Since WAMU went under with a reserve of $45 for every $10,000 loaned, I shudder to think what the ratios of government bailouts are. I suppose with the exclusive right other than counterfeiters to print the Fed’s own money, it probably does not technically apply; on the other hand, the Fed does pretend to "borrow" in order to meet the demands of the bailouts. They keep saying the "taxpayer"—actually China taxpayers—must be protected by so-called assets when in fact most assets of institutions are already encumbered. To obtain a $1,000,000 loan it’s like putting up as collateral a Lexus on which one still owes $50,000 on the speculation the car loan will be paid down, let alone the new loan.
When Reagan used to denigrate the Welfare Queen everyone seemed to agree that she should not be able to drive her Cadillac to Wal*Mart and pay for her loot with food stamps and/or government checks. Yet this is precisely what the financial world does in this current crisis. Furthermore, none of the finance-operators really have their own money, they are nothing but loan sharks and short of breaking legs they do punish borrowers who don’t come up with payments even though they themselves "borrowed" other peoples’ money to put at risk. Loan sharks of the underworld at least claim to be lending with their own money even though accumulated by devious means.
Institutional finance thugs somehow always manage to have up-front wealth for their own personal benefits by taking underhanded fees for services without having any responsibility knowing full well that investors are so dumb that they don’t even read prospectus of intent. The cry now of more regulation and fiscal responsibility will rain tears down on the financial, "free markets" but to no avail unless the regulatory system is run by the FBI to keep the monster honest.
Copyright © 2008 Richard R. Kennedy All rights reserved. Revised: Dec 7, 2008.
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