dagblog - Comments for "Questionable Finance"

I do not disagree that they

EmmaZahn — Tue, 05 Apr 2011 15:52:41 +0000

In reply to 13 Bankers is really about

I do not disagree that they have too much influence and play rigged financial games but the way to take them down is too create a countervailing power not a whole bunch more of the same that just look smaller.

What kind of spider is it that releases a whole bunch of baby spiders when you squash it? That is all that insisting on downsizing will do.

13 Bankers is really about

Beetlejuice — Tue, 05 Apr 2011 15:02:59 +0000

In reply to So,.you break them into

13 Bankers is really about how those 6 banks are a financial money cartel creating and packaging games and selling those instruments to unsuspecting investors in the public realm while covering their asses by taking out insurance against those very same instruments knowing full well they'll implode leaving the investor short changed while the bankers reap the profits from their loss. It's high stakes fraud with GOPer's blessing becasue it's money in their political campaign coffers. So as long as they have Congress's ear, they have no fear anyone will dare to suggest legislation to make them behave or take responsibility for their actions.

So,.you break them into

EmmaZahn — Tue, 05 Apr 2011 14:43:49 +0000

In reply to So you don't think smaller is

So,.you break them into smaller units, do the same people who own the big banks have a proporational interest in the smaller ones? It is the people behind the shingle with too much political clout, giving them more shingles to hide behind is not the sort of electoral reform we need to reduce their influence.

Also, the way the banks you list got to be so big and influential is through their special relationship with the Federal Reserve Bank of New York and its Open Market Operations. Until someone comes up with another way to do whatever it does with its only autoriized counterparties aka its primary dealers aka those banks, neither forced downsizing nor regulatory reform will have much impact.

For the record, do not support going back to a gold standard or forward to MMT are necessary, not that either would make any difference in the banks' political influence anyway.

So you don't think smaller is

Beetlejuice — Tue, 05 Apr 2011 09:46:00 +0000

In reply to a safe and secure place to

So you don't think smaller is automatically better, eh? Chew on this...

BANK ASSETS as %-age of GNP

Bank of America 16
JPMorgan Chase 14
Citigroup 13
Wells Fargo 9
Goldman Sachs 6
Morgan Stanley 5

That's only 6 banks whose total assets equal 63% of GNP. I'd say that poses a serious risk, especially seeing how those same banks were able to redirect Congress from accomplishing any serious regulation reform to stymie the efforts they employed that ran the financial markets into the ground in 2008. In short, size and risk are directly related to one another....the more assets accumulated increases the risk factor of everything going to hell in a handbasket if they crap out playing their high stakes financial game of roulette.

a safe and secure place to

EmmaZahn — Tue, 05 Apr 2011 01:24:28 +0000

In reply to What's a bank?Once upon a

a safe and secure place to store your money and earn some interest, and borrow funds for items of necessity to make one's life easier. They also provided an avenue for modest investing for those with a little extra cash.

FDIC provides the safe and secure for the first $250,000; then repurchase agreements (repos) of US Treasuries, other federal agencies and state and municipal bonds will secure most of the rest. Fannie and Freddie were considered risk-free before 2007-8 too.

Bankers no longer have to be pillars of propriety to convince people to trust them. All they need is an FDIC sticker and paid up premiums so it is FDIC that we trust. In my mind, that makes FDIC the biggest banker in the country.

Haven't read 13 bankers but I do not think smaller is automatically better. The problem is not the size of the banks; it is the risk they pose and the risk now is systemic. Banks, large and small, are are inextricably linked together through THE money market.aka the shadow banking system and its center is the Federal Reserve Bank of New York.

Amazon.com: Stigum's Money Market, 4E (9780071448451): Marcia Stigum, Anthony Crescenzi: Books

Believe it or not, that cover art was pre-crash.

What's a bank?Once upon a

Beetlejuice — Tue, 05 Apr 2011 00:51:10 +0000

In reply to Questionable Finance

What's a bank?

Once upon a time, I remember they provided a service to the public...a safe and secure place to store your money and earn some interest, and borrow funds for items of necessity to make one's life easier. They also provided an avenue for modest investing for those with a little extra cash.

But like most fairy tales, reality sets in and it was nothing but a story.

Today, banks are established houses of high stakes gambling...they don't need investors anymore...they want it all for themselves. Think of them as a manufacturing base making money hands-over-fists, but without producing a product to be sold to the public. It's a real life monopoly game with the FED as the banker.

I just finished reading 13 Bankers.

Conclusion : Too Big To Fail should have been broken up into smaller, more manageable parcels that wouldn't be a financial threat to the economy.

What banks love is

EmmaZahn — Mon, 04 Apr 2011 18:52:00 +0000

In reply to I suspect that the Fed likes

What banks love is volatility. They are arbitrageurs. In other words, they make more money when prices fluctuate. The Fed is a bank

I remember a stockbroker who got very happy when the market roiled. With just about every order he got whether buy or sell, he would do a little touchdown-like dance and chant "Churn, baby, churn." :)

I suspect that the Fed likes

Michael Maiello — Mon, 04 Apr 2011 18:03:41 +0000

In reply to Questionable Finance

I suspect that the Fed likes the inflation in oil, gold, and food commodities. It's about the only economic "growth" the bank has been able to engineer. That it hurts people doesn't matter to them, banks love it!