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Tag Archives: banks

Pathetic Spin from Goldman Sachs

Goldman played the American people and continues to play the American people. It has alums placed all through the US government and in the EU. The reason sorry old Greece got into the European Union was because of some Goldman sleight of hand. So to some degree that particular corner of the ongoing financial crisis is Goldman’s fault.

Goldman Sachs should be no more. In 2008 it should have died. Kaput. Done. But instead Bush Treasury Secretary Hank Paulson, a former Goldman CEO, made sure that the firm which was leveraged to insane levels lived. Why did it live? Because it was connected.

Government Sachs.

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The Federal Reserve is Not Your Friend

Regular readers of ACC already know this both because we often make the case against the Fed but also because, in our opinion our readers are just a particularly smart bunch. But that the Fed is no friend is a point which deserves to be made often.

The Fed is not on your side. It is on the side of the big banks. Always keep this in mind. In most cases Yellen and Company really couldn’t care less about you or me. But they care quite a lot about Goldman, and JPMorgan, and Citibank.

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“We’re really worried about a global meltdown”: S&P erases gains for year as stocks plunge 2% on Fed, growth concerns (Video)

I like Art Cashin. I used to read his UBS column and it was always full of great stories about the old days, even from before he came on the scene. I learned some interesting stuff from this guy. I can still picture in my mind’s eye him wearing his “Dow 10,000″ hat in 2008. (The joke being that he got the hat when the Dow was moving up and not crashing down like it was in 2008.)

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Hundreds of thousands in street in Brazil, call for the impeachment of crony president, South American socialism continues to die (Video)

These protests are a massive reaction against a deeply crony and socialist government in Brazil. The economy is failing. The “Bolivarian” movement in South America embodied by the now dead Hugo Chavez is imploding. Wherever the statist cancer has spread, Venezuela, Brazil, Argentina, Bolivia, Ecuador, even Chile it has brought with it economic dysfunction. And that is saying something as this IS South America we are talking about.

But the anger exhibited above and below is not simply some Brazilian or South American phenomenon. The sentiment embodied in the streets of Sao Paulo, Rio, and Brasilia this week runs through the world. And it is increasing as middle class people are becoming more aware of the inner workings of their governments.

As the world economy continues to sputter (sputtering would be good) we will see more of this sort of thing in other parts of the globe. People are much better educated on political matters these days thanks to the Internet. They are sick of being abused. The veil of government has been lifted a bit and people, Brazilian, American, Chinese, European, Indian, do not like what they see.

These protesters don’t want bread (at least not now, and let’s hope that doesn’t ever become a concern) they want respect and transparency. It is their money that their government is giving away to the crony class.

Sounds familiar.

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‘Ghost bank’ spooks Chinese savers

OK. So you go to the 1st Bank of Bankertown or whatever. You deposit a check. Take a little cash out. But you wake the next day to find – surprise – the 1st Bank of Bankertown isn’t actually a bank at all. Granted some would argue that banks aren’t really “banks” at all anyway in the Fed system. But you get the point.

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The Great Malinvestment in China (and America), and the pleasure and pain of monetary tequila

Cheap money feels good initially. Nearly everyone is happy when central banks open the floodgates (or helicopter doors) and cash spills into the economy. Hooray! Money! Why is it here now instead of yesterday? Who knows? Get while the getting’s good. Look, the stock market’s rising – whoopee! Monetary tequila. Bottoms up!

But the morning, the aching, head thumping morning always comes after such a binge.

“All I know is Ben Bernanke was tending bar. Goldman Sachs was buying me drinks. Everyone was having a great time. (Except those teetotalers the Austrian economists sitting in the back. They’re never any fun.) But everything after that is hazy. Where am I?”

“Son, you’re smack dab in the middle of an economic depression.”

“Oh man, really? Who are you?”

“I’m the Austrian economist who was sitting in the back of the bar. Get your hat. I’ll drive you home Mr. Keynes.”

“No, no. What I need – what we all need is more tequila.

“Suit yourself.” Said the Austrian economist as he walked out level headed and sober into the blinding summer sun.

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Reefer madness at the Federal Reserve

Seriously, what is wrong with these people?  Our American principal of federalism allows states to go their own way on drugs. The 10th Amendment makes that pretty clear, and the old “affecting” interstate commerce bit is tripe. (Though the New Deal was built around this nonsense.)

The Feds and in this case the FED are afraid of devolution of power away from Washington fundamentally. That’s it.

Let these businesses do business. Coloradans want this type of business. It’s in their state. Leave them alone.

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Robert Reich: A revolt is taking place against the “ruling class” (He’s right on this, Wrong on most everything else)

Mr Reich generally needs to be taken with a grain of salt. He has been, and as far as I know, continues to be fundamentally wrong on the most important economic questions. Saying that, he has flashes of insight on political issues, and here’s one.

Of course we issue the standard disclaimers with this piece that we do with many of the folks we choose to feature here who we feel are too enamored with the state.

That he still can’t grasp (or is frankly willing to admit) that for the most part this country should thank its lucky stars for the TEA Party and the mini-revolt of 2009 is a big flaw in his argument. Another one is that he says that the TEA Party promoted “outright racism.” (I almost didn’t run his piece because of this chunk of baloney. A few memes promoted in the Huffington Post don’t count. I was there. I never saw it. Ever. I’m betting Reich didn’t attend many rallies.)

And yet another myth he promotes is the idea of some kind of post-World War 2 golden age of government. That is just a flat out misunderstanding of the situation.

He says,

In 1964, Americans agreed by 64% to 29% that government was run for the benefit of all the people. By 2012, the response had reversed, with voters saying by 79% to 19% that government was “run by a few big interests looking after themselves.”

This may be true but this is because before the information revolution the average person didn’t understand how the game, the government game, was played. It is, and has always been played for powerful interests. It’s just that we know it now. It was because Americans were basically ignorant (through no fault of their own) that 64% of people thought government was run for the benefit of the people.

They may have THOUGHT it was. But it wasn’t.

We woke up. Mr. Reich hasn’t. At least on this very important point.

So why run his piece?

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Democracy & capitalism’s enemy: the Ex-Im Bank

This is a long fight and getting rid of the Export-Import Bank is just the beginning. A battle in a larger war to reduce the size and scope of government and to reduce the power of the current crony capitalist system. It will be a slog. Blood will be lost. But make sure most of the blood comes from the cronies and not from those who strive for a reasonably honest government and economy.

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No question that “low interest rates have exacerbated the wealth gap between the poor and the rich because the rich have assets.”

Michael Bloomberg said this recently and he is right. If one had assets prior to 2008, particularly of the stock variety, there is a very good chance that your portfolio is looking pretty good these days. The Fed through various means has inflated markets artificially.

If however one had no assets prior to 2008, or went bust during the chaos of the Crash one is probably still struggling.

The Fed, the central planners, have made the rich much richer. (For the time being.) It wasn’t free market capitalism which did this.

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