Post by steveb on Feb 14, 2014 10:54:09 GMT
This article by Rolling Stone's Matt Taibbi, details the development of major US banks buying significant shares of heavy industry (particularly in metals trading). This was a result of deregulation at the time that Glas Steagal was repealed, opening huge conflicts of interest and opportunities for massive market manipulation and monopolisation. Large chunks of the bailout money was used to buy up whole industrial processes, allowing banks to speculate on market price changes for commodities that they increasingly control the price of.
It begs the question yet again of 'Incompetence theory/ Co-incidence theory' verses 'Conspiracy theory' with regard to the 2008 crash and its aftermath:
www.rollingstone.com/politics/news/the-vampire-squid-strikes-again-the-mega-banks-most-devious-scam-yet-20140212
It begs the question yet again of 'Incompetence theory/ Co-incidence theory' verses 'Conspiracy theory' with regard to the 2008 crash and its aftermath:
Then, in the third week of September 2008, while the economy was imploding after the collapses of Lehman and AIG, two of America's biggest investment banks, Goldman Sachs and Morgan Stanley, found themselves in desperate need of emergency financing. So late on a Sunday night, on September 21st, to be exact, the two banks announced they had applied to the Federal Reserve to become bank holding companies, which would give them lifesaving access to emergency cash from the Fed's discount window.
The Fed granted the requests overnight. The move saved the bacon of both firms, and it had one additional benefit: It made Goldman and Morgan Stanley, which both had significant commodity-trading operations prior to 1997, the first and last two companies to qualify for the grandfather exemption of the Gramm-Leach-Bliley Act. "Kind of convenient, isn't it?" says one congressional aide. "It's almost like the law was written specifically for them."
The irony was incredible. After fucking up so badly that the government had to give them federal bank charters and bottomless wells of free cash to save their necks, the feds gave Goldman Sachs and Morgan Stanley hall passes to become cross-species monopolistic powers with almost limitless reach into any sectors of the economy.
And they weren't the only accidental beneficiaries of the crisis.
The Fed granted the requests overnight. The move saved the bacon of both firms, and it had one additional benefit: It made Goldman and Morgan Stanley, which both had significant commodity-trading operations prior to 1997, the first and last two companies to qualify for the grandfather exemption of the Gramm-Leach-Bliley Act. "Kind of convenient, isn't it?" says one congressional aide. "It's almost like the law was written specifically for them."
The irony was incredible. After fucking up so badly that the government had to give them federal bank charters and bottomless wells of free cash to save their necks, the feds gave Goldman Sachs and Morgan Stanley hall passes to become cross-species monopolistic powers with almost limitless reach into any sectors of the economy.
And they weren't the only accidental beneficiaries of the crisis.
www.rollingstone.com/politics/news/the-vampire-squid-strikes-again-the-mega-banks-most-devious-scam-yet-20140212