What the flaming hell is THIS all about now? Have We The People not been reamed enough already by these charming folks who keep telling us that but for us bankrupting ourselves to "stabilize the world financial markets," we will LOSE EVERYTHING? Anyone remember the old fable about the boy who cried "Wolf," once too often?
I won't even pretend to understand all this "High Finance" stuff. I'm just an old guy (all you youngsters who have swallowed the RW Intergenerational Warfare bait, take your best stupid self-defeating shot here) who just qualified for Medicare, and am still a year from Social Security. But I read Matt Taibbi's stuff and the WSJ and CNBC squibs and the local business section. I've chosen to personally stop taking part in the "Market Casino," having finally noticed that no one talks about "investing" any more, the way I understood it from buying stocks in companies like Wrigley and Ma Bell with my paper route and Christmas money -- now it's queasily and more obscurely, but more honestly, described as "exposing yourself to risk."
And in today's business news, I read that I, and the rest of of us, are about to be involuntarily "exposed," once again, to "market risk." It seems little Timmy has a real inspiration for another "stabilizing" (doesn't that sound so, y'know, WISE?) of the shaky Too Big To Fails, this time in Europe -- though of course in the Financial Industry, physical location means absolutely nada, even less than national loyalties and the general welfare.
Timmy is going to see that "We" are all going to "expose ourselves to risk," and lend the full faith and credit of our paper route pittances and Christmas money and butt-busting line labor at McBurger's and in the Dollar and Tiffany retail shops and nursing homes and remaining bits of industrial production, to a "leveraged transaction" that will pump Real Wealth into a black box that will spit out "instruments" and "facilities" that are "worth" maybe 100 times the $200 billion of our Real Wealth that Geithner is so studiously offering, in "exchange for" a bunch of "asset backed securities."
There's this huge machine that nobody understands, really, as far as I can tell, called "the world financial market," where there's maybe a quadrillion or three in Funny Munny "dollars" and "euros" and other mythical "stores of value" just floating around in the Cloud like, well, bubbles. A few slicks are really good at whooshing the bubbles in directions that make the rest of us believe they are really rich -- they have the account numbers and binary flows and maybe a few slips of paper to convince the rest of us to give them "bonuses" and private jets and megayachts and houses all over the best parts of the planet. And we comfort (or delude) ourselves that, hidden behind that word, "market," is a thing like the farmer's market in the village square, where there's some rules and norms, and the notion that sellers give good weight and buyers can see what's being wrapped up and put in their basket. That ain't even close to the way it works, of course, as far as I can tell.
Here is the headline and link to the little article in today's CNBC that stung me to even approach this miasma: "Europe: Geithner Is Likely to Suggest Europe Leverage Bailout Fund." http://www.cnbc.com/...
There's more below the break, of course.
"Geithner Giveaway?" Another "Leveraged Asset Backed Wealth Transfer?"
Here's the whole article, with the parts that bothered me highlighted, and the thoughts that arose as I read it in brackets and italics:
"Treasury Secretary Timothy Geithner is likely to suggest to European finance ministers on Friday that they leverage their bailout fund along the lines of the U.S. TALF program, EU officials said.
"Geithner will probably insist on the importance of leverage to have more funds to ring-fence the big Europeans, Italy and Spain, and to find a solution for Greece," one EU official said. [What the hell does any of THAT mean?]
"The leveraging of the EFSF—I think this is something that he will put on the table," the official said. "There could be some openness to the proposal."
TALF—the Term Asset-Backed Securities Loan Facility—was set up by the U.S. Federal Reserve and the U.S. Treasury during the global financial crisis in 2008 to jumpstart the frozen Asset Backed Securities (ABS) market. [Which was, and is, I understand, largely "frozen" because the Big Banks know that all those mortgages, bundled into worthless "securitized collateralized debt obligations and swaps," are just plain "toxic," and have been niggling the rest of us into giving them, in less indigestible chunks, REAL dollars, dollar almost for dollar, in exchange for the enormous pile of evanescent "securitized derivative" shit for which they are hoping to avoid liability, in the economic, or civil, or criminal, senses, for simply counterfeiting in the first instance.]
Under [this NEW] TALF, the New York Fed would lend out up to $200 billion [which appears to be, as before, more "fiat money" that WE THE PEOPLE are always and eventually accountable to create real wealth and concrete value to support], taking ABS as collateral with a haircut [well, maybe just a little trim around the ears and nape] and the Treasury [that's US, as in Uncle's Suckers, again] offered $20 billion credit protection for the Fed.
In this way, a little bit of public money leveraged a much larger central bank contribution and the same idea could work for the European Financial Stability Facility, which has 440 billion euros at its disposal, to offer credit protection to, for example, the ECB to buy euro zone sovereign bonds.
"One of the difficulties is that leverage may be seen as a potential liability," a second EU official said. [Well – what have we here, an honest man or woman?] "But it deserves to be looked at in detail."
A third euro zone official said that Canada [Which part? Vancouver, or Toronto?] has made the same suggestion for Europe.
"It could help those countries where the sovereign bond market is still curable," the third official said.
Such a solution would help ease market concerns that the EFSF does not have enough money to bail out Greece, Ireland, Portugal and also help Spain and Italy.
"Of course you would have to see if on the basis of the EFSF mandate you can do something similar," the first official said, adding the solution had not been free of hurdles in the United States either and in Europe they could be even bigger. [But Timmy will find a way! since I bet this will help accelerate the market "exchange" of our Real Wealth for sheafs of Funny Munny!]
"From an economic point of view it is a reasonable idea," the first official said, noting however that the ECB would have to play along with such a scheme. "The issues are more on the institutional and legal side and of course political—you have to find a way for the ECB not to, de facto, finance fiscal policy, but on the other hand you need to have resources that the ECB has and the EFSF has not."
Leveraging the EFSF, however, would not take place before the fund's new powers of intervention on bond markets, extending precautionary credit lines or lending for bank recapitalization were ratified by the end of September, the official said.
"Once the EFSF becomes more flexible, [what a wonderful word!] you can see if there are ways similar or different to try to leverage more the EFSF or find other ways to have a critical mass to ringfence Italy Spain and the others," the official said.
"You can also think about leveraging on other actors, not necessarily just the ECB," the official said.
Separately, a Treasury official said the Financial Stability Oversight Council met today via conference call to share information and dicuss recent developments in global markets. [Does that mean "the grownups are in charge," or that Ali Baba and the 40 Thieves were having a little plotting session?]
The group is led by Geithner and has 10 voting members including Fed Chairman Ben Bernanke and the heads of the FDIC, the SEC and the office of the comptroller of the currency. Nine of the voting members represent federal financial regulatory agencies. It appears to be the first unscheduled meeting of this group to be made public."
Did YOU know about this particular SuperFunnyMunnyCommittee? I didn't, but then I'm way way way out of the loop, as it were…
I know there are wise people writing their hearts out here, who have much better understandings of these kinds of, dare I say it, shenanigans, and I would hope that if there is the tiniest bit of interest in this and the other "necessary steps" that are under way to create that ultimate "ownership society" where a very few trick the rest of us into thinking that the very few "legally" own EVERYTHING.
And of course there are regularly appearing apologists and obscurantists happy to becloud any discourse and derail any issue that might get people thinking with their whole brains about the non-survival and dead-end aspects of what the few are doing to the rest of us. There's so much of what some of the libertarians call "fraud" and "coercion" going on that most of us are just pulling in our horns, hunkering down, accepting the death of a thousand cuts and the New Work Ethic that says we should be overjoyed to have a job that any three people would ordinarily have to do, and a shriveled paycheck, because that is so much better than living in a refrigerator box under the Interstate.
I hope the former set of our kos-economintelligentsia will chime in and explain what this little momentary lifting of this one little corner of that huge green TARP, under which the Kleptocrats have swept such a huge pile of their dirty dirt, might actually mean for us. As in, would it be the case that having this "facility" go forward is just letting little Timmy shove our fists and faces into yet another Tarbaby, from which we will never extract ourselves without ripping off a few square meters of tender, half-healed skin and several more pounds of emaciated flesh?
Maybe it's unkind, but I sure hope Timmy and his buddies will gather in some backwoods shack, fall through the rotted floor into a deep, flooded coal mine, and that Lassie decides to lie down in the sun with a nice soup bone and let them rot there, having pulled their greedy kleptocratic asses out of way too many scrapes induced by their own cupidity and gule already.
Fri Sep 16, 2011 at 11:00 AM PT: As the world turns, twisting slowly in the wind:
U.S. Treasury Secretary Timothy Geithner urged EU finance ministers on Friday to leverage their bailout fund to better tackle the debt crisis, but there was no agreement on what steps should be taken.
In a 30-minute meeting with euro zone ministers, Geithner pressed for the 440 billion euro European Financial Stability Facility to be scaled up to give greater capacity to combat the problems infecting Greece, Portugal, Italy and other states, a senior euro zone official familiar with the discussion said.
But ministers were resistant to Washington telling the 17-country euro zone and its finance chiefs what they should do.
"He conveyed dramatically that we need to commit money to avoid bringing the system into difficulty," Austria's Finance Minister Maria Fekter told reporters after the meeting.
"I found it peculiar that even though the Americans have significantly worse fundamental data than the euro zone, that they tell us what we should do and when we make a suggestion ... that they say no straight away."
Snip
http://www.cnbc.com/...
The perfect Neocon approach to dealing with the Wogs, right, Timmy?