Big Ben Bails on Main Street

The banking crises of the late 1920s and 1930s were of a different period and are not analogous to conditions as they exist today.

I still wonder what would have been the result if we had allowed Citibank and Bank of America to fail and perhaps AIG as well. Surely fortunes would have been lost but would this have been any more detrimental to the economy than the disaster that we are experiencing today.  I don’t think so.  After all the banking system across the country is sound and would have remained so. The FDIC was in place, thanks to FDR and his New Deal, and wholesales failures would not have occurred on the scale they did in the 1930s.

The trillions the government channeled to Wall Street could have been put to better use through sound regional and community banks. Actually the whole system could have been propped up by using the trillions to help homeowners refinance mortgages.

In the process the patricians of the financial community would have been chastened – if that is possible with limitless hubris – and forced to accept real reform instead of the pretense passed by Congress and signed by the president that leaves the door open to future fraudulent schemes.

The government would have remained a player throughout the banker created mess but would have assumed a different role with perhaps a better outcome than the economic disaster we are now faced with.

Instead the government preempted trillions of taxpayer dollars to pull the nuts of a handful of wealthy people out of the fire and backhanded the rest of us expecting the “small people” to believe that they have been miraculously saved

And pardon my incivility­. That should read chestnuts out of the fire.

Read the Article at HuffingtonPost

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