Crisis! Meltdown! Fire and brimstone! Dogs and cats living together, mass hysteria, end of the world...
Posted on 09/23/2008 11:56:08 PM PDT by bruinbirdman
Most Americans are just now starting to get an inkling of how serious the financial crisis is in this country. In fact, although it is most dire here, it is dragging down the entire world economy.
To hear Wall Street and most of the financial media tell it, this mess was caused by stupid or careless corporate executives doing risky things without thinking through the consequences. Nothing could be further from the truth. Just so you know that these periodic financial disasters are not accidents, let's take a look at some history before examining today's situation.
We'll use Citigroup as the poster child. It may not be the worst offender, but it's an easy one to follow, and I'm familiar with its story.
In 1991, when the core of what is now the investment banking business of Citigroup was still Salomon Brothers, the company manipulated the Treasury bond market by fraudulently using their clients' names, without authorization, to buy bonds so that the company could secretly exceed the limits set by law in order to prevent undue control over the market.
In 1994, Smith Barney, which by then owned Salomon Brothers, paid a $40 million fine for fraudulently manipulating the municipal bond market. It was by no means the only company involved, but it paid the largest individual fine.
According to an investigation by Nandu Narayanan, chief investment officer at Trident Investment Management, Citigroup was a key player in the Enron collapse early this decade and was found by the bankruptcy examiner to have helped Enron produce misleading financial statements.
Around the same time, Citigroup paid $400 million in fines to settle with the SEC in the WorldCom debacle, where it was accused of providing false and misleading research in exchange for lucrative WorldCom stock and bond underwriting.
(Excerpt) Read more at forbes.com ...
Crisis! Meltdown! Fire and brimstone! Dogs and cats living together, mass hysteria, end of the world...
Finally, the whole picture is starting to emerge.
This isn't just about a few greedy banks lending money to foolish people for overpriced houses.
It's about massive credit debt in general, here and everywhere else.
Pelosi is completely clueless, holding this up so she can add pork- to guarantee the same people another loan when they shouldn't have had the first one.
Other nations have already injected hundreds of billions to prevent a massive collapse, Japan alone has injected over 200 billion in the last 2 weeks.
It's projected to cost several TRILLIONS. American share is around 700 billion.
Media as usual, is confusing the heck out of people, and Pelosi, the confused one- is putting this country in enormous danger. Other countries are protecting their banks, Pelosi and her gaggle of idiots is pushing ours off the cliff. I wonder how people will feel if they woke up in the morning to find 6000+ banks across the country locked their doors permanently?
With Oprah putting on "Guest" speakers telling people to run out and pull all their money out of their banks, yank their savings out of funds they aren't sure and government protected, they could cause a stampede- a run against the banks which is the LAST thing we need right now. I guess we will see what things look like in a couple hours.
What a mess.
Several years ago I studied the Stock Market Crash with one of my sons. President Hoover warned people not to borrow from banks to invest in stocks but they mocked him and continued their behavior. I thought that we were similarly borrowing from banks (30 yr loans) to invest in houses - often beyond our means.
My grandparents lost their farm in New York. An orange in the Christmas stocking was a real treat.
I wasn't too sure what he was talking about but he said it would cost maybe 40 billion instead of 700 billion.
Anyone know about this?
Won’t work. Period.
Do you expect the way to cure a heroin addict is to cook up a bunch and give him a shot?
If the bailout goes through, it will only be a foot in the door, the first of many. And the result will be hyperinflation.
We gotta get our house in order. Honest money. Make it totally illegal for someone to try to sell something he doesn’t own, or hypothecate.
From what I hear, Obama has climbed on the Democrat bandwagon to add all sorts of credit to the bailout.
read the article. We are way beyond that now.
The fact of the matter is powerful and unprincipled money men manipulate the markets through their operants from Wall Street) have basically sucked the wealth and profits out of the system. We are left holding the bag.
There are just too many loopholes in the system. Not suprizing was Clinton repealing the Glass-Steagall Act which has basically brought the banking system to it’s knees.
Oh thats wonderfull! It shows Obama is just as dumb as Pelosi and her gaggle of idiots. The last thing we need is more credit. We have only one way out of this. SAVE! Stop spending.
I didn't think Presidents could repeal laws.
In fact, Glass-Steagall was repealed, not by Clinton, but by Congress, in 1999.
Yes, THAT Congress. The one with 55 Republican Senators and 223 Republican House members.
It isn't easy to decide where to put anything right now. Anything can suddenly experience a run down to zero.
As I mentioned, big mouth Opra had one of her idiotic "finacial advisors" on yesterday, confusing the heck out of her viewers. Her advice? If you aren't sure if your money is safe, get it out NOW!
I'm wondering if we will see something bad happen this morning because of it. I guess there's not much to do but sit tight and see what happens. stay close to the phone and make sure your broker is on sped dial.
The point is we are in this mess because of that and lots of other shady maneuvers by corrupt and greedy inside players.
Where was Bush with his bully pulpit for the last 8 years.
You can't wish it away, but you can make it worse. The only thing we have to fear is God Almighty.
During hyperinflation, it behooves you to spend. The answer is for people who "invest"/gamble borrowed money to suffer the natural consequences.
bump.....
FWIW, in the first of the great bubbles, that of the South Sea Company, Parliament confiscated the properties of the directors of the company and those politicians who they had influenced to “partially” compensate the victims. Or, more accurately, those participating politicians who had insufficient clout to protect themselves in the disaster.
I don’t believe it could be done here, as it required ex post facto legislation, but one can dream...
The aspect of this situation I find most appalling is that a great many people have siphoned 10s or 100s of millions of funny money into their personal accounts over the last 10 years by manipulating the markets rather than generating wealth. Many of these people will walk away with their morally if not legally ill-gotten gains intact, even guaranteed by the taxpayers, while hard-working less crooked people will for the most part pay for it.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.