Some Will Rob You With A Pen

Joe:
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Rather than a list of the lunches, dinners, and social events Geithner has had with the other bigwigs, wouldn't it have been more productive to produce documentation showing what his opeinions are and what those opinions mean, if they are not clear.
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Social events are a symptom of swimming in dirty water. Everyone in Washington must swim in it. That's fluffy cloud stuff, vapor, flash, or even, fartbubbles, if you will.
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What I want to know is what does Geithner think?

Joe-There was massive fraud going on. As long as we have this fear of actually looking into who committed it things are never going to change. All that's happen was predicted the one major problem though the ones doing the predicting are never taken seriously.
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Instead, first we listen to people who tell us there is no problem, nothing to worry about. Those people are taken seriously. Then we listen to people who tell us the banks are too big to fail. Those people are taken seriously. Then we listen to those who tell us the government can't take over the banks. Those people are taken seriously. Those who speak otherwise are branded as kooks.

I just listen to David Schuster do a segment on torture. He led the segment with a poll that showed 48% of the American public thought tourture was acceptable in certain circumstances. Didn't explain what those circumstances were and completely ignored the 49% that disagreed with torture. Or the fact that opinion polls are meaningless when you are talking about a crime. Then him and his 2 guests spent the rest of the segment discussing if Dick Cheney should be vindicated and if more torture memos should be released.
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The fun part was though when he led into the next segment he said they were going to discuss if Obama is living up to his pledge to be more transparent and on that subject they were going to separate fact from fiction. Unreal.

At least we know there are 5 U.S. Reps that stand for something. They just got arrested for protesting Darfur.

This is off topic but Joe I was wondering what you think about Juan Cole's assessment of Pakistan.
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http://www.juancole.com/2009/04/readers-have-written-me-asking-what-i.html
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It seems to be a lot different from the going narrative from the MSM folks

Post title's reference to "The Ballad of Pretty Boy Floyd" FTW (not to polish the apple too much, but noobs should know that Joe authored a biography of Woody Guthrie, with a blurb from no less than Bruce Springsteen on the back cover).

Perhaps, Krugman serves the purpose that banks should heed. If they continue to try to emasculate this presidency they may very well find themselves out of power completely, especially when their actions are seen as attempts to financially benefits from the injuries they have caused.
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Frankly, I see how they got themselves into this mess in the first place. Just as they lacked the social acuity to understand that a total destruction of all regulation would unleash an unbridled greed with the ability to destroy the economy, once again they lack the social acuity to recognize that are failing to take any steps inoculate themselves against the populist backlash that is surely to come.

Umm, Joe . . . did all of this, like just dawn on you this morning?
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"This is going to be one of the most important battles of the Obama Administration"
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Really? Do tell!

Obama frankly needs to treat Wall Street as what it is: a hostile force. It's not hyperbole to say the latter has effectively been just that to our people. We've gone from Enron almost singlehandedly sending California into an energy and fiscal crisis lasting years (something Al Queda wished it could do) to today's current devastation (again something Al Queda wished it could do). Obviously they are dangerous and obviously they do not have America's best interests in mind.
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These recent meetings between Obama and finance/credit card honchos make me laugh. It's as if it were Cold War-era détente taking place, replete with some from the enemy camp saber-rattling anonymously to the press ("If these actions come to pass, we will bury you...in high interest rates!"). Why beat around the bush? why not acknowledge this culture for what it is: an enemy to our interests and well-being?

I keep hoping Paul Krugman is wrong about the need to nationalize the big banks--the government's proper role is to regulate banks, not make profit-and-loss decisions
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uh, Joe, one aspect of that "regulation" is taking over banks that are insolvent. In fact, the government (through the FDIC) is supposed to take over the banks before they reach insolvency because deposits are insured, and the FDIC is supposed to ensure that taxpayers themselves are not on the hook for the deposits -- and the only way to do that is to takeover the banks and liquidate their assets before losses are so great that assets are less than deposits.

One hopes that the Treasury Secretary has gained a clearer sense, given the magnitude of Wall Street's greed and myopia, of which side he is on.
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Hahaha! Pull the other one, it's got bells on.
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But seriously, why all this coy naivete? You're supposed to be the savvy insider.

I think pay is a bit of a red herring here. A point often missed is that some of the most highly-paid finance professionals have caused the least systemic risk. Yes, I am referring to hedge funds. Many of them had a horrible 2008 and quite a few went belly-up, but their collapse did not threaten the rest of the system. I think one key reason for this is hedge funds are upfront about their motivation: they take fairly big risks. People who deal with them (investors, counterparties, prime brokers) all know about this risk and (should) prepare accordingly.

The real systemic risk comes from proprietary-risk-taking groups hiding within plain vanilla retail and commercial banks. The solution is to regulate and break up the big banks and spin-off their risky parts. These can then fail without burning everything else down. And, yes, this requires temporary nationalization. But TARPified institutions are already being meddled with. Might as well do the meddling in one clean sweep.

"The solution is to regulate and break up the big banks and spin-off their risky parts. These can then fail without burning everything else down."
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Yes, please. To go through this and come out the other side with institutions that are still too big too fail is madness squared.

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