{"id":192560,"date":"2009-03-19T17:42:00","date_gmt":"2009-03-19T22:42:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2009\/03\/19\/id-say-its-self-evident-only-not\/"},"modified":"2009-03-19T17:42:00","modified_gmt":"2009-03-19T22:42:00","slug":"id-say-its-self-evident-only-not","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2009\/03\/19\/id-say-its-self-evident-only-not\/","title":{"rendered":"I&#8217;d Say It&#8217;s Self-Evident, Only Not"},"content":{"rendered":"<p>Nemo at Self Evident <a href=\"https:\/\/self-evident.org\/?p=500\">makes a convincing case that Bernanke and Geithner are not doing anything but trying to protect the incumbent banking giants<\/a>.<\/p>\n<p>I agree.  While we need a functioning credit system, there is no need for the <span style=\"font-weight: bold;\">current<\/span> banks to continue to exist in their <span style=\"font-weight: bold;\">current<\/span> form, and the Fed and Treasury&#8217;s frantic effort to keep these banks on life support is a detriment to the rest of the economy:<\/p>\n<blockquote style=\"color: rgb(0, 0, 153);\"><p>If I were in charge and I wanted to prevent banks from failing at all costs, what might I do?<\/p>\n<p>I might relax mark-to-market accounting.  This would allow assets to be carried at inflated valuations, both for purposes of regulatory capital requirements and for purposes of getting loans from the Fed.<\/p>\n<p>I might provide non-recourse loans to private equity to create inflated marks where mark-to-market still applies.<\/p>\n<p>I might try to convince the FDIC to exercise forbearance in seizing banks.  Of course, the primary day-to-day mission of the folks at FDIC is to preserve the integrity of their insurance fund.  So they might object to my suggestion.  I might have to give them assurances that they will have the necessary resources should my great plan fail.  A $500 billion credit line from the Treasury, say.<\/p>\n<p>If the FDIC agreed, they might suddenly go from 3-4 bank seizures per week to 0-1 per week.<\/p>\n<p>Once my plan leaked to certain troubled banks, they might suddenly halt their attempts to raise capital at $0.20\/share.<\/p>\n<p>And of course, once Wall Street got wind of it, shares in financial companies would rocket higher.<\/p>\n<p>Let me know if you notice anything like this happening.<\/p><\/blockquote>\n<p>Good point, and good snark.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Nemo at Self Evident makes a convincing case that Bernanke and Geithner are not doing anything but trying to protect the incumbent banking giants. I agree. While we need a functioning credit system, there is no need for the current banks to continue to exist in their current form, and the Fed and Treasury&#8217;s frantic &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1004,1002,985,1050],"tags":[],"class_list":["post-192560","post","type-post","status-publish","format-standard","hentry","category-finance","category-good-writing","category-regulation","category-snark"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/192560"}],"collection":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/comments?post=192560"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/192560\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=192560"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=192560"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=192560"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}