{"id":12714,"date":"2009-03-18T17:22:02","date_gmt":"2009-03-18T22:22:02","guid":{"rendered":"http:\/\/planetwaves.net\/news\/?p=12714"},"modified":"2009-03-18T17:35:36","modified_gmt":"2009-03-18T22:35:36","slug":"blowing-the-roof-off-the-house-of-cards","status":"publish","type":"post","link":"https:\/\/planetwaves.net\/news\/economics\/blowing-the-roof-off-the-house-of-cards\/","title":{"rendered":"Blowing the Roof Off the House of Cards"},"content":{"rendered":"

Dear Friend and Reader:<\/p>\n

What an interesting turn of events. Late last week,\u0412\u00a0corporate interests using a financial news network to influence the market was exposed through the take down of CNBC’s chief cheerleader Jim Cramer\u0412\u00a0by Jon Stewart of The Daily Show. On that same day, it\u0412\u00a0was revealed to the White House\u0412\u00a0that $165 million in taxpayer money from the Paulson-Bernanke bailout under Bush went to bonuses\u0412\u00a0 paid to AIG executives in charge of the financial products division — the same division that brought about the company’s failure through bad lending instruments like interest-only mortgages.<\/p>\n

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This week the outrage<\/a> over this revelation is reverberating from the Oval Office to Congress. Edward Liddy, the new CEO of AIG testified Wednesday\u0412\u00a0before Congress that he\u0412\u00a0found the payment of the bonuses to AIG’s executives “distasteful” but there is no way around it<\/a>, and that the government (the taxpayers) has no recourse but\u0412\u00a0to honor the commitment.<\/p>\n

Liddy’s performance defines not just the way these mega-financial firms have taken taxpayer money and\u0412\u00a0ran. The way the\u0412\u00a0entire cultural phenomenon of unregulated markets and the greed that spawned them\u0412\u00a0makes that\u0412\u00a0a given. Its how these firms are putting one (AIG) \u0412\u00a0in front\u0412\u00a0to cover the tracks of\u0412\u00a0the other firms who had already received bailout money from the Federal Government.\u0412\u00a0Eliot Spitzer, former governor of New York and “Sheriff of Wall Street”,\u0412\u00a0explains:<\/a><\/p>\n

[W]e need to go back to the very first decision to bail out AIG, made, we are told, by then-Treasury Secretary Henry Paulson, then-New York Fed official Timothy Geithner, Goldman Sachs CEO Lloyd Blankfein, and Fed Chairman Ben Bernanke last fall. Post-Lehman’s collapse, they feared a systemic failure could be triggered by AIG’s inability to pay the counterparties to all the sophisticated instruments AIG had sold. And who were AIG’s trading partners? No shock here: Goldman, Bank of America, Merrill Lynch, UBS, JPMorgan Chase, Morgan Stanley, Deutsche Bank, Barclays, and on it goes. So now we know for sure what we already surmised: The AIG bailout has been a way to hide an enormous second round of cash to the same group that had received TARP money already.<\/p>\n

It all appears, once again, to be the same insiders protecting themselves against sharing the pain and risk of their own bad adventure. The payments to AIG’s counterparties are justified with an appeal to the sanctity of contract. If AIG’s contracts turned out to be shaky, the theory goes, then the whole edifice of the financial system would collapse.<\/p>\n

…The appearance that this was all an inside job is overwhelming. AIG was nothing more than a conduit for huge capital flows to the same old suspects, with no reason or explanation.<\/p><\/blockquote>\n

In other words, the shit isn’t running knee deep. Its neck deep. These big firms we’ve been bailing out have been double dipping from the till,\u0412\u00a0going directly to the Fed and then through their fund “insurer”, AIG. Like Iraq, they privatized the profits and socialized the risks. In both cases,\u0412\u00a0its We The People\u0412\u00a0paying the bill.<\/p>\n

There seems to be a lot of noise and blame going on this week, like\u0412\u00a0a\u0412\u00a0unscratchable itchiness underneath one’s skin after coming down from opiates. But that’s exactly what the greed of\u0412\u00a0 “Too Big to Fail” has produced–an overabundance of Pluto in Sagittarius financial free-for-all, followed by Pluto in Capricorn scrutiny on Capricorn’s favorite stage: government.<\/p>\n

Eventually, we may need to tire of even the outrage wheel we seem to be on.\u0412\u00a0The parade of financial and industrial executives including AIG’s CEO Liddy today,\u0412\u00a0testifying\u0412\u00a0in the halls of Congress is\u0412\u00a0a public relations gimmick.\u0412\u00a0Like shock and awe and the theater of 9-11, it’s\u0412\u00a0there to\u0412\u00a0provide political porn to feed every day Joe’s and Jane’s daily addiction to outrage, and\u0412\u00a0a convenient way to derail the closer scrutiny needed to uncover the real theft, which\u0412\u00a0is still going on and has happened before in our history.<\/a><\/p>\n

We have\u0412\u00a0the downfall of the biggest financial institutions that hold the assets of the US and a large share of the global economy, and the eroded credibility of the news to uncover what was done with American tax dollars, using the shock and scare technique so embedded into us from 9-11, without any sense of perspective. Like Rome,\u0412\u00a0the empire\u0412\u00a0needs a mob to generate or hide\u0412\u00a0its policy decisions. It makes me wonder whether the media is using coverage of this new tide\u0412\u00a0of populist outrage to fuel further distraction from its own failings to report on the shell game these big firms were up to in the first place and for many years.\u0412\u00a0Ya think?<\/p>\n

The energy of populism, played by all politicians in the White House and in Congress from both sides of the aisle, needs to be channeled into finding solutions. Enough of this charade already. I would much rather watch how people are bringing real industry that makes things work or makes lives better than to watch the thieves get placed in softly luxurious shackles and exhibited in the town square.<\/p>\n

The roof has been blown off the house and we’re finding there’s not much of a house left. If we’re smart, we can start putting our\u0412\u00a0focus into clearing the debris and re-building us, the people who\u0412\u00a0can originate value from\u0412\u00a0something tangible like hard work and products we can feel, hear, touch and taste, and which will last a long time because we certainly won’t have enough discretionary income to buy new things every year. When there’s nothing left, what’s there to\u0412\u00a0lose? The problem is, that’s when people become really really easy to manipulate. Easier than usual.<\/p>\n

Yours & truly,<\/p>\n

Fe Bongolan<\/strong>
\nSan Francisco<\/p>\n","protected":false},"excerpt":{"rendered":"

Dear Friend and Reader: What an interesting turn of events. Late last week,\u0412\u00a0corporate interests using a financial news network to influence the market was exposed through the take down of CNBC’s chief cheerleader Jim Cramer\u0412\u00a0by Jon Stewart of The Daily Show. On that same day, it\u0412\u00a0was revealed to the White House\u0412\u00a0that $165 million in taxpayer … Read more<\/a><\/p>\n","protected":false},"author":9,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"generate_page_header":""},"categories":[14,762],"tags":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/planetwaves.net\/news\/wp-json\/wp\/v2\/posts\/12714"}],"collection":[{"href":"https:\/\/planetwaves.net\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/planetwaves.net\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/planetwaves.net\/news\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/planetwaves.net\/news\/wp-json\/wp\/v2\/comments?post=12714"}],"version-history":[{"count":0,"href":"https:\/\/planetwaves.net\/news\/wp-json\/wp\/v2\/posts\/12714\/revisions"}],"wp:attachment":[{"href":"https:\/\/planetwaves.net\/news\/wp-json\/wp\/v2\/media?parent=12714"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/planetwaves.net\/news\/wp-json\/wp\/v2\/categories?post=12714"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/planetwaves.net\/news\/wp-json\/wp\/v2\/tags?post=12714"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}