God I'm tired of this shit!

We began the year with the Clintonian and Reaganesta economic toy soldiers who, in the past had spoken of different field instructions, more cautious in fact, about the economy, but once anointed by the new commander-in-chief went forward and continued the economic policies of Little Boy Bush by instructing the Federal Reserve’s Field General, Bennie-The Beard-Bernanke, to load up the wheelbarrows of cash and dump them into the laps of the very “infestment” banksters that brought down the economy in the first place. No interest necessary Citi, or “Golden Sacks”.

The marching orders read that the “infestment” banksters were to go forward and increase their capital reserves, since they never really had enough to cover the 30-year long betting cycle of risky loans, and credit default swaps, which made them all very, very rich upper class-men. So, to follow through they went ahead and gambled taxpayer dollars at the Wall Street casino tables, as well as moved forward advancing bets in foreign currencies, commodities, and in other stock markets. In other words, much of the cash they borrowed for free went overseas, just as the jobs they took away from us by outsourcing our own manufacturing livelihoods.

Bennie the Beard was crowned Man of the Year by Time magazine, even though he wrongly spoke about the security of our economy. Bada Bing Bernanke once said that the banks were not involved with sub-prime lending. In 2007, this economic crime syndicate field marshal general said, “ Importantly, we see no serious broad spill over to banks or thrift institutions from the problems in the sub-prime market…The troubled lenders, for the most part, have not been institutions with federally insured deposits.” Wow!! Was this guy trying to do some stand-up?

It is hard to believe that since Bernanke, a PhD and expert in the Great Depression, was so successful selling so much propaganda about the economy, that he was able to be crowned Man of the Year. No doubt, he actually sold policymakers on taking a revised version of Alan Greenspan’s prior bag of crap and made it stick to the wall, such as believing that financial innovations were good for the economy and made banking safer!!! He threw up against the Wall of Crap a belief that our economy had entered a time in history that ushered in smaller and less frequent downturns, which he coined “the great moderation.”

These sweet-as-pie assessments of our grand ‘ole economy were made back in 2007 just before he went squawkin’ to Congress warning about a falling sky Chicken Little style; yet, Bennie The Beard was reading a brand of his homegrown tea leaves as the sky came raining down with Humpty Dumpty type banks, mortgage foreclosures, and failed financial innovations burning down the house so much that he needed a backhoe to get himself out from under the charred rubble. And, that backhoe was driven by Congress, which was blackmailed into accepting the Paulson-Bernanke-BushBoy economic extortion plan.

As we all know, five of ten of the nation’s largest “infestment” banking institutions were underwater with sub-prime loans that had to be bailed out by their field marshal general stationed at the Federal Reserve headquarters. These banksters were so worried that they demanded from Congress the creation of a $700 billion bankster rescue program called TARP.

The reality is that Bennie The Beard actually failed to protect America’s depositors, homeowners, and investors to the tune of $12 trillion!!! Now, if that legacy deserves Man of the Year, then what would it take to deserve the dishonor of the Worst Man of the Year?

As the year progressed, the promise to end the war in Iraq became just an exaggeration.

Today, we are still in Iraq, and have escalated the troop deployment in Afghanistan. The war profiteers continue their gleeful praises of our President. The stockholders of GE, General Dynamics, Halliburton, KBR, and the rest are so happy to see their end-of-the-year dividend/ 1099s all coming in profitably. In addition, Blackwater, ie. Xe, and now remade into The U.S. Training Center. Even though Eric Prince, its commander-in-chief, should be put on trial as a war criminal. Our government continues to use Prince’s private, mercenary military force overseas, too.

As we move threw the year, the bankstes were paying out huge bonuses funded by the taxpayers through various Fed and Treasury programs. There were no significant regulatory changes, nor the elimination of too-big-to-fail. The mega-banks were even allowed to become bigger as they gobbled up closed down smaller banks.

None of the mega-banking CEOs or top executives has been jailed for fraud, either. The Justice department has not done any serious, large scale investigations clearly defining why this economic fraud occurred, who were the ones to blame, and why are they still smiling.

We saw a token “real” economy bailout of only a couple billion dollars because the remainder of the economic stimulus package bailout went into tax-cuts. The Republicans hijacked a Democratic Congress, once again. The unemployed-under employed-no longer looking for work, and the part time wanting full time unemployment picture has reached a near Depression era aggregate figure of almost 20%. 16 million unemployed.

Foreclosures grew to 1 in 6 homeowners. Those still paying mortgages, but are now underwater is around 1 in 4.

Wages continue to erode or stay stagnant. Those who are leery of losing their jobs have cut back on their spending.

34,750 lobbyists continue to infect our government with powers that are unprecedented.

Corporate bankruptcies are looming on the horizon. Bank credit card defaults and those 30-60-90 days delinquent have been on the upswing. Professor Elizabeth Warren, PhD, and chairperson of the Congressional Oversight Bailout Committee has warned our president that we could be on the brink of losing our middle class!!!

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Are we becoming a nation of hypocrites?
We force very low income single moms to jump through hoops to get their welfare checks. We resent them living off our tax payer dollars. We want them out working hard to support themselves even if there are no suitable jobs available, no day care for their children, nor decent transportation to get them there. We see it as a matter of personal responsibility: they are poor because they let themselves stay that way. If that's not mean spirited enough, our politicians thrive on chastising the fictitious welfare queens who supposedly turn our hard-earned tax dollars into Cadillacs.
But when it comes to Wall Street we let the welfare kings walk all over us. Let us count the ways:
We deregulated the financial sector, starting in the mid-1970s, removing many of the New Deal era controls that constrained speculation. Then, in the early 1980s we changed the tax code so that more money could rise to the top fraction of the income distribution in order to spur investment.
Predictably, the two "reforms" spurred a series of speculative bubbles -- the savings and loan meltdown, the dot.com crash, and the housing explosion and meltdown. The driving force, especially in the latest bubble, was Wall Street's "innovative" products -- CDOs, synthetic CDOs, CDO squared and cubed -- which Warren Buffet called "financial weapons of mass destruction" (all of which are still unregulated.)
About a year ago the mass destruction did indeed hit us, but not before Wall Street "earned" more than $300 billion of which at least half went to fat compensation packages. When housing prices failed to continue their improbable rise, the assets that were layered upon them like a house of cards, collapsed in value threatening the entire financial system. The $300 billion previously earned melted away. But no one gave back their phony profits.
Meanwhile, Fannie, Feddie, AIG, and CitiGroup basically were nationalized. Bear Sterns, and Merrill Lynch were merged away. To prove that we were not going to bail out everyone, Lehman Brothers was left to fail, and the global markets panicked, froze and then nearly sent us back into the Great Depression. That's when we learned that the major financial institutions really were too big and too interconnected to fail. So we put them all on welfare.
Just like there are many forms of welfare for the poor -- food stamps, workfare, SSI, Medicaid -- there are many forms of Wall Street welfare as well. There is TARP, of course. But also there are more subtle kinds. When we bailed out A.I.G., for example, we allowed it to pay up in full on its failed bets -- something the government had no legal obligation to do. Goldman Sachs got $13 billion. Had we not bailed out A.I.G., Goldman Sachs would have received pennies on the dollar. If that's not welfare, nothing is.
Meanwhile, the government also provides low interest loans. It is allows the big banks to float bonds guaranteed by the FDIC. And on top if it all, the government guarantees a variety of toxic assets. (That is, assets that were totally speculative -- the bankers' equivalent of a crap shoot -- and would now be pretty much worthless if it weren't for the government's guarantees.) The total Wall Street welfare bill according to Nomi Prins, the author and former Morgan Stanley managing director, comes to more than $13 trillion, . (That's about 37 years worth of total welfare transfers to low-income Americans.)
Now we're witnessing the transformation of Wall Street welfare into bonuses -- the dons will soon be driving taxpayer-funded Ferraris to the marina so they can sail on taxpayer-funded yachts to visit their off-shore accounts filled with taxpayer dollars. Lo and behold, the big boys are making money again, hand over fist. In fact their profits and bonuses are expected to exceed the highest years of the bubble. Some commentators gush about the true genius of these financial gurus. Call it what you will, taxpayer welfare is making it happen.
Meanwhile, our "lagging indicators" -- more than 29 million people -- are unemployed or stuck in part time work because they can't find fulltime jobs. The U6 jobless rate, reported by the BLS, is now 17.0 percent. And we're still going to allow the welfare kings to walk away with their record profits and bonuses? What's wrong with our elected representatives -- and with acquiescent citizens who aren't holding Wall Street's feet to the fire?
President Obama's advisors spent the weekend bemoaning Wall Street's new found wealth. David Axelrod, perhaps President Obama's closest adviser, said the the bonuses were "offensive." So do something about it!
Here's a simple set of solutions that could "end welfare as we know it" for rich and poor alike:
1. The President Wage Cap: No one on welfare (in inner city Detroit or lower Manhattan alike) shall have an income more than the President of the United States ($400,000) until the unemployment rate drops below 5 percent. (Can't live on $400,000? Try $20,000 for a year and let us know how it compares.)
2. Windfall Profits Tax: A tax of 90 percent should be placed on all financial sector profits until the unemployment rate dips below 5 percent. This will help repatriate some of our Wall Street welfare payments.
3. Breakup the Big Banks: All financial institutions that are too big and too interconnected to fail should be immediately broken into smaller entities that are small enough to fail.
Is that fair or what?
We bail them out. They get filthy rich. They have to pay back their windfall profits and welfare-induced bonuses. They're too big to fail? We make them smaller.
I am fairly certain that a majority of Americans would agree, assuming credible leaders fought for it. And there's the rub: most politicians are in awe of the welfare kings. They see all that money and they quickly forget where it comes from. They quake when they think of regulating the fantasy finance casinos, even though they have no trouble putting the screws to low-income welfare moms.
They don't have the guts of Teddy Roosevelt who busted the trusts, or of Ike who presided over a 91 percent progressive income tax rate on those earning more than $3 million a year (in today's dollars.).
The lack of backbone is sickening. And yes, we could easily throw up our hands and say it's hopeless -- they have all the money -- they buy the media -- they buy politicians -- their charitable contributions buy dissent. All true.
Yet we Americans, from time to time, can surprise ourselves by demanding and insisting upon true courage from our weak-kneed political leadership. Even the tea-baggers must be gagging on their anti-government rhetoric as Wall Street pockets all that welfare.
Quite clearly we need a movement and bold political leadership with the guts to end this blatant hypocrisy. We need leadership that can tap into our egalitarian and communitarian traditions that place the common good before rapacious personal gain.
Somehow, somewhere, someone is going to stand up and blow the whistle on our burgeoning billionaire bailout society.
Come on America, shock the big boys.

Read more at: http://www.huffingtonpost.com/les-leopold/welfare-reform-for-wall-s_b_325821.html

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Over the last several decades, the financial sector has grown relentlessly. It has doubled in size over the last 14 years. During the period 1973 to 1985 the financial sector never earned more than 16% of domestic profits. This decade, it has averaged 41% of all the profits earned by businesses in the U.S. In 1947 the financial sector represented only 2.5% of our gross domestic product. In 2006 it had risen to 8%. In other words, of every 12.5 dollars earned in the United States, one goes to the financial sector, much of which, let us recall, produces nothing.

That growth has not been among community or regional banks -- or credit unions. I'm talking about Wall Street.

Wall Street's growth is one big reason that most of America's economic growth during the last decade has flowed into the hands of investment bankers, stock traders and partners in firms like Goldman Sachs. The Center on Budget and Policy Priorities reports that fully two-thirds of all income gains during the last economic expansion (2002 to 2007) flowed to the top 1% of the population. And that, in turn, is one of the chief reasons why the median income for ordinary Americans actually dropped by $2,197 per year since 2000.

No surprise then that disproportionate numbers of the "best and brightest" graduates of our finest universities headed off to Wall Street. After all, that's where if you are very clever you can make tens of millions of dollars before you are thirty -- mostly producing nothing.

By 2007 the top 50 hedge and private equity fund managers averaged $588 million in annual compensation each -- more than 19,000 times as much as the average U.S. worker. And by the way, the hedge fund managers paid a tax rate on their incomes of only 15% -- far lower than the rates paid by their secretaries.

This huge wealth transfer from the "real" economy to the world of finance has also created a vicious cycle of increased credit dependency. If your family's real income isn't going up, but costs are, you try to borrow to stay afloat. That is one reason why private debt now equals 350% of the Gross Domestic Product -- the highest ever. The more debt that consumers owe to the shrinking number of big financial institutions, the greater the share of their shrinking or stagnant incomes that is siphoned off to the finance sector -- and the cycle just gets worse. And when the disposable income of ordinary Americans shrinks, they don't have the money to buy the new products and services that will fuel long term economic growth in the real economy.

Something is very wrong in this picture.

In fact, as last year's financial collapse made ever so clear, the increasing dominance of the financial sector - and its deregulation -- has become a mortal danger to our economic security. The financial sector - including the big insurance companies -- has morphed into a cancer growing on our economy -- a cancer that could easily strangle our prospects for our long-term economic security.

Later this week, Congress begins consideration of a package of measures that would serve as a first step in re-regulating and hopefully shrinking the American financial industry. This battle has not attracted as much attention as the critical fight over health care, but it is just as important for the well-being of everyday Americans.

The "best and brightest" from Wall Street would like to make the issues involved in this debate look complex and technical -- beyond the understanding of ordinary mortals. But there are a couple of clear principles to remember as the debate unfolds:

1) History has shown that financial markets cannot accomplish their ostensible goal of allocating risk and directing capital to their highest and best uses unless they function within the context of very strict rules. That is so because speculators have a natural tendency to create products and systems that allow them to engage in reckless excesses that cause the entire system to lurch from bubble to bubble, collapse to collapse. This is not a theoretical argument. History proves the case beyond a reasonable doubt.

In 1792 the newly-minted United States suffered its first credit crisis. Another credit crisis followed about once every fifteen years until 1932. Then, the mother of all credit crises caused the Great Depression that in turn spawned the Securities and Exchange Commission (SEC) to regulate the stock market, the Federal Deposit Insurance Corporation (FDIC) to guarantee deposits in banks, and the Glass-Steagall Act that prevented banks from engaging in other forms of more risky financial activity.

For the next 50 years, those regulation -- coupled with a wise use of Keynesian economic policies -- prevented another financial crisis. That is one of the reasons why America's experienced an unprecedented era of economic growth for every sector of the population - and a massive reduction in the inequality of income distribution.

But in the 1980's the Reagan "revolution" worked its de-regulatory magic on the Savings and Loan industry. It didn't take long for many of these once-stable institutions to collapse and cause the first credit crisis in a half-century. That should have given the country fair warning, but a few years later Wall Street convinced Congress to repeal the Glass-Steagall Act, and it prevented the regulation of newly-exploding "financial products" like "derivatives" that were basically bets on the movement of underlying investments like stock and bonds. Wouldn't want to "discourage financial innovation," they said. The growing predominance of private equity financing also took more and more financial transactions from the light of transparent regulated public markets into the de-regulated shadows.

Then there was the securitization of debt. Banks and other lenders bundled mortgages and other loans into packages and then chopped the packages into units that could be sold on secondary financial markets. These new markets made a lot more money available for loans, but there was no provision made for the inherent dangers. For years previous, bankers made loans with the realization that they were on the hook if they went bad. The new secondary markets allowed them to make the loans, and sell off the risk to a diffuse "market" that left them free of any risk.

All the while, the size of the financial sector was fed by the growing use of credit cards that could legally siphon off huge streams of revenue from ordinary Americans into the hands of bankers. And the elimination of usury laws encouraged the development of the "payday loan" industry that allowed someone to borrow $500 and pay $2,000 of interest on the loan over the next two years.

The result of all of these trends has been massive consolidation of power by a few major financial institutions that have ranged far afield from banking into highly speculative activities of all sorts. Brokerage firms like Goldman Sachs and banks like Citibank have become indistinguishable. Massive portions of the credit market now exist outside of the oversight of any regulator.

Today, 45% of the banking market in the U.S. is dominated by Bank of America and Citibank.

Finally, of course, huge remuneration packages were paid to clever Ivy League graduates who could make billions in speculative profit, even if they did so by taking Godzilla-sized risks. Remuneration systems paid them on the basis of short-term gain and they suffered no financial penalty for long-term pain. So they were "off to the races."

2) Much of the financial sector does not produce anything. The principal missions of the financial sector are to take on risk and allocate captial effectively. Some of the industry - especially community and regional banks -- do just that. But in the last year the financial sector as a whole didn't "take on risk," it shifted risk to ordinary Americans through gigantic taxpayer bailouts. And often the Wall Streeters themselves escaped the recent economic debacle, having salted away hundreds of billions of dollars.

Fundamentally the financial sector is made up of middlemen, who spend their time creating schemes that allow them to funnel society's money through their bank accounts so they can take a sliver of every dollar off of the top.

Right now, the private health insurance industry is busy trying to defend its turf against a public health insurance option. It wants to maintain its "right" to take that tribute off the top of as many health care dollars as possible. Remember, the private health insurance industry doesn't deliver any actual health care.

The same is true of most of the financial sector. It is the farmers, manufacturing firms, the health care providers, the transportation companies, the guys who sweep up buildings, the cops and firefighters, the people who teach our kids -- those are the people who produce the goods and services that we consume in our economy.

Most "innovative financial products" like derivatives are nothing more than schemes that allow speculators to build up paper wealth that will fuel the next credit bubble. Creating mechanisms to allow speculators to bet on the direction of stock prices or other actual investments doesn't do any more for the underlying economy than allowing the same people to bet on horse races.

Most Wall Street speculators don't contribute any more to our common well being than professional gamblers - which is pretty much what they are. Gaming in Las Vegas has fine entertainment value, but providing a gigantic worldwide casino for the rich is not an economically vital core function for the world's financial markets.

I'm not arguing against using financial markets to allocate capital and risk. Banks, stock markets and other financial institutions can be -- and have historically been -- important and efficient means of accomplishing these goals. But not when the tail begins to wag the dog. Not when the financial sector, which can be useful at serving the needs of the productive sectors of the economy, comes to dominate the economy.

After all, if so much wealth flows from the productive sectors of the economy into the fundamentally unproductive financial sector, ordinary people don't have enough money to buy the products that drive economic growth in the real economy.

3) Left to their own devices, financial speculators often kill off productive enterprises through leveraged buyouts and private equity plays. A case in point was highlighted last week by the New York Times. Simmons Bedding has been in business producing high quality mattresses for almost 133 years. Now it's about to file for bankruptcy protection -- but not because it isn't a viable successful business.

Simmons has been milked dry by a succession of buyers and Wall Street investment banks that have made millions through leveraged buyouts that made good financial sense for Wall Street, but left the manufacturing firm deeper and deeper in debt. The Times reports that "the financiers borrowed more and more money to pay ever-higher prices for the company, enabling each previous owner to cash out profitably."

Simmons now owes $1.3 billion compared with $164 million in 1991. According to the Times, "In many ways, what private equity firms did at Simmons, and scores of other companies like it, mimicked the sub-prime mortgage boom. Fueled by easy money... these private investors were able to buy companies like Simmons with borrowed money and put down relatively little of their own cash. Then not long after, they often borrowed even more money, using the company's assets as collateral."

"The result: THL (the private equity firm) was guaranteed a profit regardless of how Simmons performed. It did not matter that the company was left owing far more than it was worth." Too bad for Noble Rodgers, an employee of 22 years, who along with 1,000 others have been laid off. Too bad for the American manufacturing base. The investment bankers got theirs.

4) The bigger the financial sector gets, the more power it has to hold the entire economy ransom for huge bailouts when their speculative bubbles collapse. Firms that are allowed to grow as large as AIG, CitiBank and Bank of America create "systemic" risk that threatens the world financial system.

The bottom line is that if a financial institution is too big to fail, it's just too big, period.

The new regulatory proposals now pending before Congress are critical first steps in reining in the power of the financial sector. The proposed Consumer Financial Protection Agency is especially important. It would end the anything-goes "Dodge City" mentality that allows consumers to have their pockets picked by financial "products" like teaser-rate mortgages with prepayment penalties that guarantee the consumer pays more than meets the eye. It will require tight regulation of credit card interest rates and fees.

But equally critical are tough new regulations of the entire financial sector - including the "derivatives" and "credit-default-swap" markets - and private equity, as well as regulations to eliminate remuneration systems that incentivize recklessness, and requirements that mortgage originators maintain a stake in the loans they sell. The "resolution" authority proposed by the Obama Administration is also an important step to assure that there is an orderly way to close even the largest of financial institutions.

Serious regulation will inevitably cut back on the flow of income from normal people to the financial sector as a whole. But over time, our goal needs to be to restore dominance of the economy to the productive sectors of economic endeavor, and to break up the financial and insurance cartels that have a stranglehold on our future.

That will not happen without a monumental struggle. The Obama Administration's proposals for financial re-regulation are the first offensive on this critical front in the war for our long-term economic security.


Read more at: http://www.huffingtonpost.com/robert-creamer/the-dominance-of-the-fina_b_317310.html

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As Americans, I believe we reject communism because it historically has allowed a tiny group of people to consolidate complete control over national resources (including people), in the process stifling competition, freedom and choice. It leaves its citizens stagnating under the perpetual broken systems with no natural motivation to innovate, improve services or reduce costs.

Lack of choice, lazy, unresponsive customer service, a culture of exploitation and a small powerbase formed by cronyism and nepotism are the hallmarks of a communist system that steals from its citizenry and a major reason why America spent half a century fighting a Cold War with the U.S.S.R.

And yet today we find ourselves as a country in two distinctly different categories: those who are forced to compete tooth and nail each day to provide value to society in return for income for ourselves and our families and those who would instead use our lawmaking apparatus to help themselves to our tax money and/or to protect themselves from true competition.

If you allow weak, outdated players to take control of the government and change the rules so they are protected from the natural competition and reward systems that have created so many innovations in our country, you not only steal from the citizens on behalf of the least worthy but you also doom them by trapping the capital that would be used to generate new innovation and, most tangibly in our current situation, jobs.

We are losing the opportunity cost of all the great ideas that should be coming from the proper deployment of that 23.7 trillion in capital. Everything from innovation in medical delivery systems to accessible space travel, free energy to the driverless car; all of these things may never come to bear because those powerful individuals who have failed, been passed over by technological advancements, innovation and flat-out smarts, have commandeered our government to unfairly sustain their wealth and power.

Unfortunately, they use our wealth and laws not only to benefit their outdated, failed companies, but also spend a small pittance of their ill-gotten gains lobbying and favor-trading with politicians so the government will continue to protect them from competition and their well-deserved failure.
The massive spike in unemployment, the utter destruction of retirement wealth, the collapse in the value of our homes, the worst recession since the Great Depression have all resulted directly from the abdication of proper government.

Even with all that -- the only changes that have been made, have been made to prop up and hide the massive flaws on behalf of those who perpetuated them. Still utterly nothing has been done to disclose the flaws in this system, improve it or rebuild it. Only true rules-based capitalism ensures constant adaptation and implementation of the latest and best practices for a given business, as those businesses that don't adapt fail, and those who deploy the latest innovations to their customers benefit, prosper.
The concept of communism is rightly reviled in this country for the simple reason that it is blind to human nature, allowing a small group of individuals near-total control, while sticking everyone else with the same crappy systems -- and the bill. America spent countless lives and half a century fighting against this system of government. So why are we standing for it now?

Follow Dylan Ratigan on Twitter: www.twitter.com/DylanMSNBC

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