J. S. Kim

Let's Keep Big Banks from Ruining America Forever

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

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.

Warren Buffett Is Wrong on Fed Intervention in Bear Stearns

MetroInvestment, I love your medical analogy of the scab. Very nicely put. The only area in which I respectfully disagree is the extent of bad apples that still exist in the global financial system. I still think that financial institutions are being less than aboveboard about the level of "junk" that they currently still hold on their books and what worries me is that nothing is being done to remove the "bad apples" from the system. For example, the Feds only guaranteed $29 billion to JP Morgan if Bear Stearns's assets go belly up. But what about taking constructive measures to fix the system and to permanently extract the bad apples from the system? I'd feel a lot better about things if long-term sustainable solutions were being implemented.