Larry Summers Is Full Of It

American Scofflaw
Treasury Secretary Henry Paulson blew it, Ben Bernancke blew it and now it looks like Lawrence Summers and David Axelrod, Obama's top economic advisers, are about to blow it big time. The horse is long since dead but the flogging continues.

“The focus isn’t going to be on the needs of banks; it’s going to be on the needs of the economy for credit,” Lawrence Summers on Face the nation, 19th January. In the same segment, both he and David Axelrod agree that Paulson's use of the first $350 Billion of the TARP money was a failure..

"The point is to get credit flowing again to businesses and families across the country -- that hasn’t happened with the expenditure of the first $350 billion"

The proposal ? Set up an "aggregator" or " Bad" bank in to which Wall St. can pour it's toxic waste or keep it on their balance sheets while being guaranteed by the taxpayer. Looks like the focus is going to be on the banks after all. The fact that the banks would be unloading more than a trillion dollars in worthless junk, paid for by the taxpayer, does not seem to Summers and Axelrod as a particularly bad idea.

Tax Scofflaw Geithner Update

American Scofflaw
Remember, don't try this yourself on April 15th, 2009

My Fascist economy

American Scofflaw

It's is NOT "The Government's Money", it is YOUR money and when the bailout was ramrodded through Congress, we were all told that the money was to be used to buy up defaulted mortgages so that we could go back to buying homes.

Then we find out that the money, YOUR money, $700 billion of it, is being given to the banks and they can pretty much do whatever they want with it. Which means that loans to We The People, who were forced to cough up $700 billion (that is $1700 per household, BTW) will not see any benefit from this bailout after all. The banks are holding onto the money.

Folks, we have been HAD. While the DOW is down today, it is not down consistent with the massive liquidations required to cover $360 billion in Lehman Brothers credit defaults. So, what must be happening is that the $700 billion of YOUR money handed to the banks is being used to cover these losses.

In other words, Wall Street made a killing in the bull market with derivatives, and now that the market has turned bear, We The People get the losses.

When profits remain private, but losses are socialized, THAT is a fascist economy!