I just read a terrific article on Fortune by Allan Sloan called The Escape of the Enablers. It justifiably calls out the big Wall Street banks who claim that markets solve everything, until they run into trouble and go begging to the government for handouts. How ridiculous is it that big banks and investment houses need the Federal Reserve to bail them out? Aren’t they supposed to employ the smartest, the most intelligent, the most capitalistic of people? Please.
This embroglio, like all the others lays bare the farce. The companies make money by developing simplistic, yet sophisticated sounding schemes, and then running them, running them, running them into the ground until they beach themselves. Look at the subprime mess. They took a bunch of sub-prime loans, guzzied up the packaging, and sold them as A credit investments. People bought the jig because they believed the banks knew what they were doing. Hedge funds bought. Everyone bought.
What really peeves me is that these same banks will turn down a request from you and me to refinance the terms of our mortgages but ask the government, with out tax dollars, to help keep their operations afloat. Sloan calls this the “to big to fail” syndrome.
Maybe so. But if these big buys who went crying to Momma get big bonuses, then I’m going to get really mad – and you’ll all hear about it.
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Related Articles:
Judges on the Front Line of Punishing Wall Street by Sam Cass - Sep 08, 2009
Behind Geithner's Blunder by DanS - Feb 11, 2009
Goldman Sachs Fleecing of America by Sam Cass - Jul 22, 2009.
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