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ACTUAL SOLUTIONS TO ECONOMIC COLLAPSE REMAIN SAME
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Let’s deal with Banking Policy Reform for instance. In the 1930’s, the fat cats got away with convincing the public mind that the Great Depression was caused by a Stock Market and Real Estate “Bubble”. These days, they are teaching us to remember that this latest unprecedented economic collapse was caused by the “Housing Bubble” and triggered by a “Subprime Crisis”.
Other venerable elder statesmen and tweed coated professors swear by a failure of Capitalism, Reaganomics, Neoconservative economics, the Democratic agenda, or the Deregulation of rules governing financial institutions. Quite often, the spin of the blame falls upon the Republicans or the Democrats, depending upon who is doing the talking, and all the while, we still won’t be pointing the finger at the actual culprits.
I’m not denying it appears that Western Civilization in general, and America where the problem started, were hit hard with what appears to be the “perfect storm” of a Stock Market Bubble, Real Estate Bubble, Bond Bubble, Credit Bubble, Hedge Fund Bubble, and Commodity Bubble. But I think if I hear any of these labels, especially the term “perfect storm” as it applies to the economic crisis, one more time, I might have a hard time talking myself out of punching some innocent elitist who just happened to get his mindset by playing golf one too many times with his banker. Look, I’m not out to burst anybody’s Bubble, especially an impregnable one. I just want you to know what’s really going on, and I think that you may appreciate hearing it.
The number one cause of the worldwide economic collapse was not Neoconservative or Liberal Economics. It wasn’t the "Subprime Crisis". It wasn’t the far more insidious and destructively flawed exploitation of Collateralized Debt Obligations, Credit Default Swaps and Derivatives. Nor was it the yearly exploitation of 70% of the USA’s financial resources to drill, ship and refine foreign oil, feed a war machine to control foreign oil fields, and otherwise line the pockets of defense industry insiders. All those things are just symptoms of what happened, and there is a difference between Bubbles and Pyramid Schemes, and Graft, and Corruption.
So here it is. The number one cause of the current hidden Depression, yes Depression, the thing that brought the whole world economy down, and pushed it off the edge into freefall, was simply inhuman and multinational central banking and corporate policy, turned out of control by legislators who worry more about being blackballed, and care more about receiving campaign contributions, than what happens to nations, much less people.
Not the way you heard it eh? Well let me speak freely, and I hope you won’t be offended if you have developed a perspective or a Democratic or Republican party line, that is different than mine, or if you find it just too painful to cope with how rotten and lowdown the world we live in can be.
Listen to me. I started publishing articles about this in 1998, when I witnessed a huge fraud by IndyMac Bank. What they did was so morally wrong, so against the principles upon which our country was supposedly founded, that I had to speak about it. I put an ad in the Wall Street Journal. I had the FBI over to my house and showed them what was going on. But when the feds didn’t call me back, I began to get a clearer picture of how things really work at the top.
The FBI is in large part controlled by congress, because congress doles out the funds the FBI needs to operate. I’ve realized that, ever since my godfather, a federal agent, mentioned all the hoops the director made his men jump through to come up with the numbers on paperwork that congress wanted to see. It irked him how they had to busy themselves for self glorified politicians, when they could have been out catching bad guys. Anyway, that’s the kind of power that the banks and corporations have through our legislators over bureaucrats at the FBI.
I’m going to focus on additional solutions to this economic mess going forward. But first I owe you a brief explanation of the IndyMac fraud I mentioned: When I was on the local Community Council in 1989 I took on the task of saving a wooded area from a tract of 23 homes. I shepherded through a plan to save most of the old trees and build only eight homes within a 16 acre parcel. For the financing, I had to deal with Mozillo Mortgage, IndyMac and Countrywide, three banks that were all started by the same people.
It was our exit agreement, in accepting the land loan for the new tract, the Ocean Woods, that it would be paid off by a construction loan through IndyMac's Construction Lending Division. But in 1998, the bond market crashed, Bear Stearns pulled IndyMac's line of credit, and IndyMac defaulted leaving my partners and me with a mob of angry subcontractors.
I had been ignorant that IndyMac never really had the money and were instead using a line of credit from Bear Stearns.
Rather than admit what happened, IndyMac got clever. They sent a team to each construction job and then informed each borrower that the borrower was in default because IndyMac's experts had determined that the job would cost more than planned. They threatened foreclosure, and increased the pressure, but said the problem could be cured if the borrowers gave them the allegedly deficient amount.
In my own case it was over $800,000. Some borrowers paid up. But thinking that it was all a big mistake, my contractor and I spent many hours trying to convince the IndyMac "experts" that all we needed was the money they owed us. I wondered why they avoided looking me in the eye.
It took over 2 years of fighting with IndyMac and doing all the trades on the house by myself, before I discovered their fraud. I took out an ad in the Wall Street Journal and found others who had been given the same treatment. But I couldn't sue, because we were expected to retire the construction loans with Countrywide's permanent financing.
So that’s the kind of thing that the banks, who control congress, and hence the FBI, get away with. That’s why I questioned the timing when the FBI took down Governor Rod Blagojevich for using expletives and bartering over a vacant senate seat, because only the week before he had humiliated Bank of America by forcing them to stand down from foreclosing on a factory where blue collar workers would have lost their jobs.
That’s why it also appeared odd that Governor Elliot Spitzer was taken down, only the week after he published an article in the Washington Post condemning the Bush Administration and the Office of the Comptroller of the Currency for claiming jurisdiction and preempting States Attorneys General from defending consumers in their states against banks.
One of those two governors resigned, and the other was impeached, so it appears they must have done something wrong. But how about this one for timing? California Attorney General Jerry Brown initially joined several other States Attorneys General filing suit to uphold the rights of States Attorneys General to defend their own consumers who are being victimized by banks. The States Attorneys General were quickly brought to heel by the federal government.
Not long after that, Attorney General Brown made a speech in which his moral outrage against bank practices in foreclosing California private property became apparent. I recall he referred to them as “those banks…” The next morning he came out of his home to go to work, and his car was up on blocks with all four wheels missing.
Don’t get me wrong, I’m not out to make trouble for banks. People need banks. But banks also need a little government to keep them honest. If I were a legislator, I’d work with my colleagues writing bills to create financial independence for regulatory agencies such as the SEC and bureaus such as the FBI and the CIA. We can keep financial institutions healthy, without making a mockery of law enforcement.
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