Saturday, October 15, 2011

Hell Freezes Over As Greensboro Welcomes Thousands of OccupyGreensboro Demonstrators!

[Contributions to the maintenance of this blog are joyfully accepted. Long Live OccupyGreensboro!]

What a day it was.

Thousands of people marched from Government Plaza past the International Civil Rights Museum into Festival Park, and immediately started to network, pitch tents, cook food and distribute hundreds of cold water bottles to their thirsty neighbors.

I personally will never forget marching rhough the financial district with the crowd shouting at the top of our voices jeers at the banksters and their manipulations of the economic sphere of the US (and the world!), ruining the lives of what had once been diligent, well-educated, hard workers. (This is mostly personal fantasy, of course, as I only participated as a Legal Observer so I could not express my feelings (although I did smile a lot)). (Legal observer is a position that ensures that one promises not to partake in any actions during the march which would compromise his or her position as a neutral observer keeping the peace and recording any entanglements with the demonstrators, police or subversives in order to be able to testify in court later about the occurrences during the march.) However, it was still the best (if only in my mind). The multitude of families who marched together (with the children leading the way) were a particular thrill for me.

Saturday, October 15, 2011

Karl Denninger, "Bald LIES From The Right (This Is IMPORTANT)"

"There's a particularly odious and sickening piece of crap flying around today from "PajamasMedia", one of the water-carriers for the "right" side of the aisle - and if we're ever going to actually fix anything in this economy and in our banking system, these people need to be exposed as the liars they are, held up to public ridicule, and scorned everywhere, from the corner grocery to the barber chair to the doctor's office.

"The “gun to the head” was obvious: “You really have a nice bank there. But if you walk out without signing this document, right here, right now, we will bring all of the regulatory and law-enforcement powers of the United States government to bear on your institution. Your depositors and shareholders will suffer immensely. Your bank won’t survive. It would really be a shame if that were to happen. But we promise you, it will.” Hank Paulson’s defenders will probably claim that provision (B) above gave him authorization to do what he did, and that the preferred shares the banks were forced to issue count as “financial instruments.”

The problem with that “logic” is that these weren’t “purchases.” They were extorted ownership interests — and in case you’re wondering, there is no authorization to extort anywhere in the legislation.
The economy as we knew it died that day — and virtually no one objected. As Michelle Malkin wrote: “If you don’t feel like throwing up today, you’re not paying attention.”

Oh really?  This is the worst sort of bald-faced half-truth mixed in with utter falsehood. Let us remember a few things that bear directly on this matter:

   1. Hank Paulson - yes, that same Paulson - went to the SEC not once but twice when running Goldman to petition for a removal of the leverage limits enforced against investment banks.  The first time he was told to pound sand.  But the second time his request was granted.  Why is this so important?  Two reasons: (1) The blow-off top in housing prices could not have happened without the ability to continue to fund those loans, which required ever-increasing debt leverage and (2) both major investment banks that failed - Bear Stearns and Lehman - had more than double the former 12:1 legal leverage limit when they blew up.  In other words but for Paulson's successful lobbying effort neither failure would have happened and neither would have the final three years of the housing bubble.

   2. Tim Geithner was running the NY Fed during this time period.  The NY Fed has primary surveillance responsibility over all of the major investment banks that got in trouble in 2008 as they are the nexus of essentially all tri-party "repo" activity in the financial markets.  The NY Fed did nothing to curtail the leverage these firms were amassing - it did not raise an alarm with Congress, it did not raise an alarm with the OCC and it did not raise an alarm with the public.

Instead it intentionally averted its eyes, including but not limited to the fact that AIG had written some $500 billion in credit protection with about 1/100th of that in capital behind it, an effective leverage ratio of 100:1, and it permitted repo operations with MBS even though Fannie and Freddie were running 80:1 leverage, until all of the above blew up in everyone's face.  For this act of "remarkable stewardship" Tim Geithner was handed the Treasury Secretary's job by President-elect Obama.

Let's not kid ourselves here folks.  There was no "take-over" of Wall Street by Washington.  No, both Wall Street and Washington DC actively conspired to produce this:

That was not an accident.  Roughly $1,300 billion in one quarter alone was added to the total systemic debt against an increase in GDP of a mere $200 billion, or more than six times as much debt added to the economy as output expanded.  Put another way, five of six of those debt dollars were not producing anything new in the economy at all!


And oh by the way, see the last year or so?  We're trying to do it again but there's nobody left in the economy, other than young adults that we have intentionally rendered ignorant by failing to teach them that it's focking stupid to take $70,000 in student loans to study history while at the same time we prevent those loans from being discharged in bankruptcy

This willful and intentional corruption of the bankruptcy process effectively makes legal predatory loan-writing by student-loan lenders and their willing accomplices in the student financial aid offices at colleges who have superior knowledge and who should be exposed to well-deserved bankruptcy themselves for writing bad loans (along with the foolish students who take bad loans and who do get screwed.)

It has also caused a 900% increase in the cost of college in the last 30 years - an utterly impossible-to-sustain price change unless you intentionally bankrupt huge swaths of the young adults you lure into the trap with the claim of the necessity of a college "education" in order to obtain a well-paying job. We are now to the point where one trillion dollars in student loans are outstanding.  Put bluntly we are literally, as a nation, as politicians and more importantly as parents, screwing our kids blind in order to find just one more hit of debt crack in the carpet fibers of our economy!

Pajamas Media asserts the following in closing: "Even beyond what we can see with regulations gone wild, failed stimulus, and outright corruption, our government’s authoritarian overhang and its destructive psychological effect on business and investor behavior largely explain why the economy won’t acceptably grow."

If you believe one word of that paragraph you're dumber than a box of rocks.

What happened in the many years leading up to 2008, and what has continued since, is an organized looting operation conducted under the auspices, with and through the explicit consent and participation of both Wall Street and The Feral Federal Government. With Washington DC backed into a corner through their political promises that cannot be kept as they depend on ever-advancing exponential growth of debt both sides of the aisle turned to literal endorsement of Wall Street's "money machine" which ran on one and only one thing: Ever-increasing amounts of leverage - that is, debt - which was mathematically certain to blow up in everyone's face.

The worst part of this is that the Banksters knew good and damn well it would happen - in fact, they even have a simple rule for figuring out about how long it will take, known as The Rule of 72 that allows them to estimate the "doubling time" without using so much as a calculator or even an abacus!

It is explicitly for this reason that a "government backstop" was so important to them and was effectively purchased both through lobbying and through the revolving door of not one but two successive Treasury Secretaries!

You want to know why OWS is in the streets? It's simple: Nobody has been held to account for what happened and what's worse we're still screwing those who we intentionally left ignorant - our youth - while Universities are crying poor-mouth and rate-jacking educational costs.  For its part the government goads kids into stupid decisions with one hand while glad-handing the entire manufacturing base out of this nation through so-called "Free Trade" agreements.

The lies are not confined to one party or the other.  Indeed, it is almost impossible to assess "greater" blame on the left or right.  The fact of the matter is that both major political parties actively conspired with not only Wall Street but the Federal Reserve to put in place monetary and fiscal policies, along with intentional head-turning to outrageous practices that constituted pyramid schemes throughout our economy that have enriched the few at the gross and outrageous expense of the common man.

Our offshoring of jobs and the trade deficits that have resulted from it cannot be sustained without explicit and intentional actions by both The Fed and Congress to enable them.  This is not just China's fault (although they are certainly guilty as well) it is also our political and banking class - the 1% - that has willfully and intentionally sent the 99%ers jobs overseas and they all did it for profit!

Thank God that "Leverage" will soon be out in hardback so that everyone can understand exactly what happened, why it can't work, and hopefully we will manage to (finally) have an honest conversation in this nation about what we can afford, what we can't, and what we have to do to resolve what the "1%" (half of them on Wall Street and the other half in DC) intentionally, willfully and with malice aforethought engaged in over the last 30 years.”

Couldn't have said it better myself.

Let's march!



TONY said...

Good pics. You Americans are lucky that you get to march in the sunshine! It was bucketing in London last week.:)

Suzan said...

Sorry, Tony!

Thanks for the good words. "Bucketing?" Like "Buckets of rain, buckets of tears?"

Hope yours was as passionate as ours was.

Thousands (no matter what the MSM reports) of great people converged on this medium-sized southern town to show their determination not to be used by the politicians and banksters ever again.

Love ya!



Buckets of rain, buckets of tears
Got all them buckets comin' out of my ears
Buckets of moonbeams in my hand
You got all the love, honey baby I can stand

I been meek, and hard like an oak
I seen pretty people disappear like smoke
Friends will arrive, friends will disappear
If you want me, honey baby
I'll be here

Like your smile, and your fingertips
Like the way that you move your hips
I like the cool way you look at me
Everything about you is bringing me Misery

Little red wagon, little red bike
I ain't no monkey but I know what I like
I like the way you love me strong and slow
I'm takin' you with me, honey baby
When I go

Life is sad, life is a bust
All ya can do is do what you must
You do what you must do and ya do it well
I'll do it for you, honey baby
Can't you tell?