doomed to repeat ?

[Joseph Tracy]

The banks are not loaning to job creating business but continuing to speculate on derivatives( Banks have increased total outstanding derivatives by a record107 trillion in the last 6 months to a total of 707 trillion.This means the entire financial system is sitting on top of a giant accounting trick, because banks don't know how to get rid of this toxic tar without enormous losses. This game  could implode at any time with a major credit event) . Europe is still in crisis from the collapse of the real estate bubble. If the Euro dies, the big american banks will go bankrupt again and there will be no meaningful recovery from that.. All the evidence is that the system is still profoundly broken. Several of the smartest economists out there are predicting another meltdown.   

This bailout was a huge bank scam aided by the government. But really it was the Fed who acted independently and without accounting to anyone to insure the bankers' dominance over the government and their access to the emergency treasury of taxpayer money. That is not just this crank's opinion. Today Bloomberg reported that the Fed loaned 7.7 trillion in below market loans hidden from the Congress as Congress made the TARP bailouts. So the banks used this to lobby Congress  to avoid regulation while hiding the true scale of their bankruptcy. This was a coup  by the Fed and its clients to prevent Democratic accountability. Lawmakers knew none of this, because they refused to demand true accountability. They bought "assets" without looking at those assets or forcing a review of the banks' books.  They had no clue that one bank, New York-based Morgan Stanley, took $107 billion in Fed loans in September 2008 while claiming to be solvent..    The net effect is to prop up an economy based on  war, speculation and predatory lending at outrageous interest rates, and to prop up real estate values instead of letting them fall to real market values.  

Banks should provide stable and reliable financial services to the real economy. Instead, as a result of successful lobbying , the bankers and Friedmanites have managed to lift  all limits on usury, plundered Chile, Argentina, Brazil, Columbia, Haiti and others, inflated a giant world-wide housing bubble while posing as anti -inflation champions,created the savings and loan fiasco,  bought the Congress and white house, turned corporations into citizens, presided over the upward transfer of wealth, inflated the cost of education with student loans and deluded Americans into shipping the production of goods overseas. In the end financial businesses have become the crux of the economy  and replaced productive work with casinos, piracy, advertising, wars, brands and ponzi schemes. They become billionaires when they make good bets and pull off their schemes and they come to taxpayers when things go wrong. Propping them up only insures they will repeat this because they have nothing to lose.  

We don't have to surrender to self destruction, but change is costly; the options we need will not be on the ballot unless we put them there.  The ideas we need won't be in the air unless we sound them and point to them.