Exposed: Bernanke’s “Skimming Operation”

(So what the banks did in a sense was, they carefully removed restrictions on housing loans and created what the industry called “liar loans”, loans that they knew would default when they were making them. They got their co-conspirator at the credit rating agencies to slap “AAA” ratings on them.  They got their money up front and then packaged them up and sold them as bundles, making even more money on the toxic assets that only they knew were toxic. They sold them to various 401 ks, state and local governments, other nations. Then, as they started to default and the massive bubble began to burst, they rushed to congress, with the same people who helped create this scam, namely Bernanke and Paulson and Geithner, to blackmail congress into pumping nearly a trillion dollars of liquidity into their banks so they could then buy up all the other institutions that they had sold the bad debts to. They got paid on the front end, in the middle, and on the back end.)

by Mike Whitney, Information Clearing House

The reappointment of Fed chairman Ben Bernanke means that the opportunity for change has passed and the reform movement is dead. It means that and that derivatives trading, off-balance sheet operations, securitization, dark pools and high frequency trading will go on much as they have before. It means that the public will continue to be gouged so that a handful of Wall Street sharpies can rake in obscene profits using complex “financial innovations” and over-leveraged debt instruments. It means that the entire system will continue to be put at risk to protect the interests of investment banks and hedge funds. It means that the subsidies, the preferential treatment, and the bailouts will continue to fuel populist rage and exacerbate deepening divisions in society. It means that the status quo has been preserved and that it’s “business as usual”.

  No reform movement will succeed as long as Bernanke is at the Fed.  He’s an agent of the big banks and a Wall Street loyalist. He’s also the author of “Too Big To Fail”, the controversial theory which provides unlimited state support for financial institutions that are deemed too large or interconnected to fail. TBTF means that capitalism’s vital market-clearing function can avoided if one is rich or powerful enough. Bernanke repealed capitalism to save his friends.

The Crisis Is Not Over

by Paul Craig Roberts, Information Clearing House

Readers ask if the financial crisis is over, if the recovery is for real and, if not, what are Americans’ prospects. The short answer is that the financial crisis is not over, the recovery is not real, and the U.S. faces a far worse crisis than the financial one. Here is the situation as I understand it:

The global crisis is understood as a banking crisis brought on by the mindless deregulation of the U.S. financial arena. Investment banks leveraged assets to highly irresponsible levels, issued questionable financial instruments with fraudulent investment grade ratings, and issued the instruments through direct sales to customers rather than through markets.