Wednesday, March 28, 2012

Treasury-Fed-Goldman Sachs: An Axis of Evil

The crooks at Golden Calf are in the news again, thanks to a loud and damning resignation letter...

Some of the best analysis I have seen on the issue is by Bill Frezza. He’s one of the good guys. He writes in Forbes Magazine, often training his razor sharp darts at the crony crapitalist rip-off artists and the big government buffoons who enable them.

I am certain that you will be hard pressed to find systematic illegal activity at Goldman Sachs. These people are lawyered up to the hilt. They know more about securities regulations than the people who wrote them (which I suppose isn't saying much). They know exactly how close to the line they can operate.
No, Goldman Sachs is not a law breaker. With all the former executives and cronies it has parachuted into the halls of government and all the money it showers on politicians running for office, it is actually a law maker. And that is the problem.
TARP was an inside job.  The crooks are still on the inside...
Thanks to this last banking crisis, the lines between the Treasury, the Federal Reserve, the Executive branch, and Goldman Sachs have all but disappeared. Using the entirely legal means of calling in chits from both political parties in its hour of need, Goldman Sachs looted the Treasury to save it from a liquidity crisis, cover its speculative investment errors, and make good on winning gambling bets that would have been uncollectable had Uncle Sam not stepped in to bail out counterparties like AIG.
Feel Poorer:  The bailouts stole money from you and me, devalued our savings and eroded our spending power...
Paying back the bailout money to the one entity that has the power to print it does not forgive the sin. In fact, the very act of printing that money stole value from its rightful owners, whose currency was debased, never to be made whole. The notion that the financial system would not have recovered if not for the federal bailouts is a self-serving lie. Yes, some of our largest financial institutions would have been swept away. Yes, their stockholders would have been wiped out-and deservedly so. But the underlying assets would have still been there, ready to be apportioned by a bankruptcy judge. And a lesson would have been learned not soon to be forgotten.
Think more government regulation will fix it?
The Dodd-Frank legislation does nothing but institutionalize their too big to fail status, while making it harder for would-be competitors to rise to challenge them.
This is not real market capitalism as it once was, should be, and could be again. This is crony capitalism of the worst order. (Bill Frezza)
... And it's all brought to you by corrupt politicians, clueless bureaucrats, and the Wall Street moles who infest our government.


Ducky's here said...

TARP was an inside job.


I don't think you're going to get a lot of disagreement today.

Marco Rubio is the answer!

So it's pretty clear we aren't close to getting out of this box.

Bunkerville said...

THe ultimate ponzi scheme.

Anonymous said...

The banksters always have been in charge. If we had taken the path that Iceland followed, telling the banks to stuff it, we would be recovering very nicely by now.

dmarks said...

TARP was an outrage. Must Republicans opposed it. Most Democrats supported it.

Jersey McJones said...

Anyone who believes TARP was avoidable is living in La La Land. Which party was in power made no difference for the inevitability of TARP. The Dems do have one advantage, though. I'm not so sure the GOP would have bailed the auto biz. And not doing that would have been a big mistake. Obama did the right thing there - Oh. And Bush already started it.

Bailouts are band-aids on symptoms. Not nearly the causes unto themselves you guys bemoan.


Finntann said...

Bailouts are the unconstitutional use of taxpayer money.

The bailouts aren't bandaids they are just another symptom of the corruption rampant in our state.

What is this? A schoolyard?

Why did you give GM 50 billion dollars Obammy?

Waaaah! Bush started it!

TARP was entirely avoidable. Let them FAIL!

And if you lose your life savings in a Goldman Sachs collapse...well that's called RISK, you should have read the fine print when you invested.

It's this total avoidance of any and all responsibility for one's actions that has led us to this.

The new definition of consequence... something the government absorbs!

All you progressive (D&R) teat suckers need to man up.

Ducky's here said...

Unconstitutional? How so?

Finntann said...

Violates enumerated powers.

There is no constitutional basis for government to buy distressed assets or ownership in a private institutions.

Government power extends to regulating, not participating in the private market.

Fifth Amendment: ...nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

Stockholders in GM were deprived of their property through the government shell game of shuffling assets between old GM and new GM, leaving the stockholders stuck with the crap while the government took anything of value into 'new'
GM transfering ownership to itself and the UAW.

"Due process" would have been following US bankruptcy law, which was ignored.

TARP says that "financial institutions" -- defined as banks, savings associations, credit unions, security broker-dealers and insurance companies -- can get aid.

The administrations redefinition of financial institution as a manufacturer is absurd, and contrary to other actions by congress in attempting to pass an auto-bailout. If congress intended to include automakers, why were they attempting to pass (unsuccessfully) legislation for automakers?

Treasury's position was the "ambiguous" definition is "entitled to judicial deference."

Hmmm.... "defined as banks, savings associations, credit unions, security broker-dealers and insurance companies" doesn't seem all that amibiguous to me.

The government gave preferential treatment to some people, business and organizations over others, violating the equal protection clause.

Need I go on?

viburnum said...

Ducky: "Unconstitutional? How so?"

How not? What enumerated power covers covers it?

Another stretch of the Commerce clause?

The entire idea of a company being "too big to fail" is antithetical to the notion of free enterprise., as is government picking the winners and losers. Propping up failing businesses weakens the economic system rather than strengthening it. Let them fail and let someone with a better idea or a more efficient way of operating take their place.

MathewK said...

Makes you wonder, can we ever get out of this mess when these bastards are in charge making the laws to suit themselves and their pals.