Well well well Senator Durbin:
"And the banks -- hard to believe in a time when we're facing a banking crisis that many of the banks created -- are still the most powerful lobby on Capitol Hill. And they frankly own the place."
Now that had to be uncomfortable.
Oh by the way, its not just The Senate either; Barney Frank seems to have a revolving door in his office that goes between his front door and Goldman's along with SIFMA, a big industry group.
The amusing part of this is that the article appeared in Salon, a notoriously left-leaning rag. The not-so-amusing part of this is that nobody is bothering to try to hide the blatant corruption and fraud any more - $100+ billion in so-called "CDS" written by AIG that were "made good" by Treasury so as to avoid people having to take an economic loss that was properly theirs for getting involved with someone in a transaction when their counterparty didn't have any money!
Pelosi claims to want a modern-day Pecora review. I don't believe it for a minute, because should such a thing happen it would expose conflicts of interest that reach across both sides of the aisle and would inevitably lead to dozens if not hundreds of indictments.
This is not just about banks; it also extends to pension funds, where there are allegedly ties to Mr. Rattner, President Obama's appointee to oversee the auto industry. That story isn't likely to go away any time soon; NY AG Cuomo appears to have latched on to it like a rabid dog (good for him!) and seems to have every intention of raising hell in that regard:
The state is issuing more than 100 subpoenas to investment firms and their agents, officials said. It’s the latest step in a broadening investigation of alleged kickbacks paid in return for pension-fund business.
There is never, ever only one cockroach.
It gets better. Another blog, Finemrespice, makes the following allegation regarding the Chrysler bankruptcy and what they were telling "holdouts":
Who the f*ck do you think you're dealing with? We'll have the IRS audit your fund. Every one of your employees. Your investors. Then we will have the Securities and Exchange Commission rip through your books looking for anything and everything and nothing we find to destroy you with.
This allegedly was Mr. Rattner (roughly phrased); see above for why that's important.
And of course that's just The Car Czar. The Wall Street Journal, on A-1 (that'd be the top page) this morning is pointing out something much more uncomfortable - The Federal Reserve Bank of New York's Chairman, who was sitting on Goldman Sachs' board, continued to serve after they converted to a bank holding company and was in fact buying their stock.
Why is this important? Because The Federal Reserve Bank of NY is a policy-making body and the Federal Reserve System is a primary banking system regulator! Once Goldman converted to a bank holding company the firm fell under Fed jurisdiction.
During that time, the New York Fed's chairman, Stephen Friedman, sat on Goldman's board and had a large holding in Goldman stock, which because of Goldman's new status as a bank holding company was a violation of Federal Reserve policy.
The New York Fed asked for a waiver, which, after about 2½ months, the Fed granted. While it was weighing the request, Mr. Friedman bought 37,300 more Goldman shares in December. They've since risen $1.7 million in value.
The NY Fed says:
New York Fed officials disagree. Last fall, then-New York Fed President Timothy Geithner was President-elect Barack Obama's choice to head the Treasury, and New York Fed officials say that to have forced Mr. Friedman off the board while it sought a Geithner successor would have deprived it of two leaders at a crucial time.
"Steve Friedman is a very capable chairman," said Tom Baxter, the New York Fed's general counsel, "and was the kind of person who we needed to head the search" for someone to succeed Mr. Geithner.
This of course has nothing to do with what The Fed should do, which is forcing the disgorgement of profits from the acquisition of stock which he knew was against the rules.
The Fed is a funny institution in that it is not "fully government" or "fully private"; it has elements of both. But as a regulator its board members must be beyond reproach and that clearly did not happen here.
But this raises a rather obvious (and serious) question: Was Mr. Friedman in possession of material inside information at the time he placed that trade? He certainly was in a position to know Fed policy in advance of its publication!
The government will not stop this until and unless we the people demand it in no uncertain terms, because doing so means that they would have to implicate some very powerful members of their own body. That's like asking a dog to gnaw its own leg off; it will only do so if it has that leg caught in a bear trap and has no other means of survival.
We are and have been at a critical juncture in this nation for the last several years. We must decide if The Rule of Law means anything, or if we are going to become a permanent banana republic.
The important thing to realize is that the latter is not an option unless we are willing to forego all external financing, and that would mean an immediate cut in the federal budget by 50% or more.
"The Bezzle" must and will stop. We are only choosing now between shutting it down now and having it shut down as a consequence of a general economic and political collapse.
Do not believe for a second that they can "paper this over." That's what they thought back in 2007; how did it work out folks? Did we not see the S&P 500 lose nearly 2/3rds of its value - thus far?
Do not be fooled by the rally off the 666 lows. Lucifer stuck his head into the tent and bellowed that day, and if we do not force this garbage out of our government he will soon be back with a much worse lashing than we took last fall - or this spring.
Mark my words.
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