Posts Tagged ‘End of the Rule of Law’

I saw a video last night in which the speaker stated the Fed charter comes to an end in December of next year. Unfortunately, it appears he does not know about the McFadden Banking Act of 1927, which gave the Fed a permanent charter. More to follow…

 

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If you haven’t followed the housing market, you may not be aware of what a Credit Default Swap entails. Basically, it’s insurance against default. Of course, there is a twist. You need not own the asset on which you’ve taken out the insurance. This is part of the process that broke the US housing market.

The practice should be abolished. No other insurance policy allows you to insure something you don’t own.

All that said, the notion that Greece – via this most recent bailout – may be able to sidestep paying the insurance on their default is absurd. It’s word games. The notion that a state bailout, in Europe or America, avoids a default is a false premise. Greece, like the banking industry here, defaulted. That is why they need and needed a bailout.

All of this is just further evidence the rule of law is broken.

 

The bank settlement doesn’t address the rampant fraud perpetuated by the banks. When asked, prosecutors and politicians say this is just the initial step. I don’t agree; when the dust settles (what little dust this will create), the banks will point to this settlement and say, “But we’ve paid our dues.” Further, politicians will look to this and say, “We made the banks pay!” Neither of which is true.

 

There are entirely too many “coulds” and “mights” in this article. One other detail jumps out; if California receives 9 to 15 of the 25 Billion, a “couple hundred million” per remaining state is not valid. These banks are being given a free pass, especially when you consider how much the taxpayer has given them. We are literally paying the settlement for them.

 

 As always, Mish has great words.  However, the comment thread is even better than Mish’s post…it gets deep fast.

Barry Riholtz eloquently sums up my feelings on the rule of law (and where it’s gone) in our country: 

The Rule of Law is yet another bedrock foundation of this nation. It seems to get ignored when the criminals involved received billions in bipartisan bailout monies.

The line of bullshit being used on State AGs is that we risk an economic crisis if we prosecute these folks.

The people who claim that fail to realize that the opposite is true — the protest at Occupy Wall Street, the negative sentiment, the general economic angst — traces itself to the belief that there is no justice, that senior bankers have gotten away with economic murder, and that we have a two-tiered criminal system, one for the rich and one for the poor.”