Wednesday, February 11, 2009

We NeEd AcCoUnTaBiLiTy

The problem-banks are not only insolvent, they are in debt, the economist roubini says 3 trillion, goldman sachs says over 5 trillion.

Why does this matter? Our national economy runs on credit, if banks are in debt because of bad loans and bad wall street bets, they will not lend.

Round One.
The first bailout under bush tried to address this buy throwing 350 billion dollars in cash the banks way, while the fed made loans and guarantees on up to 8 trilion. The result was the bank hoarded the money and did not lend and the economy lost over 1.5 million jobs in nov-jan..

Round Two.
Obama and treasury sec. Geitner are planning on giving out the other 350 dollars approved by congress before the elections with hopes of giving the banks enough money that they not only begin lending again but also are able to raise private capitol. So far the Gietnar plan is to give money to those companies or individuals who will buy up the toxic assets hurting the banks balance sheets.
I have a couple of ideas.

One many have been floating is to follow the model that Sweden used when their banks were in trouble. The government took over the bank, fired the management, hired bright minds, fixed up the bank and sold it off to private individuals. The reason why we wont try this probably is because in the process those owning stock will lose all their investment. And we know how this nation feels about its investor class.

Another idea I probably read about, is based on the question what is the actually problem? It seems that our banking system is not sound enough to support our economy that relies on credit. Well so far according to many; we seem to be on the hook for close to 9 trillion dollars that have gone into fixing the broken banks. Why not use that money to establish a new bank. One healthy enough to jump start the credit market that is the engine of our economy. This way we don’t have to worry so much about the too big to fail theory. While our government bank gets the economy going, JP Morgan Chase and company can figure out what to do. We dont need em.

Many say but heh, the government is bad at running things? But there are many bright minds who can be brought in. Right now we have a private banker running the Treasury Department. Under Bush we had a private banker running the Treasury Department.
Now what to do with the Mega banks. One problem I see in this whole mess is the size of our banks being too big to fail. Me and you are not too big to fail. Average Americans go bankrupt all the time and no one steps in to save them. To me the answer is obvious. If your too big to fail, than your too big.

This has been a problem not only of banks but of corporate America. Some corporations are so big that they wield too much power. Whether it be in the halls of Congress when it comes to passing laws. Whether it be with a group of workers fired for trying to unionize. Whether it be a giant health insurance company who has platoons of secretaries and doctors and lawyers on their payroll who constantly deny claims, and fight them.

Why is it that these big powerful interests always win, and the small American citizen seems to lose? Well I think there are two components. The first is that we Americans have not found a way to unify our voice. There are more of us than them. No lobbyist would have a chance if the American public, 300+ million strong, formed its own lobby.

In France they can stop traffic, shut down work across the country, stop colleges, when they choose to protest. Literally, the whole country grinds to a halt. Are we ready for this type of unifying force in America?

So the first part is we need to become stronger. But the second part is we need to weaken corporate power, I think. ( I think because in one sense i see it as a challenge. If the American public is not strong enough to stand up and defeat these powers than we deserve what we get. The bigger the challenge the stronger we become).

If you are too big to fail than you are too damn big, period. Banks like JP Morgan Chase will get split up into 100 banks. Same for the rest. So in the future if shit hits the fan, we can cut off the dead wood, let them go under without having to worry about the ripple effect throughout the economy.

Same goes for corporate America. Wall mart, Best Buy, McDonalds, its all over. It seems obvious, these large firms have too much market share and it is not good for our nation as a whole.

Lets remember the problem is not the housing market, the fall in the stock exchange, the huge unemployment figures that are piling up, or the fact that banks are broke. These are all the results of the problem. And while we need to fix the symptoms, if we do not fix the disease our symptoms will be back soon enough.

The disease is corruption, no oversight, no supervision, no accountability.

Mr. Madoff’s fraud case was brought to the attention of the government oversight committee, the SEC, yet they did nothing. Loans were given out with no money down no collateral and no jobs needed, no one cared because fees were so big. Insurance was sold on stocks and no money was held in case the insurance was claimed. Government oversight agencies were stocked with people who did not believe in oversight. Stock ratings agencies gave crap stock a perfect rating because they were paid off. The accounting industry which no one has mentioned yet, kept books on these banks that are full of fraud, why didnt they catch this?

If you got caught doing any of this at your high school burger joint job, you would be fired. If you got caught doing any of this at your current job, you would be fired. When you went for a new job they would ask you what happened. If they found out, your probably wouldnt be hired again.

When those who were charged with oversight allowed such devastation to occur are not fired and jailed and publicly tarred and feathered, than the unofficial word goes out, do whatever you can get away with because even if you are caught you will not be punished.

To this day it boggles my mind how those charged with oversight are not only not fired, but they are not in jail. No bank executive are in jail, no mortgage executives are in jail, no accounting executives are in jail, no governemnt oversight executives are in jail. Its almost as if this was just an accident. The word has gone out, those in the inner circle of elite power will never have to pay for any of their wrongs. Obama's economic team cannot claim anyone who saw this crash coming. Why is that? W

The same crew that crashed the country is the same crew saying only we can fix it. But I know different. The Blogoshpere knows different. This house that Rothchild built is a fake. It cannot survive. It is a cancer. When you have cancer that causes you to lets say lose nutrients, the answer is not more nutrients. Sure it helps, for now. But everyone know you need to cut that shit out. And guess what? If you go back to your same lifestyle that cancer is a coming back. Because your body is set up, physically, mentally and spiritually to support cancer. You need to change your diet, exercise more, and meditate more, create a different internal environment that is hostile to cancer.

That’s just what we need as a nation. New leaders, New role models, new powers, new ideas.(read this next part with Dr. Martin Luther Kings Jr's voice in your head).

I have a dream. That one day we can build a nation, a world with a new environment that is hostile to corruption, to lack of oversight, supervision, and accountability.

If you want some real information on whats going on, look of cjr the audit, or david sirota, or npr planet money, or bill moyers, or roubini, each one of this these guys should bring you dozens of other references.

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