[Sivad]

Ten Years After The Financial Crisis, The Contagion Has Spread To Democracy Itself
Tim Geithner, Ben Bernanke and Hank Paulson dealt a catastrophic blow to public faith in American institutions.

Today, Ben Bernanke, Hank Paulson and Timothy Geithner insist they did what they had to under conditions of extreme duress. Mistakes were made, the government’s former top financial overseers acknowledge in a recent piece for The New York Times, but they did ultimately “prevent the collapse of the financial system and avoid another Great Depression.”

Except they didn’t really rescue the banking system. They transformed it into an unaccountable criminal syndicate. In the years since the crash, the biggest Wall Street banks have been caught laundering drug money, violating U.S. sanctions against Iran and Cuba, bribing foreign government officials, making illegal campaign contributions to a state regulator and manipulating the market for U.S. government debt. Citibank, JPMorgan, Royal Bank of Scotland, Barclays and UBS even pleaded guilty to felonies for manipulating currency markets.

Not a single human being has served a day in jail for any of it.

The financial crisis that reached its climax on that Monday morning 10 years ago was not fundamentally a problem of capital, liquidity or regulation. It was a crisis of democracy that taught middle-class families a grim lesson about who really mattered in American society ― and who didn’t count.

[...]

beginning in the 1950s, the United States increasingly came to understand finance as apolitical ― something best handled by technocratic experts insulated from the passions of a democratic electorate. This idea went by different slogans ― “the liberal consensus,” “the great moderation,” “central bank independence” ― but they all amounted to the same thing: The economy was nonideological. The decisions made by experts tending to the financial machine were were strictly tactical. Any mistakes were a matter of pulling the wrong lever or setting a dial too high.

The financial crisis exploded this myth. “The failures of the crash and the bailout were not technocratic failures,” says University of Georgia law professor Mehrsa Baradaran. “They were about power.”

[...]

Geithner hadn’t set the dials wrong. He had made a choice about who deserved the government’s full attention and how aid would be distributed. And he had done it without any meaningful input from Congress, or even a public debate.

“It led to a breakdown and a lack of trust in institutions,” says Admati. “What we witnessed here … is kind of ominous. It raised a lot of questions about who controls society ― corporations or the elected government.”

[...]

The crisis wasn’t just a breakdown of regulatory oversight. It was a failure of the democratic process, of economic management as an apolitical, technocratic field.

https://www.huffingtonpost.com/entry/fi ... 32ebf92396

[Rich]

Who are these liars? The US tax payer made a profit on the so called bank bail out.

[Crantag]

Who are these liars? The US tax payer made a profit on the so called bank bail out.

I understand what you are suggesting, but that's actually a tenuous supposition.

The banks paid back the loans, with interest. I think there was other than just loans, but let that one lie. Banks are in the business of making money off of money, so give them money and they will turn it over for a profit, generally. The near-zero interest rate policy though has been a significant cost for US citizens, as savings accounts have paid next to nothing. This is, again, great for banks, which can borrow cheap and speculate. It is bad for savers, though.

I listened to the video, and there are aspects which I disagreed with, but overall I agree with the presentation. In particular, the boom-bust cycle is consistent with my views, and I agree that we are in one.

A thing to consider is holding cash so as to buy stock when the market crashes again. That is, if you have any cash to hold.

I'm not exactly rolling in cash myself. But maybe I can manage to save up some gs to buy stock if the market crashes. Trying to time the market isn't really the proper thing to do, but I don't have a lot of confidence in the current stock market keeping on its present trajectory. First things first, I sorta need to pay off my student loans and such, so any investing will have to wait. Maybe the market will crash at just the right time.

[Drlee]

If we are lucky we get a stock market crash. If not we get runaway inflation which would devastate the masses.

This is brilliantly timed for just about when the democrats take control of the presidency. And so it begins again.

[jimjam]

Of course. Economic activity is simply a manifestation of human nature which never changes and re plays over and over.

Once this is understood there are courses of action which the individual can take to insulate him/her self from the machinations of the puppet masters and their puppets.

[Stormsmith]

By shares in liquor.

[jimjam]

By shares in liquor.

cheap liquor !

there is no one size fits all for this one but, generally, keep your assets in places where changes in their value can be minimally affected by others. maximize your control. I actually made money in 2009. luck is also nice. while luck cannot be fully predicted there are places where it is more probable than others.

[Steve_American]

Reply the the OP.
Prof. Steve Keen (a semi-MMTer) says that in 2005 he started predicting the GFC/2007.
He based his prediction NOT on Gov. debt, but rather on the private debt level.
He is NOW predicting another GFC/soon because private debt is now out of hand again.

For those of you who care ---
The reason that private debt is out of hand is ---
1] The 1% and their Corps. have tilted the playing field* so far now that they can easily not give out wage increases above inflation.
2] American workers have not yet got the message that they will never again live better year after year like they had, going all the way back to 1788. {A few bank panics and depressions not withstanding.}
3] Therefore, to live better they borrow and hope they can repay it when their income goes up.
4] But, their real income will never go up. So,they can't repay those debts.
5] The 1% and their Corps. are stupidly lending them money; even though the above should be obvious to them, [because they know the average American worker's real income will never go up (as long as they have any say)].
6] As soon as there is any shock that makes the typical American miss a payment there is a strong chance that it will grow like a snowball rolling down a hill. Just like happened in 2007&08.


* . The 1% now control both parties [Repuds and Dems]. There is just one party. It has 2 wings. a] The socially reactionary wing and b] the socially liberal wing.
But, on economic policy they both agree --- don't raise the minimum wage, don't enforce anti-trust laws, don't enforce labor laws, cut welfare (see Pres.Clinton), create a new class of slave workers in our prisons, spend a lot on weapons, ignore the obvious fact that American workers can't support the economy by buying stuff and this cuts into corporate profits, Don't have Gov.single payer healthcare (because that destroys the profits of the health insurance industry, which is owned by the 1%), etc.
.