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View Diary: The Left Drops the Ball (244 comments)

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  •  Rule Of Law first (9+ / 0-)

    I would want to see the rule of law enforced first before we look at reforms. Essentially we have a bunch of Class A felons running the money of the country. Discussing reforms without the necessary cleansing process of jailing the felons is way way premature. There are many laws on the books right now to deal with what they have done that have been completely ignored such as securities fraud, mortgage fraud  and more importantly the RICO act when we have cultures in the TBTF that rewards criminal behavior.

    We need to clean the banks out and see what we have left which means FASB has to put back the rule of Mark to Market. The banks have to come up with 10 Years worth of insurance payments to the FDIC that they bribed congress to suspend from 1996-2006, regardless of what is does the capital of the bank. Then once we see where we are we let the numbers dictate the actions.

     If the ratios are below minimums the banks must be taken into receivership. All the TBTFs are insolvent once mark-to-market or even non-performing loans are pulled from assets. Note: If someone stops making payments on their credit cards , banks add the penalties and charges to their income statement for 6 months before taking a charge off. The way that banks are leveraged up now, a 10% write down of their assets will result in wiping out the equity.

    The average write down of banks taken over by the FDIC was 30%.

    If we take in the largest and sell the assets for 10 cents on the dollar to the other 8000 banks out there with the idea that they will markdown the loan 75%, we strengthen and decentralize the banks. Then put an upper limit on leverage and assets that would be an immediate call to break the bank up. The TBTF banks have over 70% of the consumer debt in the country.

    Citibank : 2 Trillion
    JP Morgan: 1.7Trillion
    B of A: 2.2 Trillion
    Wells Fargo 1.2 Trillion

    Just these 4 Banks have 65% of the consumer debt in America. One way of stimulating the economy constantly is to mark the debt down by half or 3/4s which immediately frees up disposable income. The way we are doing it now, throwing unlimited amounts of money at the banks the plug the leaks ,millions of them, isn't working.

    Businesses need customers to hire , take out loans, pay taxes. The problem clearly started with the banks and will only end if the banks are prosecuted. Rule of Law first then everything else will follow. Without it, the Nation will most certainly implode.

    •  Banking dummy here. But as you can explain so (2+ / 0-)
      Recommended by:
      Black Max, blueoasis

      clearly that even I understand enough to be able to research your information, then, as PlutocracyFiles says:

      That could be useful information if someone was interested in a Cancel the Debts program. If they're not, cool - but if they are, he can help - A LOT.

      This is the kind of information that should be available.

      We´re going to have a rough time anyhow this century, but we could face it with confidence and trust in each other, if only we could get over our fears of each other.---marsanges

      by DawnN on Sat Oct 01, 2011 at 04:28:25 PM PDT

      [ Parent ]

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