Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24
At These Levels, Buying Silver Is Like Getting It At $5 In 2003 - 28th Oct 24
Nvidia Numero Uno Selling Shovels in the AI Gold Rush - 28th Oct 24
The Future of Online Casinos - 28th Oct 24
Panic in the Air As Stock Market Correction Delivers Deep Opps in AI Tech Stocks - 27th Oct 24
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump! - 27th Oct 24
UK Budget 2024 - What to do Before 30th Oct - Pensions and ISA's - 27th Oct 24
7 Days of Crypto Opportunities Starts NOW - 27th Oct 24
The Power Law in Venture Capital: How Visionary Investors Like Yuri Milner Have Shaped the Future - 27th Oct 24
This Points To Significantly Higher Silver Prices - 27th Oct 24
US House Prices Trend Forecast 2024 to 2026 - 11th Oct 24
US Housing Market Analysis - Immigration Drives House Prices Higher - 30th Sep 24
Stock Market October Correction - 30th Sep 24
The Folly of Tariffs and Trade Wars - 30th Sep 24
Gold: 5 principles to help you stay ahead of price turns - 30th Sep 24
The Everything Rally will Spark multi year Bull Market - 30th Sep 24
US FIXED MORTGAGES LIMITING SUPPLY - 23rd Sep 24
US Housing Market Free Equity - 23rd Sep 24
US Rate Cut FOMO In Stock Market Correction Window - 22nd Sep 24
US State Demographics - 22nd Sep 24
Gold and Silver Shine as the Fed Cuts Rates: What’s Next? - 22nd Sep 24
Stock Market Sentiment Speaks:Nothing Can Topple This Market - 22nd Sep 24
US Population Growth Rate - 17th Sep 24
Are Stocks Overheating? - 17th Sep 24
Sentiment Speaks: Silver Is At A Major Turning Point - 17th Sep 24
If The Stock Market Turn Quickly, How Bad Can Things Get? - 17th Sep 24
IMMIGRATION DRIVES HOUSE PRICES HIGHER - 12th Sep 24
Global Debt Bubble - 12th Sep 24
Gold’s Outlook CPI Data - 12th Sep 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

We're Deep In The March Toward Economic Socialism

Politics / Financial Markets 2012 Oct 02, 2012 - 07:18 AM GMT

By: Money_Morning

Politics

Best Financial Markets Analysis ArticleShah Gilani writes: Have you noticed that the world is on a creeping - some (that would be me) would say cascading - slide into socialism?

It started with one giant step in the direction of economic socialism.


Economic socialism is specifically the shared risk the public has been yoked into pulling on behalf of banks.

The unmistakable and indelible footprints of socialism's latest forward march have been made by collectivist central bankers, pushed forward (at least that's the direction for them) by their constituents, the bankers of the world.

The bankers' jackboots are filled with stinking feet itching from the fungus of greed. And sadly, the sole of those boots bears the unmistakable "Made in America" stamp.

What's flooded into all those succeeding footprints is the stagnant future we all face. The march towards global hegemony of bankers' birthrights makes that evident.

It's not ironic that bankers espouse capitalist, free-market doctrines, but under cover of their ostensible handlers - their central bankers - prosper and propagate behind a Marshall Plan whose manifesto is socialized risk; it's sickening.

The moral hazard of socialized risk, of economic socialism, is unfettered.

The United States let the biggest banks in America get bigger. We let them bridle us, saddle us, and ride us into the ground. And they are all bigger now.

How can there be any free market discipline if there is no free market? How can moral hazard be corralled if there are no fences around the risks banks are allowed to take, given their size and power?

We're facing QE4ever (that's quantitative easing) on account of the banks being subject to lawsuits and an attack on their capital.

Oh, you didn't get that?

Here's the real reason we have stimulus to the nth degree here in America...

The stimulus is not for us. It's for "them" - the bankers.

Of course, it's being done under the guise of the dual mandate, gifted to the Federal Reserve by our Congress a few decades ago. You know, the dual mandate that says, besides price stability, the Fed is tasked with manifesting full employment, too.

Forget that that's an abdication of fiscal policy, an abdication by our Congress and American leadership (what's that?).

Just realize that it was a gift to the Central Bank to cover the butts (print money) of their banker constituents when they (the greedy bankers) get themselves into trouble with their moneyraking schemes.

Banks are facing billions in lawsuits. They've already paid out billions.

Bank of America just settled a class-action suit for $2.4 billion. What was the suit about? BOA executives misled shareholders at the time of the financial crisis. Forget the specifics; was there a single bank in America that didn't mislead the public and their shareholders at the time of the financial crisis? Not a one.

And the Fed? Did they mislead the public? Of course they did. But they can't be sued.

So, the Fed is making sure the banks have the money they need, the liquidity they need, to deal with ongoing litigation, litigation that won't end any time soon.

And about those capital ratios...

Basel III was supposed to increase the equity capital ratios banks have to maintain. What happened? The benchmarks have all been raised, but they are far lower than all the academics and prudent regulators wanted.

The main equity capital ratio was supposed to be between 7% and 11%, with the consensus being 10%. We got 7%. How? The U.S. Treasury Secretary and the head of the Office of the Comptroller of the Currency undermined the Basel Committee's intentions and teamed up with the French and Germans to lower the ratio.

How do I know? It's in "Bull by the Horns," the new book by Sheila Bair, the former chairman of the FDIC. (Read it.)

Here's one excerpt: Bair wrote in a memo after an Aug. 6, 2010, meeting with Geithner, "Why do we keep making banking policy to accommodate weak institutions? Keep hoping our relationship will improve, but this was a new low."

Socialized risk is killing the free market "clearing" mechanisms that would have made our pain coming out of the financial crisis really bad. But they'd also put us much farther along in the healing process than we are now.

Instead, today, we're deep in the march towards socialism, with the central bankers of America and the world leading the charge.

And if this isn't cut out like a cancer ought to be, our economic future will be subject to a constant nagging fungus - the fungus of failed capitalism.

Source :http://moneymorning.com/2012/10/02/were-deep-in-the-march-toward-economic-socialism/

Money Morning/The Money Map Report

©2012 Monument Street Publishing. All Rights Reserved. Protected by copyright laws of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), of content from this website, in whole or in part, is strictly prohibited without the express written permission of Monument Street Publishing. 105 West Monument Street, Baltimore MD 21201, Email: customerservice@moneymorning.com

Disclaimer: Nothing published by Money Morning should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investent advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication, or after the mailing of printed-only publication prior to following an initial recommendation. Any investments recommended by Money Morning should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.

Money Morning Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

SaulRosenberg
02 Oct 12, 22:29
This link sums up America

http://www.youtube.com/watch?v=BtTt_M17xqo


Post Comment

Only logged in users are allowed to post comments. Register/ Log in