Spector of 2008 haunts Big Bracket Banks

Stock markets are reacting badly, witnessing large decline in equities. And this drop cannot be blamed on the financial woes of the European Union and the Euro. Look at the banks, especially the US bank!

These ‘too big to fail’ banks are reaping the economic debacle they sown. George W. Bush’s TARP programme lavished billions on them without any accounting of monies received.

A good example of greed is Goldman Sachs’ getting at 100 percent of a dollar on us$13 billion AIG owed them. This reimbursement highlighted that the big bracket houses who diddled with subprime mortgage and did fancy footwork with complex financial instruments they themselves understood, refused to write down bad loans on their books. Instead they carried them with full values which defied fiscal commonsense but spoke to the logic of greed.

The economic recession they engendered has come back to haunt them in spite of the fact they are sitting on a golden egg of multibillions in cash in vaults without any productive use. Not only that they resorted to illegal means to repossess houses, and for the good part, getting away with it.

Any move to regulate bad behaviour is fiercely resisted through forceful lobbying venal Congress members who will sell souls of their for reelection. As a result of short sightedness, the financial industry is reeling with billions disappearing as their equity on the world’s bourses evaporate with a flick of the wrist.

Is it worth wondering whether these wunderkindern of the country’s ‘best and brightest’ can read a spreadsheet? Can they do anything right for the commonweal?

Little do they care, it seems, other than living high on the hog as the ordinary American feel severely the economic pinch and the pain of being déclassé. We are witnessing the formulation of a political and financial mix which favours extremism and ultimately terrorism. One only has to look at the tawdry slate of Republicans vying for the Elephant party’s nod to occupy the White House.