c

        by hannah on Fri Sep 02, 2011 at 06:45:05 AM PDT

        [ Parent ]

        •  Good point (1+ / 0-)
          Recommended by:
          Cliss

          That's been my experience--connections are everything and will be more of everything a time passes. Which is why I always recommend to stop thinking about government or anyone else taking care of you or public spaces because we re moving into a neo-feudal future--thus your friends, family, clan, community is where we all need to put our energies.

          The USA is, frankly, no longer here in practice--just in theory. It's an empty shell and rule-of-law is rapidly declining as people just ignore as many laws as they can avoid at all levels and it will get worse. It will take time, at least a decade and we'll be used to it just like we are used to the fact the police can do almost anything they want to us.

      •  Which brings to mind the problems of inbreeding. (2+ / 0-)
        Recommended by:
        DelilahOhMy, Cliss

        Over our lifetimes, the privileged class has become even more separated from the masses, as income disparity has grown.

        This makes me think that the powers that be erred by thinking the middle class would survive in good health despite being stripped of assets.  They underestimated because they do no understand, the fragility and vulnerability of ordinary people.

        Now, they are saying to themselves "oh, shit" and are making contingency plans as it is all about to fall down.  Their gated fortresses are being buttressed and the worst of them continue to loot because they know it's already past the tipping point.

        Government of the people, by the people, for the people, shall not perish from the earth - Abraham Lincoln

        by Gustogirl on Fri Sep 02, 2011 at 07:20:34 AM PDT

        [ Parent ]

  •  A couple things stick out (27+ / 0-)

    one is this phantom menance of financial abyss that you posit we are being shielded from. What does it look like? People kicked out of their homes? No jobs? No access to living wages? Health care? College out of reach for the middle and lower classes?

    We're there.

    But who's not? Look up. These same institutions who in your hypothetical scenario are in such dire straits are also posting record profits. And rewarding their executive ranks with record-breaking salaries and record-breaking bonuses. Literally. They are literally breaking compensation records.

    I suppose that could be part of the clever ruse to hide the truth from the people so they don't know how bad things really are. While they nobly work tirelessly behind the scenes to correct the situation and save us all from the financial abyss.

    If you study history though, it suggests there might be a simpler explanation for what's actually going on.

    The New Testament is to fundamentalism what Charlotte's Web is to arachnophobia.--Tweet of God

    by Scott Wooledge on Fri Sep 02, 2011 at 01:19:49 AM PDT

    •  The simplest explanation: Denial. (6+ / 0-)

      The looters want to believe it's OK to get back to looting as much as we are hoping things will return to the "normal" that we used to enjoy a few years ago.

      The die is cast.  The remediation options available at this point may be woefully insufficient in any case, or simply politically impossible at this point in time.

      "If you do not read the paper, you are uninformed. If you do read the paper, you are misinformed."--Mark Twain.

      by ovals49 on Fri Sep 02, 2011 at 03:00:02 AM PDT

      [ Parent ]

      •  No one wants to take their medicine. (0+ / 0-)

        I'm not talking about the stuff about eating peas.

        For the economy to really turn the corner it has to go into a crash sufficiently extreme to compel enough people to vote out all or most of the lackeys, obstructionists, and apoligists in government.

        Something akin to what happened during 1931-32. Total and real unemployment unknown but close to 20% or more, millions homeless and wandering, looking for work or shelter, no social security, no unemployment insurance, limited relief, uncounted number of people slowly starving to death. Dozens of bank failures every month. Bankers not allowed to be seen in public. Newly built factories locked shut with weeds growing in the parking lots. Incumbents and defenders of the system and propoents of incremental changism voted out of office in droves. Populism in the air and demogogues like Huey Long in favor. Veterans and labor marching on Washington in numbers impossible for the media or the politicians to ignore. Interruptions at country auctions and courts. Near revolution conditions.

        That sort of pain everyone wants to avoid, and understandably so.

        And so here we are.

        H'mm. I'm not terribly into this, anymore.

        by Knarfc on Fri Sep 02, 2011 at 12:05:24 PM PDT

        [ Parent ]

    •  Heh, chuckling at "literally breaking compensation (0+ / 0-)

      records."

      I imagined a bunch of guys in suits holding cocktails in one hand and with the other smashing vinyl records on the floor and stomping on them.  Records with "Compensation" written in black sharpie on a piece of tape stuck on them.  Then the bankers jovially toast each other.

      :-)

      As for the substance, good comment.

      Between excessive citizen activism and excessive trust or passivity, the former is far preferable to the latter. - Glenn Greenwald

      by An Affirming Flame on Fri Sep 02, 2011 at 11:55:39 AM PDT

      [ Parent ]

  •  Hmmm.... (8+ / 0-)

    I hope you're right on Obama's smarts.

    I hope you're wrong on the financial situation generally.

    I'd feel a bit better if we could at least get all the bonuses to hedge managers and CEOs--every penny from 2008 onwards.  People should not have been allowed to profit personally from the havoc they were instrumental in causing.

  •  explanations (7+ / 0-)

    I think we're all looking for any reason to explain Obama's various actions regarding not only the banks, but wars, economic policy, etc. It can't be that he's not smart. It can't be that he's weak. It can't be that he's easily intimidated. It can't be that he's on the side of the corps and not the people. Etc. So we look and look.

    You could be right, Ray. If the banks are not insolvent, they are surely in much worse shape than we've been told.

    Somehow I suspect even if the banks are insolvent, it would still not be the reason the Obama administration is not investigating.

    America is so not like her hype.

    by OLinda on Fri Sep 02, 2011 at 02:32:03 AM PDT

    •  Insolvency (6+ / 0-)

      My first guess when I heard, finally, about the trillions of dollars given out to international banks by the Federal Reserve and then never actually lent out again indicated a book balance so out of whack that there was no way that they were not then insolvent and probably still are insolvent.

      Banks like to make money, not hold it.  If they held on to those trillions w/o putting it into the economy, there is a reason for it.  They wouldn't have given two shits about the inflationary aspect of so much money supply being added.

      My core tenets:
      • I am intolerant of only intolerance
      • I am prejudiced only against prejudice
      • I hate only hate
      But Republicans continue to strive to be the subject of these three tenets.

      by DrSpalding on Fri Sep 02, 2011 at 06:47:16 AM PDT

      [ Parent ]

  •  if it's true (3+ / 0-)

    Then talking about it being true is problematic. I believe there have been comparable realpolitics on the military & surveillance side, where he has gone along to get along and rescue the U.S. from the brink of disaster before really trying to do the straightforward things that would/should normally fall to his role to make our life better. But MEANWHILE we have two Democratic chambers of Congress to get elected in 14 months. That's our role. He'll get himself reelected and almost all of us here will go to the polls and vote for him. But he needs both chambers to be effective and exert his potential.

    I disagree about the probability of a big disorganized crisis. I think he's been a prudent crisis manager and reassured big money (and a majority of Americans) that he will keep things stable. We've just got to play our part. And prayer is optional.

  •  Our world economy may well not be sea worthy, (3+ / 0-)
    Recommended by:
    blueoasis, whenwego, Catte Nappe

    but perhaps if the bailing were to suddenly stop we would just sink in the middle of the ocean a little quicker.  Would paddling like mad instead of bailing get us safely to shore in time to make needed repairs?  I doubt it.

    How many of the world's people (not the fictional corporate-person types) would be able to safely swim to shore once the ship goes down?

    It's not a pretty analogy, regardless of how it is dealt with.  

    "If you do not read the paper, you are uninformed. If you do read the paper, you are misinformed."--Mark Twain.

    by ovals49 on Fri Sep 02, 2011 at 02:47:04 AM PDT

    •  Bingo (0+ / 0-)

      We can think and discuss all we want about the cover ups and conspiracies of the Obama administration but at the end of the day - this is a world economy and world politics. The thing to grapple with is that it's not about the US alone -that is, the reasons for and parameters around any action or reaction. The patient is the world and the world is sick.

  •  Still no excuse for obscene.... (9+ / 0-)

    ...salaries and bonuses or all the money used for lobbying. If Obama is abetting in the  cover-up of insolvent institutions further into the future (it's not like there's a possibility of the banks ever recouping the loot) then he's not doing the nation any favors as the collapse will be inevitable and he will have been party to a worldwide fraud of the most astounding magnitude. You can look at his association with Wall Street and the banks the way many incensed liberals do or apply your own theory and it hardy makes a difference. He is still WRONG to foist this criminality on the American people.

  •  Freddie and Fannie (0+ / 0-)

    are suing several banks for misrepresentation, and seeking billions in compensation. 50 state attorney generals have also filed suit and are in the final stages of negotiations.
    Doesn't sound like the government is worried about the banks failing at all.
    Also, in your diary, you accuse the administration of trying to "cover up" the crimes, when they're doing nothing of the sort, accord to the article you linked to in your own diary that is used for a reference to the "cover up" claim.

    You will never know what it’s like to work on a farm until your hands are raw, just so people can have fresh marijuana. Jack Handey

    by skohayes on Fri Sep 02, 2011 at 03:49:49 AM PDT

  •  I don't think so. (7+ / 0-)

    Remember, if the homeowners had been supported, the mortgages would have kept being paid. And the bonds would have kept performing. That would have been expensive, but would not have run into the trillions of dollars.

    The mortgage-backed securities would have kept performing. The foreclosure crisis would have been averted. And THAT, in some circles, is a problem. Some investors looked at those bonds and bought highly leveraged credit default swaps. If the securities keep performing, they do not win their highly leveraged gamble. And they lose the value of the insurance premium that they paid.

    Obama's policies are designed to make sure that the mortgages fail so that the CDOs fail and the credit default swaps pay out. They are essentially lending out money to pay the gamblers their winnings rather than lending out money to homeowners to support the mortgages so that the gamblers don't win their bets.

    Barack Obama: So morally bankrupt that he thinks people who tortured other people to death should get a pass. Likes to prosecute whistleblowers, though.

    by expatjourno on Fri Sep 02, 2011 at 04:14:42 AM PDT

  •  I think this theory has been posted here (6+ / 0-)

    a couple of times before, BobSwern?, which makes the bailout with ZERO STRINGS ATTACHED even more outrageous.   What it also doesn't explain is why during his campaign Obama rushed back to DC to WHIP the bailout through when there was a bi-partisan effort to let them fail.

    Yes we can, but he won't.

    by dkmich on Fri Sep 02, 2011 at 04:56:27 AM PDT

  •  The US economy is handicapped by the fact (10+ / 0-)

    it hardly makes anything nowadays besides war, fraud, and distractions.

    However, people and nations cannot long live solely off of war, fraud, and distractions. So you might be right.

    H'mm. I'm not terribly into this, anymore.

    by Knarfc on Fri Sep 02, 2011 at 05:02:04 AM PDT

  •  Be careful, Ray. You might be mistaken for an (2+ / 0-)
    Recommended by:
    econlibVA, Jeff Simpson

    Obama apologist, of sorts.

    Seriously though, it's refreshing to see you write something that suggests Obama is well-intentioned, albeit misguided.

    I think it's altogether plausible that Obama is not covering for Wallstreet because he thinks they did no wrong, but to save everyone from having to suffer unimaginably from the entire world economy blowing up.

     

    Ds see human suffering and wonder what they can do to relieve it. Rs see human suffering and wonder how they can profit from it.

    by JTinDC on Fri Sep 02, 2011 at 05:14:27 AM PDT

    •  Stirling Newberry explained it to me this way (21+ / 0-)

      Paraphrased (it was a long time ago): "The creditor class said, in as many words - you will bail us out or we will bail out on the American economy."

      And the outgoing Bush and incoming Obama admins went along (we can dispute how much volunteerism was involved in the move, I think the Obama team is more reluctant but going along to get along regardless.)

      So basically, the superlateively wealthy have been dictating public policy ever since - the drumbeat on entitlement cuts (financiers hate long-term liabilities unless they're the ones owed the money) is very, very explicable. Ditto the evisceration of state governments in the Midwest. It's all of a piece - back out of now-inconvenient covenants by demonizing the beneficiaries.

      And if the GOPers win the White House, guess what? They'll be even more aggressive about slashing Social Security and Medicaid. You will have a Federal government empowering Tea State affliction of their own citizens.

      There is no making peace with these evil fools. We simply must fight them, perhaps the hard way, because for years (long before this administration) Dems clung to the false hope they could cajole the Republicans back to a sense fo common cause.

      The GOPers see no common cause with us. They want us extinct - politically, economically ... and (for the worst of them) biologically, too.

      •  Yes! (1+ / 0-)
        Recommended by:
        Cliss

        You (and Newberry) have hit the nail on the head. So now what?

        •  His advice is this is a time to look to one's own (6+ / 0-)

          That liberals are suckers for giving $300-400 million worth of content to Arianna Huffington, who just took it all to AOL and got a serious payday. That could have been a valid progressive media platform... and Arianna took it to the bank.

          And that they'll be suckers to anyone who, for a few moments, shills their particular cause to the exclusion (or even demise) of all other progressive goals.

          Taking that further than he did - So anyone looking to a liberal champion is wasting their time - there isn't one and if there was one, liberals don't have the consistency of good judgment to know it... and are too allergic to compromise to even work well with other liberals, thus their perennial disarray.

          Back to Stirling - He feels that special interest-ism is in practice evil and people should be called out for it...that if we are accepting bombings of countries overseas and mass destitution here at home so we can have an incremental advance in civil rights here (for just one example) then that's worthy of scorn.

          Me - one could take it that a certain level of income and comfort is required to support the decadence of single-issue-ism... and that is IS decadent. The rich think holistically because they have to power and dedication and class cohesion to do so. The poor think holistically because their weakness forces them to make compromises and trade-offs every day.

          Only a certain level of middle class has both the sense of special identity and the means to support devotion to... causes.

          Stirling's full of sharp comments. The current administration gets the lion's portion of his wrath but he has it in for people who feign general progressive airs to obtain selfish and short-sighted and limited objectives that can be yanked from them very easily later on.

          I think what sums up his thinking ( and to a less draconian measure, my own) is that there are no good investments available in the liberal spectrum. Not a one. It's just going to break your heart looking for one and if we found one, we'd run them out. They wouldn't be particularistic enough.

          Which might be yet another reason why Democrats as a party are led from the center by default. No organized cohesive challenge from the left is even possible, for the simple reason that there are so many competing visions of how to change the world for the better, whereas the reactionaries on the other end of the spectrum have a common (if heavily revised) version of history to replicate as best they can in the here and now.

          As for where I think we should go from here?

          Shy of replacing the constitution to something that allows for multiple parties via proportional representation, this party is the horse we rode in on... and it can't and won't be altered from the left...and the Republicans have such a different business model, they won't stop lurching rightward and look to reclaim the center (and thereby force the Dems to shore up even much-diluted leftist bona fides).

          I think the two-party system has to be replaced. Period. It structurally encourages the dysfunction of one party never ever stopping its rightward flight and the other never choosing against following in its footsteps to claim an ever shifting center that rests, regroups, and eventually lurches right yet again.

          Consider the past few years. The rightward surge has not stopped at all. Republicans in 2011 are vastly more reactionary than in 2001 - and they were nuts then.

          This train will never stop until it's stopped.

          •  You ask for fundamental change (0+ / 0-)

            in our system of government and finance. Does that get accomplished without some kind of a revolution in society? And also, when that is achieved, will we be worse off than before (e.g. Russia today)?

          •  Great post. (2+ / 0-)
            Recommended by:
            cskendrick, whenwego

            There is a single issue for poor people from the liberal side, and it's even got a ready made movement - it just needs to be pointed at the right target.

            Corporate sponsored public policy is that single issue. If liberals stood up to that - pointed a finger and started removing bricks and bashing walls on that front, then people who are disenchanted (Rep/Dem andnon-voters) could be empowered.

            Just as the rich have a single issue with a shitload of pet issues that they try to connect to their prevailing trickle-down ideology and try to piggyback, ram or slip through, the poor could have the same, but it requires attacking the corporate agenda.

            I think IRV is an end round to the 2 party system's dominance and exploitation. Everyone but the corporate center would go for it in a big way and opposing IRV means supporting the exploitative, extractive democracy that all of us abhor.

            Great comment, csk...
            peace

            Democracy - 1 person 1 vote. Free Markets - More dollars more power.

            by k9disc on Fri Sep 02, 2011 at 01:16:13 PM PDT

            [ Parent ]

      •  cskendrick, the best (1+ / 0-)
        Recommended by:
        Ray Pensador

        post I've read in a long time (and I read quite a few).

        I recall reading a few years ago, and it's even more appropriate today.  Over on the DU: 'When the government become predators, the citizens become the prey'.

        These people are our ENEMY.  They have declared war against us.  They have systematically looted the public coffers, way out into the future.  They've ruined this country.  That's why I'm in favor of letting the evil banks fall into smoldering heaps.  Let them fall.

        We'll pick up the pieces and start over.

  •  In light of the (12+ / 0-)

    news last night that the Administration is prepared to file against over 12 banks in a civil action, how is that not an "aggressive" investigation?  For those who have already complained that it has taken too long -- you don't understand complex litigation -- much less one of this magnitude.  

    And unless folks here actually work in the fraud division of the DOJ, none of us has a clue if there is a parallel criminal investigation (actually, there is -- the FBI has been at it for a couple of years) which will end with charges and prosecution.  The statute of limitations for fraud and other potential crimes in these matters is five years.

    You may be correct re: the dire straights the banks are in, but I'd need more than a link to a DKos diary to claim cover up.  

    Vi er alle norske " My faith in the Constitution is whole; it is complete; it is total." Barbara Jordan, 1974

    by gchaucer2 on Fri Sep 02, 2011 at 05:15:08 AM PDT

    •  I'm hopeful that this civil suit will (4+ / 0-)
      Recommended by:
      divineorder, TomP, DianeNYS, justintime

      help uncover information that we need to separate bad actors from their huge salaries and remove them from power and influence.  I'm sure this has taken as long as it has because the Administration needed an airtight case, and that takes quiet, un-dramatic, painstaking work to accomplish.

      Forgive me if this is a stupid comment, but: we are not tv watchers in our house, so we are just getting to see The Wire for the first time, and we're plowing through Season 1.  It strikes me how the police, who are quietly building a step-by-step case are frustrated by their superiors who want sudden, dramatic action to show they're "doing something."  But grandstand moves undermine the unglamorous work that could really get to the heart of the matter.  That's what many people here, who scream "Why doesn't he just throw the banksters in jail?" are doing.  If this case against BOA begins to uncover and punish some perpetrators, maybe we'll come to see we have to have patience if we are going to effectively get at those who caused this mess.

      Sometimes I wonder whether the world is being run by smart people who are putting us on or by imbeciles who really mean it. --Mark Twain

      by SottoVoce on Fri Sep 02, 2011 at 06:32:52 AM PDT

      [ Parent ]

    •  Again... (0+ / 0-)

      The DOJ is NOT filing that suit. It's the Federal Housing Finance Agency.

      "I wish I could tell you, in the midst of all of this, that President Obama was waging the kind of fight against these draconian Republican proposals that the American people would like to see. He is not." -- Senator Bernie Sanders

      by Sagebrush Bob on Fri Sep 02, 2011 at 09:26:22 AM PDT

      [ Parent ]

  •  I don't know if you are right... (6+ / 0-)

    ... but since Obama's election, I've been reading more history books and presidential biographies and I've realized  that there is a TON of stuff that goes on behind the scenes that, in hindsight, explain decisions and policies made by presidents that on the surface are inexplicable.

    Which is not to say I think Obama is "doing the right thing", I'm just aware that he is privy to way more info that I don't have and so I tend to give him the benefit of the doubt more often than not w/r/t whether he's some sort of "sellout".

    Lisa

    All Kossacks are my allies, but if you can't express your thoughts in a civil and kind manner, I won't be engaging in a conversation with you.

    by Boston to Salem on Fri Sep 02, 2011 at 05:49:00 AM PDT

  •  I wish I could give Obama so much credit (7+ / 0-)

    that he was, in effect, blackmailed into pro-Wall Street policies, but I think the answer lies in a lack of interest in and disengagement with economics.  Obama seems to have bought economic orthodoxy hook, link and sinker and has delegated his economic policy to Wall Street oriented "experts."  Since these same "experts" largely define economic "common sense," it's true that Wall Street has us by the 'nads; but I'm skeptical that this fact involves Obama being forced into a deal with the Devil after consciously discovering hidden weaknesses in the financial system.

  •  Hmm (2+ / 0-)
    Recommended by:
    lotlizard, k9disc

    Your thesis is that Obama is taking the bad option (coverup) over the worse option (the truth).

    Did he really need to make the appointments that he has in order to do that, though?  I think not.

  •  Sadly (5+ / 0-)
    Recommended by:
    TomP, divineorder, justintime, Cliss, k9disc

    I'm afraid that your hypothesis regarding the mega-banks being insolvent to one degree or another might be right on the money.

    If so - It's past time to find out who did the looting and actually do something about it. I'm happy to see the Justice Dept. file suit over the mortgage crisis but it's a drop in the bucket, and I 'll withhold judgement as to whether or not it will be any more than a whitewash, or just more Kabuki theater.

    Perhaps we'll find out once and for all who really runs the country.

    I'd go long on the oligarchs and short on the government were I in the money and in a betting mood.

    Try new Slurm - It's even more addictive!

    by Anthony Page aka SecondComing on Fri Sep 02, 2011 at 06:18:05 AM PDT

  •  I work on Wall St and frankly I fear the same (8+ / 0-)

    thing, and sometimes I think that the Prez just has a major blindspot, but sometimes I fear that he is faced with some major financial crises that could and probably will rock the whole freaking globe and bring this whole house of cards down..

    Not to confuse two issues - but they are related.. I mean the idea that a Brownstone in the hood in Brooklyn is worth a million $ and often neither the tenants nor the owners earn over $100K seems to me like an obvious house of cards.. and the banks make these determninations, lend money on these values and then create complicated securities out of this paper money, and then sell CDS upon CDS on top of those securities.. and that's just one teeny weeny example... there are CDSs on everything from the likelihood that your grandma will go to a retirement home to GM failing and/or succeeding! Enough to make anyone's head spin!

    I'm super frustrated with Obama and Dems - by god, I am tearing out my hair!

    by karanja on Fri Sep 02, 2011 at 06:33:58 AM PDT

  •  Yes, he's saving the criminals... (4+ / 0-)
    Recommended by:
    divineorder, MrWebster, mightymouse, Cliss

    to save us all!

    Check mate by the smartest 11th-dimensional chess player on the planet.

    Booby Fisher, eat your heart out!

    More and Better Democrats

    by SJerseyIndy on Fri Sep 02, 2011 at 06:39:47 AM PDT

  •  Well, this makes for an interesting rec list (4+ / 0-)
    Recommended by:
    TomP, Randtntx, DianeNYS, Knarfc

    We've got a diary explaining why they won't do what the other diary two slots up explains that they are doing.

    I'm a concert pianist with a double doctorate... AND YOU CAN BE TOO!

    by kenlac on Fri Sep 02, 2011 at 06:49:28 AM PDT

  •  It's mindboggling... (12+ / 0-)

    If you've read "Too Big to Fail" by Andrew Ross Sorkin, it's easy to imagine what you describe.  The thing that struck me is how those big players actually give no consideration to the individuals that suffer consequences.  Multi-billion dollar deals are struck in board rooms at these institutions and the players are well aware of the fees that they'll collect for doing the deal.  There's no consideration of how many jobs are affected or what happens if a value drop cuts down any individual person's pension.  It's like the banking system was a big ATM for the bankers, only instead of drawing cash from an account, it was coming from a secured line of credit whose security ultimately was the real estate assets that were bought up to sell as securities.  Well guess what?  The bankers already have the cash from all of those fees and the real estate is worth half.  What President Obama is doing now is coordinating a group of knowledgeable insiders who are robbing Peter to pay Paul.  Nobody is calling any of these lines of credit, because if that happened, the whole thing would come tumbling down.  I'm sure that their hope is that the whole thing stays afloat long enough for the value of the assets to return enough to be divested from the system.  Managing this entire confidence game is hard enough.  But, managing it against the backdrop that is looming requires a very good man with very great intelligence.  The "good part" gets him into trouble with negotiations because he thinks that others are inherently good as well.  They're not.  I thank God for the intelligence part every day.

    I've spent a few years in higher ed and I try hard to at least understand economics.  One thing that always bothered me was the concept of perpetual growth.  Is it always good for an economy to be growing?  Can't it still be good if it stays the same size?  What I've come to realize is that it's not growth, per se.  It's the movement.  As long as people are buying things, whether from wages or credit, or whatever, the system works.  As technology and other factors improve we have more productivity and growth is the by-product.

    One more point from "Too Big to Fail."  At one point someone got a call during the crisis from the CEO at GE (sorry - don't remember who).  They couldn't roll over their working capital and were in danger of missing their payroll.  That's a huge revelation.  If the movement stops, everything stops.  President Obama has to keep the system moving.  Plus, this cannot be public knowledge because the panic would also freeze the system.  If any of this is true, then President Obama doesn't have a lot of choices.  He can work on the fraud aspects after he is re-elected.

    •  I have the same problem with (5+ / 0-)

      growth as an inherent good.  That's at the core of capitalism, but I don't think it has to be.  Why can't businesses and communities decide that it's okay to be where they are?  I have a friend who makes uilleann pipes, and he takes just enough orders to keep him where he wants to be.  He's not interested in "growing."

      I wish more businesses were like that, and that greed hadn't become a motivation for doing business.

      --

      Republicans chap my ass

      Me

      by Marc in KS on Fri Sep 02, 2011 at 07:05:41 AM PDT

      [ Parent ]

    •  lots of recs if possible (1+ / 0-)
      Recommended by:
      Cliss

      excellent comment

    •  Because they are greedy sociopaths. That's why (2+ / 0-)
      Recommended by:
      Cliss, Knarfc

      they don't care about the consequences.

    •  The exponential function is an amazing concept (0+ / 0-)

      as well.

      @ 7% growth, every 10 years the principle doubles.

      In terms of population, an example used by this cool mathematician - a man who believes that the failure to understand the exponential function is the most problematic part of our dysfunctional society - was the city of Boulder.

      He asked politicians in Boulder what a good population growth rate was...

      10% and above were pretty common answers, according to the mathematician. Trouble is, at 7%, the population doubles in 10 years. 50,000 to 100K by 2020. 100K to 200K by 2030. 400K by 2040. and 800K people by 2050. Does Boulder really want that kind of growth? Seems pretty problematic to me and probably to most people in Boulder.

      It's really scary when it comes to consumption... I should try to find that video. Stunning shit!

      Democracy - 1 person 1 vote. Free Markets - More dollars more power.

      by k9disc on Fri Sep 02, 2011 at 01:24:49 PM PDT

      [ Parent ]

  •  No Banker Left Behind (1+ / 0-)
    Recommended by:
    Cliss

    Ry Cooder

    "They were all down at the White House,
    no banker was left behind..."

  •  He Appointed Insiders Because He NEEDED Insiders (7+ / 0-)

    If you're going to tackle a situation like he inherited, you need to have the people who were on the inside, so you know where all the bodies are buried, or at least some of them.

    If you hire someone like Krugman, who is brilliant, he would be able to get nothing done with the people who Obama needed to work with. Krugman would only antagonize those people (not necessarily intentionally), and nothing would be accomplished.

    Yes, the economy was (and possibly still is) in worse shape than we are being lead to believe.

    And no, it would not necessarily be smart to let everyone know that and to start a panic.

    It would make sense to try and fix that problem if you can, and to do that, you would NEED insiders to guide you through the guts of a this complex, insider world that is world finance.

    This post is dedicated to myself, without whom, I'd be somebody else. Though I'd still be an asshole. My music: http://www.myspace.com/beetwasher

    by Beetwasher on Fri Sep 02, 2011 at 07:10:23 AM PDT

    •  Cause a panic (5+ / 0-)
      Recommended by:
      larryrant, Ray Pensador, Cliss, Knarfc, wonmug

      Problem is:  People know things are a lot worse than has been acknowledged from the corridors of power.  It's kinda wishful thinking to believe that if one doesn't mention it, no one's gonna notice.  One of those Emperor's New Clothes kinda things.

      The truth will out.  And if the President (or whomever else) won't acknowledge it - like when he missed the mark by trusting BP over the oil gusher last year - the result is that the population at large starts ignoring what he says, thinking that he's out of touch.  Thinking that he doesn't know, much less care, about the harsh realities afoot in the land.

      The river always wins. -- Mark Twain

      by Land of Enchantment on Fri Sep 02, 2011 at 07:38:19 AM PDT

      [ Parent ]

    •  Perhaps this is why Republicans with any knowledge (4+ / 0-)
      Recommended by:
      Ray Pensador, DianeNYS, justintime, Cliss

      of what's really going on are not running for President.  All we have are jokesters, state governors and an ambassador.

      West. No further west. All sea. -- Robert Grenier

      by Nicolas Fouquet on Fri Sep 02, 2011 at 07:39:24 AM PDT

      [ Parent ]

    •  Beetwasher-I absoloutely agree with you (1+ / 0-)
      Recommended by:
      Cliss

      that the problem is huge and most banks are insolvent.

      "No man has a good enough memory to be a successful liar." Abraham Lincoln

      by appledown on Fri Sep 02, 2011 at 09:51:05 AM PDT

      [ Parent ]

  •  If true, why save the system? (1+ / 0-)
    Recommended by:
    whenwego

    sounds like it doesn;t work and is totally corrupt.

    Give title to the primary mortgage or car loan holder and start over.  Sure, "they" ("us") don't deserve it but I am still waiting to hear credible reasons for why banksters hav ebeen given free money.  What's the difference other than the identities and/or occupations of the bailed out?

    Whatever happens, and I thought Ray it was all supposed  to have happened a week or two ago, people will breathe, and walk and the Sun will rise in the east set in the west.

  •  Interesting theory (2+ / 0-)
    Recommended by:
    Ray Pensador, Cliss

    Probably the one closest to the truth.  

    I also thank the one who rearranged deck chairs on the Titanic so those on board ship could get a better view of the iceberg.

    by NyteByrd1954 on Fri Sep 02, 2011 at 07:16:27 AM PDT

  •  Good diary. (7+ / 0-)

    I think it is possible that he and his adminstration is very concerned over the solvency of some banks.  Buffet met Obama and w/i a week put $5B into BoA.

    A story today suggests a massive lawsuit by the agency that oversees Freddie Mac and the other Mac.

    Very interesting hypothesis.  

    The American people must wise up and rise up!

    by TomP on Fri Sep 02, 2011 at 07:22:53 AM PDT

  •  Nancy Pelosi missed an opportunity (3+ / 0-)
    Recommended by:
    mightymouse, Ray Pensador, Cliss

    When she was Speaker of the House, they passed hundreds of bills that were never taken up by the Senate.  Given that reality, a focus turning over rocks and shining a light to see what crawled out, would have been just the thing.  It could have been a useful way to feed the narrative in the public consciousness.

    Even though Obama kept saying he didn't want to look back, the House could still have done it while the Senate was dithering.

    Too late now, sadly.  Opportunity blown.

    The river always wins. -- Mark Twain

    by Land of Enchantment on Fri Sep 02, 2011 at 07:30:51 AM PDT

  •  Smart? (2+ / 0-)
    Recommended by:
    DorothyT, kovie

    There probably is a lot to what you are saying here, but there is one statement that strikes me as really off:  Obama is one of our smartest presidents.  Sorry, Obama is facile, not smart.  There is a difference.  Smart people can think ahead, see what might happen if one thing or another is done.  When have we seen that?  Look at the appalling mishandling of next week's address to Congress.  Definitely not smart.

    •  Madison, Jefferson, Adams, Adams, Lincoln (1+ / 0-)
      Recommended by:
      tea in the harbor

      TR, Carter, Clinton--all really smart men. Not sure if he's in their league.

      "Liberty without virtue would be no blessing to us" - Benjamin Rush, 1777

      by kovie on Fri Sep 02, 2011 at 10:56:30 AM PDT

      [ Parent ]

      •  Hey for what it's worth I don't see (0+ / 0-)

        Carter or Clinton in the same league as the others. I don't see John Q Adams fitting in that list either.

        And you missed Franklin D Roosevelt.

        Jefferson and Lincoln were tops, though, with Franklin close behind.

        Wilson was smart, but it didn't help him much. Same with Van Buren and Buchanan.

        Fillmore and Arthur were pretty sharp, by the way, and underappreciated.

        H'mm. I'm not terribly into this, anymore.

        by Knarfc on Fri Sep 02, 2011 at 12:21:06 PM PDT

        [ Parent ]

        •  FDR was not an intellectual (0+ / 0-)

          His genius was for politics, not policy. Carter was a nuclear engineer with a Phd. Clinton is a Rhodes scholar who can intelligently discuss pretty much anything. JQ Adams was one of the most brilliant legal and policy minds of his era. I don't see Obama in any of their intellectual league, except FDR, whose political skills and instincts he vastly undereaches. Obama's plenty smart, but he's not brilliant. At least not in real world terms, only in a grad school bull session sort of way.

          Also, never a president, but Hamilton was also one of the brilliant ones.

          "Liberty without virtue would be no blessing to us" - Benjamin Rush, 1777

          by kovie on Fri Sep 02, 2011 at 12:27:42 PM PDT

          [ Parent ]

          •  I misunderstood you. (1+ / 0-)
            Recommended by:
            kovie

            I thought you were talking about smart. You were talking about intellectual. Slightly different. And with that I can agree with most of what you said.

            As for...

            I don't see Obama in any of their intellectual league, except FDR, whose political skills and instincts he vastly undereaches.

            Let me emphasize that Obama has vastly less experience at the federal level and at the executive level than FDR had when he was elected President. Less, even, than James Buchanan, Warren Harding, or (gasp!) Jimmy Carter.

            H'mm. I'm not terribly into this, anymore.

            by Knarfc on Fri Sep 02, 2011 at 12:56:04 PM PDT

            [ Parent ]

            •  Yes, intellectually, not politically smart (1+ / 0-)
              Recommended by:
              Cliss

              And he's not in either league when it comes to the top people in each. He is perhaps the most overrated politician since Reagan--and even Reagan was a much smarter politician than Obama can ever hope to be.

              Obama is the ultimate exemplar of a generation of smooth-talking overrated hacks who have come to dominate government and the private sector.

              And why both are failing.

              "Liberty without virtue would be no blessing to us" - Benjamin Rush, 1777

              by kovie on Fri Sep 02, 2011 at 01:21:28 PM PDT

              [ Parent ]

              •  Well I assume you read my other response (0+ / 0-)

                to... tea in the harbor's comment. On this point I disagree with you. The only thing we know for sure now is that Obama is just relatively inexperienced.

                H'mm. I'm not terribly into this, anymore.

                by Knarfc on Fri Sep 02, 2011 at 09:48:48 PM PDT

                [ Parent ]

    •  We can't really tell how smart Obama is (0+ / 0-)

      because we don't really know exactly who he's working for or who financed and supported him in his presidential campaign or exactly what his goals are.

      Having said that, I assume his IQ is 150+.

      I just want to add that sometimes in the course of human events, and I think this is one of those times, smart is dumb and dumb is smart.

      H'mm. I'm not terribly into this, anymore.

      by Knarfc on Fri Sep 02, 2011 at 12:13:46 PM PDT

      [ Parent ]

  •  If what you say is true..... (4+ / 0-)
    Recommended by:
    mightymouse, whenwego, Ray Pensador, Cliss

    .....then it's a total failure of leadership in a supposedly democratic republic.

    You are saying that the President is engaged in a massive deception to hide a state of economic emergency. By "protecting" the American people from the truth, he is preventing them from making informed decisions about the most important issue of their lives.

    If we had a democratic republic that was in such a state of economic disaster, then the government would openly declare a state of emergency and mobilize the country to effectively deal with it.....just as if it was going to war. That is essentially what Roosevelt did in the 1930s.

    We actually do have a state of war. But it's not the kind of war where one unified country battles against another unified country. It's not even a metaphorical war, where a unified country fights against a common economic disaster.

    For over 30 years, the US oligarchy has successfully waged war against the US middle class. Decade after decade, they've decimated the middle class with "jobless recoveries" that see the stock market go up, while more Americans sink into poverty. The Clinton Administration and now the Obama Administration have stood shoulder to shoulder with their allies in fighting this war.

    Which side is Obama on? Well, who are his allies? From day One, he has been standing shoulder to shoulder with the Rubins, the Summers, the Geithners, the Bernankes, the Daleys and the Immelts.

    While I don't hold Obama in high esteem, that doesn't mean I would say he's the Devil Incarnate and the lessor of evils. He is merely the lessee of evils.

    by xynz on Fri Sep 02, 2011 at 07:35:38 AM PDT

  •  read this diary (0+ / 0-)
    NYT: U.S. will sue big banks over misleading mortgages by Laurence Lewis

    Vermont is under water. New Jersey is reeling. North Carolina is just starting to pick up the pieces. But GOP House Majority Leader Eric Cantor is already taking Hurricane Irene's victims hostage.

    by anyname on Fri Sep 02, 2011 at 07:38:53 AM PDT

  •  woulda, shoulda (6+ / 0-)

    but coulda?

    I think the underlying analysis, that we have a zombie financial system,  all sorts of unacknowledged contigent liabilities that could take down the system, has merit.

    It was in all of the diaries in 2008.   The 'end is near' extreme predictions didn't quite come true.   The dire but more accurate in my opinions were that there were essentially two choices, let it crash and try to pick up the pieces, and most wealth of the middle class and pensioners as well as the investor class would disappear and there would be world wide catastrophe, but you could start over.  The second choice was a slow slide towards a crash, buying time to try to restructure, avoid absolute catastrophe in one fell swoop, but more stability.   I think the second choice was made. And I think it was made before Obama took office.  TARP, fed policy was set and the game plan implemented in October. Unfortunately, the kinds of restructuring, the kinds of adjustments necessary to actually address the problems, haven't been made.

    As to another huge crash,   very possible, and that time it will stay crashed.   Because those who gambled with everyone else's money intend to keep taking what little is left and nothing has been done to stop them.  Criminal actions may have created outrage, but outrage isn't moving votes in Congress any more.   I can't be the only one noticing that.   Public opinion at 60 and 70% levels, doesn't get the public what it wants.   I don't think even criminal convictions would have moved the current players to vote for meaningful reforms.

    I think it really will take massive civil disobedience, people refusing to stay home and be silent, to be locked out of discussions with representatives, to have their elected local officials be superseded by appointed financial managers, life time investments in pensions and jobs wiped out, etc.  

  •  According to Gretchen Morgenson, not if but when (4+ / 0-)
    Recommended by:
    Getreal1246, Ray Pensador, DianeNYS, Cliss

    ...the next debt crisis happens. Your narrative is the narrative, and the Lehman panic and crash was simply more expensive for DC to tolerate. One failure paniced the whole system - for good reason. But the system is larger that you describe. The interconnected, tightly coupled, and abysmally deep financial behemoth called TBTF US banks of which you speak is also global, intergeneraational, and determines sovereign integrities. The pressures on what is/isn't done includes the necessity to avoid/coverup/manage panic. As each teeters it much be absorbed gracefully or the whole falls.That doesn't mean coverup, but graceful resolutions, ongoing, until it's all managed, unavoidable consequences managed to the best state. When politicians confuse that with coverup the resolution process is delayed. When politicians expect "completion" and "recovery" that's not smart. SO what are the expectations? Investors, CEOs, large funds have moved their money into locked in rated bonds and T-bills so the that means not if but when.

    Eliminate the Bush tax cuts Eliminate Afghan and Iraq wars Do these things first before considering any cuts

    by kck on Fri Sep 02, 2011 at 07:48:29 AM PDT

  •  Interesting diary, Ray. Much better than (1+ / 0-)
    Recommended by:
    Knarfc

    the usual emotional splattergun stuff I have come to expect from you.

    Obviously everything you say is highly speculative, and I hold the ideas you express in the light of my judgment that you are a bit of a paranoid fantasist -- but for once I don't find myself simply laughing and rolling my eyes.  So that's a major improvement.

  •  Banks aren't lending (4+ / 0-)
    Recommended by:
    KayCeSF, Ray Pensador, DianeNYS, Cliss

    because many of them are still insolvent. Loss reserves aren't adequate to cover the write down of assets, particularly mortgage loans, so many banks aren't foreclosing on loans or dumping bad business loans from their portfolios. Even now, banks don't trust that other lenders are solvent so its creating a lending freeze.

    I remember reading that an estimated 56 trillion in credit in the marketplace was secured by only about 13 trillion in assets. When I read that three years ago, my heart sank.

    You're right. Obama was dealt a stinking pile of dung with this economy. And for everyone who thinks letting the banks fail would have been better, I don't think anyone truly knows what would have happened. Certainly not a better economy.

    To compound that, we're experiencing one of those major transitions that shake up world orders. If I had to make a comparison, I think we're experiencing something similar to the fall of the British Empire. Globalization, technology, China's and India's and Brazil's emergence as global players, are all impacting the U.S. economy and the change will be permanent.

    I remember when George W. was annointed, feeling like we'd just started the new century with exactly the wrong man at the wrong time. George was a product of the extractive industries. Clinton had his roots in Silicon Valley and high tech. Obama isn't married to either, but he does have a clear vision of where we're headed as a country if we don't improve education, embrace innovation and alternative energy, invest in America to compete with the rest of the world.

    This takes long-term thinking, which Republicans aren't capable of. Perry or someone like him will be exactly the wrong president at the wrong time, and the damage Bush didn't do, Perry will finish.

    I despair about our congress because they are incapable of taking the long-view too. On both sides. Old white men in the Senate who are too complacent and too many young guns in the House who are too stupid. This is not a formula for success.

    "The white race is the domineering race, which is why I'm voting for McClain." Anonymous voter on NPR

    by txdemfem on Fri Sep 02, 2011 at 08:01:21 AM PDT

  •  "The Broken Global Banking System"... (3+ / 0-)
    Recommended by:
    Ray Pensador, justintime, Cliss

    ...this (Oct. 2010) article explained how

    "...the banking system has been turned on its head, and become a borrowing machine...

    But how many Americans understand how broken and defective the banking system as a whole has become? For the crazy facts are these: bankers now borrow from their customers and from taxpayers. They are effectively draining funds from household bank accounts, small businesses, corporations, government Treasuries and from e.g. the Federal Reserve...

    British banks are currently borrowing £12 billion ($18bn) a month to maintain existing levels of activity. According to the Bank of England, by 2011 they will have to borrow £25 billion ($39bn) a month -- and the Bank is sceptical they can continue to raise that level of funding...

    Global banks are estimated to have around US$5 trillion of medium to long-term funding maturing over the next three years, and 'the scale of competition for funds in global markets' is intense...

    By borrowing from the real economy, and then refusing to lend, except at high rates of interest, bankers are effectively performing a lobotomy on the real economy...and then speculating with trillions of dollars of taxpayer-backed resources.

    NEF's report shows, thanks to the persistence of archaic, neo-liberal economic theories of finance, the banking system has frozen lending and been turned on its head...Instead of lending into the economy, bankers are borrowing from the real economy...

    And yet, the governments continue to prop up the criminal and/or incompetent zombie banks, in a losing effort to "stabilize" things.

  •  While I've had similar thoughts about (2+ / 0-)
    Recommended by:
    Catte Nappe, Cliss

    the way Obama has dealt with the banks as outlined in your post, I am not sure I would use the phrase "cover-up."  I think the whole situation was/is so complicated it would be very difficult to reveal, expose, explain all of it because the bank activity was very complicated, as you said:

    ... there is the possibility that the use of the very complicated financial instruments deliberately created as ponzi schemes, including credit default swaps, collateralized mortgage obligations, and similar securities, may have created a situation whereas the consequences may have gotten so complicated, that the financial criminals may have lost their ability to fully understand them.
    [emphasis added]

    If the criminals within the banks are confused about exactly what happened, how can it be explained to The People, especially if in the very dire situation you describe? Especially since from the get go this was going to be an ongoing process to straighten out the situation. Which is also why I have often said as you have, that Obama had to surround himself with the very people who caused this mess to straighten it out, namely Goldman Sachs, Citicorp, et al.  If you can't open the Chinese Puzzle Box, you better get the Chinese man who built it?

    Scary.  

    Sometimes it's just enough to listen.

    by KayCeSF on Fri Sep 02, 2011 at 08:10:52 AM PDT

  •  This diary adds nothing. Old news with (0+ / 0-)

    a conspiracy spin.
    This is a CT diary.

    Everyone knew years ago about Fed intervention to the tune of at least 12 Trillion AND they knew it was going to lubricate the global financial system.  They just didn't know the exact banks' names and dates.

    Everyone knew years ago about the Swaps and derivatives totaling $60 trillion in the real estate game.  One big yawn.

    (btw the total for ALL derivatives contracts = $595 Trillion)

    You've just added a phony spin that President Obama is spearheading a vast Center-Wing Conspiracy.  Bah. You get a D- .

    NO CE/CW. NO UNION BUSTING

    by Aeolos on Fri Sep 02, 2011 at 08:12:03 AM PDT

  •  It's Argentina writ large (1+ / 0-)
    Recommended by:
    Ray Pensador

    Those with longer memories recall when the Argentine government defaulted on its debt back during the 80's. By rule, every major bank was insolvent and the FDIC was far undercapitalized to deal with a mess of that size.

    So the Fed and FDIC just ignored the problem until it went away - eventually, profits from other lines of business restored solvency.

    That's probably the model being followed here. Let's all root for the bankers and hope it works, because a major deflationary spiral would utterly ravage everyone, everywhere.

    In theory, there is no difference between theory and practice; but in practice, there always is a difference. - Yogi Berra

    by blue aardvark on Fri Sep 02, 2011 at 08:13:46 AM PDT

  •  An open question or two (2+ / 0-)
    Recommended by:
    Ray Pensador, Cliss

    I hope this isn't a tired or stupid thought, but here goes:

    Is there a word for the total gross worth of Earth?  I mean, if every conceivable resource, property, etc., were used to its highest efficiency, is there a theoretical price tag, so one could say that at this point in time, the combined worth of everything of value is $X US?

    Whether such a word exists or not, is it possible to estimate such a figure?

    What happens when theoretical debt exceeds theoretical wealth on a planetary scale?

    Thanks for any insight!

  •  I don't comment often here (7+ / 0-)

    but my gut feeling on this whole stinkhole is that Obama's decision wasn't (and couldn't be) made based on how it would affect the US economy alone.  We are talking about major banks/financial institutions we are familiar with that are international.  And the banks we are familiar with aren't the only ones involved in this crisis - major institutions in countries around the world are tied up in this and they also are international institutions - they cross multiple borders.  I believe Obama made decisions based on what the impact of his actions would be globally... because the implications would be global.  If he decided to let "too big to fail" to fail... what would other nations do, how would that affect the big picture of resolving the crisis, and what options did international banks that operate in the US have to escape the consequences here?

    I don't comment alot because I'm not the most articulate person but I think this is worth considering.

    •  you comment makes sense (3+ / 0-)
      Recommended by:
      Ray Pensador, jguzman17, Cliss

      & is very articulate.

      It's true that in the heat of the moment he had to go along to get along. But within a reasonable timeframe thereafter the focus should have been putting Glass-Steagall back in place and backpedalling all the financial industry deregulation in a determined and deliberate manner. Instead we threw the weaker banks into the hands of the slightly less weaker banks in deals that were pennies on the dollar and surely rained money into the pockets a the top executives. So now we have raised the stakes such that there is no longer any question as to who holds the cards: the banks. And the stinkhole will only get worse & more dire & more fragile because the top execs don't give one goddam fuck about the banks they inhabit as parasites: they will appropriate huge sums of money and leave carnage in their path.

      •  I agree (1+ / 0-)
        Recommended by:
        DelilahOhMy

        but coincidingly think he is trapped in a colossal cluster f^%k of global malfeasance that he couldn't undo with legislation given the makeup of the House and Senate over his tenure.  

        I don't see a path out of this without an uprising of the people - people who are too busy trying to survive to be able to unravel the "that's too crazy to be real" plot twists and turns of this twilight zone take on democracy.

        •  yes, colossal cluster f^%k (2+ / 0-)
          Recommended by:
          jguzman17, Ray Pensador

          as you more delicately turn an apt phrase.

          You are right, he could not get it done given the filibuster. But he need to pound the goddam table with both fists and take the case with ardent passion to the American people and tell them to hold congress' feet to the fire. What we got was a chicken shit spit in the eye to every one of the serfdom class.

          •  Agree again. (2+ / 0-)
            Recommended by:
            Ray Pensador, radv005

            I would much prefer someone willing to stand by their convictions (assuming I even know what the President's convictions are at this point) even if they know they are going to lose, than someone who is unwilling just because they believe they cannot win.

            In a not so Alice in Wonderland world, I do believe he could have been a truly great president.  I'm not a fan of arm chair quarterbacking but I can't stomach settling willingly for mediocrity, even if it is all I believe I can get.  I suck at fighting, and I lose a lot, but I still fight.

  •  My best guess is that some of your thin ice... (2+ / 0-)
    Recommended by:
    Ray Pensador, Cliss

    Looks like pretty solid ground to me.

    ePluribus Media
    Collaboration is contagious!

    by m16eib on Fri Sep 02, 2011 at 08:19:28 AM PDT

  •  stop thinking....its NOT THAT COMPLICATED.... (3+ / 0-)
    Recommended by:
    radv005, bobinson, Cliss

    a) small businesses are the primary job creators

    b) banks are the primary lenders for small businessess

    c) the tightening of credit is a major impediment to small companies expanding, hiring, etc

    YOU SQUEEZE THE BANKS....THE BANKS SQUEEZE THE SMALL BIZ OWNER....DUH.....!....

    OR DID YOU NOT NOTICE THAT BOFA LAID OFF 10,000 PEOPLE, AFTER DOJ BEGAN INVESTIGATING THEM......

    EVERY ACTION HAS A CONSEQUENCE.......

    •  Even that is thinking too much (0+ / 0-)

      Which industry spends the most on federal lobbying efforts? Wall Street. Second place isn't even close. Follow the money.

      "As God is my witness, I thought turkeys could fly."- Arthur Carlson

      by bobinson on Fri Sep 02, 2011 at 09:54:22 AM PDT

      [ Parent ]

      •  YOUR ARE EITHER LAZY OR CLUELESS (0+ / 0-)

        LOBBY SPENDING BY INDUSTRY

        1) PHARMACEUTICALS

        2) INSURANCE

        3) ELECTRICAL UTILITIES......

        4) CHAMBER OF COMMERCES......

        STOP WATCHING FOX.....U MAY LEARN SOMETHING..

        NOW CAN YOU FOLLOW THE MONEY.......SEE THE LITTLE EPA ANNOUNCEMENT...TODAY.....

        •  All caps? Really? (0+ / 0-)

          That's so 2004.

          I digress. Perhaps I should have been more specific when I said that Wall Street was the biggest spender on lobbying. What I meant was the "FIRE" sector industries which tend to be based in Lower Manhattan. Finance, Insurance, Real Estate. Added up, they kick pharmaceutical's ass.

          "As God is my witness, I thought turkeys could fly."- Arthur Carlson

          by bobinson on Fri Sep 02, 2011 at 12:20:21 PM PDT

          [ Parent ]

    •  Doesn't matter. Almost all large banks (0+ / 0-)

      exist today for apperances only. And as part of the appearance the managers of the Potemkins are rewarded, or as they say, highly compensated.

      Why do small businesses need loans if they are economically viable? Most aren't. They need loans because they, too, are Potemkins.

      H'mm. I'm not terribly into this, anymore.

      by Knarfc on Fri Sep 02, 2011 at 12:27:13 PM PDT

      [ Parent ]

  •  your money para would have been my choice too... (2+ / 0-)
    Recommended by:
    Ray Pensador, Cliss

    But, Mr. Obama has painted himself into a corner now to do anything real he would have to cop to the real story and it kinda fucks with his public relations as he would have to acknowledge the lies.  

    I think the big mistake was trying to keep afloat a financial system that had been basically taken over by a criminal cartel and is totally corrupt.  It would have been a better option to launch full investigations, and if those investigations led to the conclusions that the banks were insolvent (due to the massive looting), then the banks should have been liquidated, the criminals should have been prosecuted (and this would have strengthen the social fabric of the country), and the banking system should have been nationalized.
  •  This is a great effort to think this out (6+ / 0-)

    Thanks for this effort.  It is a model.  Rather than just another rant, it attempts to figure out what the true nature of the crisis is.  

    I have a bit of experience which might be useful here.  

    Some time back I did a stint as a temp office worker in San Francisco.  I had recently graduated from a university, and had had a job as a weekly newspaper editor.  My chief qualifications in the eyes of the temp agency, however, were that I could type and I had a three piece suit.  So I was sent to a series of international banking headquarters.  

    These were some adventures.  But I learned that this world is a world of really beautiful interior decoration and fine art.  You see the people below on the streets, fifty stories below looking like small ants.  

    The people up there are all wonderful people, really,  It is like graduate school heaven.  Everyone has graduated from the best universities in the world.  Harvard.  THe Sorbonne.  They have seen the latest broadway play.  Have been to all the great places to visit.  They are knowledgeable and great conversationalists.  You really want to stay up there.

    I think these people are all vulnerable to being led by their own high opinion of themselves relative to mere mortals such as members of Congress or the President.  

    I suspect that what is at work is that this culture is completely out of the reach of scrutiny by the public, and probably has the Washington regulatory crowd wowed.  They are more likely to be lusting after a job in this environment or some way to be friends with these people than to be vigilant in pursuing accountability.  

    Thus, with no scrutiny and little effective oversight, what is probably guiding the world financial system is really what I call likeminded mindlessness.  

    Nobody in charge.  

    Obama's problem is the size of this system.  The big deal about the total US indebtedness is over about 14 trillion.

    Banks are probably handling investments in the hundreds of trillions, and looking at a map of the world instead of being concerned with such a small locality as the United States of America.

    I think that this system is out of control because it is beyond awareness.  Most of us have not been paying attention because we think bankers and what they do is boring.

    We will probably pay for this lack of interest.

    Thanks for starting a discussion on the road to improved consciousness.  Hopefully what will come of this disastrous state of affairs is some way of inserting true accountability, whether from Washington or from Zurich or wherever.

    hope that the idiots who have no constructive and creative solutions but only look to tear down will not win the day.

    by Stuart Heady on Fri Sep 02, 2011 at 08:24:00 AM PDT

    •  Excellent (2+ / 0-)
      Recommended by:
      Cliss, DelilahOhMy

      I happen to understand this "type" you describe and their affability and "culture" is charming but it is based on a profound (sorry I couldn't resist) shallowness that they have to adopt in order to live their refined lives. In reality, they know very well what they are doing--and at the highest levels (a different crowd entirely) they take off the mask a little. The power those people wield is impossible to grasp. They do run the world on an international level. Each head of a major bank outranks any head of state anywhere in the world and increasingly look to extra-legal means to enforce their will.

    •  Great perspective. Thank you. (1+ / 0-)
      Recommended by:
      Cliss
  •  I disagree on the remedy (2+ / 0-)
    Recommended by:
    Ray Pensador, Cliss

    I think your analysis is spot-on: clearly the numbers are in the tens of trillions, far beyond the capacity of the banking system to absorb with existing assets. All this was apparent BEFORE Obama took office.

    However, his remedy has been to support and succor these same banksters, at the expense of the entire world economies, specially the poorest of the poor. By not taking a real remedial action (and I give you he is a smart man), he has just extended the financial nightmare in which we all live today.

    Unfortunately for him, the much-touted hidden hand of the market is forcing a reckoning. His remedy is just causing that to happen in slow motion, dooming a generation to growth-less unemployment and misery.

    And he is paying the political price, while the teahadists walk scot-free.

  •  Best explaination of capitalism in america: (1+ / 0-)
    Recommended by:
    Cliss

    Go watch the Simpsons episode "Homer the Great" where Homer is The Chosen One and cannot fail.  He never fails while he is the chosen one, because the rest of the stone cutters go to extreme ends to ensure he never fails.  That is capitalism in america:  we go to extreme ends to fix-it-as-it-fails because we want to believe it cannot fail.  We then marvel how it never fails.

  •  Renting "Inside Job" tonight (3+ / 0-)
    Recommended by:
    Ray Pensador, vets74, Cliss

    Can't wait to see Four Horsemen.

    It really does seem this bleak.

    Compassion and Charity are vices to the right. Greed is a virtue.

    by orangecurtainlib on Fri Sep 02, 2011 at 08:34:18 AM PDT

  •  I agree with your theory. I have thought (1+ / 0-)
    Recommended by:
    Cliss

    the whole time that the problem is so bad they risk collapse of the whole system if everything were brought to light.

  •  Fast Times on the Wreck List (1+ / 0-)
    Recommended by:
    Cliss

    I'm not the slightest bit put off by this diary, but why is a mostly conjecture-based & chock full of typos post like this racing up the list?

    I cannot explain it, but I am fascinated. Ah, I so love Daily Kos!

    So I was at a concert the other night, and the performer says at one point: "I was born in 1980... So I've lived my whole life in postmortem America."

    by surfbird007 on Fri Sep 02, 2011 at 08:36:21 AM PDT

  •  people need to go to jail (2+ / 0-)
    Recommended by:
    justintime, Cliss

    its that simple. Over a thousand bankers went to jail in the saving and loans crisis, perhaps 10000 need to go to jail now.

    Here is the thing, which you really didnt mention.  Money isnt real.  Its made up stuff, it ONLY works because of the confidence people have in it.  Once that confidence is broken its game over.  Its a confidence game.

    To sure up the confidence, the world needs to see thousands of the perps, do the perp walk.

    its about confidence, nothing else.  Money itself is fiat, meaning its just monopoly money.

    If these bankers were young and minority they would be in jail already, we lock them up for anything, white middleaged rich men, who do real damage, well...

    Bad is never good until worse happens

    by dark daze on Fri Sep 02, 2011 at 08:51:45 AM PDT

    •  People have nothing else (2+ / 0-)
      Recommended by:
      Ray Pensador, Cliss

      Money even if it is worth nothing is all we've got. Until we come up with alternatives we're stuck with money being the ultimate arbiter of all values.

      I think since the S & L crisis the financial community has gained extraordinary power and are in a position to dictate policy now. We have to face that fact. We live, in my view, in the "former USA." Not a bad place and we haven't had to go through the major problems the former Soviet Union had to go through even if we face another downturn it won't be as bad as what happened in Russia.

      •  disagree (2+ / 0-)
        Recommended by:
        Ray Pensador, Cliss

        if this isnt addressed, it may certainly be as bad.

        We have the most citizens locked up int he world, some of the greatest wealth disparity, among the most violent societies, corruption running rampant,  just because it hasnt hit us yet, doesnt mean things are OK and will remain so.

        We are at a turning point, people dont seem to get that.  

        As for money, yes people do have other options, barter. And if we dont fix this fiat problem, it will come to that.

        Germany was a nice place to live also, then came war, debt, hyperinflation and more war.

        Bad is never good until worse happens

        by dark daze on Fri Sep 02, 2011 at 10:04:33 AM PDT

        [ Parent ]

        •  In order for barter to work (1+ / 0-)
          Recommended by:
          Cliss

          The system has to break down completely--even then I think gold and silver will become mediums of exchange. I think, in the end, it is possible to create a barter system but it will take some time and much will depend on the attitudes of people.

          If we were to give up the fiat system that would mean an almost complete breakdown of society and most people, instinctively, know that and therefore won't go for it unless things get far, far worse. Even then I think any kind of major breakdown will be almost a relief for many Americans because it will give us a tangible reason to become very creative and I think, as a culture, that is where our strength lies. We can do much better than the stupid system we live under now.

      •  You've got it - precisely (1+ / 0-)
        Recommended by:
        banger

        I call it the "arbitrarily charged symbol system"; you call it the "ultimate arbiter of all values." It's money, and it's the root, trunk, branch and tree of the evil we're living in at this time.

        When human incentive shackled itself to the money system, we were doomed...far better when we had (and how long did it last, and is it just a fable?) the barter system, and I gave you something you needed in exchange for something I needed. Beautiful. They'll tell you that people won't do anything, innovation won't happen, cancer won't get cured, baseball players won't take the field (and the field will be a weed-choked nightmare) without the ne plus ultra of all carrots dangling before their wide eyes: money. Money makes it happen. Gold makes it happen. Silver and diamonds make it happen. Don't have any of those? Then you die. You starve. You rot, and the vultures will puke you up. This is the proposition at hand, and it's untenable, and in the scheme of history it's been going on for what, about 20 minutes? Let's tear up the wiring and get on with our fucking evolutionary process already, the one involving the mind. We need a different system, one where the incentive is life and beauty, joy and love. This capitalist version we have? It needs a shotgun blast right in the kisser.

        Nobody ever talks about this, but everyone should because everyone knows...it lurks in there, it wants to come out, but it's inarticulable. People in front of the White House demanding an end to the money system would be one hell of a thing. I for one hope I'd be brave enough to be there.

        Remember the suffering of the North Korean people.

        by Nathan Hammersmith on Fri Sep 02, 2011 at 10:07:00 AM PDT

        [ Parent ]

        •  Only community can replace the money system (1+ / 0-)
          Recommended by:
          Cliss

          The money system breeds distrust and selfishness and it works perfectly to create the kind of world most people seem to want but it is not sustainable it's like a crystal-meth high, glorious while it lasts but it eventually leads to a kind of madness.

          Until we are able to break away from the culture of narcissism that is very deeply ingrained we aren't going to get very far. Mind you, you can't ever completely get away from it but we can remove our emotional attachment to it and that takes a lot of self-observation.

  •  I really like your analysis (3+ / 0-)
    Recommended by:
    AnnieR, justintime, Ray Pensador

    It was my understanding that Wall Street, whose executives make such large amounts of money that they are the most powerful interest group in the world (much of their wealth is hidded btw), essentially, call the shots in the Western world and are the real rulers of at least this country along with what I can the national security state which involves the people with guns and extra-judicial rights.

    Big changes in policies are simply above the President's pay grade. That's a fact I think people on this and other progressive sites just don't seem to get.

    •  Maybe a collective effort in Congress could (2+ / 0-)
      Recommended by:
      Ray Pensador, Cliss

      turn this around, but not in this toxic divisive political climate.  There is no regard any more for doing the right thing.  But if there were, I think it could be done.  

      The GOP will destroy anything they can't own.

      by AnnieR on Fri Sep 02, 2011 at 09:23:38 AM PDT

      [ Parent ]

      •  But there's little Congress can do at this point (2+ / 0-)
        Recommended by:
        AnnieR, Cliss

        There was always a modicum of what I hesitate to call patriotism in Congress and in Washington. I think that is no longer the case. I think the country will gradually dissolve into smaller actual and virtual components. I see not possibility for any positive change. Obama, so far, has been unable to lead--and I don't think he has the power to lead or do much of anything other than keep things from falling apart too fast--if he can do that then I would consider him a successful President.

  •  Reluctance? (1+ / 0-)
    Recommended by:
    Cliss

    Why on earth would he enrage his current and future employers!

  •  It sounds like you believe Pres Obama is the (3+ / 0-)
    Recommended by:
    Ray Pensador, Churchill, Cliss

    smartest guy in the room. I don't feel that way. To me, it looks as though Pres Obama is totally clueless, totally unaware that he is being bamboozled by a group of shysters who all went to the same schools, who all belong to the same clubs, who all vacation together.

  •  Not fixable (7+ / 0-)

    What some banks are beginning to realize is that my neighborhood is an omen.  What has been a stable street for the last 30 years now has kicked out the homeowners mostly due to underwater prices.  They are now renters and vagabonds wandering like the Okies of the Great Depression looking for communities that are still viable.  The home-ownership idea is repulsive to them unless the system is retooled and provides some sense of stability and honesty.  The walk-aways from the underwater areas are enough to sink the remains of the banks.  Many of the banksters are long gone from Wall Street or any of the centers of looting like CEO's, Military-Industrial Complex.  They have self-protected and are untouchable by any "justice" system.  Instability produces revolts like the Middle East and may in the end lead to war.  Dangerous times we are living in.  My sons are trying to lead their families through mazes of destruction while keeping their children safe and pretending they are not on the edge of disaster.  

  •  And, if he's so damn smart (1+ / 0-)
    Recommended by:
    justintime

    and the situation was so damn dire and fragile. The why the fuck isn't he pushing with all his might to regulate and reform and get Glass-Steagall back in place pronto??

    •  Simply put, the GOP's #1 goal is to get him (4+ / 0-)
      Recommended by:
      DianeNYS, Ray Pensador, Churchill, Cliss

      out of the White House, and they'll destroy this entire country to achieve it.  Our politicians no longer believe in doing what's best for the country, it's just about winning.  And most of us aren't even paying attention closely enough to  notice.

      The GOP will destroy anything they can't own.

      by AnnieR on Fri Sep 02, 2011 at 09:26:43 AM PDT

      [ Parent ]

      •  agreed (2+ / 0-)
        Recommended by:
        AnnieR, Cliss

        But I'd go as far as to say they no longer cares who site in the WH as they, Boehner and McConnell et al govern just fine one way or the other.

        But still, it would make me feel better that while Obama is still in the WH for the next 16 months that he at least pretend to do something.

  •  I Think the Answer's Much Simpler (5+ / 0-)

    Fear.

    The WH knows just how fragile a state our economy's in.

    To open investigations into bank fraud will shake marketplace confidence sufficiently to bring it to its knees.  A credit crunch worse than what we saw immediately post-2008 would occur.

    Why the reluctance?  Because the extending network of fraud isn't restricted to American banks; it runs well into European banks as well, who heavily invested in American home mortgage debt paper products.  And we have no knowledge of how extensive is the morass of bad debt there and how under-capitalized their banks are.

    The American economy may be fragile, but the European economy is teetering on the brink.  Such an investigation on top of Europe's inability to make Greece, Spain, Portugal, Ireland, and Italy (and Iceland) solvent with capitalized functioning financial institutions has even greater potential to rock Europe's marketplace -- even cause a true worldwide depression.

    Everyone in government, finance, and markets has pretty much decided to look away and simply pray that the market works its way out of the morass naturally.  Whatever that means.

    Readers & Book Lovers Pull up a chair! You're never too old to be a Meta Groupie

    by Limelite on Fri Sep 02, 2011 at 09:18:11 AM PDT

  •  There was a point, right after Obama won, (4+ / 0-)
    Recommended by:
    justintime, Ray Pensador, vets74, Cliss

    when the news was covering him and Bush at the White House, where I wondered if he thought "Oh God, why did I want this job."  It made me wonder if he was learning things that he didn't want to know.  Ok, I sound crazy, sure, but it really struck me hard, and has stuck with me.  He looked grim.

    The GOP will destroy anything they can't own.

    by AnnieR on Fri Sep 02, 2011 at 09:20:17 AM PDT

  •  The banks are deliberately not lending (2+ / 0-)
    Recommended by:
    Ray Pensador, Cliss

    in order to tank the economy and complete their takeover of our government, not because of any severe strucutural problems.

    If we thwart them by electing a progressive Congress and keeping Obama in the WH, one of them will break and begin ledning again to stem the tide of losses. And all we need is one crack in the dam...

    "The future of man is not one billion of us fighting over limited resources on a soon-to-be dead planet. . .I won't go back into the cave for anyone."

    by Whimsical on Fri Sep 02, 2011 at 09:25:50 AM PDT

  •  Perry says that Social Security (2+ / 0-)
    Recommended by:
    vets74, Cliss

    is a Ponzi scheme.  I don't think the establishment likes him saying that because, in truth, it's just one short step from a much deeper, more ominous truth:  the whole World financial system is a Ponzi scheme.  They really don't know where this is going or where it's going to end up.  If you are Obama, would you rather have Goldman Sachs in your meetings or not?  And is that smart?

    Help new teachers to grow and love their work at www.newteachernetwork.net

    by Mi Corazon on Fri Sep 02, 2011 at 09:53:56 AM PDT

  •  FIRE and the (3+ / 0-)
    Recommended by:
    vets74, Ray Pensador, Cliss

    global economy are zombies. Krugman said they were from the onset. I just don't believe that their demise would be apocalyptic. There are and were other solutions like nationalizing the banks or busting some trusts or regulation.  The world as we find it is one we have created and none of this is inevitable.  The main problem with this administration is that they are true believers in this giant failed Ponzi scheme. They place it's preservation above everything that we the people globally need and even our planet. It is not democratic it's insane and ass backward. They are too big not to fail and they should fail. the president is supposed to deal with national interests. This new world order of financial piracy is not in our or any society/ nations interests. It's just another scourge which has turned it eyes on the world and demands we feed it. Let it fall let it fail. People are resilient they can survive and prosper without the giant squid on humanities face.      

    •  That's silliness. (0+ / 0-)

      Every single part of it.

      Please, google [ Nicole Gelinas ] and budget a couple months reading time to get yourself back on an even keel.

      And getting even with Goldman, Sachs has to be on the Federal agenda... somewhere. Those bastards set up their own foreign policy, plus making the EU banking situation close to untenable.

      Angry White Males + Crooks + Personality Disorder psychos + KKKwannabes + "Unborn Child" church folk =EQ= The Republicans

      by vets74 on Fri Sep 02, 2011 at 11:41:01 AM PDT

      [ Parent ]

      •  I suggest you read (1+ / 0-)
        Recommended by:
        Cliss

        the Shock Doctrine by Noami Klein. Silliness my ass. Getting even isn't what I'm talking about it's getting rid of this failed disaster virulent brand of capitalism that bills itself as inevitable and offers nothing to any society globally.  

  •  The solution is much bigger than this WH (2+ / 0-)
    Recommended by:
    Ray Pensador, Cliss

    is capable of.  Quite simply, the entire system is broken beyond repair.  The solution is to re-make it, not to try and patch-up and pretend its OK.  This would mean trust-busting / forced break-up / re-regulation at a minimum.  

    The 60 trillion (or whatever the hell-zillion) in derivatives should be erased from the balance sheets (mark to market).  They are castles built of sand anyway, so this would only be recognizing reality.  If that pulls the system down completely, then force all bondholders  to take massive haircuts and the shareholders - well, too bad.  

    The government has the power to print and spend as much money as is necessary for the system to run.  The key is CONFIDENCE, transparency and justice.  If the existing banking system is rotten to the core, nationalize it and reboot from under government control with full transparency.  Chase the money-changes out of the temple!  

    There is no limit to the size of the national debt IF THERE IS ZERO INTEREST to be paid as the government created that money itself!  The only limit is to make sure the amount of money created is just enough to support real economic activity and no more, or else hyperinflation will result.  

    I believe that private banks shouldn't be in control of the money supply anyway via fractional reserve credit system.  Basic commercial banking functions should be regarded as a public utility for the economy, much like heat, light, water, roads, sewers, etc.  Higher risk investment banking functions could still be in private hands, but with much stiffer regulation.

    Longer-term, the financial system needs to be reformed to function in a new economic order, one constrained by shrinking oil supplies and other raw material and energy limits.  We cannot maintain a system predicated on endless growth needed to support high rates of return on capital.  It will be IMPOSSIBLE to endlessly satisfy the greed of the rentier-class on Wall St. in a non-growth economy forced by physical limits.  

    A new economic model will be incompatible with the precepts of finance capitalism.  If the economy can't grow, then the compounding returns demanded by finance capital will steal bigger and bigger slices from a pie of fixed size.  I believe this is what has been happening for much of the past decade.  This can only go on for so long before the masses become so indebted and impoverished that violent revolution becomes a real possibility.

    Massive structural reform MUST happen for all these reasons.  But, I don't think this president has the guts to take this to the people and grab congress by the throat to make it happen.  It is too big.  It would be too revolutionary.  It would simply upset too many billionaires and other leeches accustomed to making money for nothing via speculation, and financial manipulation including fraud.  

    The intrinsic nature of Power is such that those who seek it most are least qualified to wield it.

    by mojo workin on Fri Sep 02, 2011 at 10:08:35 AM PDT

  •  Maybe this is all just the Adjustment Bureau (1+ / 0-)
    Recommended by:
    nicethugbert

    tweaking the plan, just like they did when Obama was accidently born in Kenya so they had to quick put in a birth announcement into the Hawaiian papers and make a birth certificate and prevent him from marrying his Indonesian first love?  

    (this is snark for you purists, I am not a birther --I just watched the movie last night and loved it)

  •  Nationalize the banks... (4+ / 0-)

    the ones that got us into this mess. Should have happened from the beginning. But I have to say, the excuses for how this has been handled are getting quite creative.

  •  Great diary. Thanks for taking the time (1+ / 0-)
    Recommended by:
    Ray Pensador

    to post.

    Who knows how all this is going to shake out. But what I do believe is that nothing this big could take place without the full knowledge and compliance of every branch of business involved in the this ever-growing scandal; every department, every executive and employee made this happen, and continue on.  They all knew.

    When everybody talkin' all at once no one can hear the wise one speak, So just be still and silence will provide the wisdom that you seek - by Tori del Allen

    by Dumas EagerSeton on Fri Sep 02, 2011 at 10:58:03 AM PDT

  •  Obama is leading the country? This is leadership? (1+ / 0-)
    Recommended by:
    Cliss

    wow, I thought I knew what leadership was, but I guess I was wrong.  Leadership, Obama should give lessons SNARK

    80 % of success is JUST SHOWING UP ! Obama Presidency: The Amazing O-Man meets Waiting for Godot

    by Churchill on Fri Sep 02, 2011 at 10:58:38 AM PDT

  •  Yet another lone unwarranted HR (2+ / 0-)
    Recommended by:
    Ray Pensador, vets74
    Hidden by:Shockwave

    I doubt it was intentional, not by this member, and not without an explanation.

    Is it that hard to see/hit the rec button with the new tip jar yo[ kst?

    "Liberty without virtue would be no blessing to us" - Benjamin Rush, 1777

    by kovie on Fri Sep 02, 2011 at 11:01:12 AM PDT

  •  freaking trolls hring (1+ / 0-)
    Recommended by:
    Ray Pensador

    such an awesome diary.

    http://punkitechs.blogspot.com/ (Punk, Technology, politics-my blog)

    by greenpunx on Fri Sep 02, 2011 at 11:02:24 AM PDT

  •  Yes... (2+ / 0-)
    Recommended by:
    Ray Pensador, Cliss

    But he still had a choice.  The path he chose serves the rich and screw the middle class.  In Iceland, they chose to have none of that and re-created their government.  There are legal remedies for exactly this situation.  The banks can be nationalized and then audited by the government.  For some reason, whether it be the threat of more panic or a fundamental belief the problem wasn't that bad, Obama chose not to do that.

    The 'Free Market' will decide. It will decide that the United States cannot consume 25% of the world's resources and the upper 1% cannot control 50% of the wealth.

    by RichM on Fri Sep 02, 2011 at 11:03:35 AM PDT

    •  They did what in Iceland? (0+ / 0-)

      You realize that most of the Banksters who did this are not only still free, but still treated like guests of honor?  For example, Björgólfsson Þór still has what amounts to a diplomatic passport.  And did you forget that the "recreated government" (are you referring to the election?) is who organized the failed referendums on negotiated settlements for the Icesave dispute?  That it is the Icelandic middle class who's paying for all this due to austerity measures and the collapse of the króna?

      Really, what exactly sort of comparison are you trying to make with Iceland?

  •  Funny how the gods of anti-goverment/business-does (2+ / 0-)
    Recommended by:
    vets74, Cliss

    -it-better can't "live" without government to tend to their mumified remains.

    P.S.  90% of all businesses die within a few years of getting started.

    P.P.S  The U.S.A. is over two hundred years old.  Older than any business.

  •  Also, let's remember that the wealth (1+ / 0-)
    Recommended by:
    Ray Pensador

    that underlies our economic system--i.e. assets--are still in place and largely undestroyed. They're just been reduced in value, while the currency that represented their temporarily inflated values has been shifted elsewhere.

    That's basically what the real estate bubble was:

    1 - Real estate values vastly inflated

    2 - Speculation taking place on those vastly inflated values that shifted the money represented by their inflated excess values to manipulative speculators via CDO's and other esoteric derivatives

    3 - Real estate values plunging suddenly, leaving the now undervalued assets in the hands of suckers, and the money that was represented by their excess vastly inflated value in the hands of these speculators

    It was as if I offered to buy your car, worth $5000, for $8000. Not being one to turn down a good deal, you sold it to me, for $8000. To raise this $8000, I got some sucker to believe that it was actually worth $10,000 (or else why would I pay $8000 for it--what a steal!) and lend me the $8000, and for another $2000 let him have the car. Now he was either out $5000, or in seach of an even bigger sucker. At a certain point, we ran out of bigger suckers.

    One of the main questions to me is, where did all the money that was represented by all that excess inflated value come from, that was used to finance (even if only on paper, with little actually money changing hands) these inflated value deals? Was it real money that some people are now out of? Was it new money that the Federal Reserve and other government banks throughout the world simply created out of thin air, either during or after the bubble? Or was it all fake, a bunch of numbers in what was basically a very spreadsheet that didn't actually exist (and which the Fed can now issue to cover, and is perhaps already doing)?

    Seems to me that the eventual outcome of all this is either the financial collapse of some supposedly very rich people, banks, firms and governments, or massive inflation resulting from the printing of money to cover these positions. Or both.

    And Obama, understandably, wants neither, and is trying to push the eventual inevitable reckoning beyond the '12 elections.

    "Liberty without virtue would be no blessing to us" - Benjamin Rush, 1777

    by kovie on Fri Sep 02, 2011 at 11:21:22 AM PDT

  •  Obama has an army and a national guard. (1+ / 0-)
    Recommended by:
    Ray Pensador

    He could shut down the markets and arrest the banksters.

    The two things Teabaggers hate most are: being called racists; and black people.

    "It takes balls to execute an innocent man." -- anonymous GOP focus group member on Rick Perry

    by Punditus Maximus on Fri Sep 02, 2011 at 11:27:38 AM PDT

  •  I compare it to a poker game (1+ / 0-)
    Recommended by:
    Cliss

    all the players (banks) hold so many IOU's that they can't pay, that they have to stay in the game with the slim hope they can win that last hand.  There are no winners in this game and they all need to just walk away.  That is what the word Jubilee means.

    Loyalty to petrified opinion never yet broke a chain or freed a human soul in this world--and never will. Mark Twain

    by whoknu on Fri Sep 02, 2011 at 11:31:29 AM PDT

  •  You're actually not that far off (2+ / 0-)
    Recommended by:
    Ray Pensador, Cliss

    1. So many major financial institutions have become "too big to fail" that it will take a long time to cut them down to size.

    2. Even without that to consider, there may be a limit to what we can legally do--and these outfits have the resources to tie up even the most airtight legislation in court for years.

  •  Counter explanation ::: Retirement Trusts. (2+ / 0-)
    Recommended by:
    Ray Pensador, Cliss

    Far too many of the bogus mortgage-based-asset bonds were sold to retirement trusts. That's why the rating agencies were bribed to expand "AAA" from 2,500 equities to over 4,000 equities.

    Yes, bribes were paid.

    If Obama pursues criminal actions against the perpetrators of the underlying crimes -- federal jurisdiction crimes, not the local fraud and forgery crimes -- then these MBA bonds might fall to near-zero value.

    Protect retirees.

    You never hear that in the whining contests that pass for comments on the Internet.

    But that's what is at stake. Retirement funds are predicated on orderly markets, seeing MBA bonds valued to actual mortgage payment streams, and not much else.

    The 2003-2008 Big Bubble II event was evil in dozens of ways. Trashing retirement assets in 401(K) accounts and corporate retirement trusts went among the worst of it.

    And btw: the banks that own MBA bonds are far less likely to be bankrupted than a retirement trust is to fail to meet expected retirement payments.

    Banks owning/managing_accounts_with these bonds ARE NOT the perpetrators who did fraud and forgery to generate the Big Bubble fakery bonds in the first place.

    Angry White Males + Crooks + Personality Disorder psychos + KKKwannabes + "Unborn Child" church folk =EQ= The Republicans

    by vets74 on Fri Sep 02, 2011 at 11:36:06 AM PDT

  •  great diary, RP (1+ / 0-)
    Recommended by:
    Ray Pensador

    I believe the system folded back in October of 2008.  It has not recovered.

    The only thing keeping the economic system going is the belief in the system.  Otherwise it's really - written off to bad debt.

    We've already entered a new era; I'm just not sure what it is.  And I'm also not sure how this is going to play itself out.  

    I also believe we should be looking ahead - focusing more on our families & communities because I believe that's where our future lies.  With each other.  We're much tougher and more resilient than we give ourselves credit for.  

  •  I feared As Much. (2+ / 0-)
    Recommended by:
    Ray Pensador, Cliss

    A lot of times, I get hammerd for pointing out that the economy is basically imaginary and meaningless unless we all give it meaning...

    Maybe its time we stopped that. I dont think its giong to get any better. Maybe its time we look for a society that doesnt depend on an ever increasing value to stay afloat.

    How would we do such a thing? I would deem all money/currency worthless, but that would cause so many problems. For instance, Im pretty sure the only reason China and the US wont go to war is it would immediatly cripple both economies, as we are each others biggest trading partner, making war impossible the instant it broke out. (both economies would become effectively meaningless.)

    There has to be a solution. Im just afraid that like with climate change, it may be more than any of us are willing to do. It may be scary and inevitably would result in rapid worldwide change.

    Maybe for the better. Maybe not. Thats the horrible thing about it: We have no way of knowing. All these economic situations were not set up for a world with 7 billion people. We're just making it up as we go along it feels like.

    It felt like rather a long time, but then long times get longer when you're standing around thinking about them. A curious thing, that. Long roads get longer too, if you're thinking about them, but what about long words? They don't change nearly as much

    by kamrom on Fri Sep 02, 2011 at 01:12:29 PM PDT

  •  sooner rather than later this will happen, (1+ / 0-)
    Recommended by:
    Ray Pensador
    "and the banking system should have been nationalized."

    and it won't be too soon....

    Please do not tell me you are involved by being a member of DK4....really get involved...... http://october2011.org/frontpage.....The goal is not to bring your adversaries to their knees but to their senses. -- Mahatma Gandhi

    by Mindmover on Fri Sep 02, 2011 at 09:47:17 PM PDT

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