Wall Street Lies Blame Victims to Avoid Responsibility for Financial Meltdown
September 29, 2009 9:51 pm

By Nomi Prins

To hear it from the big financial companies, the big crash started when poor people bought homes they couldn't afford. But that was at most 1% of the problem.

Editor's note: The following is an excerpt from Nomi Prins' new book, It Takes a Pillage: Behind the Bailouts, Bonuses, and Backroom Deals from Washington to Wall Street.

The Second Great Bank Depression has spawned so many lies, it's hard to keep track of which is the biggest. Possibly the most irksome class of lies, usually spouted by Wall Street hacks and conservative pundits, is that we're all victims to a bunch of poor people who bought McMansions, or at least homes they had no business living in. If that was really what this crisis was all about, we could have solved it much more cheaply in a couple of days in late 2008, by simply providing borrowers with additional capital to reduce their loan principals. It would have cost about 3 percent of what the entire bailout wound up costing, with comparatively similar risk.

Just as great oaks from little acorns grow, so, too, can a Second Great Bank Depression from a tiny loan grow. But so you know, it wasn't the tiny loan's fault. It was everyone and everything that piled on top. That's how a small loan in Stockton, California, can be linked to a worldwide economic collapse all the way to Iceland, through a plethora of shady financial techniques and overzealous sales pitches.

Here are some numbers for you. There were approximately $1.4 trillion worth of subprime loans outstanding in the United States by the end of 2007. By May 2009, there were foreclosure filings against approximately 5.1 million properties. If it was only the subprime market's fault, 1.4 trillion would have covered the entire problem, right?

Yet the Federal Reserve, the Treasury, and the FDIC forked out more than $13 trillion to fix the "housing correction," as Hank Paulson steadfastly referred to the Second Great Bank Depression as late as November 20, 2008, while he was treasury secretary. With that money, the government could have bought up every residential mortgage in the country - there were about $11.9 trillion worth at the end of December 2008 - and still have had a trillion left over to buy homes for every single American who couldn't afford them, and pay their health care to boot.

But there was much more to it than that: Wall Street was engaged in a very dangerous practice called leverage......

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Why Would We Let Them Rig the Game?
September 29, 2009 9:55 pm

Dylan Ratigan

Why is health insurance the only business that has an exemption from the Sherman Anti-Trust Act other than Major League Baseball? If the delivery of taxpayer trillions by our politicians to the banks to support their fraudulently paid bonuses hasn't shown you what our current government's values are, check this link out.

Through the governmental negligence that we as voters allowed, a health care system was created in which a single health care company controls at least 30 percent of the insurance market in 95% of the country, including states like the following:

Maine, where Wellpoint controls 71% of the market.

North Dakota, where Blue Cross controls 90% of the market.

Arkansas, where Blue Cross Blue Shield controls 75% of the market.

Alabama, where Blue Cross Blue Shield controls 83% of the market.

This monopoly, combined with the misaligned incentives that trap people in employer-based health care, is causing the skyrocketing health care costs that are hurtling our nation towards bankruptcy.

I don't know what's worse: that most Republicans seem to be against ending this unfair legal protection for an entrenched industry that is ruining our country with their non-competitive practices, or that most Democrats seem to be threatening this arrangement only as a bargaining chip to push for a meaningless public option that wouldn't be accessible to almost 85% of the population?

Instead of improving our country, through creating and enforcing free and fair markets, our politicians are currently engaging in backroom deals, most of which protect the very companies who profit the most from these disastrous outdated systems -- industries like health insurance and big Pharma.......

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ABC News 'Stunned' To Discover Dead Peasant Insurance
October 3, 2009 9:58 pm

by Alien Abductee

Michael Moore's Capitalism, A Love Story has revealed a deep dark secret to the intrepid reporters of ABC News - so-called Dead Peasant Insurance, the practice of companies taking out secret life insurance policies on their low-level employees, with the benefits paid out to the company upon the employee's death, even if they no longer work at the company.

Corporations avoid paying taxes this way.

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