Bankers Are the Wagging Tail of the Sick Dog

One of the most astute observers of the financial world, Simon Johnson, has a very good posting which underscores the astounding hubris of the American Bankers Association.

In Johnson's blog, which is also available here, he provides the following quote from a recent ABA press release.

It is now widely understood that the current economic situation originated primarily in the largely unregulated non-bank sector,” he said. “Banks watched as mortgage brokers and others made loans to consumers that a good banker just would not make and they now face the prospect of another burdensome layer of regulation aimed primarily at their less-regulated or unregulated competitors. It is simply unfair to inflict another burden on these banks that had nothing to do with the problems that were created.

This extraordinarily inept remark completely fails to take into account, as Simon Johnson points out, the fact that it is the rescue of the banking industry by taxpayers the world over, which explains why economic stagnation and possibly worse will be with us for years to come.

The quote provided from the ABA press release is indicative of an industry that not only has no shame but one that seems to have learned nothing from the near meltdown last fall.

The banking sector is the tail wagging the sick dog which is better known as the global economy.

Comments

[Leftfield:]

All above is true. But, the ABA is unfortunately demonstrating typical behavior of all favored groups in America. There have been numerous comments by workers in firms such as AIG in SA complaining they had nothing to do with the problem sectors. Accountants applaud while the government, who increasingly determines winners and losers, makes more rules requiring their services and yet accountants in this country are silent about the disgraceful practices of, for example, the US government. There are many good teachers, but the NEA is a cancer on our country.
Too many who know better and benefit are standing by content to be "good Germans" while our country declines alarmingly.

Jul 06 09:01 AM

[John Lounsbury:]

Clive - - -

As unsettling as the hubris of the ABA is, I'm even more upset this morning by the new securitization schemes in the news. If you can stand some uncharacteristically crude language, you can read my thoughts at seekingalpha.com/artic...

Jul 06 11:17 AM

[Clive Corcoran:]

Leftfield
Your point is well taken - it is the passivity and acquiescence by those who know that something is deeply flawed but turn the other way which is yet another alarming aspect of this.

John L
Thanks for drawing my attention to these new shenanigans. I shall read the article in full and post a comment at your article. Once again it seems that the snake oil salesmen are at work again.

Point raised by both comments is just how much the current administration are beholden to the likes of GS and the financial technocracy. No wonder the BRIC countries have questions about how much faith to have in the US currency!

Jul 06 11:46 AM

[Stepbear7:]

You people still don't get it.
The Central banks along with the Federal Reserve, Fractional reserve banking procedures, and absence of the Gold standard are the spring boards of happiness for these cartel counterfeiters to rake the entire world over the coals and out of existence.
Federal Reserve Notes are near extinction. Rightfully so, because they(FRN) are worthless paper not soft enough for biological purposes and have no value without Gold standard backing it.
The rest of the world is starting to realize the USD (Federal Reserve Note) is the ROOT CAUSE OF PRESENT GLOBAL CHAOS.
Use the Gold Standard and get rid of Federal Reserve Notes and start having the U.S Government Treasury print United States Notes backed by gold reserves only producing allotments as needed to balance goods and services.

Abolish the Federal Reserve Act of 1913,Fractional Reserve Banking, the IRS, Ben Bernanke and the entire Federal Reserve System.
Then you will be able to understand and open your mind and eyes and move on to a better economic level of survival.
In other words remove 96 years of bend over vaseline jobs from the Federal Reserve System.
Just a thought ............. Have a good day,week,month,year and next decade.


Stephen

Jul 06 12:25 PM

[Bayard:]

As Simon would also say, the oligarchs are still at it. I really don't believe in abolishing the Fed, but readily admit/believe that it spends too much energy by being more of a participant than a controller or regulator. It's concerns don't extend far enough into banking and general financial sector practices, so it just becomes a part of the core problem. Its job is, yes, to drive the underlying flow of money, both by controlling the supply and cost of it, but also must work toward sane practices by working closely with the FDIC and other regulators.

The ABA is just doing its job by spreading dysinformation to support its membership. What else do we expect? That is one of its main functions, sadly: to support its dues paying oligarchs.

Jul 06 12:34 PM

[pitchingpen...:]

Re: ABA press release

What university can I go to where I can learn to distill and filter bullshit, thereby creating absolute, pure bullshit?

Jul 06 02:28 PM