Turbo-Tax Treasury Secretary Timothy Geithner helped create the “stress test” for banks. This fact alone should give you the cold shivers. For the past several weeks examiners have been combing over the banks balance sheets and assets, putting the institutions through their paces. Or so we’ve been led to believe. Surprise, surprise, officials are now saying that the banking industry, broadly speaking, seems to be in better shape than many people think! Except that they will probably need to be bailed out again. Do these people take us for imbeciles?
Obviously they do. Despite all of the bailouts we never voted for, many banks probably need to be bailed out again, either by private investors or, more likely, the federal government. After receiving many millions, and in some cases, many billions of taxpayer dollars, banks still need more capital, these officials say. This is because there is the enormous elephant in the room called the derivatives bubble, which estimators say is an exposure of hundreds of trillions of dollars. Our bailout money is like pissing on a bonfire.
The federal “stress tests” that the examiners are administering are the subject of hot debate within the banking industry. Regulators say all 19 banks undergoing the exams will pass them! Indeed, they say this is a test that a bank simply will not fail: if the examiners determine that a bank needs “exceptional assistance,” the government, that is, taxpayers, will provide it!
Watch Bill Moyer’s EXPLOSIVE interview with tough former S&L regulator William Black, on how a massive fraud has been perpetrated by the banks. Black is the author of “The Best Way To Steal A Bank Is To Own One.”
As with all things Geithner, the tests, which are expected to be completed by the end of this month, are being conducted out of public view. Many investors wonder if the new tests are rigorous enough, given the potential problems lurking inside the banking industry. Industry insiders say, that the government will use its findings to press certain banks to sell troubled assets. The story they’re telling the public is that by cleansing their balance sheets, banks will be able to lure private capital, stabilizing the entire industry. The Truth? By jumping into the government’s “private-public partnership” scam, banks can buy troubled assets from each other, and dump most of the risk on Uncle Sam…meaning US.
Are the banks really that healthy? Because if they are, we’ve been robbed to the tune of tens of thousands of dollars per person in this country, and it is long past the time that we act to stop it. If they aren’t, then how is it that these banking executives are not residing in the Big House for cooking their books? Again, it is long past the time that we, the citizens of this country, act to stop it.
Here are the facts- you decide if this looks healthy: at year-end 2008, Bank of America’s total credit exposure to derivatives was 179 percent of its risk-based capital; Citibank’s was 278 percent; JPMorgan Chase’s, 382 percent; and HSBC America’s, 550 percent, according to the Comptroller of the Currency (OCC). In addition, in the fourth quarter, Goldman Sachs began reporting as a commercial bank, revealing an alarming total credit exposure of 1,056 percent, or more than ten times its capital.
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