Google
Archive
Data
« Tutorial - Sliding Split Screen | Main | Bank of America is wrong. »
Tuesday
Oct182011

Occupy Wallstreet, Glass-Steagal and why you care.

What is happening with the Banks?
It complicated but not overly so.
When I was a little kid, my mom would occasionally buy a treat for my little brother and I to share. One of our favorites were Plain M&M’s. I was a bit more crafty then my little brother though. We would open the bag, dump the M&M’s out on the table and count them out one by one so we would split them evenly. I would usually figure out a way to eat the extra one in the even of an odd number of candies in the bag.
Then I would get greedy. I was much more ‘reckless’ with my half, I would always eat my M&M’s faster then Jon would and upon doing so, I would then point out to him that, he had more then me and it “would only be fair” if we were to split them M&M’s… AGAIN!!! Amazingly enough he would fall for it every time. So, since he ate his candies much slower then I did. I would take basically his half and split it again. effectively getting 3/4 of the candies for myself.
This is essentially what is happening with the banks post “bailout”.
Follow with me.
In 1933 a bill was passed called the “Glass-Steagal Act”.

From Wikipedia:
“In the nineteenth and early twentieth centuries, bankers and brokers were sometimes indistinguishable. Then, in the Great Depression after 1929, Congress examined the mixing of the “commercial” and “investment” banking industries that occurred in the 1920s. Hearings revealed conflicts of interest and fraud in some banking institutions’ securities activities. A formidable barrier to the mixing of these activities was then set up by the Glass–Steagall Act.”

So, in essence, they realized something was wrong that caused the Great Depression in 1929 and they made rules to make it safe for the future so another depression would not happen again.
The problem is that in 1999 the Glass-Steagal Act was repealed opening the doors for severe conflicts of interest in the banking communities and the ability for financial institutions to delve into VERY risky business ventures. In other words they had the ability to wolf down their M&M’s in a reckless manner.
Once the banks lost their shirts on the sub-prime lending of the early 21st century they got their buddies in high places to go in front of the American People and say, “Hey, these guys are ‘Too Big to Fail’ and besides they ate all their M&M’s already so its time to divvy up the candies again.”
In the form of OUR TAXES, the government distributed over $700 BILLION dollars thru the TARP or Trouble Asset Relief Program.
Does this make sense? These guys played fast and loose with our money making LAME loans, lost their shirts and then said, “oh, we need your tax dollars to bail us out”.
The worse part of it all is the LONG list of execs that STILL take home HUGE paychecks, benefits and bonuses EVEN THOUGH they essentially drove their companies into the ground. In other words the US government is robbing from the POOR, to give to the RICH.
Yikes!!! what is happening here?

UPDATE: I found this article on the 20th of October, talks about a lot of this.

PrintView Printer Friendly Version

EmailEmail Article to Friend

References (1)

References allow you to track sources for this article, as well as articles that were written in response to this article.
  • Response
    Hi, this essay is despite the small, but rich in content. Reverie verbiage. If you want to see details:http://www.fotodigitaldiscount.de/hollistersde.asp

Reader Comments

There are no comments for this journal entry. To create a new comment, use the form below.

PostPost a New Comment

Enter your information below to add a new comment.

My response is on my own website »
Author Email (optional):
Author URL (optional):
Post:
 
All HTML will be escaped. Hyperlinks will be created for URLs automatically.