Big Banks Go Bust Print

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Big Banks Go Bust: America’s Financial System in Crisis

The Nation and Campaign for America’s Future. Posted September 16, 2008.

Authors Bill Greider and Dean Baker argue that the latest Wall Street woes expose the finance industry’s deep need for reform.

Below are two key articles for understanding the current financial crisis:

William Greider: "Creative Destruction"

The Nation

Dean Baker: "Time to Reform Wall Street"

Campaign for America’s Future.

Creative Destruction

The epic deflation of Wall Street rolls forward like a blood-spattered steamroller, claiming more important victims. It takes down noble old names like Merrill and Lehman Brothers, destroys the savings of large pension funds and mom-and-pop investors, throws tens of thousands of financial workers out of jobs.

But let’s not dwell on the downside. This is the process Joseph A. Schumpeter famously described as "creative destruction" -- capitalism’s way of clearing away debris from the past so that new flowers may bloom. In this drama, what is being swept away is the monumental arrogance of celebrated financiers, also the fraudulent gimmicks that created lots of new billionaires by selling bad paper to the world’s investors. A great bubble of wealth grew in the canyons of Wall Street -- a run-up of falsified financial assets that lasted for roughly twenty-five years. Now the air is rushing out of that balloon with no way to stop it.

In the long run, the destruction of concentrated wealth and power is always good for democracy, liberating people from the heavy hand of the status quo. Unfortunately, many innocents are slaughtered in the process. As the US manufacturing economy was dismantled by downsizing and globalization, the learned ones (Alan Greenspan comes to mind) told everyone to breathe easy -- ultimately this would be good for the workers and communities who lost the foundations of their prosperity. Now that "creative destruction" is visiting the bankers, we now observe they are not so accepting of their own fate.

The destruction of Wall Street’s girth and power is unavoidable, in any case. To switch metaphors, Humpty Dumpty fell off the wall and not even the king’s horses in Washington can put him back together again. It would have been far better if the federal government and national politics had recognized the great deceptions of Wall Street and put a stop to them before catastrophe unfolded. Since that didn’t happen, we are all now doomed to take a perilous ride -- the economy, the country, the world -- and hope for the best.

However, we can look forward to the new order that emerges from the wreckage. The financial wizards who have dominated politics and economic orthodoxy for a generation are unmasked, their delusions failed. We have an opportunity to think anew, at least to hope that governing elites in both political parties will finally come to their senses or, better yet, get out of the way.

Last weekend’s events come down to this: The authorities in Washington and Wall Street finally admitted what they persistently brushed aside during this year of turmoil and government bailouts. The Federal Reserve and Treasury treated the financial system’s problem as "psychological" and assumed they could manipulate investor confidence by pumping lots of public money into the embattled financial firms and banks. Financial markets are gripped by desperate psychology -- fearful people fleeing from the consequences of their own reckless behavior -- but the core of this crisis is real and will not yield to happy talk from the authorities.

The long-running inflation of financial values and phony accounting allowed by deregulation created an unworldly sense of new wealth. It was essentially false and is now gradually receding, coming back down to something resembling honest valuations.

As a result, the financial system has lost as much as $1 trillion in capital, maybe twice that much. Wall Street will not truly recover until it has replenished that capital -- most unlikely, given the worldwide skepticism of investors. Or it may grow smaller -- shrinking balance sheets and employment, resulting in fewer firms and less economic influence over the rest of us. When the blood dries, people will be able to see this is good news for the republic -- a chance to rebalance our society and politics -- but the road ahead is going to be rough and uncertain.

Last weekend, the Fed and Treasury Secretary took a modest step toward acknowledging the truth. They implicitly admitted that their rescues have failed. If the government continued its psychological approach, bailing out the big boys one by one, the public’s assets and public patience would soon be exhausted. Now we shall see whether financial markets worldwide can endure the stern doctrine of "creative destruction" that was so confidently imposed on others.

Big Banks Go Bust: Time to Reform Wall Street

With the demise of Fannie Mae, Freddie Mac, IndyMac, Bear Stearns and now Lehman Brothers, we’ve been treated to the failure of more major financial firms than during any year since the Great Depression. The sight of rich bankers getting the boot might be lots of fun if it were just a spectator sport. Unfortunately, we are in the game with these clowns.

As a result of their incompetence, irresponsibility and greed, the housing bubble was allowed to grow to dangerous proportions. Its collapse threw the economy into recession, putting millions of people out of work and lowering the wages of those who still have their jobs. The plunge in house prices has destroyed much of the life savings for tens of millions of people nearing retirement.

Meanwhile, the bankers who messed up and destroyed the companies who hired them are still multimillionaires. Most of them are still in their old jobs getting multimillion-dollar pay packages. This is a sector that badly cries out for reform and there is no better time than now to put it into place.

The first target for reform should be the outrageous salaries drawn by the top executives at financial firms. The crew that lost tens of billions at Citigroup, Merrill Lynch and the rest have received tens of millions, possibly even hundreds of millions, in compensation for their "work" over the last few years.

There is a general problem in corporate America of stockholders being unable to effectively organize to rein in top management. This problem is most serious in the financial industry.

Thankfully, the credit crisis gives us the tools we need to rein in executive pay. Currently, the major surviving investment banks (e.g. Merrill Lynch, Morgan Stanley, Goldman Sachs) are operating on life support. They are drawing money at below market interest rates from the Federal Reserve Board’s discount window. This privilege (for which they pay nothing) can easily be worth billions of dollars a year.

These banks are also operating with an explicit guarantee from Fed Chairman Ben Bernanke to their creditors that he will honor their loans in the event that an investment bank, like Bear Stearns, goes belly up. This guarantee is enormously valuable. Investors who make loans to Merrill Lynch or Morgan Stanley don’t have to worry about the health of these companies because Bernanke has said that, if necessary, he will use public money to pay them back.

While we don’t want a chain reaction of banking collapses on Wall Street, the public should get something in exchange for Bernanke’s generosity. Specifically, he can demand a cap on executive compensation (all compensation) of $2 million a year, in exchange for getting bailed out. For any bank that is not on board, Bernanke could make an explicit promise to their creditors -- if the bank goes under, you will get zero from the Fed.

This can be an effective way to restore sanity to the salaries paid on Wall Street. And, this can be a good example for setting executive pay more generally. Any time a company comes to the public for a handout, like tax breaks for oil companies or low-interest loans for auto companies, the $2 million cap on all compensation goes into effect.

This is important directly because much of the country’s wealth has been steered into these folks’ pockets, but also because the outrageous compensation packages on Wall Street distorted pay structures throughout the economy. Presidents of universities often get over $1 million a year, and even top executives at private charities can often earn near $1 million a year. These salaries seem low when compared to their counterparts in the corporate world, but they are outrageous when compared to the pay checks of typical workers.

Of course we must go further in fixing the financial sector -- most importantly by downsizing it. The financial sector accounted for more than 30 percent of corporate profits in 2004. Back in the 1950s and 1960s, the country’s period of most rapid growth, the financial sector accounted for less than 10 percent of corporate profit.

The financial sector performs an incredibly important function in allocating savings to those who want to invest in businesses, buy homes, or borrow money for other purposes. But shuffling money is not an end in itself. The explosion of the financial sector over the last three decades has led to a proliferation of complex financial instruments, many of which are not even understood by the companies who sell them, as we have painfully discovered.

The best way to bring the sector into line is with a modest financial transactions tax. Such taxes have long existed in other countries. For example, the United Kingdom charges a tax of 0.25 percent on the purchase or sale of share of stock. This is not a big deal to someone who holds their shares for ten years, but it could be a considerable cost for the folks who buy stocks in the morning that they sell in the afternoon.

Comparable taxes on the transfer of all financial instruments (e.g. options, futures, credit default swaps, etc.) could go a long way in reducing speculation and the volume of trading in financial markets. Such a tax could also raise an enormous amount of money -- easily more than $100 billion a year. This would go a long way toward funding national health care insurance or a major green infrastructure project.

And, this tax would be hugely progressive. Middle-income shareholders might take a small hit; but it would be comparable to raising the capital gains tax rate back to 20 percent, where it was before it was cut to 15 percent in 2003. The real hit would be on the big speculators and the Wall Street boys, the folks who gave us the housing crisis. Given what the Wall Street crew has done for us, this is change that we can believe in.

William Greider is The Nation magazine’s National affairs correspondent. He is the author of, most recently, The Soul of Capitalism (Simon & Schuster).

Dean Baker is co-director of the Center for Economic and Policy Research.

Corporate Accountability and WorkPlace

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Expletive deleted, expletive deleted, expletive deleted...

Posted by: VetAgainst McCain on Sep 16, 2008 1:13 AM

That’s what I think of the (expletive deleted) Wall Street Greed Machine.

Vet against McCain

To find out why, click on the links below:

Songbird McCain (Popular anti-McCain Web site)

American View (My favorite anti-GOP Web site

Vietnam Veterans Against McCain (self-explanatory)

Vote Vets (supported by 100,000 Iraq and Afghan war vets)

» RE: xpletive deleted, expletive deleted, expletive deleted... Posted by: symcokid

Sorry, this comment has been removed from the system. » RE: xpletive deleted, expletive deleted, expletive deleted... Posted by: Spot

» That’s why I started my Depression garden, Spot! Posted by: VetAgainst McCain

FASCIST CRASH 101

Posted by: Mister_PsyOps on Sep 16, 2008 2:11 AM

Greider and other status quo apologists for the illegal bank monopoly that is the "Federal Reserve" Corp (not federal, zero reserves) run by private oligarchs should not have a public megaphone to speak on such issues. As I’ve said before, the "Fed" system is a private Fascist bank that prints money out of thin air by and for corporate criminal freeloaders.

In other words: an propaganda based extortion racket.

This is about a parasite ruling class run through organized corporate crime that has produced serial crashes before and will continue to do so until the bedrock framework of the system itself is overhauled. Something that beltway charlatans are hired to do virtually anything to prevent.

(The authors here recommend a faux band-aid "modest financial transactions tax" that will accomplish nothing).

Crooked ruling class "owners" that late, great, George Carlin lampooned will continue with their massive Ponzi scheme until it falls to pieces. As soon as it does, this vampire-class of Fascist "owners" will pick up those pieces and devise another Orwellian fraud just as vicious under a new innocent sounding name by way of corporate poodle play-actors such as Obama or McCain.

They’ll call it something like the "HOMELAND BANK ACT" or perhaps even something like "The MOM & APPLE PIE ACT". Whatever the label is, you can be sure it will be more of the same starring the corporate monopoly jackals that created the blood money mess we face now.

The American public will be sold the new program by an utterly cooked Washington-MSM axis. We will be told that trusting Fascists that created the debacle is the only option we’ve got. Sadly, Americans will believe it like they’ve believed most of the thousand plus lies since before 9/11 coverup and its genocide "war on terror" travesty.

I sincerely hope I’m wrong but if history is any guide, God help us.

» RE: FASCIST CRASH 101 Posted by: using

» Loser nation Posted by: LMNOP

» Right on, but God isn’t helping anyone! Posted by: common intelligence

» RE: FASCIST CRASH 101 Posted by: cdub

» RE: FASCIST CRASH 101 Posted by: sirios

» RE: FASCIST CRASH 101 Posted by: cwilsondrum

I have another idea... Posted by: Spot on Sep 16, 2008 2:19 AM

Wow, I must say I’m impressed to see an actual proposal of policy.

I’ve been telling everyone who will listen for months that this is a lot deeper than the tv will tell you. Monday, over lunch, I was watching analysts on CNBC work themselves up over the idea that Paulson’s inaction today would rally the market. The Dow later fell an additional 250 points, a total of over 500 points worth of red ink for the day.

Unfortunately for both credentialed press and ordinary citizens, no amount of wishful thinking will extract us from the situation. Neither will executive salary caps, nor will a ring-fence around the problem, as Mike Whitney suggests may happen.

So I would offer this alternative to The Nation and Campaign for America’s Future’s plan: Let the financial system fail. The government has no business bailing out corporations which invent and abuse "financial instruments" that are beyond the scope of the law. It is not the business of the government to insure the value of stockholders’ portfolios, whether the stockholder is named "John Doe" or "Central Bank of the People’s Democratic Republic of China"

If we are to allow, under law, the unfettered exploitation of the working class by capital and the oligarchs who wield it, we must also allow the failure of their plans to be complete and irretrievable.

Every day, we hear that the poor need to take on more responsibility. Here is an ideal opportunity for the rest of us to let the wealthy try that idea on themselves.

» RE: I have another idea... Posted by: Knot_Rich

» RE: I have another idea... Posted by: Spot

DIRECT LINK BETWEEN THE STUPID IRAQ DECISION AND THE CURRENT ECONOMIC MELTDOWN. REPUBLICANS.

Posted by: David Baker on Sep 16, 2008 4:14 AM

George Bush made the biggest blunder of the century in going after Iraq immediately after the 9/11. The Republicans all followed him. The Republicans and the Media bullied the Democrats into following.

This stupid decision was immediately opposed by billions of people around the world who were also bullied in various ways by their various governments. People in cities all over the world, in their hundreds of thousands - massed against it. Including Alternet to its eternal credit. Including Obama. Against his party. Against the Republicans. (The Republicans are trying to make you forget this).

And now these very same people who stupidly went along with Bush’s monumentally stupid decision, which is only the top of the mountain, these stupid stupid people, who made such a bad decision, which even Bill O’Reilly agrees on tape with Obama was a bad bad decision (and isn’t Bill running half-heartedly for the Republicans as well he should) which was opposed by Obama.

Obama was right. Republicans were wrong. In the biggest decision of the 2000-2008 Republican administration. Face it all of you: a decision which can be directly attributed to the current economic melt-down. No one in your media is discussing the elephant in the room because the Republicans are supposed to be given even time. Your democracy is failing you.

Conservatively there are probably about 3,000 Republicans who should be in JAIL right now.

Anyone considering voting Republican should be ashamed of themselves. Utterly ashamed. THEY got you into a stupid war on false pretexts, and Republicans have RUINED YOUR ECONOMY. The war and the economic meltdown are connected.

They do not have a secret plan. They are just incredibly greedy.

You have a lot of smart people on the liberal side and very very few of the smart people who should not be in jail are in the Republican party.

You can fix up this mess. But ONLY by voting for Obama. Obama can be elected by SHAMING the Republicans. Republicans have created a absolute fiasco. Abetted by the media. Shame on them. Shame on McCain. Shame on Palin. Shame on Bush. Shame Shame Shame.

Keep Saying it. Shame McCain. Shame McCain.

When is the US gonna face it. You lost the war on terror the moment you declared it. The US has been fighting a mirage for seven years. When is it going to get it?

Republicans endlessly tell you Obama will break everything. Everything is broken people. You need a Community Organiser to fix this mess up.

Shame McCain Shame.

» RE: DIRECT LINK BETWEEN THE STUPID IRAQ DECISION AND THE CURRENT ECONOMIC MELTDOWN. REPUBLICANS. Posted by: VZEQICVA

I hear Obama bringing this up a little but what does he really plan to do about it? Posted by: maxpayne on Sep 16, 2008 5:16 AM

I seriously doubt he’ll do very much especially since he’s a messenger boy for Goldman Sachs. It doesn’t matter if Mccain or Obama is in the White House. Wall $treet wins and Main Street further loses !

votenader.org

» RE: I hear Obama bringing this up a little but what does he really plan to do about it? Posted by: using

» RE: I hear Obama bringing this up a little but what does he really plan to do about it? Posted by: maxpayne

Cooperate To Survive

Posted by: Last Chance on Sep 16, 2008 5:22 AM

The financial markets seem to have turned into a gigantic tumor on the global body. I say cut it out and devolve to local economies based on mutual aid by working farms and gardens for family and community and to hell with the market. Help each continent organize a network of eco villages that practice family planning, trade feely with each other for mutual benefit and carefully surround themselves with miles of healthy wilderness.

Let them fail

Posted by: Cybershaman on Sep 16, 2008 5:52 AM

And let the stockholders sue the idiots who orchestrated this mess for fraud.

Every time I hear talk of all that ’bad paper’ floating around, I can’t help but think of all the people out there who cannot pay their mortgages. THAT is the real story here. Too many Americans whose wages have not kept pace with the cost of living for too many years.

Very few of us have any financial security these days. We’re watching our financial world collapse and our Government is trying to force us to buy all these high definition toys! It’s just one more piece of evidence that our ’representatives’ have no clue as to what is going on out here.

I say let these people who have ’gamed the system’ eat their losses, DO NOT pour taxpayer money into their rat hole. The bigger they are the harder they fall should be fun since we all know this ’economic boom’ has mainly benefitted conservatives.

Shore up whats left of the liberal economic sphere and let it ride out the storm. Let the honest businessperson, who most likely has liberal tendencies, rise once again to dominate our economy and let all these parasites whither on the dead carcass that was ’Reaganomics’.

» RE: Let them fail Posted by: Spot

» RE: Splendid sentiment, Posted by: oregoncharles

» " ’Reaganomic’. Now that’s some scarry shit", -Eddy Murphy Posted by: common intelligence

Payback is a bitch, eh? Posted by: popeurbanxxiii on Sep 16, 2008 6:26 AM

Throughout the run of "Reaganomics", the little guy was always told that it was for the greater good that they lost their jobs, their industries sent packing to Mexico, India, or China. They were told that education was the key to their futures. But what good is a Phd. when the only job you can get is as a barrista at Starbucks (who is now also down-sizing)?

When this hypothetical little guy was knocked down, the cheerleaders for "Market Fundamentalism" said "pick yourself up by your own bootstraps", but now that they themselves are failing and falling, they want the taxpayers to bail them out. I say HELL NO. Go retrain yourself for some USEFUL occupation and shut up!

If we keep bailing out the perps, they have no motivation to change their behavior. They will just cook up the next fraud, er... uh... I mean "financial engineering" scheme.

I hope the Market Fundamentalist faithful have finally re-learned the lesson that Capitalism needs regulation to save it from itself. Regulation is not a dirty word.

» RE: Payback is a bitch, eh? Posted by: andabottleof_rum

» Democrats wrote the laws... Posted by: Romans1

» RE: Democrats went along... Posted by: Cybershaman

» Then Republicans are "spineless" to stop them? Nah ! Posted by: maxpayne

» Romans1, You’re lying. Phil Gramm wrote the laws that eliminated Glass-Steagal. Posted by: yellow

an article with a clear vision

Posted by: using on Sep 16, 2008 7:07 AM

thanks! This article makes good common sense to me. I am not studied in this area but it seems to me that this plan is a good start for changes and control over the financial sector. I do not know how much tweecking such suggestions need to work but I do know it is the first article I read that offers suggestions of how to control our money from moving upwards..and wallah....disappearing at the top.

The question is: How could ideas such as these be implimented? Who has that power? And is there a part we can play to support or force these changes? Forinstance, can thinking people with a plan that makes plain common sense grow a grassroots movement, open to discussion, to support our best interests for change in financial institutions? As a group we would have power of imput.

» RE: an article with a clear vision Posted by: Spot

vote early, vote often

Posted by: sre on Sep 16, 2008 7:53 AM

I see comments on this article about politicians. Obama is perfect, he’ll solve all our problems. Or McCane is perfect for the presidency of this country. He’ll solve all our problems. I don’t think that either of them will be able to solve anything for us. We should just pick one of the homeless folks from the street, you know, those people that push around old shopping carts that contain all their worldly goods, and elect him (or her). They know about the problems first hand. Maybe there’s a solution there.

» SO then Uncle Sam will be pushing a shopping cart? Posted by: Ky Lake Dave

» He’s already "bailing" out the POMPOUS FRAUD Wall $Treet. That’s not a "free" market. Posted by: jwverez

I have stopped watching television and it looks like I also have to stop reading...

Posted by: christianslayer1955 on Sep 16, 2008 8:07 AM

I need to stay away from so called progressive websites such as this one.....The word greed came up only once in this article.....I have a very great suspicion that the author,Greiger,and others like him are paid to write articles such as this one to give the public a false sense of empowerment while protecting the criminals they want us to believe they are criticizing.....Organized crime has taken over our government and only long jail terms will perharps help the situation

» RE: I have stopped watching television and it looks like I also have to stop reading... Posted by: Spot

» RE: I have stopped watching television and it looks like I also have to stop reading... Posted by: Last Chance

Obama has sweetheart mortgage while the rest of us suffer

Posted by: Romans1 on Sep 16, 2008 8:08 AM

» That’s what you get for voting Republican. Posted by: maxpayne

Shouldn’t be a surprise to anyone -----

Posted by: symcokid on Sep 16, 2008 8:12 AM

it’s been coming for years, people can’t make it from week to week and too many families have been living on Credit Cards, buying SUV’s, building McMansions and a big percentage of families don’t even cook anything at home to eat - it’s the old, "let’s go out to eat routine".

At the same time our government can war at will around the world, wars cost mucho money, we can bail out auto companies, banks, mortgage companies and start more wars - this USofA is way out of control so what can we expect, it’s about time we had a depression.

And now, unlimited loans for nuclear!

Posted by: PaulK on Sep 16, 2008 8:18 AM

Unlimited loan guarantees for construction of new atomic reactors.

That’s right, unlimited. As much money-hundreds of billions of dollars--as everyone in the nuclear industry wants, when it wants, for as long as it wants.

This would destroy our ability to effectively address the climate crisis. It’s a disaster for our economy, for our nation, for our planet.

In the middle of a presidential election, they’re trying to rush this through. How do our Senators think they can get away with this?

» RE: & now nuclear! ~ also see Rocky Mountain Institute... Posted by: blurider

Hey...

Posted by: Pirate1 on Sep 16, 2008 8:47 AM

All you former hippies turned into SUV/McMansion yuppies by abandoning the counter culture through the urgings of EST and Lifespring, etal, and joining the mainstream. How do you feel now after investing in the system all this time? Sure was a fun ride for a while for you, I’m sure, but look what your excess has cost the planet and the future generations! It’s all coming down around your heads now. Good work!

» RE: Couldn’t have said it better myself! Posted by: Cybershaman

» RE: Couldn’t have said it better myself! Posted by: Spot

» RE: Hey... Posted by: Ky Lake Dave

» RE: Hey... Posted by: maxpayne

» KY Lake Dave is just an ungrateful bastard sucking off the welfare checks he rails against. Posted by: jwverez

» RE: Hey... Posted by: symcokid

Who bought Fanny Mae bonds?

Posted by: billwald on Sep 16, 2008 9:18 AM

How many of you have Fanny Mae bonds in your retirement portfolio? How many responded to AIG ads?

When Fanny Mae failed and it looked like the Chinese government would get screwed the Republican administration bailed them out "to stabilize the market." When AIG and banks that manage your retirement funds fail, the Republican administration says, "Tough titty."

Why is this addressed as a Surprise? Pyramid schemes are suppose to be against the law. Posted by: common intelligence on Sep 16, 2008 9:27 AM

I’ve been telling everyone for years that this was inevitable. My Father who died in 1993 kept telling me all though his years, "there is NO WAY (referring to the economy) this country can last past the year 2000". Well he was only a few years off! Curious how the Train Wreck in California coincides with the bursting of this pustule boil.

Somehow no one wants to accept the truth that the debt based system run by a private corporation (the Federal Reserve) and insurance Corporate investment cartel to secure people from economic disaster is a pyramid scheme that will and has finally caught up with the roulette wheel of stacked odds.

Now to top off the burial ground headstone comes overwhelming natural disasters from another hurricane season. The Fed simply can not repair this Bush Titanic.

Now that the Chinese, Japanese, South Koreans, Belgium, Germans, and of course Saudi Arabia are holding United States Bonds in Multi Trillions of dollars, because Bush had to have his war, The United States is screwed. The bastard Republicans in the "loop" have never had any in tension of paying off the debt or capabilities to do so. The "tax payers", currently living and for generations to come, can not possible carry the load of debt.

You see holding the Government accountable for allowing this all to transpire goes back at least as far as 1913. And all those bastards that lead us down this path are dead and gone.

Now don’t let the Bastards off this time around. They are not the answer to the problems. They are the cause.

I told everyone in blogs and on the street. But somehow everyone put their faith in the "System" and wouldn’t listen or accept sound reason. People wouldn’t listen to Ron Paul either who’s been working diligently to show the way out. Hundreds of wise ones not in the "loop" of power have been trying to teach and show the path. But most everyone stupid ass moron driven by personal gain, while having nothing really to offer the country but pie in the sky double talk, have made this all happen.

SO I say let all these compliant, brown nose, kiss ass, lolly gagers, keep buying the lies, the manipulation of the snake oil merchants.

That whole line of shit from the Fed as this being a "cycle" of boom and bust......Well it didn’t have to be unless it was planned to be.

The fact of the matter is all these bastards holding the reins of world economic control have known that the policies allowed to evolve to this point are guilty of mismanagement, but more likely by default, intentionally driving this train wreck head-on (" Just apply it to your forehead") into a crater the world has yet to realize.

There is going to be hell to pay. I have no pitty for those that wouldn’t pay attention and just continued with their psasive, "Same ol’, same ol’ " attitudes, going through their daily little jobs, without screaming out daily.

If you don’t educate yourself, shame on you. Because if you don’t, DON’T expect to get the truth out of the system. They’ve been lying all along this path to hell.

Facing the truth is your only freedom. Now start taking some of these bastard Repuks in Washington out! and start loving your neighbors and friends. Educate them!

» RE: Why is this addressed as a Surprise? Pyramid schemes are suppose to be against the law. Posted by: Spot

Restitution

Posted by: Ignatz deFyre on Sep 16, 2008 9:49 AM

The individuals who were in positions of authority and responsibility at these failed firms and who collected fat bonuses and stock options over the years should be obliged to re-pay. This is conspiracy masquerading as business. RICO the pricks. Their homes, boats, cottages, investments, everything. Back into government coffers for re-distribution back to the aggrieved. Those who regulate them, and who approve the regulations should be included. Maybe a few arms should be cut off.

In medieval times, the peasants would burn their mansions down, tar and feather them and drive them out of the village. It’s a shame to have lost some of these old traditions.

approaching complete collapse

Posted by: wagnerrocks@gmail.com on Sep 16, 2008 10:07 AM

That old bastard Regan and his advisors and corporate bosses started this downslide. The Bush crime family and their corporate buttbuddies turned the country into a fantasy world where giving more to the "Rich" means it will trickle down to us peons through righteous investment in the future of the American people. Can this country recover from these years of lies and deception? It’s doubtful but not impossible, in my opinion. Voting Obama into office is the place to start. He will bring a new and much needed intelligence to the office, and although all that needs to be achieved may not be achieved immediately, it will be a new beggining for the average citizen. Obama represents hope...McCain represents more of the same shit that has brought us to the brink of third world membership.

Obama’s advisors made millions...

Posted by: Romans1 on Sep 16, 2008 10:31 AM

...off of those failed financial institutions. So let’s start the investigation.

» So did Mccain. Quit complaining asshole. Posted by: jwverez

» RE: So did Mccain. Quit complaining asshole. Posted by: Romans1

» RE: So did Mccain. Quit complaining asshole. Posted by: maxpayne

USA is bankrupt

Posted by: stev90 on Sep 16, 2008 11:47 AM

It should be apparent by now that the US economy has long been kept afloat by foreign investments.

Thanks to the failed policies of the Bush/Cheney/Rove Republican Neo-conservative administration, and will no doubt be merely perpetuated by the John McSAME/Sarah Palin ticket, the country is drowning in debt, squandered it’s treasury and mortgaged the future of our children.

Now the foreign investors want their money back and as a result of the financial meltdown beginning with the collapse of the housing market and financial bubbles, are left with no choice but to tighten their

grip on the US economic scrotum.

Brace yourselves as this once proud country gets sucked into an economic blackhole of it’s own making.

» RE: USA is bankrupt but still wars. Posted by: symcokid

» YES, THE USA IS BANKRUPT Posted by: Last Chance

Clearly obvious

Posted by: GreyFoxThree on Sep 16, 2008 12:13 PM

It has become clearly obvious that we have some major issues going on. Banks closing, Wall street issues, Foreclosure issues, Jobless issues yet Dictator Bush (and his little Mini-Me McBush) say everything is jsut fine. How much more will the Sheeple endure?

Jiff

Ultimate Anonymity

So when will China and other countries the USA borrows from finally hit the FORECLOSURE SWITCH? Posted by: maxpayne on Sep 16, 2008 12:51 PM

My guess is they’re making sure the laizze faire consequences cripples this nation to the point where it’s easy to cash in. Like Rome, America’s at the point of collapsing from within followed by Russia, China, or whatever battling their takeover plans from there. Folks, this does not look good.

» RE: China and other countries msut withdaraw subsidizing the anglosaxon exploiter class. Posted by: avatar_singh

Still wall street and london stock exchange are thriving despite being the main culprit. Posted by: avatar_singh on Sep 16, 2008 3:57 PM

While the other stock excahnges of the countries(Asian, china and Russia) who are laoning money to the angloamerican banks- are going down ,the main culprits of anglosaxon scam called wall street and london stock excahnge has not gone kaput yet- some thing to wonder about. in fact today wall street gained.

Where are those IMF and world bank boys who used to lecture other countries to lower excahnge rate and then borrow ,monery to correct market meltdown in asian crisis of @97 read this article too--

" LaRouche: "I Was Right, and You Were Wrong"

15 Sep 2008

Print quality PDF now available for mass distribution.

LaRouche on the Financial Meltdown: I Was Right, and You Were Wrong--But You’re Going to Get Another Chance

September 15, 2008 (LPAC)--U.S. statesman Lyndon LaRouche spoke bluntly today about the significance of the weekend’s financial developments, including the bankruptcy of the long-dead Lehman Brothers, the buyout of drowning Merrill Lynch by the equally desperate Bank of America, and the growing list of financial corpses--such as AIG, Washington Mutual, and others--lining up at the morgue.

"The key thing here," LaRouche said, "is, who is to blame? It was inevitable. Why was nothing done about it? It was inevitable. We warned about it. Why was nothing done? We warned that the whole thing was happening, back in our international webcast of July 2007. And we defined the precautions that should be taken all the way through. Why was nothing done about it?

"All of the current liquidity bail-out plans being floated by the U.S. Federal Reserve and Treasury, and other idiots, are total nonsense. They have to take the actions I have specified, right now--which is to freeze absolutely everything, go to a bankruptcy reorganization mode, and move immediately to call the Congress back to session. And instruct the Congress to pass my legislation, now, starting with the Homeowners and Bank Protection Act (HBPA), or else.

"This is a time to hit with clout, because if we don’t hit fast, there’s not going to be any U.S. economy or other economy left."

LaRouche addressed all the politicians, pundits, so-called economists, and average citizens who rejected his warnings and advice. "What did you do about it? What was your position? What was your estimate? And what right do you have to advise somebody on what they should do now, on the basis of your record, as a forecaster, given your political judgment? What about your political judgment? Do you trust it, after what you did?

"The members of the Congress, especially the leaders of the Congress, have failed miserably ever since July 2007, when they were both given a warning, and were given in rapid succession a series of actions that would have prevented this crisis. And they wouldn’t do it! Especially Cong. Barney Frank, Sen. Chris Dodd, Cong. Nancy Pelosi, etc. These guys were warned, and these guys didn’t do it. They said &rsquo:no.’ Well, they said &rsquo:yes’ to hell, didn’t they? Maybe they should resign. It might be a good thing, especially the Speaker of the House. What the hell did she do? She was warned, repeatedly. What did she do?"

» RE: china and other non -anglosaxon countries must not subsidize the anglosaxon cheats and liars. Posted by: avatar_singh

La Rouache has been right about this anglosaxon cabal of pirates and criminals in england and USA. Posted by: avatar_singh on Sep 16, 2008 4:00 PM

that is why he gets a lot of flask from the lair anglosaxon media.but then anglosazon media msut be destryed ti=o save the humanity.

LaRouche: "I Was Right, and You Were Wrong"

15 Sep 2008

Print quality PDF now available for mass distribution.

LaRouche on the Financial Meltdown: I Was Right, and You Were Wrong--But You’re Going to Get Another Chance

"This is a time to hit with clout, because if we don’t hit fast, there’s not going to be any U.S. economy or other economy left."

LaRouche also said the planned hearings of Chris Dodd’s Senate Banking Committee, currently scheduled for Sept. 16, should be canceled. "Tell them to call off the scheduled Dodd hearings. Because Dodd has no respectability: his opinions are completely self-discredited, as of this moment. He should turn the whole matter over to other members of the Congress and Senate who are less contaminated by what he has done. The mess that was created is largely a result of measures that were taken by Dodd--not as a sole perpetrator, but as a very culpable member with responsibility. So Dodd should not be holding any hearings; he should turn the hearings over to someone who is less contaminated. This guy has been stubbornly holding on all along against doing all the things that should be done. You want to call him and his committee in to make the decisions?

» RE: La Rouache has been right about this anglosaxon cabal of pirates and criminals in england and USA. Posted by: avatar_singh

Q.E.D.

Posted by: Direct Democracy on Sep 16, 2008 7:03 PM

Representative democracy is a failed experiment.

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