Tag: financial collapse

In a post entitled, “The Harrowing,” The Epicurean Dealmaker (TED) makes quite a spectacle of himself, not at all unusual for investment bankers, but somewhat unusual from him in its straightforward straits, forward! bullshit, wherein he’s lamenting that investment bankers will “suffer the greatest harm” in their ongoing self-made financial collapse:

Now is the winter of investment bankers’ discontent. The long foreshadowed harrowing of my industry, the great winnowing of its inhabitants, is underway. The huge, tottering edifice of proprietary trading, structured products, and bespoke derivatives, which suckled at the twin teats of Greenspan’s largesse and investors’ desperation for yield in the age of negative real rates, will suffer the greatest harm. But the rest of us-innocent or not of the worst offenses of our industry-will suffer the fallout, too. Pay will be slashed, jobs will be cut-never to return-and egos will be racked upon the callous indifference of executives and shareholders more concerned with their own personal trials and tribulations than the suffering of their bought-and-paid-for minions.

[egos racked?  the bought-and-paid-for minions?  Say it ain’t so, Mama!]

Our enemies will rejoice. Spiteful, envious souls will gnaw greedily on the bitter bones of schadenfreude in cramped and narrow defiles, sucking out the meager marrow to satisfy their self-righteous, operatic anger. Let them. Those humans among us who remain, who survive-and rest assured, Dear Friends, some of us will survive-will remember.

O yes, Dearly Beloved, we will remember. We will remember our friends and enemies. We shall never forget.

Enjoy the show.

Egos racked upon callous indifference?  Say it’s not so, bro!

Look, pal, believe it or not, I know people who are trans-global executive CEOs and whatnot, people who explicitly rejected the business of financial parasitism, people who make things, people I trust.  One guy I know, I axed him, bro, “That’s pretty high-end technical shit you guys are into, do you spend your whole time doing powerpoints on the technical advantages of your products?”  His response, more or less was, “Nah, we tried that.  It [being technically honest and explicit] doesn’t work.  Buy them dinners and drinks.”  And that’s’ the whole show.  

Going after some more of the best? of the best? of the best?……… in the financial Meltdown!

Financial crisis panel demands documents from Moody’s

I have always hated Darrell Issa.  I live in California and Darrell Issa is largely the reason that we now have Arnold “will my term ever end?” Schwarzenegger in the governor’s hot tub.   He’s also, quite simply, a scumbag.

But remiscent of the Bush years, when I found myself agreeing more with Pat “I’m also a scumbag” Buchanan, than I did with most “mainstream” Democrats like, well, almost all of them, I now want to pat Scumbag Issa on the back.

Why?

Because he’s come out with this:

Geithner’s Fed tried to keep sweet deal for banks a secret

The controversy surrounding Treasury Secretary Tim Geithner’s role in the 2008 Wall Street bailouts was ramped up Thursday with the revelation of emails that show the New York Federal Reserve — then run by Geithner — pressured insurance giant AIG to withhold information about payments the company made to its creditors.

Rep. Darrell Issa (R-CA) obtained emails between AIG employees showing that the company had planned to disclose in its filings to the SEC that it had paid 100 cents on the dollar to creditors like Goldman Sachs and other banks, but “the New York Fed crossed out the reference,” Bloomberg News reports.

AIG has received $183 billion in taxpayer relief. The news that the New York Fed attempted to keep from the public how that money was spent will likely increase political opposition to Geithner’s appointment as Treasury Secretary.

The Bloomberg.com article is here.

Jan. 7 (Bloomberg) — The Federal Reserve Bank of New York, then led by Timothy Geithner, told American International Group Inc. to withhold details from the public about the bailed-out insurer’s payments to banks during the depths of the financial crisis, e-mails between the company and its regulator show.

AIG said in a draft of a regulatory filing that the insurer paid banks, which included Goldman Sachs Group Inc. and Societe Generale SA, 100 cents on the dollar for credit-default swaps they bought from the firm. The New York Fed crossed out the reference, according to the e-mails, and AIG excluded the language when the filing was made public on Dec. 24, 2008. The e-mails were obtained by Representative Darrell Issa, ranking member of the House Oversight and Government Reform Committee.

The New York Fed took over negotiations between AIG and the banks in November 2008 as losses on the swaps, which were contracts tied to subprime home loans, threatened to swamp the insurer weeks after its taxpayer-funded rescue. The regulator decided that Goldman Sachs and more than a dozen banks would be fully repaid for $62.1 billion of the swaps, prompting lawmakers to call the AIG rescue a “backdoor bailout” of financial firms.

“It appears that the New York Fed deliberately pressured AIG to restrict and delay the disclosure of important information,” said Issa, a California Republican. Taxpayers “deserve full and complete disclosure under our nation’s securities laws, not the withholding of politically inconvenient information.”

Will this become a mainstream story?   Well, you’d think so, wouldn’t you?  After all, it paints a “Democrat” in a negative light, and it’s being pushed by a Republican.

But we’re talking about Banksters here, and they don’t play by the rules.   They run the place.  

All these people need to be in jail.  

Morgan Stanley’s Mack: ‘We Cannot Control Ourselves’

Say What?? But you clowns are supposed to be the best of the best of the best……………………………………., which is supposedly the reason you get Extreme Compensation and ever growing Company Perks, writeoffs by the way, No One Else Can Do What You Do, or so the crap is stated and You Can’t Control Yourselves, say it ain’t so you freak!!!

 

Gee, it’s a good thing the governments rode to the rescue with billions of dollars in Corporate Welfare for the lying cheating fucktards who screwed everything up, no?

Otherwise, gosh, we would have had people not being able to buy bread, power shut off to everyone, riots in the streets …

No, we would have had the banks nationalized.  Which is what should have happened in the first place.

But here with the 1-year anniversary of the collapse, we are having a ridiculous level of retroactive propagandizing BY the criminals who fucked everything up in the first place.  The same people who STILL haven’t had any new regulations to control their activities, the same people who STILL haven’t faced any repercussions for nearly destroying the economy of the western world, are now expecting us to BELIEVE their bullshit about how they managed to dodge the bullet and keep us all from anarchy and starvation …

U.K. Faced ‘Bank Runs, Riots’ as RBS and HBOS Neared Collapse

This begs the question for me — why haven’t we had a run on the banks? Who in their right mind would continue keeping their money in banks?  How stupid are people?  Wait, I already know the answer to that.

“Hey, I know we almost destroyed the world economy, and took every dollar you owned with it, but hey, it’s all good now!  Trust us!”

Oct. 7 (Bloomberg) — A year ago today, Royal Bank of Scotland Group Plc and HBOS Plc were close to collapse, causing a chain reaction that could have ended with riots in U.K. cities, security analysts and economists said.

Bank failures would have forced the government to cancel police leave and deploy troops as the breakdown of the financial payments system threatened the ability of utilities to provide essential services, said David Livingstone, a fellow at the Royal Institute for International Affairs in London, a former adviser to the government’s Cobra crisis response committee.

“You are talking about a situation with mass disorder and panic,” the former Royal Navy officer said in an interview. There would be “riots, pandemonium, everyone fending for themselves.”

Chancellor of the Exchequer Alistair Darling, Bank of England Governor Mervyn King and Financial Services Authority Chairman Adair Turner met at 5 p.m. on Oct. 7, 2008, and readied a 250 billion-pound ($398 billion) rescue for the banks in the 16 hours before they opened for business the following day. In response to a Freedom of Information Act request from Bloomberg News one year on, the Treasury declined to say if it had a contingency plan for the two banks, then or now.

Releasing such information would probably “have a destabilizing effect on financial markets,” damage the government decision-making process and cause commercial harm to the banks involved, the Treasury said in a letter.

“In the current economic climate, economic perception, even if totally misconceived, is important and has the capacity to alter market behavior,” the government said. “To confirm or deny whether or not the information is held, either in relation to the banks mentioned in your request or more generally” would hurt the banks and the U.K.’s economic interests.

‘Catastrophic’ Costs

The crisis last year was the worst Britain had faced in peacetime, Darling told the British Broadcasting Corp. last month. The two banks were not “confident they could get to the end of the day,” on Oct. 7, King told the same program.

“You would have had unmitigated panic and a bank run,” said Tom Kirchmaier, a fellow at the London School of Economics. “People would not have been able to buy bread. The cost to the economy would have been catastrophic.”

RBS and HBOS, then in talks to be taken over by Lloyds TSB Group Plc, had more than 35 million business and individual customers with 475 billion pounds of deposits, 22 percent of the U.K. total, held at about 3,250 branches.

‘Contagious Effects’

“If RBS hadn’t been propped up as it was, in practice it would have been nationalized the following week,” former Bank of England deputy governor John Gieve said in a Bloomberg Television interview. “If RBS, HBOS, Lloyds had gone down, that would have had huge contagious effects throughout the rest of the world.”

The failure of Edinburgh-based RBS and HBOS would have had a domino-effect with customers seeking to take out their deposits from other lenders and causing a wider run on U.K. banks, said Vicky Redwood, an economist at Capital Economics Ltd.

“Trust in the banking system would have completely collapsed” and would have generated civil unrest, said Redwood. “People would have been rushing to take their money out of the other banks and you would have been heading back to the depression era.”

At BofA, a customer overdrawn by as little as $6 could trigger a $35 penalty. If the customer does not realise they have a negative balance and continue spending, they could incur that fee as many as 10 times in a single day, for a total of $350. Failing to repay the overdraft within a few days results in an additional $35 penalty.

How do ya like them apples?

Why anyone still keeps their money in these banks is beyond me.  Oh wait.  If you have a low credit score, you can’t open a new account anywhere else.  So if you’ve had the dominos start to fall, thanks to these banksters like those who run BofA and others, you are stuck with them and their goddamn thievery.

http://www.ft.com/cms/s/0/43d1…

Data from Moebs Services, a research company, show that the crisis has prompted many banks to lift charges on overdrafts and credit cards in order to boost profits.

The median bank overdraft fee has this year rose from $25 to $26, according to Moebs, the first time it has gone up in a recession for more than 40 years.

“Banks are returning to a fee-driven model and overdraft fees are the mother lode,” said Mike Moebs, the company’s founder.

Hit ’em when they’re down.  That’s a great business plan.  It’s the mother-lode, baby!  Woo Hoo!  

The highest overdraft fees were charged by the largest banks, said Mr Moebs. At banks with assets greater than $50bn – a group including Citigroup, Bank of America, JPMorgan Chase and Wells Fargo – the median overdraft fee is set at $33.

So those “too big to fail” continue to do whatever the fuck they want, because, hell, these banks can’t even fail if they wanted to.   They tried to fail!   Congress wouldn’t let them!   So why not do whatever the hell pops into your head to rip people off, who’s going to stop you?

In the meantime, three more little banks, I guess those who were “small enough to fail” did in fact fail on Friday.

That brings the total for the year to 72.   Yup, 72 banks small enough to fail, while the Big Boys just do whatever the hell they want.  

In other news, Obama has lost Dailykos, which is the equivalent of George Bush losing the Freepers.   Now, we have “Everybody Hates Barry” playing out in Washington.  The right hates him, and his most devoted followers are completely disillusioned and crestfallen with him, talking about being “in tears” over his actions.  They like to cry.   Crying and cats.  I don’t get it.  

http://www.dailykos.com/storyo…

What is he doing?  He’s doing exactly what he’s supposed to be doing, being an errand boy for the corporate elite that put him in power.  That’s what he’s doing.   He’s there to let Goldman bail out Goldman.  

Oh, and let’s not forget that a British General has just come out and said that the “mission” in Afghanistan is going to take a good 40 years to “complete”.     He’s probably being optimistic.

The US must increase its nuclear arsenal in response to China’s growing military might, according to a State Department report.

http://www.telegraph.co.uk/new…

CNBC interviewed Paul Donovan, senior international economist at UBS, who is out shilling for government bailouts like all the other bankers.  Here’s what he has to say:

The financial system is ceasing to function effectively. The government needs to step in to support the financial system, or else capitalism is over.

Perhaps more dire was his answer to a question about whether injecting all this money into the economy would have an inflationary impact:

What we’re concerned about at the moment is salvaging something…If, in two or three years time we get back to a more normal function, [then that will be a concern.]  For the next two or three years, deflation is the concern.

.

Deflation is really a codeword for Depression–for years stretching into the future.

Original article by Mike Whitney, subtitled Lehman Gone; Merrill Lynch Swallowed Up; AIG Going… Who’s Next for Madam Defarge?, via counterpunch.com:

Bank of America is buying Merrill Lynch for $45 billion, AIG needs an emergency $40 billion bail-out from Uncle Sam to stay afloat, and Lehman Bros is kaput. Whew! The financial world has been turned upside-down overnight. It’ll be a rough day of trading ahead.”