Bankers Get $4 Trillion Gift From Barney Frank

December 30th, 2009

Via: Bloomberg:

I quickly discovered why members of Congress rarely read legislation like this. At 1,279 pages, the “Wall Street Reform and Consumer Protection Act” is a real slog. And yes, I plowed through all those pages. (Memo to Chairman Frank: “ystem” at line 14, page 258 is missing the first “s”.)

The reading was especially painful since this reform sausage is stuffed with more gristle than meat. At least, that is, if you are a taxpayer hoping the bailout train is coming to a halt.

If you’re a banker, the bill is tastier. While banks opposed the legislation, they should cheer for its passage by the full Congress in the New Year: There are huge giveaways insuring the government will again rescue banks and Wall Street if the need arises.

Nuggets Gleaned

Here are some of the nuggets I gleaned from days spent reading Frank’s handiwork:

— For all its heft, the bill doesn’t once mention the words “too-big-to-fail,” the main issue confronting the financial system. Admitting you have a problem, as any 12- stepper knows, is the crucial first step toward recovery.

— Instead, it supports the biggest banks. It authorizes Federal Reserve banks to provide as much as $4 trillion in emergency funding the next time Wall Street crashes. So much for “no-more-bailouts” talk. That is more than twice what the Fed pumped into markets this time around. The size of the fund makes the bribes in the Senate’s health-care bill look minuscule.

Posted in Economy, Elite | Top Of Page

One Response to “Bankers Get $4 Trillion Gift From Barney Frank”

  1. edwardo says:

    The upshot of this is that public policy is such that the odds now definitively favor a hyper-inflationary crack up boom developing before the ultimate deflationary collapse. The “government” has the means and the will to make many more electronic credit entries in exchange for more essentially worthless “assets.” In a phrase, where monetization is concerned, “we ain’t seen nothing yet.”

    Hold you gold and secure your silver.

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