Occupy Wall Street doesn’t know what or even necessarily how, but they know something is wrong with Wall Street. Paid talking heads and and partisan pundits keep saying that nobody really knows what the Occupiers want or what they are protesting against.
Well, let me help OWS out and tell you exactly why every single American who doesn’t work on Wall Street or who isn’t putting their faith in listening to “fair and balanced” talking points, or putting their faith in listening to AM Radio, should be worried and listening to what IS being said implicitly, if not explicitly, by well-meaning and peaceful protesters in the streets.
Not one thing has changed since the 2008 crash. Moreover, it’s gotten much worse. Too Big to Fail is now BIGGER WILL IN FACT FAIL. The toxic assets that existed then still exist now. More people are out of work, thus less demand. And despite the fact that Republicans still propagandize that reduced taxes and “certainty” will improve hiring, the ONLY thing that convinces businesses to hire is demand. And unemployed individuals do not create demand.
Given that nothing has changed, I offer as backup for my prediction the opinions of the person and the commission that Congress put in charge of determining the causes of the 2008 meltdown.
The person that Congress put in charge of determining the reasons for the 2008 financial crisis has a sobering message for us: “It’s going to happen again.”
Phil Angelides, the real estate developer and former California state treasurer who chaired the Financial Crisis Inquiry Commission, said on Thursday that “all across the marketplace the warning signs were there” of a coming disaster before the 2008 crash, but the mechanisms and political will to stop it were not. Angelides warned of a recurring economic nightmare unless Congress and the next president start paying attention to the facts and stop listening to the people who caused, profited from or failed to detect the crisis.
While Wall Street and laissez-faire Republicans who continue to insist that regulations are job-killers, have attacked the commission’s final report, not one fact has been proven wrong.
Statements from the leading Republican presidential candidates, as well as the tepid actions of President Barack Obama, show an active disinterest in not fixing the problems, but rather in enabling Wall Street to go on doing business pretty much as it chooses. Even worse, ever since the 2008 meltdown, a convenient canard has gained popular popularity through mere repetition: no one could have seen the meltdown coming.
Horse hockey. Even I saw it coming. And I’m saying it again : It’s coming again, and it’s coming soon.
The commission’s report shows that a number of people did see what was coming but that they were squelched or ignored.
The chairwoman of the Commodity Futures Trading Commission, wrote a paper predicting that disaster would flow from the unregulated sale of derivatives. Congress responded by making sure derivatives were not regulated.
Then there were the internal reports at failed mortgage banker Countrywide Financial, which warned there was little-to-no hope that many borrowers would ever repay. Freddie Mac and Fannie Mae tried to resist these shaky mortgages, but they had to keep taking them after Countrywide founder Angelo Mozilo applied political pressure..
In early 2004, after detecting a mortgage bubble in the data, I wrote wrote countless warnings of the problems and what the extent of the coming problems would be. If a mere amateur accountant/ amateur journalist who was not even dabbling in real estate could discern the problem, what excuse was there for those whose job it was to monitor the situation?
Wendy Edelberg, who was the commission’s executive director, showed with hard numbers that, contrary to the nonsense being peddled by Wall Street and the politicians that it finances,that the meltdown was a Wall Street creation, and that loan delinquencies “were lower by an order of magnitude” for government-sponsored Fannie and Freddie than for Wall Street’s mortgage-backed securities. Delinquencies at one point were 15 percent for Fannie and Freddie versus 40 percent for Wall Street.
Edelberg also outlined who bought the obviously bad loans. No one did.
She compared the bad loans to soup with so much fat no one wants it, so it is put in the refrigerator. Once the mixture chills the fat rises to the top and is skimmed off.
By 2006 more than 80 percent of the sure-to-fail loans were combined inside collateralized debt obligations that were being repackaged and resold like so much excess fat. “No one was actually buying the risk,” she said. “It was just being recycled.” This is exactly what Washington politicians in both political parties, with their eye on donations from Wall Street, do not want to hear.
One of the best proofs of official lack of interest in learning the facts is the size of the commission budget Congress authorized: $9.8 million. That is less than a quarter of what Kenneth Starr spent investigating President Bill Clinton‘s dalliance with an intern.
And then there is the official hostility to the commission. When the report was issued in January, Representative Darrell Issa, a California Republican and one of the richest self-made men in Congress, mounted an investigation.
Angelides characterized the move as a search for just one email showing the inquiry was motivated by ideology rather than truth-seeking. Issa came up dry, but his message was loud and clear: don’t mess with Wall Street.
What the commission’s report has shown is that leaving Wall Street alone will ensure a future of continuing panics, to the detriment of everyone who is not part of Wall Street.
And THAT is what Occupy Wall Street is unknowingly protesting.