Junious Ricardo Stanton
The shock waves from the failure of several major US banks and the too big to fail Swiss bank Credit Suisse are still reverberating in the ethers as the banksters, government leaders and the media try to trick us into believing “the system is sound”. I get it, they don’t want to create panic or more runs on banks, but come on it’s preposterous to claim the system is sound! The system has not been sound since the 2008 financial collapse.
Even with the government “bailouts” the system was never made whole, the 2008 bailouts were the equivalent of putting a band-aid on a severed limb! The bailout did not, I repeat did not, solve the root causes of the problems within the global financial system which were the trillions in shaky derivatives. “During the financial crisis in 2008, the root cause of the meltdown was derivatives. Specifically, CDOs, or Collateralized Debt Obligations related to mortgages and CDSs, or Credit Default Swaps. Derivatives encompass a wide range of financial products: futures contracts, interest rate swaps, options contracts, foreign exchange contracts (currencies), etc. The explosive growth in derivative contracts occurred after 1999 when the Glass-Steagall Act was repealed, which allowed banks to operate as brokerage houses. Glass-Steagall, adopted in 1933, separated brokerage houses and banks in order to ensure banks would no longer be involved in risky transactions, which was the root cause of the crash that led to the Depression.” The Root Cause of the 2008 Financial Meltdown: Derivatives https://www.investmentwatchblog.com/the-root-cause-of-the-2008-financial-meltdown-derivatives/
The repeal of the Glass-Steagall Act by Congress in 1999 opened the door for wholesale casino type Ponzi scheme exuberance far worse than what took place in the 1920’s. Derivatives did not exist in the 1920’s! To fully grasp what happened in 2008 read this article here, The Root Cause of the 2008 Financial Meltdown: Derivatives https://www.investmentwatchblog.com/the-root-cause-of-the-2008-financial-meltdown-derivatives/
“Folks, there are $305 TRILLIONlet me say it again $305 TRILLION in Derivatives floating around the top 25 holding companies out there. The primary asset for these holding companies is either a bank or an insurance company.The question is not will it happen again “ the question is WHEN it will happen?
I am 99% confident it WILL happen again – I am 99% confident that the scale of the collapse will be MUCH LARGER than the most recent collapse in 2008 “ and I am 99% confident we will be in FAR WORSE SHAPE to deal with the collapse in light of the massive amounts of debt that countries have accumulated during this most recent collapse.” ibid
When you see the risk figures in the trillions of dollars and you realize the TARP bailouts were nowhere near this amount you realize bank failures were bound to happen again especially in an era of greed and hubris like we live in now. Keep in mind all the TARP money, contrary to what we have been told, has not been paid back all these years later! https://projects.propublica.org/bailout/list
The real problems is not the “pandemic” it is the banksters, their fractional reserve where only a small amount of depositors’ money are held by the banks while the rest is lent out at interest, it’s the quadrillions in overleveraged derivatives, it’s massive debt, overpriced stocks, contagion and most critically, the current polices of the Federal Reserve Bank to cool down the inflation it has caused in recent years! https://news.stanford.edu/2022/09/06/what-causes-inflation/. All these factors are compounded by the lies being told to hoodwink us into thinking this house of cards is safe and sound. Alas the Silicon Valley Bank, Signature Bank, First Republic and Credit Suisse failures are harbingers of the tsunami of contagion heading our way! There isn’t enough money in the FDIC, or in circulation to stave off a major collapse! Plus bailouts have limits and pose risks and they don’t always work. https://covid-19.mitpress.mit.edu/pub/vf54oo8p/release/1
The recent bank bailouts don’t bode well for the system even though we are being told everything is fine, the system is sound. “Jamie Dimon, Jerome Powell and Janet Yellen assembled the First-Republic deal. That cooperation between Fed, Treasury and the CEO of JPMorgan to bring together major competitors to rescue one of their own reminds me of how the original John Pierpont Morgan brought together a group of bankers who pooled their money prior to the Great Depression to do this very same kind of thing. In that instance, their concerted action was definitely to fend off a systemic crash that could have hurt their own banks. An historically grand and unusual act like that now makes me think the present was a systemic failure, though the former FDIC chair initially assured us this was not.” https://thegreatrecession.info/blog/what-a-day-feds-skyrocketing-balance-sheet/
I am not trying to cause a panic or bank runs; all I’m saying is like so many issues in this country, things are not what they are being made out to be in this situation.