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Government Rescue Spending: Clear or Cloudy?
2008-11-11, ABC News
http://abcnews.go.com/Business/Economy/story?id=6225744&page=1

After weeks of sometimes frenzied efforts by the federal government to rescue the financial system ... critics say there are many questions but few answers about the work performed by the Treasury Department and the Federal Reserve. "The bailout, the Treasury, the Federal Reserve -- it's like a three-card monte game, you don't know where the money's coming from, you don't know who it's going to, and I think the public has every right to be outraged by this," said Bill Allison, a senior fellow at the Sunlight Foundation, a government transparency watchdog group. Gerald O'Driscoll, a former vice president at the Federal Reserve Bank of Dallas ... said he worried that the failure of the government to provide more information about its rescue spending could signal corruption. "Nontransparency in government programs is always associated with corruption in other countries, so I don't see why it wouldn't be here," he said. Questions about transparency at the Federal Reserve, in particular, have prompted a lawsuit: Bloomberg L.P., which operates the news agency Bloomberg News, is suing the Fed for the release of information on its lending to private financial institutions. "We really don't know anything," Matthew Winkler, the editor-in-chief of Bloomberg News, told ABCNews.com. "All we know is something close to 2 trillion is being used and that money is the taxpayers'. ... We don't know whom it's being lent to and for what purpose because we can't see it because it isn't disclosed."

Note: For many revealing and reliable reports on the Wall Street bailout, click here.

Warning: King Henry's bailout like Rummy's Iraq
2008-11-10, MarketWatch (A Wall Street Journal Digital Network Website)
http://www.marketwatch.com/news/story/reagonomics-hides-sleeper-cells-harbori...

So you thought Barack Obama's victory signaled the death of Reaganomics? Wrong, wrong: Reaganomics is very much alive. In a subtle, bloodless coup, the Reaganomics ideology magically pulled victory out of the jaws of defeat in the meltdown. The magic happened fast and quietly, in the shadows, while you were in a trance, distracted by the election drama. Recently Naomi Klein, author of The Shock Doctrine: The Rise of Disaster Capitalism, framed the issue perfectly: "Has the Treasury partially nationalized the private banks, as we have been told? Or is it the other way around?" The question was rhetorical, the answer painfully clear. In a few weeks Wall Street did the old bait and switch, emerging from an economic and market disaster with new powers, in total control of America. And thanks to Treasury Secretary Henry Paulson's brilliant bailout coup, Reaganomics is now the new "sleeper cell" quietly hidden inside the Obama White House and America's Treasury, where it will be for a long time to come. Listen closely folks: You and your government are and will continue being conned out of trillions. Klein further exposed this insanity in a recent Rolling Stone article, "The New Trough: The Wall Street bailout looks a lot like Iraq, a 'free-fraud zone' where private contractors cash in on the mess they helped create." Paulson's privatization, outsourcing and management of the $700 billion bailout has the exact same Reaganomics ideological, strategic and deceptive footprints that President George W. Bush and former Defense Secretary Donald Rumsfeld used to privatize, outsource and mismanage the costly Iraq War blunder.

Note: For the powerfully revealing article by Naomi Klein mentioned in the article above, click here. Speaking on Tulsa Oklahoma’s 1170 KFAQ, Senator James Inhofe of Oklahoma (Republican) has revealed that Treasury Secretary Henry Paulson was the source of the threat of martial law in the US if the $700 billion bailout bill was not passed that was exposed on the House floor by Rep. Brad Sherman. For many key articles revealing the hidden realities of the bailout, click here.

White House defends money for banks
2008-10-30, Washington Post
http://www.washingtonpost.com/wp-dyn/content/article/2008/10/30/AR20081030022...

Under fire from Democrats and Republicans alike, the White House ... defended giving billions of bailout dollars to banks that plan to reward shareholders and executives -- or even buy other banks. Allowing banks to engage in such normal business activities actually could help loosen lending and revive the sagging economy, said Ed Lazear, chairman of the Council of Economic Advisers. He said the administration would not impose any conditions on banks beyond those required when Congress created the bailout program, which authorized the government to buy stock in financial institutions. Lazear was put before the cameras in the White House briefing room amid a rising chorus of complaints from lawmakers about the latitude that banks will have when they receive bailout money from Washington. That bailout was originally sold by the administration as a plan for the government to purchase toxic mortgage-based assets from financial institutions, to get them off their books and inspire the resumption of normal lending. After passage, though, the administration decided the better course would be to devote $250 billion into buying ownership stakes in banks. With taxpayers' money flowing into their vaults, banks are going ahead with paying dividends to shareholders, giving bonuses to top executives and acquiring competitors. Lawmakers are asking why banks with the money to do those things need taxpayer-funded help. The rescue legislation included some limits on executive compensation, considered weak by many. And while it does not allow institutions receiving the money to increase dividends, it does not prevent them from paying those dividends.

Note: For extensive coverage of continuing revelations about the Wall Street bailout, click here.

Bernanke Is Fighting the Last War
2008-10-18, Wall Street Journal
http://online.wsj.com/article/SB122428279231046053.html

"Nothing," [famed economist] Anna Schwartz says, "seems to have quieted the fears of either the investors in the securities markets or the lenders and would-be borrowers in the credit market." The credit markets remain frozen, the stock market continues to get hammered, and deep recession now seems a certainty -- if not a reality already. [Recently, according to Schwarz, Secretary of the Treasury Hank Paulson has] shifted from trying to save the banking system to trying to save banks. These are not, Ms. Schwartz argues, the same thing. In fact, by keeping otherwise insolvent banks afloat, the Federal Reserve and the Treasury have actually prolonged the crisis. "They should not be recapitalizing firms that should be shut down." Rather, "firms that made wrong decisions should fail," she says bluntly. "You shouldn't rescue them. Everything works much better when wrong decisions are punished and good decisions make you rich." How did we get into this mess in the first place? As in the 1920s, the current "disturbance" started with a "mania." But manias always have a cause. "In every case, it was expansive monetary policy that generated the boom in an asset. The particular asset varied from one boom to another. But the basic underlying propagator was too-easy monetary policy and too-low interest ratest. And then of course if monetary policy tightens, the boom collapses." Today's crisis isn't a replay of the problem in the 1930s, but our central bankers have responded by using the tools they should have used then. They are fighting the last war. The result, she argues, has been failure.

Note: Anna Schwarz and Nobel-winner Milton Friedman authored A Monetary History of the United States. It's the definitive account of how misguided monetary policy turned the stock-market crash of 1929 into the Great Depression. The excellent article above mentions that Fed Reserve Chairman Bernanke once said "I would like to say to Milton and Anna: Regarding the Great Depression. You're right, we did it. We're very sorry. We won't do it again." Top bankers and their cronies have been aware of what causes the boom/bust cycle for over 100 years and taken full advantage of it. Try to find one top banker who lost significant money in any bust cycle.

Derivatives the new 'ticking bomb'
2008-03-10, MarketWatch (Part of the Wall Street Journal's digital network)
http://www.marketwatch.com/story/derivatives-are-the-new-ticking-time-bomb

"In our view, however, derivatives are financial weapons of mass destruction, carrying dangers that, while now latent, are potentially lethal." That warning was in [Warren] Buffett's 2002 letter to Berkshire shareholders. He saw a future that many others chose to ignore. Wall Street didn't listen to Buffett. Derivatives grew into a massive bubble, from about $100 trillion to $516 trillion by 2007. Despite Buffett's clear warnings, a massive new derivatives bubble is driving the domestic and global economies, a bubble that continues growing today parallel with the subprime-credit meltdown triggering a bear-recession. Data on the five-fold growth of derivatives to $516 trillion in five years comes from the most recent survey by the Bank of International Settlements, the world's clearinghouse for central banks in Basel, Switzerland. Keep in mind that while the $516 trillion "notional" value (maximum in case of a meltdown) of the deals is a good measure of the market's size, the 2007 BIS study notes that the $11 trillion "gross market values provides a more accurate measure of the scale of financial risk transfer taking place in derivatives markets." The fact is, derivatives have become the world's biggest "black market," exceeding the illicit traffic in stuff like arms, drugs, alcohol, gambling, cigarettes, stolen art and pirated movies. Why? Because like all black markets, derivatives are a perfect way of getting rich while avoiding taxes and government regulations. And in today's slowdown, plus a volatile global market, Wall Street knows derivatives remain a lucrative business.

Note: $516 trillion is equivalent to $75,000 for every man, woman, and child in the world! Do you think the financial industry is out of control? For lots more powerful, reliable information on major banking manipulations, click here. For a powerful analysis describing just how crazy things have gotten and giving some rays of hope by researcher David Wilcock, click here.

Retired Supreme Court Judge shoved up against a wall and threatened by NYPD at Occupy Wall Street clashes
2011-11-20, Daily Mail (One of the UK's largest-circulation newspapers)
http://www.dailymail.co.uk/news/article-2063716/You-want-arrested-lady-The-re...

A retired New York Supreme Court judge has claimed she was manhandled by a policeman after watching him beat a woman at the Zuccotti Park raids. Karen Smith was working as a legal observer when she saw a distressed woman pushed to the ground and beaten by an officer, she said. When she demanded he [stop], the unidentified cop pushed her against a wall and threatened her with arrest. Ms Smith had attended the raids ... to note down the names of people arrested as the Occupy Wall Street camp was cleared. She was wearing a fluorescent green baseball cap bearing the words 'National Lawyers Guild Legal Observer' to show she was not taking part in the protests. Ms Smith, who was also carrying a pad and pen, said the incident happened at around 1.30am on Tuesday at Dey Street and Broadway Street in New York City. Speaking to Democracy Now, she described the scene as ‘a paramilitary operation if there ever was one’. It was ‘what we call a stealth eviction’, she added. Ms Smith explained her son had participated in Occupy Wall Street and she had been ‘very concerned’ about his safety.

Note: We don't normally use the UK's Daily Mail as a reliable source, but as no other major media are reporting this story, we felt it warranted inclusion. The judge gives her own testimony in a video near the bottom of the article.

Did You Hear the One About the Bankers?
2011-10-30, New York Times
http://www.nytimes.com/2011/10/30/opinion/sunday/friedman-did-you-hear-the-on...

Citigroup had to pay a $285 million fine to settle a case in which, with one hand, Citibank sold a package of toxic mortgage-backed securities to unsuspecting customers — securities that it knew were likely to go bust — and, with the other hand, shorted the same securities — that is, bet millions of dollars that they would go bust. It doesn’t get any more immoral than this. James Stewart, a business columnist for The [New York] Times, noted that Citigroup’s flimflam made “Goldman Sachs mortgage traders look like Boy Scouts.” This gets to the core of why all the anti-Wall Street groups around the globe are resonating. Our financial industry has grown so large and rich it has corrupted our real institutions through political donations. Our Congress today is a forum for legalized bribery. One consumer group using information from Opensecrets.org calculates that the financial services industry, including real estate, spent $2.3 billion on federal campaign contributions from 1990 to 2010, which was more than the health care, energy, defense, agriculture and transportation industries combined. Why are there 61 members on the House Committee on Financial Services? So many congressmen want to be in a position to sell votes to Wall Street.

Note: For lots more from major media sources on the collusion between financial interests and government, click here.

'Occupy Wall Street' -- It's Not What They're for, But What They're Against
2011-10-14, Fox News
http://www.foxnews.com/opinion/2011/10/14/understanding-occupy-wall-street/

Critics of the growing Occupy Wall Street movement complain that the protesters don’t have a policy agenda and, therefore, don’t stand for anything. They're wrong. The key isn’t what protesters are for but rather what they’re against -- the gaping inequality that has poisoned our economy, our politics and our nation. In America today, 400 people have more wealth than the bottom 150 million combined. That’s not because 150 million Americans are pathetically lazy or even unlucky. In fact, Americans have been working harder than ever -- productivity has risen in the last several decades. Big business profits and CEO bonuses have also gone up. Worker salaries, however, have declined. Most of the Occupy Wall Street protesters [want] an end to the crony capitalist system now in place, that makes it easier for the rich and powerful to get even more rich and powerful while making it increasingly hard for the rest of us to get by. The question is not how Occupy Wall Street protesters can find that gross discrepancy immoral. The question is why every one of us isn’t protesting with them. According to polls, most Americans support the 99% movement, even if they’re not taking to the streets.

Note: For lots more on the reasons why people all over the world are occupying their city centers, check out our "Banking Bailout" news articles.

Can Liberals and Libertarians Find Common Ground?
2011-10-12, Forbes.com
http://www.forbes.com/sites/benzingainsights/2011/10/12/can-liberals-and-libe...

The Occupy Wall Street movement has the potential to turn into a political firestorm. We have become so divided as a nation that it is very difficult to prognosticate if anything good will come out of these protests from a political perspective. Let’s examine a number of issues that have been raised by Occupy Wall Street, the Tea Party and liberals and libertarians and see where there is agreement. Get Corporate Money Out Of Politics – This is the issue that really kick started Occupy Wall Street. Americans are sick and tired of mega-corporations and Wall Street banks being in bed with our politicians in Washington D.C. End the Federal Reserve – The Federal Reserve is directly responsible for the Too Big To Fail banking cartel, the U.S. debt, the perpetual deficits, and ... the Fed has also robbed the poor and working class blind as a result of their inflationary policies. End The Wars – The American people are fed up with these conflicts, and even large percentages of the military believe that the wars in both Iraq and Afghanistan were not worth fighting in the first place. It is time for our troops to come home. End The Drug War - The drug war is an absolute failed policy. The U.S. incarcerates a higher percentage of its population than any country on Earth, yet we call ourselves “The Home of the Free.” Repeal The Patriot Act – The assault on our civil liberties in the wake of 9/11 has been swift and draconian. These are the types of things that go on in totalitarian states, and now, apparently the United States as well.

Note: For lots more from major media sources on the reasons why people worldwide are occupying the financial centers of their cities, check out our "Banking Bailout" news articles.

Goldman Sachs let off paying £10m interest on failed tax avoidance scheme
2011-10-11, The Guardian (One of the UK's leading newspapers)
http://www.guardian.co.uk/business/2011/oct/11/goldman-sachs-interest-tax-avo...

Britain's tax authorities have given Goldman Sachs an unusual and generous Christmas present, leaked documents reveal. In a secret London meeting last December with the head of Revenue, the wealthy Wall Street banking firm was forgiven £10m interest on a failed tax avoidance scheme. HM Revenue and Customs sources admit privately that the interest-free deal is "a cock-up" by officials, but refuse to say who was responsible. Documents leaked to Private Eye magazine and published in full by the Guardian record that Britain's top tax official, HMRC's permanent secretary Dave Hartnett, personally shook hands on a secret settlement last December. Hartnett also refused to give the facts about Goldman Sachs to MP Jesse Norman on the Treasury committee last month, claiming disclosure would be illegal. He also refuses to brief ministers on the details. The £10m Christmas gift for Goldman was the culmination of a prolonged attempt by the US firm to avoid paying national insurance on huge bonuses for its bankers working in London. The sum was pocket change to Goldman, whose employees received $15.3bn (£9.5bn) in pay and bonuses last year.

Note: For lots more from reliable sources on corporate and government corruption, click here and here.

World facing worst financial crisis in history, Bank of England Governor says
2011-10-06, The Telegraph (One of the UK's leading newspapers)
http://www.telegraph.co.uk/finance/financialcrisis/8812260/World-facing-worst...

The world is facing the worst financial crisis since at least the 1930s “if not ever”, the Governor of the Bank of England said last night. Sir Mervyn King was speaking after the decision by the Bank’s Monetary Policy Committee to put £75billion of newly created money into the economy in a desperate effort to stave off a new credit crisis and a UK recession. Economists said the Bank’s decision to resume its quantitative easing [QE] showed it was increasingly fearful for the economy, and predicted more such moves ahead. Sir Mervyn said the Bank had been driven by growing signs of a global economic disaster. “This is the most serious financial crisis we’ve seen, at least since the 1930s, if not ever. We’re having to deal with very unusual circumstances, but to act calmly to this and to do the right thing.” Announcing its decision, the Bank said that the eurozone debt crisis was creating “severe strains in bank funding markets and financial markets”. Financial experts said the committee’s actions would be a “Titanic” disaster for pensioners, savers and workers approaching retirement. Under QE, the Bank electronically creates new money which it then uses to buy assets such as government bonds, or gilts, from banks. By increasing the demand for gilts, QE pushes down the interest rate yields paid to holders of these and other bonds. Critics of the policy say it pushes up inflation and drives down sterling.

Note: For lots more on the global financial crisis from reliable sources, click here.

Senate panel concludes Goldman Sachs profited from financial crisis
2011-04-14, Los Angeles Times
http://www.latimes.com/business/la-fi-crisis-probe-20110414,0,6709903.story

A Senate panel has concluded that Goldman Sachs Group Inc. profited from the financial crisis by betting billions against the subprime mortgage market, then deceived investors and Congress about the firm's conduct. Some of the findings in the report by the Senate's Permanent Subcommittee on Investigations will be referred to the Justice Department and the Securities and Exchange Commission for possible criminal or civil action, said Sen. Carl Levin (D-Mich.), the panel's chairman. The giant investment bank was just one focus of the subcommittee's probe into Wall Street's role in the financial crisis. The 639-page report — based on internal memos, emails and interviews with employees of financial firms and regulators — casts broad blame, saying the crisis was caused by "conflicts of interest, heedless risk-taking and failures of federal oversight." Among the culprits cited by the panel are Washington Mutual, a major mortgage lender that failed in 2008, as well as the Office of Thrift Supervision, a federal bank regulator, and credit rating firms. Asked if he was disappointed that no Wall Street figures had gone to jail in connection with the crisis, Levin responded, "There's still time."

Note: For many key reports from major media sources illuminating how major financial corporations knowingly brought about the global financial crisis and profited from it, click here.

Mortgage paperwork mess: Next housing shock?
2011-04-01, CBS News 60 Minutes
http://www.cbsnews.com/stories/2011/04/01/60minutes/main20049646.shtml

It's bizarre but, it turns out, Wall Street cut corners when it created those mortgage-backed investments that triggered the financial collapse. Now that banks want to evict people, they're unwinding these exotic investments to find, that often, the legal documents behind the mortgages aren't there. Caught in a jam of their own making, some companies appear to be resorting to forgery and phony paperwork to throw people - down on their luck - out of their homes. This past January in Los Angeles, 37,000 homeowners facing foreclosure showed up to an event to beg their bank for lower payments on their mortgage. In February in Miami, 12,000 people showed up to a similar event. For many that's when the real surprise comes in: these same banks have fouled up all of their own paperwork to a historic degree. There were a million foreclosures last year. And there will be another million this year - those lawsuits are forcing open those bundled, mortgage-backed securities that Wall Street cooked up in the mid 2000s, and exposing a lack of ownership documents all across the country. Banks are defensive because all 50 state attorneys general want to punish them: the states are seeking about $20 billion in damages for what they say is the irresponsible, perhaps criminal way, that some mortgage companies handled what is, for most folks, the most important investment of their lives.

Note: To watch the amazing 14-minute video of this article, click here. Learn how banks paid a company which hired people off the streets to pretend they were bank vice presidents and sign thousands of documents fraudulently. For lots more from reliable sources on the criminal practices of mortgage lenders, click here.

The Michigan Monarchy Legislates Financial Martial Law -- Nation Yawns
2011-03-18, Forbes blog
http://blogs.forbes.com/rickungar/2011/03/18/the-michigan-monarchy-legislates...

This week, the Michigan legislature passed – and the governor signed into law – a bill that would permit Governor Rick Snyder to push aside elected city officials and replace them with emergency financial managers in any municipality or school district facing financial difficulties. The law would include virtually every town and city in the state as those cities that aren’t bankrupt already soon will be once the governor’s proposed budget – which cuts billions in aid to municipalities and school districts – is approved by the legislature. One of the most shocking, Draconian, democracy-destroying measures in the history of this country has became law – and the nation has seemingly slept through it. The new law, described by one of the GOP legislators sponsoring the bill as “financial martial law”, empowers the governor’s appointees [referred to as ‘Emergency Financial Managers’] to fire duly elected local officials, cancel labor contracts and even dissolve entire communities and school districts. This is about so much more than collective bargaining agreements and unions. This law gives an appointee of the governor – which, by the way, may be a corporation – the authority to dismiss any or all of a municipality’s elected government officials.

Note: For a treasure trove of reports by major media sources on the collusion between government and financial powers against the public interest, click here.

Financial meltdown culprits seem too big to jail
2011-03-07, San Francisco Chronicle (San Francisco's leading newspaper)
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/03/06/EDPG1I481K.DTL

What's wrong with this picture: Years have passed since Wall Street's financial meltdown. Due to the crisis, the economy tanked, the mortgage market has yet to recover, and millions of jobs were lost. Many of those jobs losses will be permanent. The only person who went to jail for any of this was Bernie Madoff. When he accepted his Academy Award for the documentary "Inside Job," Berkeley filmmaker Charles Ferguson reminded Americans that the lack of criminal prosecutions for the financial crisis is, simply, "wrong." No matter what kinds of logical, legal explanations that the Justice Department has trotted out to explain why all of these senior financial executives are too big to jail, it's outrageous that there has not been and will not be any comeuppance for the men who plunged the American economy into chaos. The fact that some of these executives have or will receive some financial punishment in civil court is of little consequence - if ruining the economy isn't worth a little jail time, then what is? The Obama administration has not made it a priority to prosecute financial executives. Its reticence to punish was prominently on display last month, when the Justice Department decided not to prosecute Angelo Mozilo, the former CEO of Countrywide Financial. Mozilo left an e-mail trail detailing his feelings about Countrywide's "toxic" mortgage products and negotiated a $67.5 million payout in a civil suit that was brought against him by the Securities and Exchange Commission. If the feds don't go after him, it's unlikely that they'll go after anyone else. It's a bitter contrast to the 1980s savings-and-loan crisis, when the federal government threw enormous resources at criminal prosecutions and sent even well-connected executives, like Charles Keating, to jail.

Note: For other highly revealing major media articles showing just how much control big bankers have over government, click here.

America's favorite bankers have outdone themselves yet again
2011-01-30, CNN
http://finance.fortune.cnn.com/2011/01/30/money-for-nothing-at-goldman/

How might you compensate management for a year in which profits plunged, you spent $550 million of shareholder money to settle a fraud investigation and your stock ended up more or less exactly where it started? You might be tempted to nix raises or withhold bonuses to send a responsible message about linking pay to performance. But if so, you wouldn't be Goldman Sachs. It just had the year described above – and responded by tripling everyone's base salary while boosting bonuses by 40%. Is this a great country or what? Goldman said in a filing [on January 28] that CEO Lloyd Blankfein will make $2 million this year, and his top lieutenants will each make $1.85 million. Top Goldman brass had been making $600,000 annually in salary since the firm's 1999 initial public offering. All 470 of Goldman's partners will get higher salaries. The top five officers will also get $12.6 million each in bonuses. That's up from $9 million each last year. That may seem like a high price to pay for a pretty lousy year – and one that ended with a Fed-inspired reminder that Goldman, just in case anyone forgot, took billions upon billions of dollars in bailout loans in 2008 and 2009.

Note: For key articles from reliable sources detailing the outrageous compensation awarded to the highest officers of Wall Street financial corporations after they were bailed out by the government, click here.

State Budgets: The Day of Reckoning
2010-12-19, CBS News
http://www.cbsnews.com/stories/2010/12/19/60minutes/main7166220.shtml

There is [a] financial crisis looming involving state and local governments. In the two years since the "great recession" wrecked their economies and shriveled their income, the states have collectively spent nearly a half a trillion dollars more than they collected in taxes. There is also a trillion-dollar hole in their public pension funds. The states have been getting by on billions of dollars in federal stimulus funds, but the day of reckoning is at hand. The debt crisis [could] cost a million public employees their jobs and require another big bailout package that no one in Washington wants to talk about. "The most alarming thing about the state issue is the level of complacency," Meredith Whitney, one of the most respected financial analysts on Wall Street. "It has tentacles as wide as anything I've seen. I think next to housing this is the single most important issue in the United States, and certainly the largest threat to the U.S. economy," she [said]. California, which faces a $19 billion budget deficit next year, has a credit rating approaching junk status. It now spends more money on public employee pensions than it does on the state university system, which had to increase its tuition by 32 percent. Arizona is so desperate it sold off the state capitol, Supreme Court building and legislative chambers to a group of investors and now leases the buildings from their new owner. The state also eliminated Medicaid funding for most organ transplants.

Note: For key reports from major media sources on the devastating consequences for Main Street of the criminal bailout of Wall Street, click here.

Brooksley Born foresaw disaster but was silenced
2010-12-05, San Francisco Chronicle (San Francisco's leading newspaper)
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2010/12/05/BUHC1GLHFA.DTL

There's a brief scene in "Inside Job," the locally produced documentary on the Great Financial Meltdown, in which a colleague of the head of the Commodity Futures Trading Commission in 1997 describes how "blood drained from her face" after receiving a phoned-in tongue-lashing from deputy Treasury Secretary Larry Summers. The target of Summers' wrath was Brooksley Born, ... the first female president of the Stanford Law Review and a recognized legal expert in the area of complex financial instruments. Her crime: Born had the temerity to push for regulation of the increasingly wild trading in derivatives, which, as we learned a decade later, helped bring the U.S. economy, and much of the world's, to its knees. Summers, with 13 bankers in his office, told Born to get off it "in a very grueling fashion," said the colleague. The story is told in much more detail in All the Devils are Here, the latest, but eminently worthwhile, book on the roots of the crisis, by Bethany McLean and ... Joe Nocera. It makes for dispiriting, even appalling, reading. Responding to growing evidence of manipulation and fraud in unregulated derivatives trading - "the hippopotamus under the rug," as Born and others referred to it - Born suggested the commission should perhaps be given some sort of oversight. She had a 33-page policy paper drawn up, full of questions and suggestions, like, for example, whether establishing a public exchange for derivatives might not be a bad idea. Responding to the policy paper, Summers, "screaming at her," according to the book, told Born the bankers sitting in his office "threatened to move their derivatives business to London," if she didn't stop.

Note: For key reports on financial fraud from reliable sources, click here.

Senator Bernie Sanders on the War Between the Shrinking Middle Class and the Wealthy
2010-11-30, U.S. Senate Testimony
http://sanders.senate.gov/newsroom/news/?id=c8f26b05-01e7-429f-a5e0-a9a6bd1a0f40

Mr. SANDERS. Mr. President, there is a war going on in this country, and I am not referring to the wars in Iraq or Afghanistan. I am talking about a war being waged by some of the wealthiest and most powerful people in this country against the working families of the United States of America, against the disappearing and shrinking middle class of our country. The reality is, many of the Nation's billionaires are on the warpath. They want more, more, more. Their greed has no end, and apparently there is very little concern for our country or for the people of this country if it gets in the way of the accumulation of more and more wealth and more and more power. The percentage of income going to the top 1 percent has nearly tripled since the 1970s. In the mid-1970s, the top 1 percent earned about 8 percent of all income. In the 1980s, that figure jumped to 14 percent. In the late 1990s, that 1 percent earned about 19 percent. And today, as the middle class collapses, the top 1 percent earns 23 1/2 percent of all income--more than the bottom 50 percent. Today, if you can believe it, the top one-tenth of 1 percent earns about 12 cents of every dollar earned in America.

Note: To see a video of this amazing speech by courageous Senator Bernie Sanders (Independent), click here.

Winning the Class War
2010-11-27, The New York Times
http://www.nytimes.com/2010/11/27/opinion/27herbert.html

The class war that no one wants to talk about continues unabated. Even as millions of out-of-work and otherwise struggling Americans are tightening their belts for the holidays, the nation’s elite are lacing up their dancing shoes and partying like royalty as the millions and billions keep rolling in. Recessions are for the little people, not for the corporate chiefs and the titans of Wall Street who are at the heart of the American aristocracy. They have waged economic warfare against everybody else and are winning big time. The ranks of the poor may be swelling and families forced out of their foreclosed homes may be enduring a nightmarish holiday season, but American companies have just experienced their most profitable quarter ever. The corporate fat cats are becoming alarmingly rotund. Their profits have surged over the past seven quarters at a pace that is among the fastest ever seen, and they can barely contain their glee. On the same day that The Times ran its article about [record corporate] profits, it ran a piece on the front page that carried the headline: “With a Swagger, Wallets Out, Wall Street Dares to Celebrate.” Anyone who thinks there is something beneficial in this vast disconnect between the fortunes of the American elite and those of the struggling masses is just silly. It’s not even good for the elite. The rich may think that the public won’t ever turn against them. But to hold that belief, you have to ignore the turbulent history of the 1930s.

Note: For many reports from reliable souces on corporate profiteering, click here.

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