How they just set it up to be Obama's fault when the house of cards

[BR_Parkway]

crashes on Jan 30 (10 days after Inauguration) - oh, and broke the law to do it, not that that should shock anyone here.

Go read the entire diary -it's clear, concise and easy to follow - there's no way to put that much info in the 4 paragraphs here.

http://www.dailykos.com/story/2008/9/16/54230/2116/741/600308

So, reading further up, above, and connecting the dots, if WaMu goes under--which is highly anticipated to be the case in coming days/weeks--the FDIC will be almost broke. The FDIC will then go back to the Federal government for more funds to provide payoffs to the projected depositors that'll be filing claims at other banks as they become insolvent in coming weeks and months, too.

And, just in case you haven't put all the pieces of this treasure hunt together, the large banks (i.e.: JP Morgan Chase and Bank of America and others) now absorbing the large investment houses (i.e.: Merrill and Bear Stearns) are now going to be allowed to break the law--between now and January 30th--and "reallocate" normal, everyday, customer bank deposit funds for their own use to shore up the possible trillions of dollars in losses accrued by their new investment firm subsidiaries.

Then, on January 30th, 10 days after the next president takes office, it will all cease. And, if these large banks are left with negative balance sheets, due to shelling out hundreds of billions, or even trillions, of dollars in customers' (your) deposit funds to dig their new investment bank subsidiaries out of their holes, then these large banks will mosey on over to the FDIC and they'll be reimbursed by your taxpayer funds via that entity, instead.

and the broken law part:

Bernanke Violates Federal Reserve Act Section 23A

Allowing banks to extend funds to their brokerage affiliates is in violation of Federal Reserve Act Section 23A.

Section 23A of the Federal Reserve Act ( Act ), originally enacted as part of the Banking Act of 1933, is designed to prevent the misuse of a bank's resources through non-arm's-length transactions with its affiliates and to limit the ability of a bank to transfer its federal subsidy to its affiliates.

--SNIP--

The Fed simply does not care whether its actions are illegal or not. The Fed is operating under the principle that it's easier to get forgiveness than permission. And forgiveness is just another means to the desired power grab it is seeking.

Supposedly the Fed "will temporarily allow commercial banks to extend liquid funds to their brokerage affiliates for assets that would normally be accepted in tri-party repurchase agreements." For starters I doubt it will be temporary. But the main point is the Fed is taking steps that it knows to be blatantly illegal.

[zeemike]

1. Isn't it nice that they get to gamble with other peoples money?

Wish I could do that...I would be at the casino every day.

[BR_Parkway]

2. But they've set it up to crash just after Dems take over in Jan - and Rove

comes out and says that McSame's ad's aren't truthful? Along with the media finally starting to talk about the issues that actually win it for us?

I think they're still trying to get their permanent Republican majority - they plan for the long term and know there's no way to keep it right now. But if it all goes to hell in a handbag on the Dem's watch, they'll spend the next 4 years blaming us for every bit of it - so they can take it all back in 2012

[zeemike]

8. That might be their intent

But Obama if elected could pull a FDR on them and set back their plans for decades.
Which is my hope. Because after that long the old guard will be gone from this earth and a new enlightened generation will take over.

[katty]

12. yup, agree Obama w/pull an FDR - full overhaul

[nebenaube]

3. nope... they own this now

The GOP is history! Domestic traitors must be punished. Their conspiracy is in the NSA archives.

[formercia]

4. Domestic surveillance is a double-edged sword

The dragnet captures everything, including lawbreaking by Bush Gang and their traitorous cronies.

[boomerbust]

5. The crash

Seems to be happening Now. They miscalculated by a few months.

[dixiegrrrrl]

17. yes, I agree on that.

[mrih]

6. This is why

I am confident DEMS will win the election this year... Something inside me tells me it's gonna be a situation where the GOP is gonna screw up the entire world as much as possible, and throw the entire problem onto the Democrats, sit back and go "SO LONG SUCKERS!!"

Why else would McCain take on the biggest BIMBO possible as his VP choice?

People are NOT that stupid, even the GOP apologists. McCain WANTS to lose this election.

[DemReadingDU]

16. If poll numbers are any indication, the new pres will be McCain

Seems to me that the bimbo Palin is just what the Republicans needed to insure McCain wins in November. There really are a lot of stupid people out there.

:shrug:


edit: I don't doubt that the GOP is gonna screw up the entire world as much as possible, but their wacko world may just come back to haunt them. I voted for Obama in the primary because our country really needs a change in leadership, just that there really are a lot of stupid people out there who will still vote Republican.

[lumberjack_jeff]

7. Holy shit!

That was the scariest f'ing thing I've read all week.

[hootinholler]

9. I'm sure the regulators and the DOJ are all over this!

Do I need it?

-Hoot

[sybylla]

10. It's almost like they're trying to set up a bank crash

I know of no better way to do it than skirting regulations meant to protect bank solvency.

Perhaps what we need instead of fire-sale mergers is government take-over of failing investment houses - before they make the whole world pay for their avarice and greed.

[Fearless]

11. I posted an article you all might find interesting on a similar topic...

"Reagan, Deregulation, and the Fruit It Now Bears"

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=103&topic_id=384561&mesg_id=384561

[zeemike]

13. Just sent that to the greatest page for ya

A good analysis but way to kind.
I think the financial institution is populated with a bunch of greedy bastards who can't keep there fingers out of the cookie jar.

[MrsCorleone]

14. Thanks, BR, for posting this! If the dems win, it is hugely important

that we educate ourselves and all the average peeps out there on how the economy got this way & what is to come.

The corporately owned media will influence general sentiment against Obama, making it very difficult for his administration to begin the economic healing process.

The multinationals that own the media have way too much to lose if the peeps are educated. J6P has a very short memory and will blame the dems for hard economic times.

Education is key.

[Tutonic]

15. Good post, but I don't think Obama has been sitting in a cone of

silence for the last seven years. I figure Biden hasn't either. They're big boys.

[FatDave]

18. OK, so...we shouldn't try to win?

Because we're afraid to be left holding the bag? Even if we win, we really lose.

About the only thing that gives me hope is that the conservative base is dying and the up and coming generations seem to be pretty liberal. Maybe I'll be able to retire in peace one day.

[MrsCorleone]

19. If J. Hoover McCain wins, he will do nothing to protect average

Americans in an economic crisis. He not only appears to be completely oblivious to what is going on, but it is becoming increasingly clear that he's not in control.

He'll just hand the keys to this country over to the vultures who started this mess, ensuring a continued downward spiral.

We cannot spare another four years.

[Chisox08]

20. We literally can not afford more of the same.

John Herbert McHoover will allow the Bush Depression to continue and he will only serve to keep the rich rich and the rest of us poor.
Well since we are majority stakeholders in AIG I'll like to propose that all of the CEO's work for minimum wage and the severance packages be made null and void.

[TrogL]

21. This is exactly what I've been predicting

I just had no idea it would be this bad.

Personally, though, I think their timing is off. The current crash wasn't supposed to happen until after the election. People have their heads up.

[paparush]

22. GIANT KICK!!!!!!!!!!!!!!!!!!!!!

[cui bono]

23. Damn, can't rec anymore but kick this mofo to the top!

Sheesh. I'm glad I just pulled all my savings out of WaMu!

Is a credit union safe?