Impeach Bernanke. Now

This is from Karl Denninger. He co-founded the Tea Party specifically in opposition to the theft of taxpayer money to bail out failed companies and recently blasted its current incarnation as being about “the usual pablum. Guns, gays, God” and not about the economic crisis.

The Tea Party was initiated as a political protest against the unlawful and in fact unconstitutional usurpation of power from the Congress and The People in the form of extortion-led bailouts of enterprises that had engaged in acts that I, and many others, believe were at least civilly actionable and in many cases crossed the line into criminal activity.

Many of those brought on or kept on by the Obama Administration to get us out of the economic crisis are precisely the same people who created it. Worse, it’s obvious that massive fraud and criminality were rampant but the government still has made no criminal indictments, which is appalling.

Obama’s rise was funded and helped by investment banks

Maureen Dowd ponders the sinking Obama presidency, wondering what happened, not really understanding that Obama became president with huge help from investment banks. My view, Obama just isn’t that concerned with the rest of us.

After two years of taking his base for granted, the former Pied Piper of America’s youth had to spar with Jon Stewart to try to get the attention of young people who once idolized him.

With his coalition and governing majority shattering around him, President Obama will have to summon political skills — starting Wednesday — that he has not yet shown he has.

Oh, he has the skills, and it’s not so much that he’s detached or elitist but rather that he is beholden to and a creature of the investment banks who aided his rise to the presidency.

In Bought and Paid For. The Unholy Alliance between Obama and Wall Street, Charles Gasparino documents how Obama was backed early and heavily by investment banks. They saw Hillary as too independent and OMG, she actually would criticize them, can’t have that happening. McCain thought the banksters were “spoiled brats and ruthless opportunists” who would keep the bailout money then pay themselves big bonuses. Look, he would have been a disaster as president but on this he was completely correct. But Obama had no such qualms and made a point of cozying up to bankers, commenting about how wonderful all their mortgages were and how they give a real service to the rest of us. He also asked them for advice on how they would fix the mess they made (gosh, what a fine idea that is) then hired the primary architects of our economic crisis to repair the damage they made. Wall Street showered him with many millions early on, way more than they had ever given to a candidate. Obama amply rewarded them with hundreds of billions in taxpayer money then made sure the accounting rules got changed so they could mark-to-whatever and not mark-to-market.

Yes, Gasparino is right-wing. But his primary point is the economic crisis is as much the fault of federal government policies as it is of the banks. The government continues to give them almost free money in the form of miniscule interest rates. Then banks use the money to buy treasuries or speculate. Very little of it ends up helping Main Street. This is hardly accidental.

To paraphrase Malcolm X in a different context, we’ve been hoodwinked, we’ve been bamboozled.

And if you think maybe Gasparino is suspect because he’s a conservative (I don’t), here’s liberal James Kunstler saying much the same thing, in his post on the mid-term elections.

The President and his Democrats may have inherited this clusterfuck from the feckless George Bush but they flubbed every chance to mitigate any part of it, ranging from their failure to restore the rule of law in banking (by prosecuting the executives of major banks who oversaw the systematic swindle), to mis-directing our dwindling resources toward ends (such as “shovel-ready” new super-highways) that won’t promote a credible future for this society, to misleading the public in the fantasy that alt-energy will offset the disruptions of peak oil (and allow us to keep running suburbia, the US Military, and WalMart by other means).

It’s really too late for both parties. They’re unreformable. They’ve squandered their legitimacy just as the US enters the fat heart of the long emergency. Neither of them have a plan, or even a single idea that isn’t a dodge or a grift. Both parties tout a “recovery” that is just a cover story for accounting chicanery and statistical lies aimed at concealing the criminally-engineered national bankruptcy that they presided over in split shifts. Both parties are overwhelmingly made up of bagmen for the companies that looted America.

Wall Street corruption and crime round-up


Something quite extraordinary is happening. The mainstream, regular business people and moderates, are speaking out. They are furious about the corruption on Wall Street and death grip the banks have on DC. The banks won’t win this time.

Quiet Coup. A former chief economist of the International Monetary Fund says the finance industry has effectively captured the US government.

Marching toward Zombieland.

When sober-minded individuals begin to regard an enterprise within a nation as “an enemy of the people” you can bet that some serious blood is going to flow. This is now essentially the situation for the Goldman Sachs company.

More insider trading cases coming after Rajaratnam arrest. There are a lot of scared hedgies on Wall Street now. Can you say “prison” and “asset forfeiture”?

IBM potential CEO arrested in Rajaratnam case. That’s how deep the rot and corruption is. A Senior VP at IBM in line to be CEO has been arrested for selling insider knowledge.

Bloomberg: FDIC failed to limit CRE loans. “Failed to enforce its own guidelines.”

Goldman Sachs’ black magic, Here’s how they did it.

Investment banks borrow money from gov’t at 0%, lend it back to them at 3%. Isn’t that convenient. A license to print money, really. Banks doing this are no better than parasites.

Banks securitized the glop and kept the good stuff

A study found that securitized mortgages were five times as likely to be delinquent as mortgages that were not resold to securitizers. In other words, banks held the good stuff and sold the glop to be securitized. Thus, they knew exactly what they were doing

Kinda makes you think that the banks that planned on keeping their mortgages had different lending standards than those that knew the paper would be off their hands soon.

The real reason the giant, insolvent banks aren’t being broken up

shell game

Zero Hedge explains why the big banks aren’t being broken up, after demolishing the bogus reasons given as to why they shouldn’t be. Here’s the highlights. Read the whole thing, it’s long, detailed, with copious documentation.

Do we need the Too Big to Fails to help the economy recover?

Nope, plenty of economists say just the opposite.

Do we need to keep the TBTFs to make sure that loans are made?

Wrong, smaller banks are already moving into that void.

Have the TBTFs recovered, so that they are no longer insolvent?

Not hardly, they still have huge amounts of toxic glop on their balance sheets that they refuse to mark-to-reality.

So what’s the real reason?

As of the 1980’s the nine largest banks were already insolvent.

So the government’s failure to break up the insolvent giants – even though virtually all independent experts say that is the only way to save the economy, and even though there is no good reason not to break them up – is nothing new.

William K. Black’s statement that the government’s entire strategy now – as in the S&L crisis – is to cover up how bad things are (“the entire strategy is to keep people from getting the facts”) makes a lot more sense.

What makes this even worse is that government and investment banks seem nearly the same entity now, given the huge and obvious control the banks have over the political process, as they continue to transfer huge amounts of wealth from the poor and middle class to themselves.