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We're hearing it from some of our country's most senior officials in D.C., and throughout the MSM and the blogosphere, and even right here with regard to some of this community's most prominent diarists. Over the course of the past few months and weeks--and as recently as multiple times over the past 72 hours here at the Big Orange--we're told, somehow, the taxpayer is profiting or that Wall Street has "repaid" or is "projected" to repay our government for the trillions of dollars in government guarantees, backstops, long- and short-term loans, and actual cash disbursements (i.e.: "bailouts") that were made to U.S. banks and mortgage companies since our economy imploded in late Summer 2008.

Very simply, the very notion that taxpayers are making a profit on the Wall Street bailouts is pure unadulterated bulls**t. It simply isn't true. It is a meme fabricated by the status quo and furthered by its minions and true believers, even right here in this community. The concept that taxpayers will ever be repaid for these tithes to our nation's power elite is just as far-fetched.

For a moment, let's forget all about "the government guarantees and backstops," and let's just discuss the cash money that's still out there funding all of those obscene, record-breaking banker bonuses and salary increases right now....

As Wall Street pundit Barry Ritholtz noted, just two months ago:


Pro Publica has been maintaining a list of bailout recipients, updating the amount lent versus what was repaid.

So far, 938 Recipients have had $607,822,512,238 dollars committed to them, with $553,918,968,267 disbursed. Of that $554b disbursed, less than half -- $220,782,546,084 -- has been returned.

Whenever you hear pronunciations of how much money the TARP is making, check back and look at this list. It shows the TARP is deeply underwater.  

I just checked the list, which is regularly updated over at the (Pulitzer Prize-winning) ProPublica website, and as of tonight, Wall Street's $322,144,764,732 (keep the change) in the hole to Main Street as you read this.  If Ritholtz' commentary was written with today's numbers in place of the numbers he posted 60 days ago, it'd read:


So far, 938 Recipients have had $615,944,506,423 dollars committed to them, with $560,459,325,504 disbursed. Of that $560b disbursed, less than half -- $238,314,560,772 -- has been returned.

But, that only begins to scratch the surface of the real story(ies). (You know...the truth? This is a reality-based community, right?)

The list, linked above (and the huge sums on it), does not even include the Federal Reserve's emergency loan programs to Wall Street. ProPublica provides us with a separate Federal Reserve list and accounting for those funds.

Here's more on this from Dean Baker: "TARP Repayment and Legalized Counterfeiting."

Now, about those government guarantees, backstops and stealthier payments...bailouts that aren't even acknowledged as such...

As I've noted in recent diaries, the Wall Street too-big-to-fail ("TBTF") banks, starting with Bank of America, are now receiving more government commitments and backstops, going forward, to bail them out of the mortgage/foreclosure fraud fiasco--another Wall Street creation typifying the status quo's successful, ongoing efforts to privatize their profits while they socialize their losses among the unwashed masses.

Then again, fellow Kossack gjohnsit told us all about "The most expensive bailout of all, and no one is talking about it," last March.

And, as I noted in my post on Friday, "Endgame," a proposal is very quickly gaining serious momentum in Washington D.C. to turn the mortgage arms of virtually every major Wall Street bank into government-sponsored enterprises ("GSE's"), much like Fannie Mae and Freddie Mac, et al, are now. (Fannie and Freddie have, jointly, received over $150 billion in government/taxpayer subsidies in the past 28 months, give or take...come to think of it, scratch the "give," leave the "take.") This would amount to--by far and away--the biggest government/taxpayer backstop/commitment of all.

(h/t to blogger George Washington)

But, let's take a moment to look at some of the more stealthy bailouts that have occurred over the past 30 months, with many/most of them still in place, today. (Yes, the bailouts still continue...even if they're not called "bailouts.") Let me count just a few of the ways (and this is just a partial list):

Here's Bloomberg explaining, last May, how the TBTF's have massively benefitted (scores of billions of dollars over the past 24 months, alone) from guaranteed profits on trading spreads. Contrary to what one Kossack stated over the past day, this isn't about lending money for crappy collateral (that's another story, altogether); this is about the Federal Reserve lending money at less than 1% to the TBTF's, wherein the TBTF's turn around and buy securities and government paper with guaranteed yields of 2%, 3% and more.

There's the Wall Street Journal and blogger George Washington telling us of just a couple of the special tax benefits provided to the TBTF's to facilitate "emergency mergers"--mergers where the TBTF's netted billions--during the mortgage meltdown.

Read another post from Bloomberg on the Treasury Department-funded Public-Private Investment Program ("PPIP"), which many economic pundits tell us was merely just another bogusly-packaged scam to dispose of toxic bank assets on the backs of taxpayers for the benefit of invited members of the status quo. And, adding insult to injury, it actually enabled some TBTF's to increase their holdings of mark-to-make-believe crap, not decrease them.

And, of course, there's all of those sovereign bailouts we're reading about, nowadays. Here's Bloomberg, again explaining how the TBTF's are benefitting in a big way from those efforts, too.

As well as what may be the most publicized stealthy bailout of all, from Shahien Nasiripour at HuffPo: "Goldman Sachs Got Billions From AIG For Its Own Account, Crisis Panel Finds."


...Goldman Sachs collected $2.9 billion from the American International Group as payout on a speculative trade it placed for the benefit of its own account, receiving the bulk of those funds after AIG received an enormous taxpayer rescue, according to the final report of an investigative panel appointed by Congress.

The fact that a significant slice of the proceeds secured by Goldman through the AIG bailout landed in its own account--as opposed to those of its clients or business partners-- has not been previously disclosed. These details about the workings of the controversial AIG bailout, which eventually swelled to $182 billion, are among the more eye-catching revelations in the report to be released Thursday by the bipartisan Financial Crisis Inquiry Commission...

And those totally false statements you might have read over the past few days of how the banks had to "pay" for the privilege of disposing of their trash over the past three years at the public garbage collection point known as the Federal Reserve? That, in and of itself, is a truly false claim once you realize the Fed--even under court order to disclose the specifics of these transactions--thumbed it's nose at the U.S. taxpayer (even then). From Naked Capitalism Publisher Yves Smith, on December 2nd (just over two months ago): "Fed Thumbs Its Nose at Audit the Fed; Withholds Data Required on $885 Billion of Collateral."


Fed Thumbs Its Nose at Audit the Fed; Withholds Data Required on $885 Billion of Collateral
Yves Smith
Naked Capitalism
Thursday, December 2, 2010

Well, even under the compulsion of law, the Fed chooses not to comply. Should we be surprised that it continues to refuse to make mandated disclosures?

In this case, as reported by Bloomberg, the Fed has withheld information that was of the collateral posted by borrowers to secure $885 billion of loans. Without this information, it is impossible to ascertain the risks undertaken in various emergency facilities. Dodd Frank specifically requires this detail be released: the relevant language is boldfaced:


(c) PUBLICATION OF BOARD ACTIONS.--Notwithstanding any other provision of law, the Board of Governors shall publish on its website, not later than December 1, 2010, with respect to all loans and other financial assistance provided during the period beginning on December 1, 2007 and ending on the date of enactment of this Act under the Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility, the Term Asset-Backed Securities Loan Facility, the Primary Dealer Credit Facility, the Commercial Paper Funding Facility, the Term Securities Lending Facility, the Term Auction Facility, Maiden Lane, Maiden Lane II, Maiden Lane III, the agency Mortgage-Backed Securities pro- gram, foreign currency liquidity swap lines, and any other program created as a result of section 13(3) of the Federal Reserve Act (as so designated by this title)--
(1) the identity of each business, individual, entity, or foreign central bank to which the Board of Governors or a Federal reserve bank has provided such assistance;
(2) the type of financial assistance provided to that business, individual, entity, or foreign central bank;
(3) the value or amount of that financial assistance;
(4) the date on which the financial assistance was provided;
(5) the specific terms of any repayment expected, including
the repayment time period, interest charges, collateral, limitations on executive compensation or dividends, and other material terms
; and
(6) the specific rationale for each such facility or program

In other words, there is no way to pretend that this information was not part of the stipulated disclosure. The terms of the various types of support extended are to be revealed by borrower, in particular the details of the various types of support extended, including the collateral posted. Instead, the Fed provided the data on an aggregated basis, by asset type and rating and then only for three of six facilities.So what is the Fed trying to hide?

A number of experts correctly pointed out that this is inadequate:


"This is a half-step," said former Atlanta Fed research director Robert Eisenbeis, chief monetary economist at Cumberland Advisors Inc. in Sarasota, Florida. "If you were going to audit the facilities, then would this enable you to do an audit? The answer is `No,' you would have to go in and look at the individual amounts of collateral and how it was broken down to do that. And that is the spirit of what the requirements were in Dodd-Frank."...

It is "specifically impossible" to know how much risk taxpayers were taking by looking at pools of collateral grouped by asset class and rating, said Sylvain Raynes, a principal at R&R Consulting in New York and co-author of "Elements of Structured Finance," published in May by Oxford University Press.

"I need to know the individual composition because a $2 billion pool can be one asset of $2 billion, which would be very risky, or 2,000 assets of $1 million each, and that's not risky at all," Raynes said. "The spirit of Dodd-Frank was not respected, and they used the vagueness in the wording of the law to weasel out of fulfilling their duty to the American people."

One expert argued that the data needed to be withheld because it might spur bank runs. This is simply barmy. These loans took place during the crisis; this exercise is about past, not current exposures. And the Treasury has given all the TARP banks clean bills of health. There's no risk here, save to the Fed's reputation and its secrecy.

So, we now have Kossacks--apparently people in our community "know facts" that not even the most senior elected officials in D.C. are privy to--telling us (sorry, no links; I'm not going to call out anyone, directly) that the banks didn't profit from all of this chicanery, while the Federal Reserve has openly defied court orders regarding disclosure, to the tune of $885 billion in assets. We're told by these diarist's that this was all "AAA" collateral.

LOL! And, I'm laughing because based upon facts and documentation that we do know (now), the truth is that the banks got away with wholesale abuses of the system. From the NY Times: "How Banks Pawned Junk to the Fed."


How Banks Pawned Junk to the Fed
By BEN PROTESS
Dealbook
NY Times.com
December 2, 2010    2:01PM

...The Central Bank's program, known as the Primary Dealer Credit Facility, was a cheap overnight loan system for banks that was similar to the Fed's discount window.

The Fed originally restricted collateral to investment-grade bonds. But the fall of Lehman lowered its expectations, and the banks wasted no time responding.

The day after Lehman's collapse JPMorgan, Goldman Sachs, Citigroup and Morgan Stanley collectively pledged more than $100 million in collateral that was rated Triple-c or below.

On a $4 billion loan that day, Morgan Stanley posted $32 million in junk-rated collateral. The week after, Bank of America started pledging junk and never looked back. Nearly all of Bank of America's loans through the Fed program  were at least partly collateralized by low-rated assets.

And as time went on, banks found it cheaper -- and easier -- to borrow...

Here's more on this from Pulitzer Prize-winning NY Times columnist Gretchen Morgenson, also from just a couple of months ago: "So That's Where the Money Went."

Also checkout a recent post by economist Dean Baker, linked here: "The Big Bank Theory: How government helps financial giants get richer."

Well, of course, the pretzel logic being deployed here is thus: the TBTF's took on greater and greater risks throughout the past decade, with the tacit understanding that if they screwed the pooch, the government would step in and bail them out with taxpayer money. In 2008, that is what happened. And, in 2011, it is happening, still. So, to prevent the banks from behaving badly in the future, we are now providing them with even greater support and more formalized/institutionalized guarantees...so...so...they won't do it again?

Well, that's just peachy. I can't wait to read diaries here in coming months and years about all the profits we'll be making then.  Damn! You can practically count the "profits" already!

Originally posted to http://www.dailykos.com/user/bobswern on Sun Feb 06, 2011 at 05:30 AM PST.

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Comment Preferences

  •  Gee bob your diary s so ciomplete (5+ / 0-)

    that it appears no can comment!(at least for the first 20 minutes)

    snark

    I believe that banking institutions are more dangerous to our liberties than standing armies. Thomas Jefferson

    by deepsouthdoug on Sun Feb 06, 2011 at 05:52:27 AM PST

  •  thank you for this. The pooch remains screwed. (7+ / 0-)

    Essentially, we remain in a fantasy economy in which the mega wealthy are building new redoubts for the next collapse.

    ecstatically baffled

    by el vasco on Sun Feb 06, 2011 at 05:52:52 AM PST

    •  Easy to See Where Too (2+ / 0-)
      Recommended by:
      orson, Joieau

      "...the mega wealthy are building new redoubts for the next collapse..."

      Just follow the money!  It's all headed toward China and the quiet principalities of the Middle East.  Corporate chieftains love nothing so much as tightly controlled societies which have ready access to military violence to enforce rules imposed from above.  The plutocracy certainly doesn't want a populace which can walk away from their commands.

      The right-wingers of this world don't want to hear it, but that is essentially what the old Soviet Union was - a corporate operation (the party apparat) deciding where investments would be made and ordering people around to staff those facilities, all under the threat of some sort of violence to resisters.  Some called it state capitalism, but it wasn't communism and it barely even approximated socialism.

      "Love the Truth, defend the Truth, speak the Truth, and hear the Truth" - Jan Hus, d.1415 CE

      by PrahaPartizan on Sun Feb 06, 2011 at 07:52:19 AM PST

      [ Parent ]

  •  complete (4+ / 0-)
    Recommended by:
    bobswern, LWelsch, Words In Action, Joieau

    better have my coffee first.

    I believe that banking institutions are more dangerous to our liberties than standing armies. Thomas Jefferson

    by deepsouthdoug on Sun Feb 06, 2011 at 05:53:15 AM PST

  •  More doom and gloom. (7+ / 0-)

    Why are you such a hater, Bob?

    Don't you know that Obama is brilliant and his pragmatic financial advisers the best in the land?

    The economy is just fine and you WILL like it; financial beatings will continue until moral improves.

    /snark

    ...his...appointments showed that he had no intention of honoring the promises he made... He's a liar and a cheat. -Dallasdoc

    by Words In Action on Sun Feb 06, 2011 at 05:58:47 AM PST

  •  I'm a mathmatic idiot (4+ / 0-)

    But I knew something was up.  Just because I've grown to expect it.

    I'm not afraid of guns! I'm afraid of the people that obsess over owning them.

    by Detroit Mark on Sun Feb 06, 2011 at 06:01:15 AM PST

  •  You mean factual diaries rather than hysteria? (6+ / 0-)

    I know it's distressing if you have a preconceived notion that the bailouts can't possibly work.

    But the recent diaries that you are complaining about are based on facts and figures provided by groups like Pro Publica, financial press reporting and even close readings of the documents and agreements that created the various financial bailouts.

    Moreover, they are based on simple mathematics and an understanding of accounting which your diary today shows you simply don't have a grasp of.

    If someone puts $1,000 in the bank, gets 5% for 6 months, draws out $600, leaving $400 on deposit, that person is not "in the hole" for $400.  That person has made 5% for six months and still has a $400 investment.

    This paragraph shows that you still don't understand the most basic ideas of finance:

    I just checked the list, which is regularly updated over at the (Pulitzer Prize-winning) ProPublica website, and as of tonight, Wall Street's $322,144,764,732 (keep the change) in the hole to Main Street as you read this.  If Ritholtz' commentary was written with today's numbers in place of the numbers he posted 60 days ago, it'd read:

    So far, 938 Recipients have had $615,944,506,423 dollars committed to them, with $560,459,325,504 disbursed. Of that $560b disbursed, less than half -- $238,314,560,772 -- has been returned.

    This means that $560 billion was disbursed.  Most of it carried a 5% mandatory preferred stock dividend, plus warrants to recapture any increase in the stock price of the recipient.

    Just under half has been returned, and just over half is still invested in the banks and performing, and paying 5%.  This does not mean TARP is "in the hole." This is why the financial press predicts that TARP will break even or make a profit.

    You also continue to repeat the idea that banks can borrow at zero interest and buy treasuries at a positive interest rate.  You might want to read this diary, which debunks this claim:

    http://www.dailykos.com/...

    The Bloomberg article you linked to, to support your claim is about the spread between short term lending, such as inter bank lending, and the yield curve.

    And your recent diary, "Endgame," about the proposals by the left leaning Center for American Progress,  concerning returning mortgage lending to normalcy, seems to have nothing whatsoever to do with the actual CAP document you are trying to discuss and that you linked to.  That document points out that while the Tea Party misled public is screaming that the bailouts helped Wall Street and not Main Street, in fact virtually every mortgage made since 2008 has been financed directly or indirectly by the Fed (and I might add, every student loan, every car loan, and many payrolls and inventory purchases).  That document simply points out that this is unsustainable and seeks to get back to something like what we had before deregulation.

    We're in an amazing period because "teh internets" provide an abundance of information to everyone instantly; problem is, most of it is wrong.  

    Under these circumstances, it's possible for you to publish diary after diary based on the right wing, free market rantings of Yves Smith of Naked Capitalism, while trashing the liberal Keynesians at Center for American Progress, and people who think they are progressive applaud you while usually prefacing that applause with something like, "I don't know much about economics, but gee this is impressive..."

    •  aside from the major banks being bailed out, (0+ / 0-)

      what has changed substantially?   Do we have real rating agencies for example?

      ecstatically baffled

      by el vasco on Sun Feb 06, 2011 at 06:56:26 AM PST

      [ Parent ]

      •  You mean changed from what was happening? (2+ / 0-)
        Recommended by:
        el vasco, Wheever

        First of all, most people don't grasp what the purpose of the bailout was.  I've written about it here, but because it's not full of words like "bankster" and "fraudster," it isn't wide read.

        http://www.dailykos.com/...

        http://www.dailykos.com/...

        What changed was that we were headed predictably toward a depression much worse than the 1930s, based on what was already happening.  To summarize a series I've started, this is where things stood in late 2008-2009:

        *the system for "settling" check deposits, ATM withdrawals and electronic funds transfers had collapsed; as Dean Baker noted at the time, you'll need gold to buy groceries if something isn't done within a week

        *the system for financing international shipping -- food, oil, coal, steel, goods -- had collapsed, ships were being withdrawn from the ocean and shipping rates were down 98%

        *the system for financing payrolls and inventories with commercial paper had collapsed, and there was a run on it projected at $5 trillion in one day, more than any US financial agency could face, and we faced all the montly layoffs that happened from late 2008 to early 2009 happening in one week

        *the system for financing farmers to plant winter wheat in the fall (that's actually when most wheat is planted) had collapsed even though it was planting season

        *the system for financing trains and rail traffic had collapsed, so railroads were parking all the box cars in train marshalling yards and abandoned rail sidings

        *the system truck drivers use to finance fuel, food and lodging had collapsed and many truck drivers were pulling over to the sides of highways

        *the system for financing credit cards (credit card receivable asset backed securities) had collapsed, the banks were out of credit card funding, and were calling customers telling them not only that they couldn't charge more, but that their credit limits had been lowered to below their balances -- in effect, "calling in" all credit card loans

        *the system for financing student loans had simply disappeared, and there were zero funds available for the Spring 2009 semester

        *the system for financing car loans had also simply evaporated, which was why GM went bankrupt -- even more so than because of long term structural deficits

        *the system for financing mortgages was completely frozen, so there was no money for mortgage modifications, or any sort of home purchase market

        *the system by which grocery stores finance the purchase of food had collapsed

        I could go on and on.  This is why Paulson and Bernanke called in members of Congress and said if something isn't done, there will be martial law.  Not because they were saying give us TARP or Bush will declare martial law; but because if something wasn't done, there would be no real economy left, and without food, fuel, bank deposits and withdrawals, checks, ATMs, or anything else, people would freak out.

        So what changed was that in addition to TARP stabilizing the banks, the Fed essentially became the nation's retail banker.

        Almost every student loan, car loan, and mortgage, many payrolls, much of the industrial inventory purchases, almost all sea and rail shipping, etc., was financed directly or indirectly by the Fed.

        This is what the Center for American Progress report that bob so mischaracterizes is about.  It's about the fact that the Fed cannot continue being everyone's bank forever.  

        I find it very amusing that people wanted the Fed to disclose their books.  When they finally did, there was all this commentary, like, "huh? why was the Fed lending money to Harley Davidson and McDonalds?"  The answer is that there was no financing system other than the Fed and the credit lines that companies like Harley and McDonalds relied on, were basically taken over by the Fed.  

        Main street has been kept afloat largely by about $2 trillion in credit from the Fed.

        Yet people are upset that the Fed was lending money to "big corporation."  Would you have preferred that all those corporations go bankrupt along with the "banksters" and lay off all their employees?

        So what changed is that we were not pummeled back into the pre industrial age.

        We also got the first few baby steps toward reconstructing a financial system in which this can't happen again.

        •  well Hamp (3+ / 0-)
          Recommended by:
          PrahaPartizan, emal, TracieLynn

          I remember that diary of yours, I even Rescued it.  But I remember that as specifically about the immediate liquidity crisis that I thought you explained quite well.  However, I suspect bobswern is referring to other bailouts  in which the Fed bought up a bunch of junk paper that we'll never see value for.

          Perhaps if you had spent the past few years writing more diaries to explain things, instead of your sole two offerings, we might have more info to evaluate your position.

          don't always believe what you think...

          by claude on Sun Feb 06, 2011 at 08:56:01 AM PST

          [ Parent ]

          •  Thanks again, but I did write more (1+ / 0-)
            Recommended by:
            Wheever

            I just wrote one about how the idea, that the Fed accepted "junk" is pretty much a myth:

            http://www.dailykos.com/...

            I've also explained in several comments why, despite the massive amount of mortgage foreclosure, surprisingly many mortgage backed securities retain their triple A ratings:

            http://www.dailykos.com/...

            So I'm continuing the series, slowly but surely.  Unfortunately, I don't use words like "bankster" and do use lots of numbers and explanations of contract provisions, and that isn't popular.

            •  Over Simplification (4+ / 0-)
              Recommended by:
              claude, emal, TracieLynn, bobswern

              A review of those diaries and comments indicates that, in and of themselves, they are quite accurate and truthful.  Unfortunately, that's now the whole story, which is still in the writing.

              Isn't the issue at play that few people are willing to trust the bankers, after their awful track record?  It doesn't matter that this or that MBS is truly a gilt-edged security when even the bankers acknowledge that they really can't assess just what is stuffed into those MBSs and how their models are performing.  

              Also, while over a century some of the bankers' models will have proved out to be tolerably accurate, in the moment of crisis, when prices were spiraling down, the Fed absorbed the risk which should have belonged to the banks and wasn't paid much for it.  Now that the system has quasi-stabilized, the bankers are back to "business as usual" while the rest of society tries to dig its way out of the financial system mess created in large part by those very same bankers.  If the bail-out preserved only keeping the system greased (stopping Great Depression II in other words) but didn't terminate the process which put that system in jeopardy, did it actually perform as it was sold to the public?  Otherwise, if all of the swaps, etc. you site are so ordinary, run-of-the-mill occurrences which would not have cost the banks money, why weren't they used previously?

              "Love the Truth, defend the Truth, speak the Truth, and hear the Truth" - Jan Hus, d.1415 CE

              by PrahaPartizan on Sun Feb 06, 2011 at 10:49:52 AM PST

              [ Parent ]

              •  Not sure we're talking about the same issues (0+ / 0-)

                The issue is not whether we should "trust the bankers."  Please point out somewhere in any of my diaries where I make that point.

                The issue is very narrowly, what was TARP, did it work, did it work while not costing very much?  

                I suppose the bigger question is, is the Keynesian/liberal model of aggressive government intervention in the economy correct?  Or are the right wing teabagger and bobswern type "leftbagger" approaches correct, that all aggressive government intervention in and regulation of the financial markets only help for "banksters" and "lazy poor people" doomed to failure and fleecing of the taxpayer?

                Also, keep in mind that the bailouts did not "preserve the system."  The system is radically altered.  In fact, by early 2009, many financial writers had concluded, correctly, that Wall St simply doesn't exist anymore.  Wall St consisted of independent investment banks, unregulated by statutes and regulations imposed on depository banks.

                Except for a few survivors, all the major investment banks went bankrupt.  Their owners lost 90% of their wealth -- not that it matters because they were filthy rich and 10% of what they had is still rich.  The last few surviving investment merged with depository banks or had themselves reclassified as depository banks.

                I can't emphasize this enough.  The old system is completely gone.  It's dead, it has been swept away.  There is no "business as usual."  The system is entirely new and it will take years to figure out who to structure and regulate it.

                But Wall St simply doesn't exist anymore notwithstanding how many times bobswern rants about it.

                •  Your stretch from point "A" to point "Z" is... (0+ / 0-)
                  ...just more of the same, in a society where most people don't even know the name of their current member of the House of Representatives, they sure as hell don't know the difference between TARP (which most conflate with ALL Wall St. bailouts) and the Fed's Primary Dealer Credit Facility (PDCF, etc.), not to mention the 20-30 other gov't programs involved in the bailout. But, you know this, and even attempt to conflate matters in your commentary.

                  The fact is, much moreso than derivatives, per se, it was the abuse of products such as Collateralized Debt Obligations (CDO's) and synthetic CDO's which were the cause of much of this problem. But, you know that, as well.

                  Using an analogy, you're talking about the use of blasting caps and Ammonium Nitrate, of and by themselves. They have appropriate use...in fields such as construction and agriculture. It's when they're mixed with things like C-4, or sold without adequate supervision--or no supervision at all--where the real problem lies.

                  To posit that our nation's derivatives marketplace is significantly reconstructed, in any way, shape or form as a result of all of this is also quite disingenuous, at least from someone who claims to know the inner workings of Wall Street. The truth is, it's not "fixed," not by a longshot.

                  And, to brush over the fact that massive problems remain completely unaddressed in the shadow banking marketplace--problems that are and have been at the root of much of this all along--as if it's some nebulous issue, are also completely disingenuous, as well.

                  Sorry, but, this is very sophisticated propaganda you're peddling here...and I wouldn't be doing it justice by going too deep in the comments of a thread which, at the end of the day, is really just more of the same...

                  "I always thought if you worked hard enough and tried hard enough, things would work out. I was wrong." --Katharine Graham

                  by bobswern on Sun Feb 06, 2011 at 12:56:10 PM PST

                  [ Parent ]

                  •  For the record, despite the commenter's... (0+ / 0-)
                    ...ongoing attempts--and from a very sophisticated position I might addd--to conflate many matters to this crowd of laypeople, the reality is I'm a supporter of the New Keynesian school of economic thought, although I'm not an economist nor do I pretend to be one.

                    (But, again, this is just a response to what I've found to be, at its heart, quite disingenuous commentary which masquerades as something quite different in this community, and it's coming from numerous sources, each with their own slant.)

                    To even begin to defend the derivatives (without getting into the highly complex and deliberately obfuscated world of collateralized debt obligations) or shadow banking marketplaces/sectors (without getting into the incredibly obfuscated realities of regulatory capture and revolving-door supervision in this country, today) without providing very lengthy, substantive background to what's, inherently, an audience of laypeople, is quite disingenuous, at its very core.

                    But, the commenter DOES know this. The majority of the audience, however, does not.

                    "I always thought if you worked hard enough and tried hard enough, things would work out. I was wrong." --Katharine Graham

                    by bobswern on Sun Feb 06, 2011 at 01:08:19 PM PST

                    [ Parent ]

                    •  Thanks for all the mind reading an innuendo (0+ / 0-)

                      I'm a propagandist (albeit sophisticated!), my diaries are mere "memes" and I'm defending derivatives.

                      Actually, can you point to a paragraph where I defend derivatives?  Did you read what I had to say about CDOs?  As for my defending "shadow banking" did you even read what I wrote about hedge funds -- that they are parasites on the financial system?

                      In bob-word (tm) everyone who disagrees with you is merely spreading memes or propaganda, or defending the indefensible, while Bob's propagating the free market ranting of an actual Wall Street investment bank advisor (Yves Smith) is somehow honest to god truth, which needs no verification because, you know, bob wrote it.

              •  Btw, all snark aside, thanks for this--> (0+ / 0-)

                A review of those diaries and comments indicates that, in and of themselves, they are quite accurate and truthful.  

                It is much more important to me that you or any other DKer read the diaries and decided that they were truthful, than that you agree with me on interpretation or conclusions.

                That's a big first step -- when we can agree about facts and not impunge each other's motives, even if we disagree.

                •  Truthful in a half of the truth kind of way (0+ / 0-)

                  Sin of ommission...you didn't tell the whole truth...and you even conflated the "truth".

                  Yeah you told an incomplete story, therefore only a partial truth. But you inferred and made it appear like the whole complete truthful and accurate story. It'd be just like if I only gave you part of my financial disclosure balance sheet and cherrypicked pieces out and made it appear as if it was the total picture/story..it'd be dishonest...incomplete.

                  A partial truth teller is still dishonest.

                  Between this and the "leftbagger" comment above...well...you're not doing yourself any favors.

                  It will not matter how much money was in my bank account, but the world may be a better place because I was important in the life of a child.

                  by emal on Sun Feb 06, 2011 at 02:50:12 PM PST

                  [ Parent ]

                  •  Can you explain (0+ / 0-)

                    what truth I left out.  Keep in mind, that in my first diary I mentioned that the financial system pre crash was so complex that I postponed writing about it, because it's hard to write about anything without writing about everything.  So, I've deliberately broken up the series into sections addressing specific events and sectors.

                    Can you offer a constructive suggestion about any of the three diaries that points out what was left out or why you think it was misleading?

                    •  Look at the diary I responded (0+ / 0-)

                      where it's pointed out that what I thought was happening there was that you were (in your title at least) inferring that the entire TARP program, never mind the entire bailout was/is really only about one subprogam of the TARP...you even used it it saying it fully disproved anothery MYTH. The one piece you highlighted was only one small program on the TSLF/TOPS program yet you insinuated it was TARP in it's entirety. I mentioned Big Picture versus one subprogram piece here.

                      You know what you did...you know you did it. Half the story, half the complete picture of TARP.

                      I'm the one in that diary that provided the other links to other bailout programs/costs and TARP information and to the Pro Publica site there. Not you. You told a partial story...an incomplete story not the complete truth.

                      And I've yet to look at all the other comments you've made about the MBS's but here you tell me in this diary that the Bush SEC wasn't doing it's job...if it'd only done it's job and demanded stringent following of regulations for those MBS's. (I understand how not all MBS's are the same).

                      Ok...So if the MBS's that the Bush SEC was responsible for ensuring were valid and truly authentically representative of their ratings (and then bundled up into Derivatives) how can you totally infer with a straight face in that comment that they're all still valid ratings. (of course many are valid- but still it's disingenuous) How can you make that whole comment without in the breath at least t mention how you are/ were concerned that the Bush SEC was not doing their jobs and being stringent with their demands with MBS's when you initially made that comment? You left out some very important context with that comment...and inferred something very different.

                      Again a partial incomplete story from you in that comment.

                      And I must admit the fact that you're also using the "leftbagger" terminology, and also stating to bob to look up for himself for your comments on Derivatives....well that tells me you're not truly serious about debating and getting the complete truth out but really interested more in scoring points against someone you obviously disagree with here.

                      You're obviously very knowledgeable and a great resource of information on this issue ...it's a shame to see you not be fully upfront ...completely upfront.

                      It will not matter how much money was in my bank account, but the world may be a better place because I was important in the life of a child.

                      by emal on Sun Feb 06, 2011 at 04:02:23 PM PST

                      [ Parent ]

                      •  Your critique is difficult to follow (0+ / 0-)

                        you were (in your title at least) inferring that the entire TARP program, never mind the entire bailout was/is really only about one subprogam of the TARP.

                        But TARP actually was a very narrow program.  Check out Pro Publica or any other source.  TARP was the program initiated by Paulson during the meltdown.  Initially it was a purchase of assets (hence troubled asset relief...), but at the last minute was changed to a purchase of preferred stock in the banks.  Some TARP funds were used for other purposes -- I think some was diverted to GM -- but TARP was quite narrow.  I never implied that TARP was the entire bailout.  I made it very clear that the Fed program was separate.  I think you misread what I wrote.

                        The one piece you highlighted was only one small program on the TSLF/TOPS program yet you insinuated it was TARP in it's entirety.

                        You are implying that I "highlighted" a TARP program that was a "small program" on the TSLF ...  I never wrote that, because it's not true.  TARP was a Treasury Department Program.  TSLF was a Fed program.  I've made that very clear throughout.

                        You know what you did...you know you did it

                        Uh, no.  I still can't parse what you think "I did."

                        And I've yet to look at all the other comments you've made about the MBS's but here you tell me in this diary that the Bush SEC wasn't doing it's job...if it'd only done it's job and demanded stringent following of regulations for those MBS's. (I understand how not all MBS's are the same).

                        I can't even follow what this means.  You haven't read my "other comments" -- so how do you know how complete my analysis is?  Also, the regulations have to do with disclosure -- how much information the issuer of MBS provides and how accurate it is.  That's where the Bush SEC failed -- obviously -- because the disclosure documents said they were AAA and they weren't.

                        Ok...So if the MBS's that the Bush SEC was responsible for ensuring were valid and truly authentically representative of their ratings (and then bundled up into Derivatives) how can you totally infer with a straight face in that comment that they're all still valid ratings.

                        I didn't say they are all valid, nor did I say the ratings were all valid.  I said that many triple A MBS did not default.  If you read what I wrote, I specifically said that AAA rated CDOs defaulted and caused the crisis.

                        •  I think you're now (0+ / 0-)

                          being a bit disingenous here...and saying you don't understand. I may not be expressing myself very well  and I apologize. But based on your responses you've understood my point. I do think you are getting what I'm saying.

                          You need to be very precise in your title as to exactly what TARP means(when you're using it...cite exactly what you mean if you can) so  when readers see the word TARP and MYTH in the same sentence in your title everyone understands exactly what it is you are and are not saying or referring to. You think you did, I disagree and explained why.

                          And  you think/assume people here that read it (outside of other experts just like yourself)fully understand these small differences with this? You need to stop playing on some of people's own lack of knowledge...when people hear TARP they may think entire Bailout and we all know for a fact that is just not the case. Everyone has a different connotation of what TARP really means...and the mainstream media and politicians are taking advantage of that confusing connotation.

                          And still the name calling and labeling needs to stop please. I noticed you haven't addressed that part of my commentary regarding "leftbagger" and even "teabagger" and "Keynesian"...I'd venture to say most people that are reading this, just do not fit any of those labels. So leave it out of your diaries if you truly want to educate and enlighten people instead of inflaming passions based on those labels as many people here use them to belittle people...imo not good.

                          And lastly you are still often not providing sources for you comments with links.

                          You'd do yourself a huge favor if you included more of them even with your comments.  

                          As I said you are wealth of knowledge and I appreciate your information/point of view you've provided here (even if I may not fully agree with you on everything I still can learn something from it). But I hope you continue to use it to educate people and leave the labels out of it.  

                          It's more than clear I may not be the best or concise writer for conveying my thoughts  here...but it doesn't mean I am always wrong.

                          Have a good evening...

                          It will not matter how much money was in my bank account, but the world may be a better place because I was important in the life of a child.

                          by emal on Sun Feb 06, 2011 at 05:30:56 PM PST

                          [ Parent ]

                          •  Point of info (1+ / 0-)
                            Recommended by:
                            emal

                            and then I'll leave it at that.

                            By TARP, I mean the bailout that was carried out under the statute passed in the fall of 2008.  That was when Paulson asked Congress for $700 billion, basically no strings attached.  Barney Frank told him he could wait for a real bill and he and his staff wrote a 100+- page bill that created the Troubled Asset Relief Program.

                            Originally, TARP, even as envisioned by Frank, was for the Treasury to purchase "troubled" securities from banks.  Then Gordon Brown, PM in the UK stabilized his banks by directly partly nationalizing the UK banks.  The US Treasury then used TARP to buy preferred shares in US banks, partly nationalizing them.

                            That's what I mean by TARP because that's what the bill and program were called.

                            Most of the other bailouts in the US were carried out by the Fed, and I don't consider them to be TARP because legally they aren't.

            •  You also don't discuss CDO's...and synthetic... (0+ / 0-)
              CDO's...(i.e.: Collateralized Debt Obligations) which were, in many instances, at the heart of this problem.

              This is a story of deliberately over-complicated products, comprised of CDS' and other forms of derivatives...in essence, an unbridled financial services industry, which is still--for all intents and purposes--virtually as unbridled today as it was in 2008.

              "I always thought if you worked hard enough and tried hard enough, things would work out. I was wrong." --Katharine Graham

              by bobswern on Sun Feb 06, 2011 at 12:40:53 PM PST

              [ Parent ]

        •  What, exactly, (1+ / 0-)
          Recommended by:
          TracieLynn

          has been put into place to assure this "can't happen again?" I'm afraid I'm not seeing it, unless you mean that this "reconstructed" financial system is your basic neo-fascist construct where the state exists to keep the essentially unregulated rich in forever growing (and always private) profits via direct assault on the living standards of the people, flavored by enforced theft.

          Now, more than ever, we need the Jedi.

          by Joieau on Sun Feb 06, 2011 at 09:21:42 AM PST

          [ Parent ]

        •  thank you for the thorough response. Truly. (0+ / 0-)

           But I wish you would offer some detail re the "baby steps".  They must be very tiny feet,  as I can't see them.

          And, seriously, why do words like "bankster" not apply?    You list the responses to broken and frozen systems.  Obviously responses were necessary.  But  where is the serious reform that will prevent new breakdowns?

          ecstatically baffled

          by el vasco on Sun Feb 06, 2011 at 09:23:38 AM PST

          [ Parent ]

          •  Consumer finance agency, SEC, ratings agencies (2+ / 0-)
            Recommended by:
            el vasco, Wheever

            The biggest villain in the meltdown, IMO, was the Bush era SEC.  I know very few people have pointed this out, so I'm an outlier here.

            But the system collapsed because many triple A mortgage backed securities, which are the bread and butter of banking, turned out not to be triple A.  That's why the system freaked out.  Triple A MBS are NEVER supposed to default and many did.

            The agency that is responsible for making sure that when a bank issues Triple A mortgage backed securities, they actually are Triple A MBS is the SEC.  Bush presided over the worst SEC since the agency was founded.  Simply by appointing competent people at that agency, we can stave off another panic for a while.

            Reconstructing the financial system is going to take a long time.  The number of regulations that apply -- and they are bound into big binders for lawyers -- is in the range of 50,000 dense incomprehensible legalese.  Those are just the regs under the Securities Act and Securities Exchange Act.  Add the banking and tax regulations and you have five years of reading and analysis before you can even begin to construct a new system.  I would not expect the Obama administration's reformers to even have finished reading it yet.  This will take a few more years.

            Also we have Elizabeth Warren in place trying to set up a consumer financial protection agency.  Again, this will take years.

            I honestly don't get the idea that somehow a system this complex can simply be fixed within 24 months.

            •  Republicans are defunding the SEC (0+ / 0-)

              budget...see here.

              And from that same article there are links to actioins which says the SEC has already put on hold  Note, There are sourced links within this paragraph to support these statements I just did not include them in this blockquote.

              ...Due to budget constraints, the SEC has already put on hold certain aspects of Dodd-Frank implementation, including the creation of a new office meant to aid financial whistleblowers. The agency is also “failing to follow up on tips about potential wrongdoing and postponing examinations of money managers and brokers who are far from their offices,” since it can’t afford to send inspectors out of town. The CFTC is facing very similar problems.

              So those baby steps are being undermined by congress. And there were plenty of people (not solely you) who said the SEC contributed to this catastrophe. I believe the SEC had some avid pron internet surfers just for starters, that we read about instead of doing their jobs.

              That said, I read those diaries but they are extremely small small almost miniscule pieces your discussing. It's like small drops/spoonfuls of water in an OCEAN of the big picture gov't bailout. Yes that information needs to be included if it is correct, but even if it is correct, it does not necessarily make the Big picture commentary others describe as wrong. It may not fully refute things. Plus you might be discussing one program (in the case of TSLF and TOPS you highlighted)that did as you stated (yet the Fed has not been completely forthcoming with all information so we may not ever really know the full truth/extent) and yet others might be discussing other different programs or looking at the total Big Picture of bailout programs made available.

              So you are conflating things and attacking others as being factually wrong, when you may not even be discussing the exact same similar acrononymed bailout program. That's wrong and you shouldn't conflate TSLF/TOPS program with the entirety of TARP either..they're where many many other programs that fell under TARP (and non TARP programs too).

              It will not matter how much money was in my bank account, but the world may be a better place because I was important in the life of a child.

              by emal on Sun Feb 06, 2011 at 10:34:19 AM PST

              [ Parent ]

              •  Not sure I get your point about the SEC (1+ / 0-)
                Recommended by:
                Wheever

                I used to work in finance during the Clinton administration, and I worked on designing mortgage backed and asset backed securities.

                In order for our clients to sell asset backed securities, they had to file a registration statement and prospectus with the SEC.  My job was to accurately describe the MBS.  The Clinton SEC was extremely hard-assed.  They made you write draft after draft until all risks were disclosed not only accurately, but in clear language.  I knew a few SEC lawyers on the other side and they were extremely dedicated, and I respected their judgment.

                While Congress may posture about not funding NEW functions of the SEC, its role in MBS is one of those routine things they can't really affect, because it is funded from the fees the SEC charges to review the prospectus and registration statement.  What matters is how the administration instructs the SEC reviewers to review these documents.  That's what I meant by the Obama administration's SEC.  During the Bush administration, the SEC simply didn't require the issuers to accurately describe the securities.  This is one of those areas in which a change of administration and policy are more powerful than changes in legislation.

                •  You're the one who mentioned (0+ / 0-)

                  the SEC as a part of baby steps..  my point here was if they (the SEC) has an enormous workload now and now they're being forced to cut their budget, what makes you think they're going to do their jobs any better or be more thorough and complete. Especially while they're now responsible for learning new regulations which we are told are put in place to help prevent another crisis from occurring. I see this as another recipe (no matter how good you might be) for huge mistakes/accidents to happen and oversight quality to suffer. I see this as an effort to undermine the agency that regulates those securities. That was my point.  

                  It will not matter how much money was in my bank account, but the world may be a better place because I was important in the life of a child.

                  by emal on Sun Feb 06, 2011 at 11:22:52 AM PST

                  [ Parent ]

                  •  SEC regulation of mortgage security issues (0+ / 0-)

                    is funded by fees.  It isn't affected by Congress.

                    The point I was making is that one important change is that the SEC does not allow issuers to issue mortgage backed securities without much more accurate disclosure, which is a major new step.  And there's nothing the issuers can do about it.  The SEC can send you back 50 times and then still deny your ability to "go effective" and issue securities.

                    It all depends on what the SEC chairmen tells the staff to do.

                    •  So Shapiro was lying when (0+ / 0-)

                      she said this here

                      Schapiro testified last summer that the SEC needed to hire 800 more employees to implement new regulations called for in the Dodd-Frank financial overhaul law. She said Friday that the lack of additional money has "hampered our ability to do what investors and capital markets deserve."

                      "So we need to ask ourselves if we want our market analysts to continue to use decades-old technology to re-create market events or to monitor trading that occurs at the speed of light," she said. Schapiro also said budget constraints could force the SEC to "to pull the plug on data management systems and on a digital forensics lab needed to re-create the data that sophisticated fraudsters leave on hard drives and iPhones."

                      Ok I get some of it is what any one who heads a dept says as an argument for why they need more money. But this is one agency that did play and has a role in ensuring the markets work correctly. She's sounding the alarm bell and we should heed it (or imo we are setting the stage and will be doomed to repeat it). So what I am saying, that the SEC and the CTFC are agencies that play a significant role in regulating the markets, markets that have grown over the past decade, and contributed to the financial meltdown and yet...what are we planning on doing...defunding and cutting it.

                      That said, I'm also not naive and understand how there is a lot of regulatory capture of the SEC. It occurs with the revolving door between well connected/former  Wall Street guys (many from GS) move over into top regulatory positions at the SEC. Yeah the regulators have some deep ties with those with whom they're regulating. So it might all be for naught anyway...when the foxes are in charge of guarding the hen house...just what could go wrong!

                      It will not matter how much money was in my bank account, but the world may be a better place because I was important in the life of a child.

                      by emal on Sun Feb 06, 2011 at 12:09:14 PM PST

                      [ Parent ]

                      •  Again (0+ / 0-)

                        Here's what you quoted:

                        Schapiro testified last summer that the SEC needed to hire 800 more employees to implement new regulations called for in the Dodd-Frank financial overhaul law.

                        What I'm saying is the main cause of the crisis is that the SEC did not enforce OLD regulations that had been established for decades -- namely, the prospectus and registration statement regulations under the Securities Act of 1933.

                        Under that Act, SEC examiners look at registrations statements before they are made public.  They have almost unlimited discretion to tell companies to rewrite the prospectus until it accurately discloses all risk.

                        The SEC officials who do this are paid from a fund that comes from fees collected from companies that want to issue securities, not from Congress.

                        While the Obama administration can be limited in hiring staff to implement new regulations, in terms of mortgage securities, all it has to do is tell existing staff to do its job -- as they did under Clinton

                        Democratic administrations tell SEC officials to be very stringent.  The Bush administration's position was that the SEC was there to help companies issue securities without making them work hard to disclose risk.

                        If you've read stuff about the kind of staff members the Bush admin hired to run Iraq -- young kid ideologues from places like Jerry Falwell's Liberty University -- and extrapolate that to the SEC, well you get the idea.

                        •  Of course if they'd only done their jobs (0+ / 0-)

                          But now they have even more job to do and more regs to look at and follow and no doubt more paperwork to push/peddle but with even less money/staff to do their old job plus more responsibilities on top of that old job. Never mind the outdated equipment they use to investigate and ensure validity/completeness, accuracy/ and full in depth reporting of that disclosure. And what were/are the consequences when they didn't or failed do their jobs previously?

                          Never mind the former Wall STreet bankers recently appointed by Geithner and this administration now in several key oversight roles at the SEC...no doubt demanding stringent adherence to those regs at the SEC henhouse they're guarding from their former Fox Wall STreet friends.

                          Yup, if they'd only done their jobs! Just like Bernanke, and Geithner and others who are still running other parts of our gov't. If they'd only done their jobs.

                          It will not matter how much money was in my bank account, but the world may be a better place because I was important in the life of a child.

                          by emal on Sun Feb 06, 2011 at 01:38:09 PM PST

                          [ Parent ]

            •  thanks. I agree that 24 months is not enough. (0+ / 0-)

              I wish that I saw a serious effort in the next 24.  I do love Warren, and hope they let her do her thing.  

              ecstatically baffled

              by el vasco on Sun Feb 06, 2011 at 01:50:38 PM PST

              [ Parent ]

        •  I just went and read those diaries. (1+ / 0-)
          Recommended by:
          kenlac

          They are absolutely fascinating, terrific and informative--and obliterate a lot of the misinformation about TARP and the financial crisis(es). I urge you in the strongest terms to keep going with the series, and not be discouraged by the apparent lack of interest. People like me want to know this stuff. This is counter-meme information that people need to know in order to form a real fact-based understanding of the situation.

          We want to be reality-based here, and those two diaries add a lot of reality to the narrative. I'm sorry I missed them when they were posted. Damned good work.

          "'club America salutes you' says the girl on the door/we accept all major lies, we love any kind of fraud"--The Cure, "Club America"

          by Wheever on Sun Feb 06, 2011 at 09:42:51 AM PST

          [ Parent ]

    •  Socialism For the Rich/Capitalism for the People (0+ / 0-)

      These backroom deals wherein the government, directed by the crony friends and former yet future employees of the banksters and plutocrats, coughs up 100 cents on the dollar for trash assets will corrode our democracy faster than anything else.  While everyone else in the society is expected to pay full price for every debt they've incurred (strategic default, quel horreur!), the banksters and plutocrats dump junk worth a penny on the dollar onto the government at face value, for a handsome profit.  When the kleptocracy starts running full tilt like this, no society can survive for long.  All of these actions by the Fed and Treasury are just accelerating the process.

      "Love the Truth, defend the Truth, speak the Truth, and hear the Truth" - Jan Hus, d.1415 CE

      by PrahaPartizan on Sun Feb 06, 2011 at 07:43:35 AM PST

      [ Parent ]

      •  Thanks for the slogans! (0+ / 0-)

        They were very uninformative.

        Now, why not trying going over to Pro Publica and checking on some real data?

        Btw, if everyone is borrowing from the Fed, including students, then this seems like socialism for everyone.

        •  Informative As Always (0+ / 0-)

          Hamden, you definitely insist on bringing clarity to discussions.  It's always truly appreciated.  Do you have any other contributions to make?

          "Love the Truth, defend the Truth, speak the Truth, and hear the Truth" - Jan Hus, d.1415 CE

          by PrahaPartizan on Sun Feb 06, 2011 at 10:24:16 AM PST

          [ Parent ]

    •  Wait a minute...does the irony escape you? (0+ / 0-)

      Here...

      We're in an amazing period because "teh internets" provide an abundance of information to everyone instantly; problem is, most of it is wrong.  

      while spouting this on "teh internets". Yet somehow you want us to believe that you are the one who is supposedly correct based on what, information gathered from .....?

      So bottom line big picture information from Propublica ...as of right NOW less than half of all TARP money has been repaid.

      It will not matter how much money was in my bank account, but the world may be a better place because I was important in the life of a child.

      by emal on Sun Feb 06, 2011 at 08:05:30 AM PST

      [ Parent ]

      •  One way to tell whether info is correct (0+ / 0-)

        is for example, when someone posts a comment with a link.  If the link flatly contradicts the post then you have a post full of incorrect information.

        Also you can refer to consensus reality characterizations of certain circumstances.  My guess is that 99% of people would say that if you have $1000 in the bank, withdraw $400 and leave $600, you still have $1000.

        Bob and I are relying on the same Pro Publica information, but for him, in my little example, this means the depositor has lost $400.

        That's how you know, without irony, what information is wrong, and what information is right.

        •  The irony still escapes you (2+ / 0-)
          Recommended by:
          TracieLynn, Joieau

          You're still using information you received from "teh internets" as the basis of you determing what information is correct. And yet you still post your interpretation of information you gathered from "teh internets" as now being the truth on "teh internets"..."teh internets" that you say most of the information coming from it is wrong (all except your information apparently)

          Plus I think your example would be better if it was You were loaned $1000 and paid back $400....You still owe $600.... more than half. You still owe money.

          Listen, why would I take your word for it, or why should I TRUST the gov't leaders who the FCIC report finger as contributing to the meltdown in the first place? Why should I TRUST Treasury Secretary Tim Geithner, or the Feds Ben BErnanke, or Greenspan, or the big investment bankers/hedge fund managers, or the rating agencies, or the SEC, or the bankster lawyers and accountants,or the gov't political leaders from both parties!....

          Why should I trust anything that comes from the mouths of the people responsible for and all had a hand in causing the worst economic man made catastrophe in the country/world.

          Imo They were/are all either derelict,negligent, and in some cases criminal in their duties/behavior, said they didn't see it coming, and yet they're the ones left picking up the pieces to "fix it" and I'm told by people like you...To just trust them they're telling the truth here. TARP is a success story.

          Yeah in my reality, you perform your job like that you should not only lose your job and but in some cases your fortune and be put in jail...but mostly you're never to be trusted on matters like this here. They have NO CREDIBILITY.

          Sorry fool me once....shame on you, fool me twice shame on me. I'll remain skeptical of anything reported from my gov't and it's various mouthpieces on this matter.

          It will not matter how much money was in my bank account, but the world may be a better place because I was important in the life of a child.

          by emal on Sun Feb 06, 2011 at 09:06:45 AM PST

          [ Parent ]

          •  I didn't say all information was wrong (0+ / 0-)

            The internet is just like life -- there's good information and bad information.  Everyone needs methods for determining what's true and what isn't.

            A person whose writings are internally inconsistent, or who cites sources that flatly contradict his writings is likely to be not providing true information.  A person whose interpretation of a particular set of circumstances is at odd with, say, economics textbooks and the way 99% of people would interpret said situation is also likely to be wrong.  

            So feel free to search my diaries for internally inconsistent information or information that is contradicted by the sources I cite.

            Also, I think you've completely missed another point:

            Why should I trust anything that comes from the mouths of the people responsible for and all had a hand in causing the worst economic man made catastrophe in the country/world.

            I'm not.  I'm referring to Pro Publica, a progressive, independent reporting website that closely tracks the bailouts.  Bob cites it as well, but then provides a counter-reality-based-consensus interpretation of the data.

            •  Your semantics are duly noted... (0+ / 0-)
              ...but, other than attempting to conflate matters, in general, there's really not much significant support for your comments.

              Cherry-picking one program, etc., etc., and then retreating back into technicalities, is not a winning strategy in this debate.

              "I always thought if you worked hard enough and tried hard enough, things would work out. I was wrong." --Katharine Graham

              by bobswern on Sun Feb 06, 2011 at 11:21:10 PM PST

              [ Parent ]

  •  When do they distribute the profits ? (2+ / 0-)
    Recommended by:
    emal, Joieau

         I need dental work.

  •  Why isn't this on Rec list? (2+ / 0-)
    Recommended by:
    splashoil, Joieau

    should be

    "Limited government only sounds good as an abstraction, but the principles of the free market won't get you too far when your house is on fire." ~Joshua Holland

    by MsGrin on Sun Feb 06, 2011 at 07:18:53 AM PST

  •  Will forward to Electaborg! (1+ / 0-)
    Recommended by:
    bobswern

    Will send this to kos fluffier Electaborg.  Thanks for posting, as always!

  •  Tell the truth brother! (3+ / 0-)
    Recommended by:
    bobswern, IndyRobin, Joieau

    Testify!  

    In the never-ending battle to counter the bullshit, thank you for doing your part.

    Everybody grab a bucket and start bailing.

  •  Bob... (1+ / 0-)
    Recommended by:
    HamdenRice

    This diary is one of the worst diaries you have written in the last 2 years...so sad and not worth commenting further on...

    Obama - Change I still believe in

    by dvogel001 on Sun Feb 06, 2011 at 07:38:35 AM PST

  •  The golden rule writ large (3+ / 0-)
    Recommended by:
    emal, TracieLynn, bobswern

    He who has the gold makes the rules.

    The people fleecing the country have nothing but contempt for us. Perhaps one day they will get their comeuppance.

    Probably not, actually. Sure wish I believed in "hell."

    The life of man can be solitary, poor, nasty, brutish, and short under BAD governance too.

    by Anthony Page aka SecondComing on Sun Feb 06, 2011 at 08:26:45 AM PST

  •  Great diary, Bob (2+ / 0-)
    Recommended by:
    emal, bobswern

    I hope a legit "audit the Fed" bill will pass this year. I still can't believe Bernie Sanders changed the language of the bill at the last moment, in favor of the Fed, the last time around. More sunshine is badly needed. The boom & groom crowd may disagree, but they are losing credibility with every day that passes.

  •  I (0+ / 0-)

    don't understand.

    Let's take Chase.

    They claim that they paid the government back 100%.

    The chart on Pro Pubica says that they got 25 billion and paid back only 2 billion.

    Can you explain?

    I remember last year all the banks claimed they paid back the Tarp money so they get pay themselves their bonues without the pay czar interfering.

    (I know that Citigroup didn't really pay all they got back but claimed they did with clever accounting and the government changing the law so it worked)

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