Robbing the Bank

Permit me an indulgence … I offer here an analogy to try to explain our sub-prime mortgage meltdown in late 2008 that cost the United States at least one trillion dollars and likely elected Barack Obama to the Presidency. This analogy will use a simple bank-robbery scenario to try to explain the actors and their roles in this (to me) criminal enterprise. Here is the cast:

- The Master Planners – Barney Frank and Chris Dodd whose drive for universal home ownership was the diabolical felonious scheme behind this travesty (with the template of the Community Development Act of 1974.)

- The Bank Robbers – Countrywide Finance, GMAC, Quicken and the myriad of other bucket-shop mortgage origination companies that sprung up during the last years before the meltdown … along with the complicity of the hundreds of thousands of homeowners who got these no-documentation mortgages using chicanery and mendacity.

- The Money Launderers (legitimizing the pelf acquired in this robbery) – Fannie Mae and Freddie Mac abetted by all those financial institutions (e.g.s: Morgan Stanley, Goldman Sachs, Citigroup, etc.) that packaged up these mortgages (Collateralized Debt Obligations -- CDOs) to sell to these fences … AND all those players in the Credit-Default Swaps casino (AIG, Goldman Sachs, Lehman Brothers, Deutsche Bank, etc.)

- The Get-Away Car Drivers – the Credit Rating Agencies that gave these CDO’s unrealistically high credit ratings

- The Bank’s Security Force – those myriad Federal financial regulatory agencies who spent the period during the actual robbery lounging in the bank’s break room playing pinochle and watching porn on the bank’s security-system screens.

- The Bank’s Depositors (who lost their money in the robbery) –ordinary United States’ citizen-schlubs.

Pity Citi

Citigroup has just been granted a $18 billion tax break by the IRS (Treasury Dept.) in order that it might repay its TARP loan with a massively reduced tax liability. See Citi Tax Break. Now the fact that Tim Geithner is the Secretary of the Treasury (and an admitted personal tax cheat) and is a long-time protege of Robert Rubin who is attached at the waist with Citigroup (a former Chairman of the Board) and picked Geithner for his job has nothing to do with this Treasury travesty. Basically it appears to this blogger that our government is effectively giving Citigroup money so that it then can turn around and give it back while at the same time eliminating much of its TARP liability. This is absolute BS with a capital "B.S." When are we, as those wimps electing these political poltroons, going to rise up and say "NO"? Geithner should not only not enjoy his august status in Washington, but he should be the first prisoner in that high-security prison that our other corrupt Washington pols are buying in Illinois (co-incidence) to house the Gitmo prisoners.

What is even more gratingly hilarious is that the current Chairman of Citigroup, Richard Parsons, just stiffed Barack Obama (along with the heads of Goldman Sachs and Morgan Stanley) when they were supposed to meet with Obama in the Oval Office to discuss increasing loans to small businesses. And Geithner's allowing Goldman Sachs and Morgan Stanley to become "banks" as opposed to investment banks is another of his mortal sins. As a result, both Morgan and Goldman can now borrow money from the New York Federal Reserve (which Geithner previously ran) at effectively no cost ... and then turn around and speculate in the Credit Default Swap and Interest Rate Swap markets with this ill-gotten pelf (as opposed to giving loans to businesses). I want to throw up.