A Decade of Armageddon

A Decade of Armageddon

New Geography essays

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A selection of articles and essays written for the New Geographic covering a decade of financial turmoil.

With a foreword from Joel Kotkin, editor of NewGeography.com

These essays by Dr Susanne Trimbath, were first published in New Geography 2008-2015. These have been edited to be read as a free-standing publication, grouped together into the following chapters:

1.    Bailouts

Why there were bailouts in 2008-9 for Wall Street and not for Main Street? This chapter includes articles on who got the money and how the true cost, which was to be borne by US taxpayers, was hard to calculate and often purposefully hidden from public view.

2.    Congressional Hearings and Legislation

Once the full-blown global financial crisis hit, the response included tens of thousands of pages of new rules, regulations and regulators in the space of about three years. Also, the US government assumed ownership and operation of AIG. This was the first “taking” since 1989 and was followed by Washington Mutual in September 2008 and W Holding’s Westernbank in April 2010.

3.    Homeowners and Mortgages

The housing market, in the years leading up to the financial crisis and the Great Recession, had been treated like gold – not that “houses are as good as gold” but that people were treating houses AS IF they were an investment and not a place to live.

4.    Federal Reserve and Treasury Actions

In 2009, Treasury Secretary Timothy Geithner presented a proposal for legislation that would give the secretary the authority to make the final determination that a financial institution on the verge of default – regulation by revolution. Geithner’s proposal would let the federal government nationalize a ‘too big to fail’ company.

5.    Bank/Broker Behavior

The actions of financial industry professionals led to the financial crisis that developed into the Great Recession. Criminal charges were brought against those who cheated their way into getting a share of the bailout money, but many of those responsible for creating the situation were paid elaborate bonuses at the same time their financial institutions were receiving bailout funds.

6.    Systemic Issues

This chapter on Systemic Issues goes into detail about topics that are widely misunderstood by the non-financial public: financial innovations were supposed to democratize capital by making it easier to fund less-popular projects, both public and private. Like many inventions, it was abused for the enrichment of a few.

7.    Public Reaction

Public reaction in the United States to the revelations of the Wall Street bailout was subdued. A Landmark Narrative developed and was generally accepted by Americans: people bought houses they couldn’t afford by using adjustable-rate mortgages, no-money-down and other schemes offered by banks. When the favorable terms ran out those homebuyers stopped paying their mortgages; they caused their mortgage bank to slide toward bankruptcy, and caused all those “sliced-and-diced” mortgage-backed bonds to fail, too.

My wish is that I have opened your eyes to the false utopia being offered by Wall Street and the businesses and governments they support. Dr Susanne Trimbath

Foreword. 6

Introduction. 7

  1. Bailouts. 8

SHOULD WE BAILOUT GEITHNER TOO?. 8

THE BAILOUTS PAYMENTS MOUNT, THE BUDGET EXPANDS, THE DEFICIT WIDENS, THE NATIONAL DEBT INCREASES. HOW HIGH IS UP?. 12

DIGGING INTO AIG BONUSES AND OTHER AID RECIPIENTS. 13

THE CONTINUING DEBATE ON AIG.. 15

LAYOUT FOR THE BAILOUT: $3.8 TRILLION AND COUNTING.. 16

MORTGAGE-BACKED SECURITIES: 1/3 NOT BACKED! 17

WHO’S WATCHING AIG?. 18

$12.8 TRILLION COMMITTED TO BAILOUT. 19

NO BAILOUT OF SMALL BUSINESSES. 21

BAILOUT SUCCESS!! 22

FOLLOW THE MONEY: SPECIAL INSPECTOR GENERAL FOR THE BAILOUT. 24

MORE MONEY FOR BAILOUT CEOS. 27

SUPPRESSING THE NEWS: THE REAL COST OF THE WALL STREET BAILOUT. 29

  1. Congressional Hearings and Legislation. 33

THIS PERP WALK NEEDS HANDCUFFS. 33

FINANCIAL REFORM OR CON GAME?. 36

DEBT CEILING OR SPENDING LIMIT?. 39

THIS IS YOUR GOVERNMENT ON CRACK.. 40

OUR FEDERAL GOVERNMENT: “THERE YOU GO AGAIN!”. 44

LOBBYING PAYS OFF 500-TO-1. 45

  1. Homeowners and Mortgages. 47

SURPRISE! FOR FISCALLY RESPONSIBLE, HOUSING REMAINS GOOD AS GOLD.. 47

A HOUSING BOOM, BUT FOR WHOM?. 52

RESPONSIBLE HOME BUYERS, WHY BE FRUGAL?. 58

HOUSING BAIL OUT PART DEUX: JUST ANOTHER FINANCIAL CON JOB. 60

WHY HOMEOWNERSHIP IS FALLING – DESPITE LOWER PRICES: LOOK TO THE JOB MARKET. 62

WANT TO FORECLOSE? SHOW ME THE PAPER! 64

MANY INVESTORS HAVE MORE TO GAIN BY LETTING YOUR MORTGAGE OR COMPANY FAIL. 65

ONE HOMEOWNER, TWO MORTGAGE HOLDERS, NO LIEN! 66

  1. Federal Reserve and Treasury Actions. 68

FOOL ME ONCE, GEITHNER, SHAME ON YOU, FOOL ME TWICE... 68

BERNANKE: JUNKMEISTER HIDES THE TRUTH.. 71

JUNK BY ANY OTHER NAME WOULD SMELL. 73

GEITHNER IS WALL STREET’S LAPDOG.. 75

GEITHNER’S REFORMS: MORE POWER TO THE CENTER MAY APPEAL TO EUROPEANS, BUT WON’T WORK FOR US. 76

GEITHNER’S TOXIC RECYCLING PLAN NIXED BY BIG FUND.. 79

THE ROGUE TREASURY.. 80

GEITHNER’S COLLUSIVE CAPITALISM... 82

BERNANKE: FOR GOOD OR FOR ILL. 83

BUFFETT AND PAULSON: PART OF THE PROBLEM... 84

CATCHING UP TO THE FED.. 87

  1. Bank/Broker Behavior. 89

BLAME WALL STREET’S PHANTOM BONDS FOR THE CREDIT CRISIS. 89

THE PLEASURE OF THEIR COMPANY.. 94

STORY OF THE FINANCIAL CRISIS: BURNIN’ DOWN THE HOUSE WITH GOOD INTENTIONS AND LOTS OF GREED.. 96

BURNIN’ DOWN THE HOUSE! PART TWO: WALL STREET HAS A WEENIE ROAST WITH YOUR 401K.. 98

TARP CRIMINAL CHARGES POSSIBLE. 100

HOW SOON WE FORGET: WALL STREET WAGES. 101

BETTING AGAINST THE USA – TOLD YA’ SO! 102

BROTHER RABBIT’S BONUSES. 103

HONEST SERVICES FROM BANKERS? INCREASINGLY NOT LIKELY.. 104

GOLDMAN’S GUNSLINGERS: 401K + 9MM = 666?. 108

RANDOM WALL STREET WALKING.. 109

GOLDMAN’S FAILURE TO DISCLOSE. 110

GOLDMAN PROFITED FROM CRISIS – SHOCKING! 111

  1. Systemic Issues. 113

FINANCIAL INNOVATION: WALL STREET’S FALSE UTOPIA.. 113

SOLVING THE FINANCIAL CRISIS: LOOKING BEYOND SIMPLE SOLUTIONS. 115

PHANTOM BONDS UPDATE: THE NEW TREASURY BOND OWNER’S MANUAL. 118

WE SNEEZED, THEY GOT PNEUMONIA.. 121

WE NEED A NEW ORACLE. 122

US BUFFETT UPDATE: DOWNGRADE FROM ORACLE TO SEER?. 124

BUFFETT’S PARTNER AGREES WITH US. 125

OH, CANADA? A SAFE-HAVEN FOR BANKING INVESTMENTS. 126

THE NEXT GLOBAL FINANCIAL CRISIS: PUBLIC DEBT. 127

DUBAI DEBT DEBACLE. 131

OVER-CHARGED AND UNDER-STIMULATED.. 132

FINANCIAL CRISIS: TOO LATE TO CHANGE?. 133

THE FINANCIAL CRISIS CONTINUES TO BE AN INSIDE JOB. 135

THE NEXT PUBLIC DEBT CRISIS HAS ARRIVED.. 137

THE SWAPS OF DAMOCLES. 141

HIGH FREQUENCY TRADING IS NOT FAST ENOUGH.. 145

10 STEPS TO FINANCIAL SYSTEM STABILITY: LESSONS NOT LEARNED.. 146

A LEAKY ECONOMY.. 152

THE INCOMPETENCE HYPOTHESIS TO EXPLAIN THE GREAT RECESSION.. 156

  1. Public Reaction. 160

MCCLATCHY-MEDILL: REAL $TIMULATING NEWS. 160

OCCUPY WALL STREET: ABOUT D@%& TIME! 162

  1. Epilogue. 166

Appendix. 167

  1. 167
  2. 169
  3. 171
  4. 174
Imprint
Spiramus Press
Publisher
Spiramus Press
Language
English
Product Format
Paperback
Dimensions
234 x 156
Publication Date
Dec 4, 2023
Number of Pages
196
ISBN
9781910151587
Product Format
Hardback
Dimensions
234 x 156
Publication Date
Nov 1, 2023
Number of Pages
196
ISBN
9781913507619