Saturday, March 7, 2009

American Democracy is Dead


Anyone who has seen "Shane" will recognize the backdrop as the Grand Tetons. The three well dressed men smiling and joking with each other are possibly among the most dangerous men on earth. They undoubtedly do not have that perception of themselves. They look relaxed because this is the look of the cognitive dissonant Federal Reserve male at rest. The guy in the tan blazer is Don Kohn, vice chair of the Fed. I think you know the other two, clueless Tim and dangerous Ben. They are attending the Jackson Hole Economic Symposium last August. The theme was "Maintaining stability in a changing financial system." They are just weeks from taking the first steps in the destruction the economic future of our children. They will testify before Congress in September that they will provide transparency. They lied and they covered up and they concealed. Meanwhile over at AIG there was no stability being maintained so Ben and Hank Paulson said the US taxpayer needed to rescue the world's largest insurance company because it wrote Credit Default Swap insurance to someone and now the claims were being filed and there was nowhere near enough money on hand to pay those claims. So now the US taxpayer had to pony up and pay those claims. Whaaaat? Gretchen Morgenson of the NY Times reported that Ben and Hank and Goldman Sachs met in September to bailout Hank Greenberg and his 350 man financial services arm of AIG over there in London. The people who paid their insurance premiums now wanted their money and the world's largest insurance company had no way to pay them. And who was filing these claims that Hank Paulson wanted to rescue? Hank refused to say because revealing their names could harm their businesses. One was certainly obvious: Goldman Sachs. Hank's old employer had to be one of the counterparties. If this sounds like a gigantic conflict of interest to have Hank's old bank present at the negotiations, you are right and it shows how utterly corrupt our political system has become. The powerful banking and insurance interests have kidnapped and hijacked the US political system and it should have been obvious to anyone, but little was said at the time in our equally co opted media. The counterparties were paid off in secret and Ben and Hank steadfastly refused to reveal their names. Two days ago Don Kohn was still refusing to reveal those names but yesterday the Wall Street Journal somehow obtained the names of the counterparties and no surprise, they are the names of the largest and most powerful US and European banks, some of whom are already insolvent. Here is the list:

Covered Counterparties

Some banks that were paid by AIG after it was bailed out by the government

  • Goldman Sachs
  • Deutsche Bank
  • Merrill Lynch
  • Société Générale
  • Calyon
  • Barclays
  • Rabobank
  • Danske
  • HSBC
  • Royal Bank of Scotland
  • Banco Santander
  • Morgan Stanley
  • Wachovia
  • Bank of America
  • Lloyds Banking Group

Source: WSJ research

If this bailout of world banks by the US taxpayer makes you furious, it should. We as taxpayers must find some way to make the Fed and the banks accountable. It's time to flood our representatives with letters demanding an end to this unimaginable bailout of world banks. How can this be happening? Their power must be restrained if we are to have any chance of saving what shred of our democracy that remains. I see no way except to abolish the Federal Reserve System and start from scratch with a new agency who is accountable to the citizens of the United States.

1 comment:

Nickname unavailable said...

Not to worry Hugh. The DOW has gone up four days in a row, so we're well on our way to another bubble. Personally, I'm designing a portable, folding, lightweight guillotine which I'll take on the road.

Ciao Comrade
Tom Sinclair