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MOSLER'S LAW: There is no financial crisis so deep that a sufficiently large tax cut or spending increase cannot deal with it.

Your thoughts on wall street remaining intact

Posted by WARREN MOSLER on September 15th, 2009


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A Year Later, Little Change on Wall St.

As previously suggested, wealth is flowing to the top from the bottom as gdp grows some, unemployment climbs, and wages languish:

Despite the predictions last year about pay cuts, those bonuses appear secure. Kian Abouhossein, an analyst at J.P. Morgan in London, predicted this week that eight major American and European banks would pay the 141,000 employees in their investment banking units $77 billion in 2011 — about $543,000 per worker, not far from the 2007 peak — even after minor regulatory changes are adopted.

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>    Can the mortgage fraud environment return?
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Lenders/investors will be smarter for a while, best guess. But always ripe for the next fraud.


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3 Responses to “Your thoughts on wall street remaining intact”

  1. TheInterest Says:

    I’ve bought in completely on the “taxes don’t fund government” deal and that government has an unlimited amount of money/credit. So where does this “payback” of the TARP money fit into this? Is the government really accepting this money as revenue to either pay down our deficit or to be used for more government spending? Isn’t this money just simply taken out of of the economy like any other tax would be?

    Reply

  2. warren mosler Says:

    tarp that ‘bought bank capital’ should never have been ‘counted’ as deficit spending. but it was, so the payback is counted as the reverse.

    all it did, functionally, was to allow the banks to operate with less private capital. with our without tarp, once the remaining private capital was lost the govt was on the hook.

    would have been much more straight forward for the fdic simply to allow the banks to operation with less capital, if it wanted them to continue to operate, with whatever terms and conditions they wanted to impose

    this shows no one in govt understood the essence of banking

    Reply

  3. hoover printing presses Says:

    Warren says: “this shows no one in govt understood the essence of banking”

    If that is true Warren, and our government not only is incapable of serving its citizens, but as you say, doesn’t even KNOW HOW to serve them because they are ignorant, wouldn’t a founding father type say it is time to overthrow that government that is no longer effective for the people and put in a new one? I wonder how the NSA, CIA types view your ideas that paint the US government as not only ineffective, but completely ignorant that could possibly lead people to start wanting to overthrow the government?

    Reply

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