Does Anyone feel like Bailing

[sugarpop]

Originally Posted by classicman

This is a very interesting article.

Chomsky: Understanding the Crisis — Markets, the State and Hypocrisy


So Rubin gets the law changed and then went into the sector to benefit from it. . . nice.

I love Noam Chomsky. Paul Krugman also saw it coming. He wrote a book about it back in 1999.

I posted links a couple of weeks ago about how the repeal of Glass-Steagal caused the housing crisis. And we can't just focus on bailing out banks, which I don't think we should do anyway, but we also have to get strong regulations and oversight back into place.

Did you see the Congress questioning all the bank CEOs the other day? Even most of them agreed they need regulating. HA! Now they admit it...

[classicman]

Originally Posted by sugarpop

So we should just let them continue to rot, so we don't inconvenience people? We should just systematically start to fix/replace things, starting with the things that are in the worst shape.

Not at all - that was MY point, and we are! What this money is being spent on is the stuff that can be fixed the easiest with the least amount of disruption. From what I have heard from DOT engineers in a local state, the bridges and roadways which need the most serious repair and are in the worst shape are NOT GETTING FIXED.

Originally Posted by sugarpop

About Japan, from what I've heard from numerous economists, including Paul Krugman, the whole reason why Japan was in a recession for so long is because they didn't put enough money into it initially, so they had to keep pumping more in. That is why we need to go big, from the beginning. Doing things piecemeal, and stopping too soon, is what causes big recessions to last longer.

I have heard that too - that is but one analysis of the Japanese situation. Doesn't really matter at this point. All we can do now is hope and pray that this package works.

[classicman]

Originally Posted by sugarpop

I love Noam Chomsky.

So you agree with him:

Robert Rubin and Lawrence Summers, Clinton's treasury secretaries, are among the main architects of the crisis.

[sugarpop]

Originally Posted by classicman

So you agree with him:

I don't really know that much about Larry Summers or Robert Rubin, or the part they played in this fiasco, but I trust Noam Chomsky, and I believe that many of the people who we are trusting to get us out of this mess are the ones who caused it. I would include Tim Geitner in there as well. He was in charge of the Federal Reserve Bank in NY, correct?

I just don't understand how all these really, really (supposedly) smart people missed what was happening, or didn't know it WOULD HAPPEN when they started figuring out all these crazy, stupid ways to make money. For crying out loud, I would have known it would eventually come tumbling down, and I am nowhere near a genius when it comes to finance stuff.

[classicman]

Maybe they all knew and got theirs before it happened. I don't see any of them hurting too bad.

[sugarpop]

Originally Posted by classicman

Maybe they all knew and got theirs before it happened. I don't see any of them hurting too bad.

Exactly. Do you think that is OK?

[tw]

Originally Posted by sugarpop

I just don't understand how all these really, really (supposedly) smart people missed what was happening, or didn't know it WOULD HAPPEN when they started figuring out all these crazy, stupid ways to make money.

So in 2005 when I warned of an obvious and major impending disaster in housing prices, you immediately saw the wisdom and agreed? Naive is to blame Tim Geitner. In fact, when you posted this, instead, you should have been watching Frontline to first learn the story.

Well, what are you waiting for:
Inside the Meltdown

Obvious is the arrogance where brains were smaller, bonuses largest, egos inflated, and MBA training is everywhere. Blaming Tim Geitner is silly. This problem is directly traceable to what we did to make it possible. (see the word we - not they). We ignored Enron accounting. LTCM made obvious the lack of transparency to let finance people enrich themselves at the expense of America. What also resulted was the CA energy crisis and (it now appears) $4 per gallon gasoline.

Why does an executive deserve more than $1million annually. Why do people who were the less intelligent in school but are big image salesman type easily making $1million a year on Wall Street?

How much of the problem do you understand? Do you know that a stock broker underperforms the market. So he sells mutual funds rather than stocks - to increase your costs and his profits. Traditionally stock brokers are poor investors. They know almost nothing about economics or products, and everything about making the sale and enriching themselves. Is your stock broker informed, or only a salesman? Did you even ask yourself that question? If not, then you too are part of the problem. A finance person is paid for image; not for knowledge and intelligence. But because he moves large sums, he feels he must take a larger percentage and that only he best knows how to direct capital.

The people with knowledge and intelligence come from where the work gets done. So we let lower intelligence finance people hide their mismanagement in the name of deregulation? But again, watch the frustration of Bernanke and Paulson when these so called geniuses only played money games and chicken to enrich themselves and mortgage America.

When Greenspan was first told that 20% of the mortgages were sub prime, he denied it. No way would so many approve or apply for that kind of mortgage. But with extremists pushing deregulation, Greenspan had no way of knowing the content of mortgages. Today's finance industry turned into outright deception and shady backroom deals. We even let George Jr completely lie about Saddam's WMDs - and said that was good.

Long before looking at Geitner, instead, first look at yourself. Do you know that most every stock brokers is a poor investor; little more than a salesman? If you did not even know that, you set yourself up to be part of the problem. Geitner had nothing to do with, for example, so many people even foolishly taking out loans to buy disposable items such as cars.

Let's see how much your grasp. Fanny Mae and Freddie Mac were designed to make housing more affordable. That is the statement. Do you believe that? Yes? No?

Both make housing prices higher. Using basic economics, then you know that AND will then reply with the reason why. Long before you could blame Geitner, you must have the answer to that question AND know the why behind that answer. Otherwise, you are simply part of the problem.

In 2007, markets were crashing. Merrill Lynch's senior VP warned loudly of the problem in early 2008. So Merrill Lynch's president fired him. Is that an accident? Later that president was paid something around $200 milliion to leave. This is also acceptable?

With any grasp of these last six months, then you know widespread denial was routine even one year later at the CEO level in all 'now famous' finance companies. They were doing exactly what is taught in business schools.

If you blame Geitner for anything, he did not let Bear Stearns go bankrupt. IOW his bosses let the rest of Wall Street remain in denial. What is found everywhere in this crisis? Massive debts and risk were hidden in Enron accounting schemes. Long before blaming Geitner, explain why widespread accounting fraud is now legal in America.

Learn why every stock broker, investment banker, insurance broker, etc all must be highly regulated. Why so much corruption? Tell me. What is the purpose of a company? The third question.

Let's see how much you knew before you were blaming Geitner. Three questions that are easily answered. You saw the impending housing crash in 2005? What do Fanny Mae and Freddie Mac do and why? What is the purpose of a company?

[sugarpop]

You misunderstand. I was not blaming Geitner. I was saying I don't know that much about him (like I don't know much about Larry Summers or Robert Rubin), but he was in charge of one of the Federal Reserve Banks, and is supposedly one of those bright people, so what did he know? I was asking the question. I'm sorry I wasn't clear. From what I've heard/read about him, he is supposed to be one of the people most likely to get us out of this mess. But again, I don't know much about him, so I don't know. IF he helped create the mess, he should not be in charge of getting us out of it. Neither should Larry Summers or Ben Bernanke or Hank Paulson, or anyone else who created the problem.

I have been raging against Wall Street and CEOs for ages. I think they are way overpaid, I always have. I call them corporate pirates. I don't think most of them deserve the money they make. I have also been griping about deregulation, ever since Reagan started the deregulation boom. I do not now, nor have I ever, thought business would effectively police itself. It goes against reality. And the more we deregulate, the more corrupt things get.

I watched a show on CNBC called "House of Cards" the other night about the meltdown. http://www.cnbc.com/id/28892719 It was very informative. Fannie and Freddie did not invent the subprime mortgage, nor any of the other unethical and questionable (borderline illegal?) activities that collapsed the market. Those were invented by Wall Street corporate pirates and other vultures in the wake of the deregulation of commercial and investment banks.

What pisses me off, is there are people walking away from this with millions and millions of dollars. They knew what they were doing was questionable. How could they not know? But they did it anyway. And they collapsed the entire world economy. They should all go straight to prison, AND lose all their money. THEY should be the ones bailing us out, don'tcha think?

[xoxoxoBruce]

I think they hired him because he knows the system and the players... and they know him.
If he follows the program, he can be a valuable aid. If he doesn't, hopefully there will be enough transparency to nip him in the bud. We'll see what works and what doesn't, and I'll accept that but I don't want any secret under the table bullshit.

[TheMercenary]

Geithner is a total insider. Ponzi turns itself inside out and gets a pass. The liberal press ignores it. If it was a Republickin Admin doing the same thing there would be a frigging riot. Double standard stinks.

[tw]

Originally Posted by sugarpop

You misunderstand. I was not blaming Geitner. I was saying I don't know that much about him (like I don't know much about Larry Summers or Robert Rubin), but he was in charge of one of the Federal Reserve Banks, and is supposedly one of those bright people, so what did he know?

It was not their job to know. It was their job to blow the whistle. However we built a system where accounting fraud (Enron accounting) is now legal. Look at what Geitner did when he finally walked into Bear Stearns to discover what was going on. He and his staff worked all night. Then at 4 o'clock AM, he called Benanke. Woke Bernanke up to announce ‘Pearl Harbor’. Bear Stearns was wall to wall junk.

Did the Wall Street executives know this years ago? Of course. What did they do? One (Merrill Lynch) even fired the messenger. They even created dummy companies to move losses into. Then claimed those companies as assets on their spread sheets. This is acceptable behavior if trained as a stock broker, investment banker, or MBA. Why are stock broker investment recommendations not to be trusted? Why do so many stock brokers recommend mutual funds to ignorant investors?

How do you know the company is in trouble? CEO comes from the finance department. Carly Fiorina who was running HP into the ground. She also was dumb because her education was MBA. Look at Rick Wagoner at GM. He never ran an single profitable operation in GM. But he was a finance guy his entire carrer. So they made him the top liar in GM. Look at the guys who replaced Herb Greenburg in AIG. The guy who created risk management was basically forced out so they could buy massive CDOs for increased profits and completely disregard the risks.

Again, I asked three important questions. Questions asked because the answers are paramount. Three questions. You saw the impending housing crash in 2005? What do Fanny Mae and Freddie Mac do and why? What is the purpose of a company? Three questions that make obvious what has happened. I await those answers that better define this mess.

[classicman]

Look over there. No the other way....

[sugarpop]

Originally Posted by tw

It was not their job to know. It was their job to blow the whistle. However we built a system where accounting fraud (Enron accounting) is now legal. Look at what Geitner did when he finally walked into Bear Stearns to discover what was going on. He and his staff worked all night. Then at 4 o'clock AM, he called Benanke. Woke Bernanke up to announce ‘Pearl Harbor’. Bear Stearns was wall to wall junk.

Did the Wall Street executives know this years ago? Of course. What did they do? One (Merrill Lynch) even fired the messenger. They even created dummy companies to move losses into. Then claimed those companies as assets on their spread sheets. This is acceptable behavior if trained as a stock broker, investment banker, or MBA. Why are stock broker investment recommendations not to be trusted? Why do so many stock brokers recommend mutual funds to ignorant investors?

How do you know the company is in trouble? CEO comes from the finance department. Carly Fiorina who was running HP into the ground. She also was dumb because her education was MBA. Look at Rick Wagoner at GM. He never ran an single profitable operation in GM. But he was a finance guy his entire carrer. So they made him the top liar in GM. Look at the guys who replaced Herb Greenburg in AIG. The guy who created risk management was basically forced out so they could buy massive CDOs for increased profits and completely disregard the risks.

Again, I asked three important questions. Questions asked because the answers are paramount. Three questions. You saw the impending housing crash in 2005? What do Fanny Mae and Freddie Mac do and why? What is the purpose of a company? Three questions that make obvious what has happened. I await those answers that better define this mess.

hey, I agree with you. But to answer your questions, did I see the crash in 2005? No, but I don't work in finance, banking or housing. IF I had known they were bundling mortgages and selling them over and over again, and they weren't checking people's income to see if they could even afford to buy a house, and mortgage lenders were creating loans where payments would balloon in a few years, and they were coercing some people into these loans who did not understand them, then I would have seen it, yes. Those are NOT good business practices, it is insanity.

My understanding of Fannie and Freddie is they were part private/part government mortgage companies. Fannie was created after the Great Depression to help lower income families own homes. It worked great for decades. From what I've read/heard, my understanding is the repeal of the Glass Steagall Act, and the separation of investment banks and regular banks, is partly what caused this. The rest is the creation, by all those MBAs you talked about, of seriously flawed systems that enabled them to make lots and lots of money while risking the world economy.

IMO, the purpose of a company is to supply a need, and supply a living to people working there. Yes, it is also their business to make money, but not at the expense of the workers, the shareholders, or anyone else (I would include the environment there) by engaging in risky behavior so people can make money.

I watched the movie Wall Street earlier, and it is even more relevent today than it was in the 80s. People on Wall Street have gotten greedier and greedier, and the job they do is crap. They don't produce anything. You are right. All they are is glorified salesmen. And what they are selling, the foundation of the system, is fundamentally flawed. I don't presume to understand it, all I know is they continually cause all kinds of problems that effect society as a whole. I am all for free enterprise, when that's what it is. What we have now? It's not that.

[sugarpop]

Originally Posted by TheMercenary

Geithner is a total insider. Ponzi turns itself inside out and gets a pass. The liberal press ignores it. If it was a Republickin Admin doing the same thing there would be a frigging riot. Double standard stinks.

huh?

And ftr, I have stated many times that Clinton is the one who signed the repeal of Glass Steagal, and that many democrats also went along with the deregulation of the laws that allowed this to happen. They should ALL be held accountable for whatever their parts were in this faisco. I am sick of corruption and greed. I am sick of it in business, and I am sick of it in government, and I am sick to death of living in a society where people only care about themselves, damn the rest. THAT is the attitude that allows this kind of thing to grow. And I'm sorry Merc, I love you to pieces, but you have that attitude. That attitude is part of the problem.

[sugarpop]

Originally Posted by classicman

Look over there. No the other way....

Illusion? Misdirection? Yes, they are sort of like magicians...