If you haven’t already seen this Real News Network interview with Bill Black, I highly recommend it (I first saw it on Polizeros "Bankers, Gangsters").



The other segments can be found here – Part 2, Part 3, Part 4, and Part5.

A story of crony capitalism, accounting fraud, and the global Ponzi scam.

After over a year of the Obama administration being in charge, the people that perpetrated the crime are still in charge. We need to get rid of them. President Obama, you said you stand for the little guy - show us and boot out the criminals. Fire Treasury Secretary Timothy Geithner, Office of Thrift Supervision chief John Bowman, Fed chief regulator Patrick Parkinson, and Office of the Comptroller of the Currency Chief John Dugan. Get rid of Ben Bernanke as chair of the Fed.

Also see Bill Black's Top Ten Ways to Crack Down on Corporate Financial Crime

First we had the "wealth transfer" bills, over $1.5 trillion, in the wall street and other bailouts - and now we have another "take from the middle class and give to corporations" plan in the, now completely debilitated, "health care reform" legislation.

Health insurers surge after key vote - The Associated Press

Credit Suisse Ups Targets on 7 Health Insurance Stocks - StreetInsider.com

Yes, our health care system in the U.S. sucks - that's a fact - and our health insurance system is terrible - but unfortunately this legislation, as it has been watered down, will not help. Well, at least it won't help anyone except the insurance companies (and presumably the crooked politicians who push it through).

This is just another form of corporate bailout, and for an industry that isn't even in trouble this time - they're just extra greedy - health insurers.

It's not about "socialism" or "big government" - it's that this bill has been thrashed and warped by corporate influences and no longer has anything for the people in it. It must be squashed. It looks like the U.S. will not be able to do what the rest of the industrialized world has done.

Those evil, socialized countries manage to pro­vide universal health care to their populations with better ­quality outcomes than ours and at about half the cost! So what do all of these countries have in com­mon? They all prohibit health­ insurance companies from being for-profit.

It sounds impossible here in the U.S. But it's not - at least in theory. Switzerland was the last of the developed countries to make that transition, which it did about 25 years ago. Their example shows that it is possible to develop a transition system in which the investors of for-prof­it health insurance companies don't get screwed.

This can be filed in the truly absurd department, or as Snagglepuss might say "unbelievable, even."

If not for FISA "reform" that gave the telcos retroactive immunity, Edward E. Whitacre Jr. would be in jail - you see, back when Ed's AT&T performed the "warrantless surveillance" for the Bush Administration, it was a felony.

Instead, the Obama administration is awarding him with the General Motors Chairmanship - say what?

When he was running AT&T, he said he didn't use computers or text messaging. Yesterday, he told the press in an interview after his appointment: “I don’t know anything about cars.” It figures. Just what GM and the US auto industry needs.

Ed "Why should they be allowed to use my pipes?" Whitacre is also the same guy that lobbied so heavily against net neutrality, something Obama told us he supported.

Whitacre, it turns out, is just another in the long line of executives running GM who knows next to nothing about cars, going back to Roger Smith, who destroyed the company's pride and global competitiveness in the 1980's - and it's been downhill ever since.

It's a damned shame. I was never a huge GM guy, but one had to respect them, and the cars they made. The American auto industry was a benchmark for the world and the American automobile was a symbol of our culture and the envy of the rest of the world. Buick, Pontiac, Chevrolet, Oldsmobile and Cadillac were all incredible brands with passionately loyal customers. Now, most people are embarrassed to admit they own one of these cars.

The choice of Whitacre for GM is a black eye for the Obama administration and a clear indicator that politics in Washington have not changed. "We the people" are screwed, as usual.

Instead of dropping money into the sink hole of Wall Street, we should be creating a landscape where startups can flourish. We have the resources we need to get out of this mess - and it is the collective brain-power and ingenuity of our people, young and old alike.

The Internet created an environment with low barriers of entry for new ideas to take flight, basically a much more level playing field, where those with limited resources could compete, on merit with larger established companies. If the government is going to throw money at the economic mess, throw it in this direction, in the form of incentives for startups and entrepreneurs, even capital, etc.

VC's have shown you don't even need to be all that selective. You could almost have a lottery system without wasting a lot of time and money reviewing ideas because there are enough smart people with drive and good ideas, if you throw money at the wall, it will stick. Literally throw the money out there to anybody with an idea - a lot of them will go on to create jobs, if not entire new industries.

The economic recovery starts at the bottom. People have to spend money. It starts with people having jobs. An ecosystem that enables thriving new businesses creates jobs. Forget these old-world Wall Street bafoons - they are not our saviour. We should put our recovery (and some money) in the hands of our smart entrepreneurial pool - that will produce results.

Even if you argue that AIG and others are "too-big-to-fail" so they need a bailout, we must NOT LET IT HAPPEN AGAIN.

We let smaller corporations merge into these mega-corporations that are inefficient, unable to adapt, or innovate, and ultimately non-competitive - because they don't have to compete - they have the implicit guarantee of a "too big to fail" bailout.

I still question whether the consequences of letting them "fail" will really end the world as we know it, as Bernanke (and may others) say. It's not like propping them up is really working all that great anyway.

If they fail, won't their assets be scooped up by smaller competitive firms and so the system will resume?

We need more proposals like Tom Evslin's suggesting that a better way to help the auto makers is to have the US govt. replace their fleet:

The US government should order a complete replacement for its vehicle fleet to be delivered over the next four years. The new vehicles must be either plugin electric hybrid, pure electric, or possibly natural gas. Obviously retooling both at the manufacturers and suppliers is required to deliver this order so the government should be willing to prepay a significant part of it as it does for new weapons systems. That gets money into the system fast and creates/saves jobs almost immediately.

We need more of these bottom-up ideas. We need them to get more support and coverage in the press and media.

Our congresspeople ignored us and went ahead and voted for the bailout even in the middle of an election, but they have to keep hearing from us on these things. Write to them and suggest that they work on more Bottom-up solutions instead of dropping money at the top.

It's Bailout, Baby, Bailout.

First we saw $168 billion stimulus package giving tax rebates, then $29 billion to J.P. Morgan Chase, a $300 billion "housing rescue" in July, Fannie Mae and Freddie Mac taken over in September, the AIG $85 billion bailout, then finally the enormous $850B "stimulus package". Now we have the auto makers snuggling up to the government teet.

These have been called only the tip of the iceberg. So who's next on this list? Here's a few of my guesses:

1. Telecommunications companies: These are totally debt-based businesses. And if the politicians can argue that GM is "too big to fail" they certainly won't let the phones go dead (or the Internet stop working). They will fork over the cash when told by the new Ma Bell.
2. Commercial real estate: The focus so far has been on residential real estate and to be fair, it probably is the primary culprit behind the banking mess. However, the amount of commercial properties taken over by banks through foreclosures is up and banks are becoming more aware of the magnitude of the trouble in commercial real estate loans.
3. Insurance companies: AIG is not the only insurance company in trouble. The entire industry is imploding. Questions continue over capital adequacy, credit downgrades, uncertainty on future portfolio write-downs, and potential cash calls on CDS and other obligations.
4. States: With big budget shortfalls, some states (such as California looking at a $22 billion dollar shortfall) will certainly try to play the "too big to fail" card and take their seat at the federal trough.
5. Satellite radio: Hey why not. This is of course a terrible idea. But when has that ever stopped politicians? And as long as Uncle Sam is handing out cash...

There are probably countless other industries that will try to get while the getting is good and jump on the bailout bandwagon. Who knows how far it will go? Who can blame them for not wanting a share of the bailout pie?

It's like paying off one credit card with another credit card. And of course propping up failing companies like GM and Ford who can't compete naturally, shows the world how strong America is, right?

We need to put an end to it, but you already knew I was going say that. The far better strategy is to let them fail (or recover) on their own.

My brother, a really smart guy, has long chided that by shipping jobs and manufacturing overseas over the recent decades, the US "no longer makes anything," or, in other words, doesn't contribute but only consumes. While this is of course not 100% true, (we produce a huge portion of the world's food, for instance), there is something to it. He has always said this would lead to a massive depression, if not the ruin of the US.

One metric for what a country produces might be GDP. Will Hutton of THE OBSERVER, LONDON has an excellent article on How to survive the market meltdown that brings this together very well. Hutton suggests that there isn't enough money in the world to pay for the "dark heart of the global financial system" or the US$55 trillion market in credit derivatives: "This is a market more than twice the size of the combined GDP of the US, Japan and the EU."

Try to imagine that: a $55 trillion market now at risk of complete destruction. Even the derivative debt owed by individual institutions stands at nation-wrecking levels. For example, a single bank in Britain, Barclays again, holds more than $2.4 trillion in credit default swaps. This is more than the entire GDP of Great Britain. If all this paper goes bad, there are not enough assets in the entire country to pay it off. And that's just one bank, in one country.

Hang on. This is going to be a bumpy ride.