Let it fail

Here's a whopper of a story that is getting next to zero play in the MSM: Bloomberg has won it's lawsuit to force the Fed to disclose what banks got our money. Court Orders Fed to Disclose Emergency Bank Loans.

The Fed and the troubled banks are hardly taking this lying down. In fact, they've threatened to pull the trigger of the entire financial system. Bailed Out Banks Threaten Systemic Collapse If Fed Discloses Information

The Clearing House Association, another name for all the banks that were bailed out over the past year with the generous contributions from all of you, dear taxpayers, are now threatening with another instance of complete systemic collapse if Bloomberg's lawsuit is allowed to proceed unchallenged, let alone if any of the "Audit The Fed" measures are actually implemented.

Oh my. Nothing like a call for transparency to get the banking mafia to pull out the big guns. How would this "systemic collapse" occur? The lame banks that needed our money last winter would be compromised in the eyes of the public. This, according to the defendants, would spark bank runs on these lame institutions and allow those that did not take Fed money an unfair advantage. And yes, I almost gagged while typing the word "unfair."

Does the distorted reality here need elaboration? On Planet Socialism for the Rich, Capitalism for Everyone Else - the prime horror is the revelation that solvent banks exist. My God! Some banks didn't need taxpayer bailouts! How dare they!?!

Also, it doesn't occur to these sharks that maybe depositors ought to remove their cash from the greedy, myopic institutions that wrecked the economy. It is, in fact, wise. If the system can't survive Bank of America going belly up then we'd better fix the system...not save BofA from its corrupt business practices.

The threat of "systemic collapse" is bogus. Why? Because the system is already collapsing. As well it should. It's a car wreck in slow motion, but it's still a car wreck.

A system in which the rich get rewarded for failing because they hold an imaginary gun to our collective heads should fail. A system of wealth conjured with computer screen dollars should fail. A system that must grow regardless of realities on the ground should fail. A system dependant on people spending money they do not have should fail. Its failure ought to be welcomed, not avoided. Our system now is abnormal. It's like a Beverly Hills matron who's had too much plastic surgery. Everyone with any sense sees mutilation - but she gazes into the mirror and casually wonders what part of her face she should cut up next.

Let the system fail. Spray the disinfectant now before the house we all live in rots further. It will be messy for a while, but what emerges will have a chance of being reality based.

a time for vivid outrage

If anyone thought the big banks were grateful for the massive bailouts they received from the American taxpayer - and the American taxpayers' grandchildren - look no further than California.

At Bank of America, which counts the state of California as a commercial client, existing customers can only deposit IOUs - and only until Friday.

"We don't want acceptance (of IOUs) to deter the state from a budget agreement," bank spokeswoman Julie Westermann said.

Oh really, Julie.

Ms. Westermann has taken on the job of fiscal disciplinarian. Funny. Her company, after going on an obscene sub prime lending spree, came begging to the U.S. Government for billions just a few months ago. Bank of America and Citigroup each received $45 billion in multiple installments between October and January. Each also benefits from guarantees against losses -$7.5 billion for Bank of America and $5 billion for Citi.

To put it succinctly: Ms. Westermann has a job because you and I and our descendants propped up her employer.

I do not know at what point seething anger at banks and their criminality will boil over into rage - but that point will come. The hypocrisy here is too hard to stomach. When they are about to fail the Feds must bail them out - or "the entire economy will sink." When people need what amounts to an extension - Wells Fargo, Citi, and BoA tell them to go to hell.

Don't get me wrong. There is much blame to go around. The California state government is utterly dysfunctional. Californians have made matters worse by voting for unfunded mandate after unfunded mandate, dependant on a pie in the sky economic model that was, in turn, gamed for profit - and later tax payer bailouts - by unscrupulous bankers. Everyone was in on this circle jerk.

Nevertheless major banks refusing to take IOUs from the state so soon after the rest of the country saved their butts is petulant and arrogant almost beyond comprehension.

The economic system we are currently watch fail in slow motion promotes amorality. More than that it deifies amorality. A very small portion of the population continues to loot the majority.

How long can go one before the blow back becomes a firestorm? It is, indeed...a time for vivid outrage.