Category Archives: Ben Bernanke
Not like Superman of course, more like Bush43. Oh, and Benny Bernanke wants them too! From the NYT article on the subject:
The Federal Reserve Chairman, Ben S. Bernanke, agreed with Mr. Geithner that Congress should grant the Treasury Department and Federal Reserve new powers. Mr. Bernanke told members of the House Financial Services Committee that if the government had had such authority in September, when the depth of A.I.G.’s troubles became obvious, the company could have been put into receivership or conservatorship and regulators would have been able to “unwind it slowly, protect policyholders” and take other prudent measures.
We have foxes in charge of the financial hen house now…why would we want to give them more power?
The Glass-Steagall act and the 1956 Bank Holding Company Act were rolled back by greedy Phil Gramm and his cohorts when they created the Financial Services Modernization Act, which was signed into law by Bill Clinton. We need to re-institute them and make them stronger. We don’t need a Financial Czar like Bernanke or Geithner.
Absolute power corrupts.
Timmy G looked a little pissed off at all the grilling he was getting.
Bennie Bernanke got down right hostile at one point. From the WaPo link above:
Earlier, Bernanke came the closest that anyone is likely to see to flashing public anger when responding to some hounding from Rep. Donald Manzullo (R-Ill.), who was demanding a “simple yes or no” from Bernanke, Treasury Secretary Tim Geithner and N.Y. Fed President Bill Dudley on a complicated matter.
“Not one of you three can give me a yes or no?” Manzullo thundered.
“That’s because it’s a poorly posed question,” Bernanke zinged back. Naturally, Bernanke’s facial expression remained unchanged.
The members of the committee, especially Maxine Waters, were not in a happy place today. They looked and sounded highly pissed off. Ms Waters is a democrat, but that didn’t stop her from going off on Geithner.
You can read Bernanke’s opening statement here.
Oh, and I finally got Sirens Chronicles back to normal, graphics and all. Happy Happy Joy Joy! 😉 I am checking on strengthening the security on the site.
I am really tired of this subject. AIG was not the only financial company to reward failure. Lehman Bros did too. Hell, I would be willing to bet all if not most of the banks and financial houses did prior to putting their hand out for that corporate welfare check.
Timmy Geithner needs to set the record straight on what he knew and when. Chris Dodd needs to name the ‘administration official’ that told him to change the language in the stimulus bill from wiping out all bonuses to letting a few of them slide through.
So what did the folks in the House of Reps do today? Why they passed a bill that smells totally illegal and unconstitutional..it taxes anyone that received a bonus or will receive a bonus…to the tune of a 90% tax rate. Retroactive legislation is rarely legal…they should know that. It was pure unadulterated theater folks! From CNN:
The measure would tax individuals on any bonuses received in 2009 from companies getting $5 billion or more in money from the Troubled Asset Relief Program, or TARP. Bonuses for people with incomes over $250,000 would be taxed at a 90 percent rate.
Yes we are outraged…but I think we are pissed at the wrong people…Timmy G and Benny Bernanke should be higher on our shit list than the folks that took the bonuses their companies were contractually obligated to pay.
Timmy has been on the side of the carpetbaggers since day one. Five bucks says he is the one that told Dodd to remove the section prohibiting bonuses.
And Bernanke knew about these fucking bonuses for months and never informed anyone in the new administration? WTF dude? He just moved up my shit list too.
Friggin carpetbaggers, and their friends in high places…kiss my brown ass. I hope all your names are released publically and you are shamed into returning those bonuses.
As for Benny and Timmy..they need to resign their posts…but they won’t. Obama can fire Timmy, but not Bernanke.
Last night, Ben Bernanke, the Federal Reserve Chairman, did an extended interview with 60 Minutes. This is news unto itself as the Fed Chair never does interviews. He spent his time defending the bank bailout, which should be expected. The section regarding AIG, is below:
(PELLEY ) There have now been four rescues of AIG, for about $160 billion. Why is that necessary?
(BERNANKE) Let me just first say that- of all the events and all of the things we’ve done in the last 18 months, the- the single one that makes me the angriest, that gives me the most angst, is the intervention with AIG. Here was a company that made all kinds of unconscionable bets. Then, when those bets went wrong, they had a- we had a situation where the failure of that company would have brought down the financial system.
(PELLEY) You say it makes you angry? What do you mean by that?
(BERNANKE) It makes me angry. I slammed the phone more than a few times on discussing AIG. It’s- it’s just absolutely- I understand why the American people are angry. It’s absolutely unfair that taxpayer dollars are going to prop up a company that made these terrible bets- that was operating out of the sight of regulators, but which we have no choice but the stabilize, or else risk enormous impact, not just in the financial system, but on the whole U.S. economy.
Notice he uses the word “bet”. The Stock Market is legalized gambling at its best. Why then, would we continue to shore up these gamblers? According to Bernanke, if we don’t, Armageddon could be on the horizon. Below is his analogy:
(PELLEY) You know, Mr. Chairman, there are so many people outside this
building, across this country, who say, “To hell with them. They made bad bets. the wages of failure on Wall Street should be failure.”
(BERNANKE) Let me give you an analogy, if I might. If you have a neighbor, who smokes in bed. And he’s a risk to everybody. If suppose he sets fire to his- to his house, and you might say to yourself, you know, “I’m not going to call the fire department. Let his house burn down. It’s fine with me.” But then, of course, but what if your house is made of wood? And it’s right next door to his house? What if the whole town is made of wood? Well, I think we’d all agree that the right thing to do is put out that fire first, and then say, “What punishment is appropriate? How should we change the fire code? What needs to be done to make sure this doesn’t happen in the future? How
can we fire proof our houses?” That’s where we are now. We’re having-
we have a fire going on.
(PELLEY) It’s still burning.
(BERNANKE) It’s still burning
The biggest surprise for me was that the Federal Reserve doesn’t use tax payers money…it simply prints more. From the transcript:
(PELLEY) Is that tax money that the Fed is spending?
(BERNANKE) It’s not tax money. the banks have- accounts with the Fed, much the same way that you have an account in a commercial bank. So, to lend to a bank, we simply use the computer to mark up the size of the account that they have with the Fed. so it’s much more akin to printing money than it is to borrowing.
(PELLEY ) You’ve been printing money?
(BERNANKE) Well, effectively. And we need to do that, because our economy is very weak and inflation is very low. when the economy begins to recover, that will be the time that we need to unwind those programs, raise interest rates, reduce the money supply, and make sure that we have a recovery that does not involve inflation.
It all sounds like a dangerous game, where no one is sure of the consequences.Printing money creates inflation doesn’t it? Didn’t I learn that in college?
Didn’t we learn anything from the Great Depression? How does Bernanke think we can fix the financial industry so this kind of crap doesn’t happen again?
(PELLEY ) There was a panic in 1907. So, the Fed was created to prevent that from ever happening again. And then we got the Great Depression. And now we have this. How do we prevent this from occurring another time?
(BERNANKE) well, tougher regulation of large firms. It includes having a set of laws that allows us to wind down. A large, internationally active firm, without the adverse impacts on the markets that a disorderly bankruptcy would have. It includes possibly having a systemic regulator. A- regulator that has some responsibility to look at the system as a whole.
Wait a friggin minute, we had laws and regulations in place to watchdog the financial industry On Bill Clinton’s watch, the Republican-led Congress passed deregulation bills a plenty. Congress neutered that watchdog folks. The Glass-Steagall Act was trashed.
So, my original question remains. Is Bernanke a friend to the little guy or just a supporter of the financial industry that caused this catastrophe? Is he blowing smoke up our collective asses in this interview?
I don’t know..but he doesn’t make me feel warm and fuzzy. How about you?