Saturday, May 1, 2010

Wall Street Fraud

Here is William K. Black on PBS's Bill Moyers Journal talking about the Goldman Sachs fraud. Start watching at 1:35 into the video:

Notice the fact pointed to by Black: "President Bush appointed people who hated regulation. I call them the anti-regulators."

And at 21:20 into the video, Black points out that the Bush era was based on an ideology that claims fraud is not possible in a market. As Black summarizes it "we don't need laws, we don't need an FBI, we don't need a Justice Department, we don't even need rules like the SEC, the markets cleanse themselves automatically and prevent all frauds. This is a spectacularly naive thing. There is enormous idelogical content...". This is the world of George Bush and the criminal spree he unleashed on the American people and created the $1.9 trillion deficit in FY 2009 (see Wikipedia).

The Bush years were the capstone of the Reagan legacy of "anti-regulation" ideology. Reagan caused the Savings and Loan crisis. Reagan's legacy?
US General Accounting Office estimated cost of the crisis to around USD $160.1 billion, about $124.6 billion of which was directly paid for by the US government from 1986 to 1996 from Wikipedia
What can be pinned on Bush?
The International Monetary Fund estimated that large U.S. and European banks lost more than $1 trillion on toxic assets and from bad loans from January 2007 to September 2009. These losses are expected to top $2.8 trillion from 2007-10. U.S. banks losses were forecast to hit $1 trillion and European bank losses will reach $1.6 trillion. from Wikipedia

In 2008 alone, the United States government allocated over $900 billion to special loans and rescues related to the US housing bubble, with over half going to the quasi-government agencies of Fannie Mae, Freddie Mac, and the Federal Housing Administration. from Wikipedia

... and the above does not add in the trillions lost in wealth by home owners and the financial impact of the 8 million unemployed.
That's the legacy of the Bush years. And with all that, Bush still gets a 30% approval rating. I find that staggering.

Notice that at 24:10 he points out that both Republicans and Democrats are infected with this ideology that has created this fraud and is destroying the US economy.

There is a transcript of the interview on the Bill Moyers Journal web site.

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