Didn't you hear the news? Everything is 'hunky dory' out there in the world and according to Newsweek, the recession is over. Even the Queen of England (the richest woman in the Universe) received a written apology from a group of 'economists' (aka as sorcery in certain parts of the world). They are all so very very very sorry it seems:
"In summary, your majesty, the failure to foresee the timing, extent and severity of the crisis and to head it off, while it had many causes, was principally a failure of the collective imagination of many bright people, both in this country and internationally, to understand the risks to the system as a whole."
Interesting. A 'failure of the collective imagination of many bright people...to understand the risks to a the system as a whole.' I don't believe that for minute. Nor do I believe the words of Alan Greenspan on 'his mistakes:'
"I made a mistake in presuming that the self-interests of organizations, specifically banks and others, were such that they were best capable of protecting their own shareholders and their equity in the firms."
Mr. Greenspan's responsibility wasn't just about presuming that the banks and the self-interests of organization were capable of 'protecting' their own shareholders. Mr. Greenspan's responsibility was 'ensuring' that the entire financial structure of the United States maintain it's integrity and independence within the halls of the Federal Reserve System. In theory the Federal Reserve system is suppose to operate without the undue influence of politics or special interests such as Wall Street or the Banksta Gangstas. In reality, and specifically because of the financial meltdown that 'theory' has been tested and shown to be the 'ultimate propaganda tool' of the financial elite who are currently pushing the idea of the Federal Reserve to become the Super Regulator.
Can you spell M-O-N-O-P-O-L-Y ?
October 15th, 2007 – Bernanke: "It is not the responsibility of the Federal Reserve - nor would it be appropriate - to protect lenders and investors from the consequences of their financial decisions."
Well, shit Ben, what is it exactly that you do do?
The Federal Reserve — the quasi-autonomous body that controls the US’s money supply — is a "Ponzi scheme" that created "bubble after bubble" in the US economy and needs to be held accountable for its actions." Eliot Spitzer
As pointed out in his recent article entitled, Dismantling the Temple - William Greider gives us some great food for thought on why placing even more power into the hands of the Federal Reserve is a very dangerous path for America to take.
During the past year, the Fed has flooded the streets with money--distributing trillions of dollars to banks, financial markets and commercial interests--in an attempt to revive the credit system and get the economy growing again. As a result, the awesome authority of this cloistered institution is visible to many ordinary Americans for the first time. People and politicians are shocked and confused, and also angered, by what they see. They are beginning to ask some hard questions for which Federal Reserve governors do not have satisfactory answers.
Where did the central bank get all the money it is handing out? Basically, the Fed printed it, out of thin air. That is what central banks do. Who told the Fed governors they could do this? Nobody, really--not Congress or the president. The Federal Reserve Board, alone among government agencies, does not submit its budgets to Congress for authorization and appropriation. It raises its own money, sets its own priorities. Among its functions, the Federal Reserve directly regulates the largest banks, but it also looks out for their well-being--providing regular liquidity loans for those caught short and bailing out endangered banks it deems "too big to fail." Critics look askance at these peculiar arrangements and see "conspiracy." But it's not really secret. This duck was created by an act of Congress. The Fed's favoritism toward bankers is embedded in its DNA.
This awkward reality explains the dilemma facing the Fed. It cannot stand too much visibility, nor can it easily explain or justify its peculiar status. The Federal Reserve is the black hole of our democracy--the crucial contradiction that keeps the people and their representatives from having any voice in these most important public policies. That's why the central bankers have always operated in secrecy, avoiding public controversy and inevitable accusations of special deal-making. The current crisis has blown the central bank's cover. Many in Congress are alarmed, demanding greater transparency. More than 270 House members are seeking an independent audit of Fed accounts. House Speaker Nancy Pelosi observed that the Fed seems to be poaching on Congressional functions--handing out public money without the bother of public decision-making.
Ben Bernanke has his underwear all in a bunch about anyone trying to encroach on 'the turf' of the semi-quasi private-political-government (Goldman Sachs Club) secret payoff organization and his poor widdle feathers are getting ruffled:
Fed chair Ben Bernanke responded with the usual aloofness. An audit, he insisted, would amount to "a takeover of monetary policy by the Congress." He did not appear to recognize how arrogant that sounded. Congress created the Fed, but it must not look too deeply into the Fed's private business. The mystique intimidates many politicians. The Fed's power depends crucially upon the people not knowing exactly what it does.
Basically, what the central bank is trying to do with its aggressive distribution of trillions is avoid repeating the great mistake the Fed made after the 1929 stock market crash. The central bankers responded hesitantly then and allowed the money supply to collapse, which led to the ultimate catastrophe of full-blown monetary deflation and created the Great Depression. Bernanke has not yet won this struggle against falling prices and production--deflationary symptoms remain visible around the world--but he has not lost either. He might get more public sympathy if Fed officials explained this dilemma in plain English. Instead, they are shielding people from understanding the full dimensions of our predicament.
President Obama inadvertently made the political problem worse for the Fed in June, when he proposed to make the central bank the supercop to guard against "systemic risk" and decide the terms for regulating the largest commercial banks and some heavyweight industrial corporations engaged in finance. The House Financial Services Committee intends to draft the legislation quickly, but many members want to learn more first. Obama's proposal gives the central bank even greater power, including broad power to pick winners and losers in the private economy and behind closed doors. Yet Obama did not propose any changes in the Fed's privileged status. Instead, he asked Fed governors to consider the matter. But perhaps it is the Federal Reserve that needs to be reformed.
And those of us who manage the public's dollars will be held to account -- to spend wisely, reform bad habits, and do our business in the light of day -- because only then can we restore the vital trust between a people and their government.
Nor is the question before us whether the market is a force for good or ill. Its power to generate wealth and expand freedom is unmatched, but this crisis has reminded us that without a watchful eye, the market can spin out of control -- and that a nation cannot prosper long when it favors only the prosperous.
President Barack H. Obama
January 20, 2008 Inaugural Speech
Those looking for ideology in the White House should consider this: For the men who rule our world, rules are for other people.
Naomi Klein
Mr. Greider goes on to make six different points on why placing more power in the hands of the Federal Reserve is exactly the wrong way for America to go at this time in our nation's history. I will only point out a few Mr. Grieder's basic premises on his six reasons. His article on this subject is very long, and I strongly suggest that you read the entire article which is located here:
http://www.thenation.com/...
1. It would reward failure. Like the largest banks that have been bailed out, the Fed was a co-author of the destruction. During the past twenty-five years, it failed to protect the country against reckless banking and finance adventures. It also failed in its most basic function--moderating the expansion of credit to keep it in balance with economic growth.
2. Cumulatively, Fed policy was a central force in destabilizing the US economy. Its extreme swings in monetary policy, combined with utter disregard for timely regulatory enforcement, steadily shifted economic rewards away from the real economy of production, work and wages and toward the financial realm, where profits and incomes were wildly inflated by false valuations. Abandoning its role as neutral arbitrator, the Fed tilted in favor of capital over labor.
3. The Fed cannot possibly examine "systemic risk" objectively because it helped to create the very structural flaws that led to breakdown. The Fed served as midwife to Citigroup, the failed conglomerate now on government life support. Greenspan unilaterally authorized this new financial/banking combine in the 1990s--even before Congress had repealed the Glass-Steagall Act, which prohibited such mergers.
4. The Fed can't be trusted to defend the public in its private deal-making with bank executives. The numerous revelations of collusion have shocked the public, and more scandals are certain if Congress conducts a thorough investigation.
5. Instead of disowning the notorious policy of "too big to fail," the Fed will be bound to embrace the doctrine more explicitly as "systemic risk" regulator. A new superclass of forty or fifty financial giants will emerge as the born-again "money trust" that citizens railed against 100 years ago. But this time, it will be armed with a permanent line of credit from Washington.
6. This road leads to the corporate state--a fusion of private and public power, a privileged club that dominates everything else from the top down. This will likely foster even greater concentration of financial power, since any large company left out of the protected class will want to join by growing larger and acquiring the banking elements needed to qualify.
The fevered activity at Goldman is a sign of lingering economic illness, not economic health.
Robert Kuttner
Economist
There is a 'war' being waged within the Obama Administration. The Treasurer, Timothy Geithner is refusing to answer questions regarding 'who, where and how much' of the TARP money was distributed to. As noted by Glenn Greenwald in his column today Neil Barofsky the TARP watchdog is under fire:
A career prosecutor, Barofsky is a life-long Democrat who donated money to Obama's presidential campaign. But ever since he was appointed to head the oversight office created by Congress when it enacted TARP -- an office designed to ensure transparency and accountability at the Treasury Department and in the banking industry -- he has repeatedly clashed with Obama's Treasury officials over their lack of transparency in how the trillions of dollars in TARP-related funds are being sent to and used by the banking industry.
Barofsky details the war being waged by the Obama administration -- especially the Treasury Department -- on his independence, as well as their constant and multi-faceted campaign to impede his efforts to bring transparency to what is being done with these vast amounts of money (those obstructionist actions are consistent with the efforts of Senate leaders to block a vote on Ron Paul's bill to audit the Fed, a bill which now has truly bi-partisan and trans-ideological support among a majority of House members). As a hard-core Obama supporter, Barofsky is quite obviously dismayed at what he describes as the failure to adhere to transparency pledges in these areas. Barofsky is particularly worth listening to because his integrity, apolitical independence, and prosecutorial tenacity in imposing accountability are exactly what our political culture so woefully lacks.
http://www.salon.com/...
Sooner or later, President Obama is going to have to figure out which side he is on. Push is now coming to shove, and the 'Golden Triangle' of the Federal Reserve, the Treasury and the White House is about to implode. It is past time for reform, and it is past time to 'tear down that wall Mr. Obama' and let the sun shine in (S604 Bernie Sanders Sunshine Auditing the Federal Reserve Act).
The propaganda machine is in full swing: The recession is over, everyone dance in the streets, Goldman Sachs rules the world, bonuses for everyone on Wall Street, The Queen got her apology.... happy days are here again, we dodged that bullet, the catastrophe is over and it's time to just go ahead and 'trust the Federal Reserve' because they did such a great great job!!!!!!!!
OMG. Will it never end? The lies, the cover up, the bullshit of it all? Step up to the plate President Obama, you are the designated hitter.