Save the poor wealthy investment banks!

March 14, 2008 at 9:02 am (Inflation)

To follow up on the last post, here are some articles surmising why the recent $280 billion Fed bailout was geared towards keeping a large investment bank from going belly up.

Ultimately, the Fed has its reasons to bail out an institution that makes its profits by speculation and enriching the already rich, by indirect collection and fleecing of the rest of us underlings, but I guarantee its reasons have nothing to do with the prosperity of you or me. Arguably, an investment bank is one of the most parasitic of all businesses, and yet it’s first in line to get a bailout by the Fed with your tax dollars and mine. Why? Why should any businesses be bailed out, much less ones that don’t create useful things, such as food or energy?

Bush chimed in with, “It was a strong action by the Fed and they did so because some financial institutions that borrowed money to buy securities in the housing industry must now repair their balance sheets before they can make further loans.” Uh….? Poor bank can’t make loans, so sad. They were teetering on the brink of collapse due to poor management or greed or whatever, and instead of letting Capitalism work, the Fed just decided to use our money to give them a free ride. I don’t care if they can make more loans. Too bad if they collapse. Good riddance, bye!

Here is a great video where Jim Rogers says simply the Federal Reserve should be abolished. He’s got common sense answers to common sense questions but of course everyone smirks when he says the obvious. Buckle up, this is going to be a strange ride.

Today’s article of doom: “You have to go back to the banking crisis of the Great Depression to find a moment when the financial system as a whole seemed so close to the precipice.”

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