Simon Johnson on Wall Street's Influence Over Washington
By Heather Tuesday Mar 31, 2009 9:45am
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David Shuster talks to former IMF chief economist Simon Johnson about whether the United States could be headed for another great depression. After getting tough with the auto industry they discuss why Wall Street is not getting the same treatment. They also discuss Simon Johnson's article at The Atlantic The Quiet Coup. From the article:
The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government—a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises. If the IMF’s staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform. And if we are to prevent a true depression, we’re running out of time.
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Maybe we can get Wall Street to market "talk" as a commodity.
We'd be the richest nation on earth. If we could find buyers.
Only thing keeping this ship afloat is "hot air" (money) being pumped into the life rafts.
http://www.youtube.com/watch?v=mJqCCbb_QfE
World Trade+Finance+Money+Greed = Chaos As Normal
Who can disagree with that?
"If its too big to fail, it shouldn't exist."
Probably too late now but we should have let all these companies "fail" into bankruptcy and let their creditors sort it out.
paid off, mortgage, cars, credit, "stuff", etc are even worried.
while the crimes we're being committed? Hell maybe even I can now get rich writing a book called Jiffy Depression Recipes. Or how bout Quick, Fast, and Convenient Depression Meals.
recipes for the fixed income person.
"You are witnesses to the final fire sale of the American economy."
don't eat Pistachios in any form there's a major national recall going on right now.
Your welcome
Youtube News: CT scan reveals hidden face under Nefertiti bust.
Pharaoh Ankhenaten goin', "Hummina...hummina...hummina...?"
The gang from Goldman Sachs has had free run to loot their own companies and the US Treasury, determine how much debt future generations of other peoples children will be responsible for, and as long as they are in charge they will never overcome their conflict of interest when it comes to dismantling their oligarchic strangle hold on the legal/political/and financial apparatus of America that is killing the rest of us.
Obama may be playing ball with the best and brightest financial experts in order to try and chart a course away from the brink of global depression - but it is in cooperation with the very same people who brought us to the point of complete disaster. These masters of finance are VERY dangerous men. Obama wont be president forever and if his extreme program should somehow avert societal collapse - the same greedy vampires will be left to bleed the world again once he's gone.
The 'populist outrage' thing needs to be channeled into demands for REAL change and for the oligarchs to get their golden slippers off of our necks. Representative democracy needs a major correction towards representing popular will and act in service of our common good. This banana republic plutocracy garbage has to end.
First...the dollar is essentially valueless. Pay no attention to the FX markets, where massive manipulation is going on to simply keep the dollar from collapsing.
The dollar WILL be replaced as the world reserve currency. The powers that be are simply working through the process.
Banana Republic? We're there already. Again, the masters are simply working through the process. Don't want to frighten the sheep now...do we?
This is OVER. They are simply dousing the fire...turning the ashes...and dousing it again.
Roughly 6 to 12 months after the G20 Meeting...an announcement will be made. That announcement will be for a NEW Bretton Woods-style meeting of world finance ministers and bankers. That meeting will be the demise of the U.S. dollar, it will be the demise of the FX markets, it will be the demise of our way of life. America will be put in receivership. We will be a beggar nation. We will keep our weapons, but rest assured...we will be on a short lease. Our weapons will ultimately be under international control.
Our standard of living will remain even more stagnant than it is..if not outright decline. RAPIDLY. Our national wealth will be concentrated into even fewer hands, the American middle class and way of life will essentially be OVER.
Write it down, and you can all get back to me later.
I'm sure if he knew the dangers...
Oh, wait.
He does.
Washington's driveway!
is Wall Street's cesspool.
Your addendum and time is appreciated. ♥
Amended: Though I may have said, Porta Potti, due too my optimism. :)
The FDIC has authority to intervene in commercial banks. That authority was granted at its founding in 1933 as commercial banks, investment banks and insurance companies were denied the right to exist under one corporate roof. Glass Steagall, the FDIC, these were responses to the excesses of the twenties.
Yesterday, Eric Dinallo, the New York Insurance Superintendent overseeing AIG and a credible public administrator wrote in the Financial Times: We modernised ourselves into this ice age here, via Naked Capitalism here.
Here is Margaret Popper of Bloomberg from Feb 21, '09 in an analysis and discussion with Dinallo. He categorically states that AIGs losses are from Credit Default Swaps. Their Financial Services Unit is essentially a hedge fund that ran amok. He says that AIG's primary units suffered no losses. These are all points subsequently reported widely elsewhere also.
The new powers requested by Geithner in his recent appearance before congress include the authority to seize non commercial bank financial institutions. This could be the prelude to applying the GM treatment to the financial sector, or not. It depends entirely on the political will.
It is also a somewhat disturbing expansion of executive authority when what is really needed is to reinstate Glass Steagal.
William Greider in the Nation, Trust Your Guts, here.
Most unfortunately, no prohibition has been placed on the political campaign or lobbying efforts of the bailed out entities.
The taxpayers shovel the money into them by the huge boatload, they shovel a cut to the politicians in campaign money and with an even larger shovel send in the lobbyists.
The system is corrupt.
Simon Johnson rightly points out in his Atlantic piece, the limiting feature for emerging market countries is their foreign debt is held in foreign currency. They run our of money and then have no choice but to reign in the oligarchs.
Our debt is in dollars, we will print them until the world stops us.
Then we will have no choice.
Then we will have no choice.
Oh...so then we'll take to the streets? Or are we just gonna change the channel and watch American Idol till the lights go off.
Everything you've listed above is correct. The direction and ultimate result of this "free market" experiment was being talked about long before this debacle happened.
The question is...what should be done...and how do we get it done. And I mean WE. The powers that be are not interested in doing what is right for the country...so...they need to be incented.
We will print the dollars until the inflation hits us. Probably thereafter.
The IMF deals with the banana republics, I don't know what will happen here.
What should be done? Read the links above. I read everything I can find and have time for.
Obama is at the G20, Sarkozy who passes near the remnants of the Bastille, I suspect, nearly every day has said he will walk out if he doesn't get international regulation. The analysts just now have said he won't get it. It is for public consumption.
The Chinese will be flexing their muscles.
I don't watch television, speak for yourself.
I write my members of Congress who send form letters. They will say one thing and then vote the other.
I vote Socialist.
I am too old to go into the street.
I will hope that my little pension and what ever there is of my very meager social security from the tiny income of a life in art will buy me enough food until I don't need any more.
You continue to bluster but offer no links to the outside world. I find you to be insulting and obnoxious. I would appreciate if you do not interact with me.
---
Here is Andrew Leonard with a further reflection on Simon Johnson.
We will print the dollars until the inflation hits us.
The inflation isn't going to "hit us". It will be brought down on us, in a very controlled fashion. We should be realizing serious inflation now, driven primarily by food costs and by the exchange rate of the dollar...IF the dollar was actually allowed to float naturally. We've added tons of new dollars to the system over the last year...and have already put out expectations for tons more...which does have a direct impact on dollar valuations.
The market is being manipulated. The same manipulation is going on in the commodity markets. Oil is inching up...with huge inventories sitting out there, which makes NO SENSE. The reasons being put out are "cold winter coming" LOL, demand is going up...yeah...SHOW ME. I don't quite understand...if Americans weren't driving when they HAD jobs, why would they be driving now? It is because speculators are now being used to control prices. Before they controlled prices for their own ends, now they are working in coordinated fashion for the global finance ministers.
This whole debacle is contrived and controlled. This didn't just "happen".
As for your social security, well...even I wouldn't place a whole lot of faith in it surviving in the long term.
Obama's trying to tell the Germans to do the same as us, print money, and stimulate. Germans are saying, been there, done that. Wound up taking a shopping cart of marks to buy a loaf of bread. Needless, the Germans eventually elected bold, firm leadership to take them out of their morass. ;-)
after the fact? Kinda like the AIG retention bonuses, they weren't illegal.
"Those Damn laws"...
http://www.pbs.org/moyers/journal/02132009/pr...
I think part of the phrase was "they think we are chumps" when referring to the bankers.
It's good to compare a real interview to the shotgun-sound-byte-style interviews of commercial TV. Listen, I'm more than grateful to Shuster for interviewing Johnson and getting a real economist on TV, but why does it have to be so abbreviated and superficial?
Given the complexity of the issues we're facing (AND the importance to our own well-being), we need details. That was akin to reading "Cliffs Notes."
DemocracyNow had James Galbraith on last Friday. That was good.
http://www.democracynow.org/2009/3/27/geithne...
There's the RealNews. I thought the interviews with Tom Ferguson, part 1, 2 and 3 was good. Part 2 touches on the corporate campaign donations aspect.
Of, course, you could read the article where there is a lot more detail.
I wish I could list (MIT) on my resumé. Nice clip!
That's what we heard when Obama rushed through the stimulus program. But with the bank rescue aspect, we have time for Geithner's plan, and nationalization is a fall back, even though we're told that credit needs to start flowing for the economy to recover. There's a few too many incongruities here for me to be comfortable in this approach.
Especially the part how we need to keep the too big to fail corporation concept and rely on a regulator, even as "the top executive officers didn’t know, to a very large extent, or at least by their own testimony, they didn’t know, the risk exposure of their own institutions." But somehow Geithner's super regulator will keep us out of harms way? I don't know about that. I'd rather rely on the reinstatment of Glass-Steagall.
Simon Johnson http://baselinescenario.com/
Change ? A leveling of the playing field ? Fairness and Justice ? Equality ? Politicians putting the well being of the country and the people first ? Assume your customary positions folks , bend over .
As an Obama supporter, it is really sad and perplexing to watch Obama take direction from Wall Street much the way that Bush did. I guess that I was expecting too much.
Unfortunetly people keep voting CFR politicians so this will never happen. So all people have to do is check to see if the politician has any ties at all to the CFR, Bildeberg, Trilateral commission and APAC if they don't then vote for them.
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