The HSBC money laundering settlement is a classic example of this. The LIBOR scandal is probably another great example.
The LIBOR rigging scandal is very deep, and it affected millions and millions of people. This was not just a few traders getting together and manipulating the second most important interest rate benchmark in the world. It wasn’t even just a few banks. It was pervasive, and it appears even condoned by regulators.
Often big business is both. In a modern interventionist state such as we have, sometimes big business prospers due to the legitimate satisfaction of the market. Sometimes it prospers thanks to friends in high places illegitimately.
Large scale Rent seeking and good economies are not often bedfellows
Much has been made of an uptick in housing. It seems that after 4 long years many people are just ready to move. Real estate may be thawing, but 40% of homeowners are still holding back the market and likely will remain a drag for a good while. They are the low and no equity homeowners.
“In short, TBTF is FUBAR.”
How does one deal with too these giant banks? It is believed widely that if one of the big banks were to implode the whole world might also collapse into a debt chain reaction ending in a monetary singularity.
“Central banking has become the new central planning.”
The crony capitalist conduit has been established. If your corporation wants to influence the direction of policy, this is the place to do it, anonymously. If you want to be a part of the President’s effort, just drop a check into this designated box. Tax free of course.
“A sick joke on all of us.”
The case of the Motel Caswell. The government says that some people sold drugs out of the place, as such they have the right to take the property, and the wealth amassed by the owners, forcibly. The owners have no criminal record.
All too true. Big corporations have deep pockets to both deal with regulation and also to mitigate regs specific to that business. Small business, the bread and butter of the American economy, has no such luxury.
In the attached article Caroline Baum at Bloomberg tries to come to terms with the Federal Reserve’s unprecedented period of ultra-low interest rates. This is the way it’s going to be she says, and we had better get used to it. The Fed has.
Jamie Dimon in Davos Switzerland today explaining why people don’t need to know what’s going on in the banking world. It’s too “complex.” Just know that their fee comes from managing this ball of financial confusion. And that’s all you need to know.
In this excellent report from Drew Griffin at CNN, we learn of Jo Anne Emerson’s plan to leave her position as a Congresswoman to take a promotion as head of The National Rural Electrical Cooperative Association. There it is estimated she will make 10 times what she made as a member of Congress.