Holy crap! That’s why they are so nervous about real transparency. It’s not a house of cards it’s a house of criminals!

BTW you misspelled Cenk’s last name “Uygur”, twice up there in the headline and 1st sentence, the way it is spelled in the quote is right. :)

Geithner is I think taking the view put forward by Barry Eichengreen in his account of the fall of the gold standard (Golden Fetters (1992), which he no doubt gets from Bernanke. The basic point is that the amount of money floating around is so great that the government has to rely on the manipulation of private expectations to ensure exchange-rate stability (I am talking about the Gold Standard period). He seems to be taking the same approach here, relying in the main on private capital, which of course flows through the hedge funds and their banking enablers. The result is to restore and perpetuate the system of parallel finance that got us into this mess in the first place. The division between economists like Paul Krugman/ Joe Stiglitz and Geither/Bernanke essentially concerns the question whether that system should be unravelled or preserved. It’s a judgment call, and there are informed persons on both sides. I’m with the young turks, but it’s mainly an emotional response. I would like to see the old Roman system of taking every tenth banker and random and putting him before a firing squad to, as they say in french, ‘encourage the others.’ Something like this or at least some jail time might increase the level of risk-aversion in that class.

Good Morning Jane and Fire Pups:

So what is it going to take to get the White House to listen to the experts, instead of a bunch of bought-and-paid-for hacks and criminals from the “financial services” industry? It’s way past time for a course correction. How can BO not see that this treasury heist will very likely take down his presidency?

It’s beginning to look like we’ve got “Bush Lite” running the show, sorry to say.

Kinda sorta looks like somebody up top is protecting them, ya think?

Yup.

Many people are saying that obama will have to clean out geithner and summers by autumn or he won’t have a second term. I think that if he waits that long we will be in an unrecoverable mess. obama has given no hint that he really wants to break with the wall st. insiders such as summers, geithner, et al. obama has done nothing to aid those who are in foreclosure or are facing forclosure, but he has closed his eyes to the $for$ recovery of goldman sachs through aig and appointing so many gs people to run the financial aspect of the government. He won’t listen to anyone that is not in line with summers (the real Sec of Treasury) shown by the big meeting of the economists with such “diverse” viewpoints.

He didn’t need to kowtow to the big monied interests because he had such a wide base of small contributors. This seems to be nothing more than obama showing the DC insiders that he is one of them. If the rest of the country winds up on par with Haiti – the super rich and the poor with nothing between – well, that’s “looking forward, not backwards” and we must move on.

Hyman Minsky pointed out back in 1986 that so long as the Fed continues to intervene with bailouts every time the capitalist system enters one of its inherent crisis periods this will set the stage for a future and more catastrophic event down the line.

We’ve seen how capitalism works. Marx wrote over 150 years ago that the capitalist system is designed to have shocks and basically depressions. The boom and bust cycle is not some anomaly it is an integral part of the system.

This current bailout and the outright gifts given to the banks that were covered as counterparties of AIG and recipients of TARP money will do absolutely nothing to fix the system. The changes made to allow banks to value their own assets are laughable. This is what got us into this starting with the saving and loan debacle twenty-five years ago. There has to be an independent entity that values whatever is on the banks’ books otherwise we are throwing good money after bad, something we’ve already done enough of.

I think it’s time Obama came clean and let us know just how far into the tank he is with Wall Street. Appointing Geithner when he was one of the people who engineered this whole TARP thing under Bush was bad enough, but retaining him in the face of what has become known about the whole AIG/Goldman Sachs et al nexus is just a slap in the face to everyone who voted for change. We didn’t mean pocket change.

Finally, it’s difficult to take Obama seriously when he says words mean something when talking about the actions of North Korea but parsing them when it comes to holding the previous criminals reponsible for their actions.

Force the GOP’s hand, make them show the country and the world what they stand for by releasing the torture documents and pushing the nominations of Johnsen and Koh. This is a fight worth having. The GOP sees compromise and bipartisan rhetoric as weakness. They believe in what the Old South believed in during Reconstruction: Reunion without Compromise. The Confederacy didn’t budge an inch forcing Union forces out of the south and then picking up right where they had left off.

Nothing has changed.

Per Andrew Ross Sorkin in NYT:

Here’s the F.D.I.C.’s explanation: It says it plans to carefully vet every loan that gets made and it will receive fees and collateral in exchange. And then there’s the safety net: If it loses money from insuring those investments, it will assess the financial industry a fee to pay the agency back.

But think about this for a moment: if the program doesn’t work — and let’s hope it succeeds — the F.D.I.C. would be forced to “assess” banks it is hoping to save, possibly bankrupting them in the process. After all, if the F.D.I.C. starts losing money, it will probably be because the broader economic environment is deteriorating further. So those fees will a new burden at a time when key financial players can least afford them.

Ms. Bair said that she can not imagine the F.D.I.C. losing money on the scale I suggested in my doomsday scenario. She said that before announcing the program, the F.D.I.C.’s lawyers determined that the statute allowed it to guarantee loans by valuing them as contigent liabilities. “That’s how we’ve interpreted it,” she said, adding that the determination was made back in October when the F.D.I.C. first introduced the Temporary Liquidity Guarantee Program, which is also backed by the F.D.I.C.

[…]

And these days, whenever anybody talks about risk-free investing, it’s not hard to hear the famous line uttered by Joseph J. Cassano of A.I.G. in 2007: “It is hard for us, without being flippant, to even see a scenario within any kind of realm of reason that would see us losing one dollar in any of those transactions.”

Emphasis mine.

The FDIC lost money all through the S&L fiasco because it paid out on accounts that weren’t covered in member banks just to ensure that there would not be a run on the banks.

I see nothing that can make me believe that the same thing will not happen here,IOW, instead of insuring an account up to $250,000, the FDIC will cover an entire account no matter what the balance just to keep the bank from being the subject of a run.

Sure would be nice if the Pension Benefit Guarantee agency was assured of such solvency.

I’m with the young turks, but it’s mainly an emotional response. I would like to see the old Roman system of taking every tenth banker and random and putting him before a firing squad to, as they say in french, ‘encourage the others.’ Something like this or at least some jail time might increase the level of risk-aversion in that class.

I believe the mind-set you are describing is, and always has been used against us. The banksters rely on our collective preference for reasonable solutions as an effective roadblock which combined with the opacity of their operations leaves us with few options that are not based on obviously deficient information or emotional responses that we ourselves feel foolish for putting forward.

That’s why they fight our insistance on transparency, because if we knew for sure that they were robbing us blind, we’d be more confident that our responses were appropriate.

Our representitives in Washington use our own lack of confidence against us too, it provides them a certain level of plausible deniability which they use to excuse their cooperation with the looters.

That said, I think we’re fast approaching the point where anybody who cares, understands that it’s true, we’ve been robbed.

More folks at dKos starting to wake up, some good diaries today on Obama’s rightward moves.

and for those who haven’t seen it yet – TARP Oversight Chair Elizabeth Warren is grabbing the spotlight with some concerns of her own :D

TARP Panel release 6 Month Report

loosely related note: NYT’s piece on small municipalities getting suckered in to debt by the Swap SnakeOil Salesmen – have been after both my small city and county reps to give me an accounting of their activities in this area – a whole lotta crickets to date.

Atrios has been talking about this very thing for almost two years – aarrgghh !

I saw Black on Bill Moyers last night. It was truly enlightening. I’m pretty cynical, but he made me realize the problem is even worse than I imagined (and I imagined it was pretty bad).

When first chosen, I really believed that Bair might just be a breath of fresh air. Instead, her ideas seem more like the air that escapes a mummy’s tomb. when all else fails, she knows that she can always rely on the American tax payer as the lender of last resort.
Everything changed in 1933. Not sure if anyone here has ever heard of Ben Fulford. He used to be a financial writer for Forbes who now lives and writes in Japan. He came out with a very interesting piece a few days ago about the Fed, slave labor and the dirty little secret that the entire government is just a corporation. If you Google his name, you can even find the one on one interview he did with David Rockefeller last year. But here’s a brief summary from his daily blog….

The other big problem is that the Federal Reserve crime syndicate has given the Chinese $2 trillion of worthless paper and now they are promising to back it up with US slave labor and property. Remember, the US is not bankrupt; the privately owned Federal Reserve Board is bankrupt.

For those of you who still have not heard this, let me explain that in 1933 a United Sates of America Corporation was formed and headquartered in Washington D.C. which is not part of the US. Every time a US citizen is born, they are assigned a number (social security) by that corporation and a bond backed by that person’s life of labor is issued. The Feds are now planning to share control over this slave labor with the Chinese.

There is an alternative group that is in possession of astronomical quantities of gold and will pay off US and UK debt with gold but they will not accept payment in Fed fiat dollars. This group wants to use their gold to kick-start an entirely new financial system that is actually controlled by the people of the planet and not a secret, in-bred cabal….Con’t

Anyone hear about this yet?

Guarding the Family Fortune
Last week, as the unemployment rate hit a 25-year high and nearly one in 10 Americans was receiving food stamps, 10 Democrats in the Senate joined all 41 Republican senators to cut estate taxes for the wealthiest families. The provision would funnel an additional $91 billion over 10 years to the heirs of megafortunes, money that would otherwise have been paid in federal taxes or donated to charity.

With economic pain and suffering on the rise, how do the senators justify a big tax cut for multimillionaires? By asserting that an estate tax cut is just what struggling Americans need.

Something is very wrong with our new, old government

Brilliantly well put, Bob.

Would that the usual “survey” of American “history” would contain that absolute gem of wisdom for the edification of every single American child, that they might grow to become better citizens and human beings than their forebears, who, apparently, have preferred the easier and more “comfortable” course of allowing others to do their thinking for them.

That “situation” does, at long last, appear to be changing.

But, one imagines that the demagogues (and sociopaths, if they are not the same thing) will yet give Reason a “run” for the Money.

Thanks Kassandra; hadn’t seen that and wish the writer was more detailed; did this tax cut get put into the Obama budget?

That provision is going to be part of the bill unless some serious heat is exerted on Democratic senators during the reconciliation. I doubt it was put there as a bargaining chip so they could sacrifice it for something else.