Treasury stress tests to be smoke and mirrors

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Monday February 23, 2009 · 11:48 AM PST

2009/02/23 · 11:48

Checking my financial blogs, I stumbled across this (ht naked capitalism).

Said one high-level official, "I think the market is missing that the whole intent of this process is to show that the banks have enough capital for even worse outcomes than we currently envision and to show there’s a program in place to give banks access to that capital if they need it."

(CNBC)

So basically the results of the stress tests are to be predetermined and are really an exercise designed to reassure the markets that the banks will not fail rather than actually determining the viability of these behemoths.

Areopagitica

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Saturday February 21, 2009 · 10:14 AM PST

2009/02/21 · 10:14

There were several stories and pundits asking or demanding that President Obama be more optimistic and hopeful in the face of a burgeoning global depression. Even Bill Clinton got in on the act.

This, in turn, and with the constant refrain that we are and have been facing a "crisis in confidence" with regards to the economic meltdown have given me pause to think about the notions of optimism and greed that undergirded the years since Reagan's first inauguration. It also pains me to think that our leaders and opinionmakers are reduced to trying to make the public believe that all is well. If only we clap our hands and believe, then the depression will go away or never come. Of course, many people here may not believe we have entered an economic depression, and I would say this belief is symptomatic of this Tinkerbellisme.

Areopagitica

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Saturday January 17, 2009 · 11:40 PM PST

2009/01/17 · 23:40

The NY Times has recently posted an article demonstrating the full stupidity of the TARP/bailout.

At the Palm Beach Ritz-Carlton last November, John C. Hope III, the chairman of Whitney National Bank in New Orleans, stood before a ballroom full of Wall Street analysts and explained how his bank intended to use its $300 million in federal bailout money.

"Make more loans?" Mr. Hope said. "We’re not going to change our business model or our credit policies to accommodate the needs of the public sector as they see it to have us make more loans."

This attitude should not surprise any of us in this community, especially since it is apparent the bankers have only their interests at heart in this deflating economy.

Poll

75 votes Show Results

What should bankers do with the next round of TARP money?

75 votes Vote Now!

What should bankers do with the next round of TARP money?

Buy crack futures, because that's what you'll be smoking when you lose everything

27 votes

Have banking conferences discussing how to sit on taxpayer money in the tropical redoubts of the world

4 votes

Start a national money burning contest

12 votes

Use it to fund political campaigns of politicians sympathetic to the bankers' plight

7 votes

Mergers and acquistion because the industry needs more consolidation

3 votes

Public service campaigns explaining why Americans should trust the banks

6 votes

Develop mortgage work-out protocols that ensure that homeowners will stay in their houses for a few more months before the process determines that it is not really feasible

8 votes

Payday loans! Payday loans! Payday loans!

8 votes

A Modest Proposal

Areopagitica

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Friday January 16, 2009 · 10:47 AM PST

2009/01/16 · 10:47

It has been an incredible scene of great sadness to watch the fruitless and profitless siege of Gaza these past few weeks. One can't but help to think that the Palestinians are the beggars of the world these days, incapable of doing anything other than an asking for mercy from the rest of the world. The only honest livelihood left for these people, if they are unable to escape to work the oil fields of the Middle East or the hotel housekeeping crews of the West, is for them to engage in acts that have been described as terrorism by some, or acts of defense by others.

It is, however, agreed by all inter- and intra- national parties that the prodigious numbers of children born in the deplorable state of Gaza (and the West Bank and the refugee camps of Jordan and Egypt) is terribly grievous; and therefore, , whoever could find out a fair, cheap, and easy method of making these children sound, useful members of the international community, would deserve so well of the public as to have his statue set up for a preserver of the international order.

My intention is far from being limited to provide for the children of this stateless state; it is a much greater effort, and will deal with a broad spectrum of children whose parents are unable to provide a meaningful, decent life.

Areopagitica

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Thursday November 06, 2008 · 11:45 AM PST

2008/11/06 · 11:45

While we ponder the make-up of the coming Obama administration, the fact remains that the Wall Street bailout continues to harm our chances for real progressive change in this country. Already the right-wing is saying that it will stick to its core principles of lowering taxes and restricting spending (as somehow the magical Laffer curve has ever worked). We knew that Republicans are not going to go along with any economic agenda set out by Democrats, and as we have been seeing, the MSM is going uncritically regurgitate their talking points as economic fact.

Naomi Klein has written an several articles showing that the logic guiding the CPA and the Iraq war is now at work with the bailout. Simply put, the Bush administration as well as Congressional allies of Wall Street are ensuring that there are and will be a myriad of problems marrying the US Treasury to fortunes of thieves who have broken our economy. As she says in Can Obama Stop the Bush Administration's Final Economic Heist?: (quote below the fold)

Areopagitica

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Saturday October 18, 2008 · 2:09 PM PDT

2008/10/18 · 14:09

I am not optimistic about the future. I haven't been optimistic about the future for quite some time. Not that I ever really believed that I could "make it" or would make it in the current incarnation of the good old America.

I have pushed a mop and a broom. I have saved money and lost money. I have worked hard and hardly worked. But mostly I have learned the lesson that Horatio Alger stories are bullshit. That pulling yourself up by your bootstraps means preparing yourself for the next whipping.

I have a litany of personal problems (mental health issues related to long-term child abuse that have been barely treated due to the absence of healthcare being a guaranteed right in this country) that have stood in the way of my personal success. But this diary isn't about me and my issues, or a time to navel gaze and spew woe is me-ism. This diary is about me asking you to fan the fires of outrage at the thieves who are robbing us and me of what little hope I have had.

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Treasury stress tests to be smoke and mirrors

The Tinkerbell Depression

The bailout approaches the event horizon

A Modest Proposal

The Bailout Bomb

It's time to shoot the bankers (with watermelon guns)