Wednesday, September 18, 2013

They wouldn’t do that. Would they?

Financial Terrorism

Evidence that Bernanke and Paulson deliberately blew up the financial system in 2008 by (1) draining liquidity from the system and causing big strains in interbank lending and in the commercial paper and money markets and, of course, (2) deliberately sinking Lehman and causing panic in the cat's cradle of its counterparties. They did this in order to frighten legislators and herd them into sanctioning the $700bn (and more later) TARP bailout.

Posted by icarus @ 10:36 AM (2021 views)
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16 thoughts on “They wouldn’t do that. Would they?

  • To some extent yes, the banks vastly exaggerated their own difficulties (largely self-inflicted anyway) and also pushed the “too big to fail” rhetoric (simply not true) and they stampeded various governments into bailing them out.

    Whether the politicians were stupid or corrupt is another topic.

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  • Maybe they did, maybe they didn’t. Am I the only one that doesn’t give a hoot? There will always be some monkey business going on in this world. It’s best to focus on things that matter like lamb chops and whether or not red wine should be oaked

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  • Different approach from the Irish banks that lured the politicos in with a small rescue stake at the beginning and then frisked them for the rest.

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  • flashman – what are you on? Last week it was Charlton Athletic, now it’s lamb chops. Barnsley chops?

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  • Wouldn’t mind a Barnsley chop right now with some Rosemary sauce.

    I genuinely couldn’t care less about this sort of thing. Just wondering if anyone else doesn’t care? For some reason I’m reminded of the Tiger Woods news. The press told us we were outraged by his philandering and a weird old constipated bloke in charge of golf said we were outraged but I never actually met anyone who cared.

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  • mark wadsworth says:

    $700 billion + as much again under Obama strikes me as something worth caring about.

    The numbers for the UK are similar, just divide by five or something.

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  • Thanks Icarus,
    This has been the subject of many articles over the years, but hitherto consigned to the bin of “conspiracy theories”. It’s about time people woke up the the Banksters who are ripping off the US and UK. Unfortunately, the mainstream press back away from this sort of story till it’s done the rounds and nobody was sued.

    Obama is a puppet of the top bank CEOs. He now wants a puppet in the Fed to help him impoverish the country, whilst lining the pockets of the crony capitalist banksters. The Kaiser Report is really informative – worth a watch!

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  • Mark, I’m not sure the $700 billion they ‘stole’ actually ended up costing the rest of us $700 billion. Putting aside any arguments they might make about it being necessary, there are all sorts of economic mechanisms whereby the $700 could come back to us plus some. Sure it’s possible that there are some losers in some scenarios but there are also some scenarios where most people would end up gaining. That’s not a justification, it’s an observation. This is an immensely complicated situation but a simpler version would entail following the money after it’s blagged from a bank. It could be argued that blagging money is a more efficient way of getting it into the economy. A bank might even eventually gain from being blagged.

    I still don’t care. Best to concentrate on things you can control. I just texted the Mrs asking her to get in some butterfly cut lamb chops

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  • Let them eat chateaubriand and drink Chateau Lafite.

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  • “Maybe they did, maybe they didn’t. Am I the only one that doesn’t give a hoot?”

    I’ll pass on whether this should be seen as screw up or conspiracy but I think that media exposure of wrongdoing does matter.

    Recently, we saw our parliment vote down the use of force military force in the Syrian disaster. There seems to be agreement among commentators that the ‘Iraq effect’ was partly to blame. In the same way that Blair’s mistakes will restrain military adventures in the future, I’d like to think that the central bank’s capers will tie their hands somewhat in the years to come.

    Personally, I welcome media exposure of the big money shenanigans.

    Thanks for posting, Icarus.

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  • quiet guy, don’t get me wrong, there is nothing wrong with media scrutiny. The Watergate scandal was a journalistic triumph but I suspect I’d have just shrugged at that too because politicians throughout history have done the same and will continue to do so.

    In this case, I’ve seen nothing that remotely proves wrongdoing. This article and many like it seem to center on the author(s) disagreeing strongly with the course of action taken and then arrogantly assuming that only someone up to no good wouldn’t do it their way (not that they have any suggestions other than being so perfect that it wouldn’t have happened in the first place). It’s all a bit silly really because none of these central bank types have had large donations made to their offshore accounts.

    Far from having their hands tied by their actions, it is slowly getting to the stage where they are being lauded for their bold and daring action. The main central bank position has become a glamour job and the Lehman thing showed the investment banks who’s boss. Let’s face it many of the people who are bitching about their actions are peeved that its working and spend most of their time clucking about (hoping) how it’ll go wrong again.

    If anyone has their hands tied, it’s the spendthrift governments who spent so much that they had to encourage the banks wildness, so they could get more revenue. Some of this banker bashing stuff is an attempt to divert attention from the spendthrift deregulators who were largely responsible for the mess. How about some media scrutiny on this or is that not fashionable?

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  • flashman said :’I’ve seen nothing that remotely proves wrongdoing’. Depends what level of proof you need. There’s much good circumstantial evidence here that Lehman was singled out – by a number of means – for the chop and for the reason stated. We have the body, the murder weapons, the only two people who could use those weapons and the motive. As for the liquidity on which commercial paper and money markets float the Fed had it in its power to fix that instead of the ‘we’ll have no economy on Monday if you don’t give us what we want’ threat.

    ‘not that they have any suggestions other than being so perfect that it wouldn’t have happened in the first place’. One suggestion they often make is public service banks – how hard is it to raise money, invest/lend it out, provide insurance, pay savers and hedge liabilities?

    ‘Follow the money’ – have you looked at the net worth of Paulson, Ruben, Summers and the CEOs et al of the too-big-to-jail banks?

    ‘Let’s face it many of the people who are bitching about (cental bamks’) actions are peeved that its working’. Most people who bitch about their actions aren’t as convinced as you are that it’s working, so need for them to be peeved.

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  • ‘so NO need for them to be peeved’

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  • Icarus, you are getting this all wrong. There is no crime or wrongdoing. It was their job to deal with it as they saw fit. It is naive to think that anyone can function at that level without being an operator. They did what they had to do. It was expected of them.

    Why the search for evidence? We all know what they did because they wrote about it and proudly told us about it. Why do you mention how much money they have? It’s not a crime to be rich and no one has ever suggested that they got a backhander for stitching up Lehmans.

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  • flashman, so it comes down to how we define ‘wrongdoing’ or ‘crime’. All I said was that ‘There’s much good circumstantial evidence here that Lehman was singled out – by a number of means – for the chop and for the reason stated’. You say ‘It was expected of them’ – expected by whom? By Congress or by Wall Street? Just as the ‘big lie’ becomes the truth in an Orwellian world (‘tell them a whopper, they’ll never believe anybody had the gall to tell such a big lie, so they’ll think it’s true’ – AH) so the ‘big crime’ becomes the normal in US financial dealings.

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  • Backhanders? They made their money working in the Wall Street banks they helped by TARP, deregulation etc.

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