Why BAC Will Beat: Understanding a New Bull Market Is Not Underway [View article]
Just looked it up. Average estimate among a polled group of analysts according to Dow Jones news wire is for BAC to declare $0.03 profit per share on Monday. So this is typically the figure the media will reference as to whether or not BAC "beats" earnings estimates.
Why BAC Will Beat: Understanding a New Bull Market Is Not Underway [View article]
Lost shirt,
I have written a lot about what assets I believe will benefit from this crisis on my blog at www.theundergroundinve... so you may want to check that out. Cheers. I've been writing that blog since 2006.
Why BAC Will Beat: Understanding a New Bull Market Is Not Underway [View article]
Justice Kinky,
Point taken. There really have never been "free" markets and you are right. But I merely mean to point out that due to the dismantling of the Glass Steagall Act in 1999 thanks to the efforts of Alan Greenspan, then Citigroup CEO Sandy Weill, and Wall Street, the corruption has multiplied in leaps and bounds since then. So I do believe it is much worse today than twenty year ago.
Let's Keep Big Banks from Ruining America Forever [View article]
PS. To "Fund Insider", are you aware that our US Constitution gives the power to "Coin money" only to US Congress and no one else, and that by coining money, the writers of the US Constitution meant that all US money was only to be backed by precious metals ("coin") so that it would maintain its value? Thus, are you stating, "Fund Insider", that you do not believe in the US Constitution?
Let's Keep Big Banks from Ruining America Forever [View article]
Again, I had hoped that my article inspired intelligent debate rather than name calling.
True, all people that work at big banks are not evil and certainly many that work at big banks ARE good people that have been hurt by this monetary crisis as well. But for those that criticize my viewpoint, I have every right to criticize the institution of Big Banking, a view that clearly is not equivalent to criticizing ALL PEOPLE that work for big banks. I WILL criticize the people at the very top of the organization because if they don't understand the fractional reserve banking system and the constant inflation that their institutions cause then they are incompetent leaders and deserve to be fired. Thus, when they repeatedly claim they were powerless to prevent or even foresee this crisis, I find many of their comments disingenuous at best. How could I foresee this crisis happening well before it happened, so much so that I started blogging about it with conviction in 2006? Yet, CEOs of the largest banks in the world including former Fed Reserve Chairman Alan Greenspan have repeatedly stated in the press that they could never have foreseen the events of the crisis unfolding as they did. This is what I find to be absolutely 100% disingenuous.
So if you want to be fair, and you say these Big Banks act with their employees' best interests in mind then let these Big Banks be honest for once in their life about the COLA (cost of living adjustment) raises the grant their employees. In 2008, true inflation averaged about 11% (and if you don't know what I mean by "true inflation" versus fraudulent government produced inflation statistics, go to the US Bureau of Labor website and read their fine print of how they calculate CPI data). Thus if a Big Bank has their employees' best interests at heart, they will have already given every employee a 11% raise in 2009 just to keep their salaries even as compared to last year (meaning this raise will not make their employees one cent richer). Then, to help them cope with the poor economy, these Big Banks should have granted all of their employees a piddling 3% to 4% REAL raise. Go check if all the Big Banks have raised all their employees salaries a minimum of 15% just to allow their employees to cope with the constant dollar devaluation their businesses cause.
If they are lying to all their employees they will continue to throw a bogus 4% to 5% COLA figure at their employees. If they are TRANSPARENT and HONEST, then they will have granted every single one of their employees at least a 11% raise over their 2008 salaries to help them cope with this crisis. For those that are highly critical of my article, please report back your findings here and if all banks have given their employees at least a 11% to 20% raise from last year then at least I will agree with you that they are trying to help their employees cope with the money devaluation they cause.
In fact, every employee in America that works for a corporation should ask for a minimum 15% raise this year from their bosses because 11% of it is not even real. A 15% raise BARELY will leave you with a net salary that purchases more goods and services than last year, and is really no raise at all.
If you understand how money creation works and the role Big Banks play in constantly robbing wealth from every American, then you would truly understand their HUGE role in precipitating this crisis. Easy money policies that the Federal Reserve and big banks implemented in the years leading up to this crisis created not only massive devaluation of every US dollar in circulation but the huge distortions in global stock markets and real estate markets that are now bursting.
Most people do not understand the role that monetary policy plays in creating massive bubbles in stock markets and real estate that wreaks havoc on the financial stability of billions. When a bubble "bursts", many times, assets are really returning to their "fair valuations" and a bubble bursting is not explained properly in the media.
For all those that don't want to engage in public discourse about this very serious problem, education and informing the public is the only way to solve this problem. If we collectively, as a people, do nothing, I guarantee that our future reality will deteriorate into a far worse nightmare than even the worst case scenario you can conjure up at this point.
Pleasant Surprises This Earnings Season Will Lead to Unpleasant Future Surprises [View article]
thanks for everyone's comments. I do believe that Central Banks have cemented a disastrous path for us in the coming years but I don't believe that we are helpless to change the outcome. It's fast approaching the point of no return but the people can still unite and fight back. Change will have to come from the people and not from the government or the financial oligarchs. The financial oligarchs of this world have already taken over most world governments. Just research the close relationships between JP Morgan and Goldman Sachs with the US Treasury, the US Federal Reserve, and the Bank of England. It's been a revolving door for years among these entities.
Actually I don't think that this is an option but a necessity for those of us that care about the future, but this is a story for another day that I will soon address as well.
Pleasant Surprises This Earnings Season Will Lead to Unpleasant Future Surprises [View article]
A very quick comment in response to wpdragon. I only extol the virtues of gold not because I truly believe that the monetary system we currently employ is not only unsound but also fraudulent. Thus I truly believe that gold as a currency with zero counterparty risk is the only true currency among the lot of fiat currencies and that every steep brief correction we receive, including the current one, is a buying opportunity for those that have remained unconvinced about the merits of holding gold.
I have been extolling the merits of gold since 2006, with some of the gold investments I advocated back then well over 200% profits now, so my comments regarding gold are not jump -on-the-bandwagon opportunism. In fact, my belief in sound money is so strong that I have even adopted a gold standard for my business which you can read about here.
I believe that more and more businesses will adopt the same gold standard as I in the future as this monetary crisis deepens.
I truly do believe wpdragon, that gold is one of the most conservative investments anyone could own right now. It is my belief that this monetary crisis will become much worse than anyone anticipates at this point. When it does, though there will be other assets and not just gold that will soar at this point, I believe that those who hold gold or who have held gold for many years, adding on every correction, will be very glad they have done so.
Pleasant Surprises This Earnings Season Will Lead to Unpleasant Future Surprises [View article]
Ah, sorry about a few tiny typos in my above article. I wrote this article in the very very early morning hours today so was not absolutely alert when editing before posting. If typos annoy you, feel free to read the corrected version, typo free, here on my blog www.theundergroundinve.../
paultaut, A month ago, I said a gold correction would happen and it did. So that people would not misinterpret that particular article of mine, I stated: "But don’t misinterpret my message. Physical gold is one of the most conservative investments you could own right now." I couldn't have been more explicit in that statement that I was not advocating selling gold.
As well, advocating a new investor to wait for a better entry point to buy gold, which indeed materialized as I predicted, is a vastly different thing than advocating selling physical gold, which I have not never advocated a single time since I started publicly writing about the virtues of gold in 2006 on my blog.
During a monetary crisis, there are always much better means of not only maintaining the purchasing power of your dollars but far exceeding in gains, the equivalent decline that occurs as a result of rapid and significant monetary expansion.
Thus, I would still never invest in traditional stocks in the hopes of maintaining the purchasing power of my dollars, especially when there is no fundamental backing to this brief rise we have experienced so far. Investing in assets that will benefit from this monetary crisis, assets that have produced significant profits for the past several years, is a much better approach.
8 Reasons the Obama Administration Will Not Solve This Crisis by the End of 2009 [View article]
Thanks everyone for your comments about my article. To Hotlanta, within the confines of a brief article, it is impossible to address all your points and that was not the intent of my article. However, I have spoken many times about credible solutions to this problem and just because you are unfamiliar with my positions based upon one article I have written here does not mean that I have not publicly written or spoken of credible solutions to this problem. In fact, if you visit my blogsite, www.theundergroundinve..., you will discover hundreds of articles that I have written since 2006 regarding my positions on this monetary crisis.
Keynesian solutions of injecting massive amounts of money to address economic woes is not a credible solution because if assets only rise due to the debasement of fiat currencies, than the increase of wealth (i.e. a stock portfolio value, or real estate values) is illusory and not real. If the DJIA for example, bounces back 20% and the US dollar is debased 25% further to accomplish this, then your net real wealth gain is negative.
The only thing that matters is the purchasing power of your currency, not how much you have of it. If I have $800,000 but my $800,000 buys less than $500,000 did six years ago, I have more money but am actually poorer. This is the flaw of Keynesian driven policies. As many others have stated here, there are plenty of resources out there, including my own, that you can research to more fully understand my position in this article. All the best.
Gold Correction Now More Likely than Not [View article]
Thanks guys for all your comments. Some of you have very valid points that perhaps I didn't explain enough some of my thoughts but that is the difficulty of trying to express everything in an approximate 500-800 word article. However, you will note a couple of things, that since I wrote this article, gold has dropped from $994 an ounce (when I released this article on my blog, $994 an ounce was the price gold was trading at in the London markets) to a low of $925 an ounce so far. Thus saving nearly $70 an ounce is not a small amount even on a $20,000 purchase of physical gold).
To clarify some points, if I failed to do so in my article, I did not favor selling any physical gold because of this correction because I have yet to sell any of my physical gold. I will keep holding on through the temporary corrections until the mania phase arrives. I wrote this article as a warning to those seeking an entry point (again remember I released this article when gold was trading at $994 an ounce) or for those seeking to add more to existing positions.
To further address others that wished I had discussed in more detail some of the issues I briefly mentioned in this article you may note that I've written more than 40 articles about gold since 2006 on my blog so perhaps you can find more answers in my own blog archives at www.theUndergroundInve.... If you reference these articles, you will discover that I am still very much a LONG TERM gold bull, have always been for many years, and my above article does not sway my long-term bullish outlook for gold.
In Today's Environment, Neither Technical Nor Fundamental Analysis Alone Will Work [View article]
To Kelm, you are correct, I haven't publicly printed all of my correspondences with Mr. Bart Chilton, Commissioner, CFTC, but you can find much of my correspondence with the Commissioner that I broached as of October 1, 2008 at this link:
For those interested in writing Mr. Chilton their own messages regarding the concentrated short positions in gold/silver futures markets that indicate collusion, you can personally write to him here.
Bart Chilton, Commissioner Commodity Futures Trading Commission Three Lafayette Center 1155 21st Street, NW Washington DC 20581 Telephone: (202) 418-5060 Fax: (202) 418-5620
Have Gold and Silver Stocks Peaked? Challenging the Analysts [View article]
Hello paultaut thanks so much for your comments. in fact, thank you everyone for your comments, whether you agree or disagree, as long as you keep the comments constructive. However, if you visit my blog, theUndergroundInvestor... which I have been maintaining since August, 2006, I started publicly blogging about the merits of owning physical gold in September, 2006 and have owned physical gold prior to posting my blog on the internet.
Yet, I guess since I did not first buy in 2001, I admittedly have been a little late to the party, but for those that had the foresight to start building physical gold positions back in 2001, I tip my hat to you. However, it is my strong belief that this monetary crisis is just getting started and that even now, people that prepare now will have the opportunity for massive profits over the next several years. Better yet, the US Federal Reserve and US Treasury engineered sell off in gold and silver futures market last year (at least this is my strong belief as to what happened) provided another great entry point for those that have been "late to the party". All the best, JS
The Undisclosed Costs of the U.S. Government Bailouts [View article]
One last comment! Some people have noted that my prediction of a "positive spin" regarding this massive bailout has so far not come to fruition. I thought about why the spin doctors haven't come out of the woodwork yet, and then bingo, it hit me.
The anger among Americans being burdened with the losses from all these banking and Wall Street CEOs is palpable now, certainly to the point, where our Congressmen KNOW the people are angry. They fear that if they passed this legislation right away, without faking some kind of righteous indignation, that their constituents will vote them hastily out of office come November. So at the very least, they must appear to be on the same side of their constituents even if they are not. If this bailout plan was brought up one year ago, when the discussion was not so close to election time, I don't believe we would be seeing the same level of indignation.
I know that this may seem overly sarcastic, but there is a reason for my sarcasm. All Congressmen have been informed for decades through Congressional Finance Committee Hearings of the great risk and greed that was being perpetuated and did nothing about if for years (though this is monumentally boring, you can read through the archived hearings of the Congressional Finance Committees both for the House and the Senate here financialservices.hous... and here www.senate.gov/~finance/sitepages/he... I know that some of our Congressmen and women have not been in office that long, but even within the past several years, they had been warned time and time again of the dangerous assumption of risk in our financial sector in the quest for easy profits. Thus, they had multiple opportunities to stand in our defense, and every single time prior to this week, they failed miserably to do so.
The time for indignation is not now when it is far too late to prevent serious damage to the American taxpayer. Any way you spin this bailout, all American taxpayers are in for a world of hurt now. For this reason, though some may be encouraged that Congressmen are fighting for our rights now, this indignation rings false. If they were truly indignant about this situation, the time for action was years ago when they could have prevented this situation, not now when it truly is too late.
The Undisclosed Costs of the U.S. Government Bailouts [View article]
One last comment from the author. I know there are people that will say that our gov't had not choice but to socialize these losses because we were on the verge of a massive financial meltdown and capital markets were illiquid causing even some money market funds to fail this month. They will present some far-fetched, illogical argument like "Would you rather have America fail?" to try to paint this solution as a necessary solution that had zero alternatives. This argument, of course, will be propaganda instead of truth. If you check my blog, you will see that since two years ago, September of 2006, I have been stating that the worst financial crisis of our lifetimes was coming. It was plain to see even two years ago that the enormous risk assumed by bankers and Wall Street driven that was driven by their equally large appetite for greed would bring our great country down. Again, I didn't say that something bad would happen, but I stated that the worst crisis of our lifetime was coming because I dug well below the surface of media reports that painted a healthy, rosy economy to understand how our financial infrastructure was being severely undermined back then all in the quest for billions of quick profits.
If I knew this more than two years ago, certainly the CEOs of every firm that has collapsed this year knew this as well. Their understanding of these complex derivatives that introduced so much risk into the global financial system almost undoubtedly exceeded mine. So they knew. Not only that, if you look up the legislative history of the SEC and the CFTC for the past 10 years you will see that they acted not as regulatory agencies one single time, but more like Wall Street lobbyists, as they systematically dismantled a lot of the legislation that had originally been enacted to prevent what is happening today. The people heading these agencies all need to go as well and we need to get REAL regulators back in these crucial positions instead of paid lobbyists for Wall Street and big banking.
So even had the regulators started to do their job as recently as two years ago, this would have forced big banks and Wall Street firms to stop their destructive behavior. Instead, the SEC and CFTC stood by silently and did nothing, knowing full well what would happen today (again, how could these so-called regulators not know, given that I've known for two years running now)?
So had they stepped in to do their jobs instead of aiding and abetting the greed of Wall Street and big banks, this situation could easily have been avoided. Instead of problems of liquidity today and capital markets freezing up, perhaps we would have had one or two firms fail instead of many. Then the solution easily could have been to let those firms go bankrupt (the economy could have easily rebounded from the bankruptcy of one or two big firms) and there would have been NO need to socialize any of the losses of any financial institutions and burden Americans for generations to come.
Why BAC Will Beat: Understanding a New Bull Market Is Not Underway [View article]
Why BAC Will Beat: Understanding a New Bull Market Is Not Underway [View article]
I have written a lot about what assets I believe will benefit from this crisis on my blog at www.theundergroundinve... so you may want to check that out. Cheers. I've been writing that blog since 2006.
Why BAC Will Beat: Understanding a New Bull Market Is Not Underway [View article]
Point taken. There really have never been "free" markets and you are right. But I merely mean to point out that due to the dismantling of the Glass Steagall Act in 1999 thanks to the efforts of Alan Greenspan, then Citigroup CEO Sandy Weill, and Wall Street, the corruption has multiplied in leaps and bounds since then. So I do believe it is much worse today than twenty year ago.
Let's Keep Big Banks from Ruining America Forever [View article]
Let's Keep Big Banks from Ruining America Forever [View article]
True, all people that work at big banks are not evil and certainly many that work at big banks ARE good people that have been hurt by this monetary crisis as well. But for those that criticize my viewpoint, I have every right to criticize the institution of Big Banking, a view that clearly is not equivalent to criticizing ALL PEOPLE that work for big banks. I WILL criticize the people at the very top of the organization because if they don't understand the fractional reserve banking system and the constant inflation that their institutions cause then they are incompetent leaders and deserve to be fired. Thus, when they repeatedly claim they were powerless to prevent or even foresee this crisis, I find many of their comments disingenuous at best. How could I foresee this crisis happening well before it happened, so much so that I started blogging about it with conviction in 2006? Yet, CEOs of the largest banks in the world including former Fed Reserve Chairman Alan Greenspan have repeatedly stated in the press that they could never have foreseen the events of the crisis unfolding as they did. This is what I find to be absolutely 100% disingenuous.
So if you want to be fair, and you say these Big Banks act with their employees' best interests in mind then let these Big Banks be honest for once in their life about the COLA (cost of living adjustment) raises the grant their employees. In 2008, true inflation averaged about 11% (and if you don't know what I mean by "true inflation" versus fraudulent government produced inflation statistics, go to the US Bureau of Labor website and read their fine print of how they calculate CPI data). Thus if a Big Bank has their employees' best interests at heart, they will have already given every employee a 11% raise in 2009 just to keep their salaries even as compared to last year (meaning this raise will not make their employees one cent richer). Then, to help them cope with the poor economy, these Big Banks should have granted all of their employees a piddling 3% to 4% REAL raise. Go check if all the Big Banks have raised all their employees salaries a minimum of 15% just to allow their employees to cope with the constant dollar devaluation their businesses cause.
If they are lying to all their employees they will continue to throw a bogus 4% to 5% COLA figure at their employees. If they are TRANSPARENT and HONEST, then they will have granted every single one of their employees at least a 11% raise over their 2008 salaries to help them cope with this crisis. For those that are highly critical of my article, please report back your findings here and if all banks have given their employees at least a 11% to 20% raise from last year then at least I will agree with you that they are trying to help their employees cope with the money devaluation they cause.
In fact, every employee in America that works for a corporation should ask for a minimum 15% raise this year from their bosses because 11% of it is not even real. A 15% raise BARELY will leave you with a net salary that purchases more goods and services than last year, and is really no raise at all.
If you understand how money creation works and the role Big Banks play in constantly robbing wealth from every American, then you would truly understand their HUGE role in precipitating this crisis. Easy money policies that the Federal Reserve and big banks implemented in the years leading up to this crisis created not only massive devaluation of every US dollar in circulation but the huge distortions in global stock markets and real estate markets that are now bursting.
Most people do not understand the role that monetary policy plays in creating massive bubbles in stock markets and real estate that wreaks havoc on the financial stability of billions. When a bubble "bursts", many times, assets are really returning to their "fair valuations" and a bubble bursting is not explained properly in the media.
For all those that don't want to engage in public discourse about this very serious problem, education and informing the public is the only way to solve this problem. If we collectively, as a people, do nothing, I guarantee that our future reality will deteriorate into a far worse nightmare than even the worst case scenario you can conjure up at this point.
Pleasant Surprises This Earnings Season Will Lead to Unpleasant Future Surprises [View article]
Actually I don't think that this is an option but a necessity for those of us that care about the future, but this is a story for another day that I will soon address as well.
Pleasant Surprises This Earnings Season Will Lead to Unpleasant Future Surprises [View article]
I have been extolling the merits of gold since 2006, with some of the gold investments I advocated back then well over 200% profits now, so my comments regarding gold are not jump -on-the-bandwagon opportunism. In fact, my belief in sound money is so strong that I have even adopted a gold standard for my business which you can read about here.
www.smartknowledgeu.co...
I believe that more and more businesses will adopt the same gold standard as I in the future as this monetary crisis deepens.
I truly do believe wpdragon, that gold is one of the most conservative investments anyone could own right now. It is my belief that this monetary crisis will become much worse than anyone anticipates at this point. When it does, though there will be other assets and not just gold that will soar at this point, I believe that those who hold gold or who have held gold for many years, adding on every correction, will be very glad they have done so.
Pleasant Surprises This Earnings Season Will Lead to Unpleasant Future Surprises [View article]
www.theundergroundinve.../
Will the Fed's Overkill Succeed? [View article]
A month ago, I said a gold correction would happen and it did. So that people would not misinterpret that particular article of mine, I stated: "But don’t misinterpret my message. Physical gold is one of the most conservative investments you could own right now." I couldn't have been more explicit in that statement that I was not advocating selling gold.
As well, advocating a new investor to wait for a better entry point to buy gold, which indeed materialized as I predicted, is a vastly different thing than advocating selling physical gold, which I have not never advocated a single time since I started publicly writing about the virtues of gold in 2006 on my blog.
During a monetary crisis, there are always much better means of not only maintaining the purchasing power of your dollars but far exceeding in gains, the equivalent decline that occurs as a result of rapid and significant monetary expansion.
Thus, I would still never invest in traditional stocks in the hopes of maintaining the purchasing power of my dollars, especially when there is no fundamental backing to this brief rise we have experienced so far. Investing in assets that will benefit from this monetary crisis, assets that have produced significant profits for the past several years, is a much better approach.
8 Reasons the Obama Administration Will Not Solve This Crisis by the End of 2009 [View article]
Keynesian solutions of injecting massive amounts of money to address economic woes is not a credible solution because if assets only rise due to the debasement of fiat currencies, than the increase of wealth (i.e. a stock portfolio value, or real estate values) is illusory and not real. If the DJIA for example, bounces back 20% and the US dollar is debased 25% further to accomplish this, then your net real wealth gain is negative.
The only thing that matters is the purchasing power of your currency, not how much you have of it. If I have $800,000 but my $800,000 buys less than $500,000 did six years ago, I have more money but am actually poorer. This is the flaw of Keynesian driven policies. As many others have stated here, there are plenty of resources out there, including my own, that you can research to more fully understand my position in this article. All the best.
Gold Correction Now More Likely than Not [View article]
To clarify some points, if I failed to do so in my article, I did not favor selling any physical gold because of this correction because I have yet to sell any of my physical gold. I will keep holding on through the temporary corrections until the mania phase arrives. I wrote this article as a warning to those seeking an entry point (again remember I released this article when gold was trading at $994 an ounce) or for those seeking to add more to existing positions.
To further address others that wished I had discussed in more detail some of the issues I briefly mentioned in this article you may note that I've written more than 40 articles about gold since 2006 on my blog so perhaps you can find more answers in my own blog archives at www.theUndergroundInve.... If you reference these articles, you will discover that I am still very much a LONG TERM gold bull, have always been for many years, and my above article does not sway my long-term bullish outlook for gold.
All the best.
In Today's Environment, Neither Technical Nor Fundamental Analysis Alone Will Work [View article]
www.theundergroundinve.../
For those interested in writing Mr. Chilton their own messages regarding the concentrated short positions in gold/silver futures markets that indicate collusion, you can personally write to him here.
Bart Chilton, Commissioner
Commodity Futures Trading Commission
Three Lafayette Center 1155 21st Street, NW
Washington DC 20581
Telephone: (202) 418-5060
Fax: (202) 418-5620
BChilton@cftc.gov
Have Gold and Silver Stocks Peaked? Challenging the Analysts [View article]
thanks so much for your comments. in fact, thank you everyone for your comments, whether you agree or disagree, as long as you keep the comments constructive. However, if you visit my blog, theUndergroundInvestor... which I have been maintaining since August, 2006, I started publicly blogging about the merits of owning physical gold in September, 2006 and have owned physical gold prior to posting my blog on the internet.
Yet, I guess since I did not first buy in 2001, I admittedly have been a little late to the party, but for those that had the foresight to start building physical gold positions back in 2001, I tip my hat to you. However, it is my strong belief that this monetary crisis is just getting started and that even now, people that prepare now will have the opportunity for massive profits over the next several years. Better yet, the US Federal Reserve and US Treasury engineered sell off in gold and silver futures market last year (at least this is my strong belief as to what happened) provided another great entry point for those that have been "late to the party". All the best, JS
The Undisclosed Costs of the U.S. Government Bailouts [View article]
The anger among Americans being burdened with the losses from all these banking and Wall Street CEOs is palpable now, certainly to the point, where our Congressmen KNOW the people are angry. They fear that if they passed this legislation right away, without faking some kind of righteous indignation, that their constituents will vote them hastily out of office come November. So at the very least, they must appear to be on the same side of their constituents even if they are not. If this bailout plan was brought up one year ago, when the discussion was not so close to election time, I don't believe we would be seeing the same level of indignation.
I know that this may seem overly sarcastic, but there is a reason for my sarcasm. All Congressmen have been informed for decades through Congressional Finance Committee Hearings of the great risk and greed that was being perpetuated and did nothing about if for years (though this is monumentally boring, you can read through the archived hearings of the Congressional Finance Committees both for the House and the Senate here financialservices.hous... and here www.senate.gov/~finance/sitepages/he... I know that some of our Congressmen and women have not been in office that long, but even within the past several years, they had been warned time and time again of the dangerous assumption of risk in our financial sector in the quest for easy profits. Thus, they had multiple opportunities to stand in our defense, and every single time prior to this week, they failed miserably to do so.
The time for indignation is not now when it is far too late to prevent serious damage to the American taxpayer. Any way you spin this bailout, all American taxpayers are in for a world of hurt now. For this reason, though some may be encouraged that Congressmen are fighting for our rights now, this indignation rings false. If they were truly indignant about this situation, the time for action was years ago when they could have prevented this situation, not now when it truly is too late.
The Undisclosed Costs of the U.S. Government Bailouts [View article]
If I knew this more than two years ago, certainly the CEOs of every firm that has collapsed this year knew this as well. Their understanding of these complex derivatives that introduced so much risk into the global financial system almost undoubtedly exceeded mine. So they knew. Not only that, if you look up the legislative history of the SEC and the CFTC for the past 10 years you will see that they acted not as regulatory agencies one single time, but more like Wall Street lobbyists, as they systematically dismantled a lot of the legislation that had originally been enacted to prevent what is happening today. The people heading these agencies all need to go as well and we need to get REAL regulators back in these crucial positions instead of paid lobbyists for Wall Street and big banking.
So even had the regulators started to do their job as recently as two years ago, this would have forced big banks and Wall Street firms to stop their destructive behavior. Instead, the SEC and CFTC stood by silently and did nothing, knowing full well what would happen today (again, how could these so-called regulators not know, given that I've known for two years running now)?
So had they stepped in to do their jobs instead of aiding and abetting the greed of Wall Street and big banks, this situation could easily have been avoided. Instead of problems of liquidity today and capital markets freezing up, perhaps we would have had one or two firms fail instead of many. Then the solution easily could have been to let those firms go bankrupt (the economy could have easily rebounded from the bankruptcy of one or two big firms) and there would have been NO need to socialize any of the losses of any financial institutions and burden Americans for generations to come.