I have been mulling this Blog post for a week now trying to find the balance between containing my anger and express my angst due to the economic circumstances created by the abuses perpetrated by certain financial institutions - mostly in the United States.
The developed world economy is about to go into a vicious downward cycle of recession that has been caused by the greed, selfishness and hubris of the “Masters of the Universe” types in the financial services sector, particularly in the USA and triggered by the sub-prime mortgage fiasco and meltdown.
It is not just the greed and short term selfishness of the mortgage/lending business that was written for too many folks who had no hope in hell of handling the initial debt – never mind the rate bumps built into the deals. There is the culpability due to the wanton negligence and possible fraudulent willful blindness of so-called “independent” debt rating agencies who ranked these junk loans a solid and who were paid by the very perpetrators of the scams in the first place.
The investment banking and commercial banking division and separation after the Depression was done for a reason. But it has been inconvenient and avoided in generating the enormous fees and bonuses inherent in the short run short term thinking of these greedy bastards who were in for the fast buck and screw the consequences to the rest of us.
The high priests of the free market who sell us the concept that open markets are the best arbiters of fairness, openness and determinate of value are undoubtedly charlatans and likely crooks in many instances.
The government’s use federal reserve systems have been bailing them out in the Billions of taxpayers money – as the write-offs pile up within big-name financial institutions that are (were) some of the most respected and revered in our world view.
Now we will see the pendulum swing away from free markets into regulated financial institutions where realities will be tough government regulation that run them like utilities. OK by me but there is another “catch.” With the gutting of governments buy the likes of Thatcher, Reagan, and the Bushes…and Harper, Klein and Harris if you want to come closer to home…and you should.
I wonder, do any of these governments still have the technical talent and expertise plus the political wisdom and energy in place to exercise the resilience and robustness of political will needed to do the job? I don't relish this alternative any more than I do the meltdown caused by the sub-prime financial fisco caused by idiots who are noted for their supreme self-absorption and selfishness instead of the common good.
The UK is under as much pressure as the US in htis regrd and, as a result, Prime Minister Brown is a spent political force...stick a fork in him...he is done! Bush is out of his depth and done like dinner too – and his Canadian "mini-me," buddy Steve Harper is not strong enough politically, policy or character-wise to cut it in the face of the pending disaster...and Canada has have no one in the wings politically to take over either.
The Democratic presidential race is internally destructive and both candidates are actually avoiding dealing with the real economic policy issues in the campaign and will continue to do so until after the election in November. McCain is just another Bush with an Eisenhower perspective who is fimly embedded in the 1950's and '60's who readily admits to not knowing much about economics anyway.
This means there are many months to go before anyone in America can really wrestle with this politically and with practical policy alternatives...even if they had someone win the election who is capable enough to do the economic job. The Americans are already in a recession and it is only a dirty little secret to the authorities because everyone else in the world already knows this truth. The "authorities" have to stay in denial to stave off the inevitable admission of reality because this is an election year and they dare not be seen as telling the truth under such circumstances.
The financial sector Masters of the Universe who are involved in running the private sector financial markets, who have also enabled, aided and abetted this travesty, and soon to be tragedy, deserve to have their “balls” busted. Why? Because of their iresponsible disregard for the common good while they manipulate the rules to gather accumulations of astonishing personal wealth through greed and possible corruption. Will it happen? Not likely.
It will only happen if we have an effective, forthright, strong and activist government leadership once again. We need political leadership who will undertake to regulate and “unfix” the “fix” that has been “in” on the public. The common wisdom about the preference for the so-called “free markets” and the "professional" managers, who have been allowed to abuse their privileges and avoid responsibility and accountability is no longer a myth - it is a lie!
In wars we have a concept of crimes against humanity and we try and even execute the guilty. These greedy bastards in these financial crimes are damn lucky the concept does not transfer to the damage that they have done against the economy and the human condition for purposes their own prosperity, power and personal purposes.
Now we will have the likely alternative possibilities of inept or fascist strong-man government who would take over and perpetrate more variations-on-a-theme abuses on the public. Unless citizens smarten up and re-engage in politics in a purposeful, informed and meaningful way we will continue to suffer abuse from private sector or public sector idiots who both abuse the system...and us!
The developed world economy is about to go into a vicious downward cycle of recession that has been caused by the greed, selfishness and hubris of the “Masters of the Universe” types in the financial services sector, particularly in the USA and triggered by the sub-prime mortgage fiasco and meltdown.
It is not just the greed and short term selfishness of the mortgage/lending business that was written for too many folks who had no hope in hell of handling the initial debt – never mind the rate bumps built into the deals. There is the culpability due to the wanton negligence and possible fraudulent willful blindness of so-called “independent” debt rating agencies who ranked these junk loans a solid and who were paid by the very perpetrators of the scams in the first place.
The investment banking and commercial banking division and separation after the Depression was done for a reason. But it has been inconvenient and avoided in generating the enormous fees and bonuses inherent in the short run short term thinking of these greedy bastards who were in for the fast buck and screw the consequences to the rest of us.
The high priests of the free market who sell us the concept that open markets are the best arbiters of fairness, openness and determinate of value are undoubtedly charlatans and likely crooks in many instances.
The government’s use federal reserve systems have been bailing them out in the Billions of taxpayers money – as the write-offs pile up within big-name financial institutions that are (were) some of the most respected and revered in our world view.
Now we will see the pendulum swing away from free markets into regulated financial institutions where realities will be tough government regulation that run them like utilities. OK by me but there is another “catch.” With the gutting of governments buy the likes of Thatcher, Reagan, and the Bushes…and Harper, Klein and Harris if you want to come closer to home…and you should.
I wonder, do any of these governments still have the technical talent and expertise plus the political wisdom and energy in place to exercise the resilience and robustness of political will needed to do the job? I don't relish this alternative any more than I do the meltdown caused by the sub-prime financial fisco caused by idiots who are noted for their supreme self-absorption and selfishness instead of the common good.
The UK is under as much pressure as the US in htis regrd and, as a result, Prime Minister Brown is a spent political force...stick a fork in him...he is done! Bush is out of his depth and done like dinner too – and his Canadian "mini-me," buddy Steve Harper is not strong enough politically, policy or character-wise to cut it in the face of the pending disaster...and Canada has have no one in the wings politically to take over either.
The Democratic presidential race is internally destructive and both candidates are actually avoiding dealing with the real economic policy issues in the campaign and will continue to do so until after the election in November. McCain is just another Bush with an Eisenhower perspective who is fimly embedded in the 1950's and '60's who readily admits to not knowing much about economics anyway.
This means there are many months to go before anyone in America can really wrestle with this politically and with practical policy alternatives...even if they had someone win the election who is capable enough to do the economic job. The Americans are already in a recession and it is only a dirty little secret to the authorities because everyone else in the world already knows this truth. The "authorities" have to stay in denial to stave off the inevitable admission of reality because this is an election year and they dare not be seen as telling the truth under such circumstances.
The financial sector Masters of the Universe who are involved in running the private sector financial markets, who have also enabled, aided and abetted this travesty, and soon to be tragedy, deserve to have their “balls” busted. Why? Because of their iresponsible disregard for the common good while they manipulate the rules to gather accumulations of astonishing personal wealth through greed and possible corruption. Will it happen? Not likely.
It will only happen if we have an effective, forthright, strong and activist government leadership once again. We need political leadership who will undertake to regulate and “unfix” the “fix” that has been “in” on the public. The common wisdom about the preference for the so-called “free markets” and the "professional" managers, who have been allowed to abuse their privileges and avoid responsibility and accountability is no longer a myth - it is a lie!
In wars we have a concept of crimes against humanity and we try and even execute the guilty. These greedy bastards in these financial crimes are damn lucky the concept does not transfer to the damage that they have done against the economy and the human condition for purposes their own prosperity, power and personal purposes.
Now we will have the likely alternative possibilities of inept or fascist strong-man government who would take over and perpetrate more variations-on-a-theme abuses on the public. Unless citizens smarten up and re-engage in politics in a purposeful, informed and meaningful way we will continue to suffer abuse from private sector or public sector idiots who both abuse the system...and us!
Ken:
ReplyDeleteyou make many great points, for and against free markets and/or government involvement in the financial markets.
What I don't see anywhere is the concept of free will and personal responsibility. No system, no matter how centralized or free, can protect some people from themselves.
How do you criticize the banking and government sector without saving some for the greedy homeowner of sepeculator who thought that house prices would rise forever, and didn't think ahead to renewing ARMS and pending interest rate adjustments.
I watched 60 mminutes 2-months ago on this subject, and was sickened to see people throw their hands up in the air and say "The Bank told me I coudl afford it"
The banks line-up nearly every day to tell me I can aford a bunch of stuff that I know I dare not RISK to try and afford.
http://www.youtube.com/watch?v=SJ_qK4g6ntM
ReplyDeleteEducational and disturbingly funny.
Thx Luigi for the link - I have seen it before but it is worth revisiting in the current context.
ReplyDeleteThe free market works when there is good faith. But lets face it, these finacial types personally became very rich at the expense of the world economy. There unbridled greed has and will be very destructive.
ReplyDeleteOne question: is Ken Chapman really a conservative?
ReplyDeleteI am a PROGRESSIVE Conserviative - a big difference from the neo-Republican Bush types dominating the CPC these days.
ReplyDeleteGeorge Bush is the best leader of our time, hands down. Clearly you're a left-leaning individual that would be Liberal or NDP in any other province.
ReplyDelete