TBTF's and US Global Hegemony

Sometimes finance executives let slip the way they really feel: that they hold the world in the palm of their hands.It’s not often that the people in charge admit what is really going on: a global game for political dominance. I just saw an interview with Wall Street superlawyer Rodge Cohen, the secret force behind (among other things) the expanded emergency lending power of the Federal Reserve through section 13(3). You know, that’s the law allowing the Fed to lend unlimited sums based on whatever it wants to lend, a section amended in 1991 at Cohen’s behest. He was involved in “more than 17 deals” during the crisis in 2008, including the bankruptcy of Lehman Brothers, the $85 billion AIG bailout deal, and the takeover of Fannie Mae by the federal government. He is, as Bill Black said, the fixer of Wall Street. Here’s his quote, at minute 3:39 ofthis Bloomberg interview:

Hopefully we will not see the major financial institutions in this country disappear because if we do we will also see a loss of ability to influence events not only financially but also politically throughout the world.

Read it at New Deal 2.0

Wall Street Fixer Rodge Cohen: Big Banks Key to American Global Dominance

by Matt Stoller
(Crossposted at Naked Capitalism)

Explains TBTF in a new light.

Matt Stoller — Fed Knew About Housing Bubble in 2004

Read it at New Deal 2.0
The Federal Reserve Knew About the Housing Bubble in 2004
by Matt Stoller

Matt Stoller gets it right about Occupy Wall Street

A lot of pundits are pontificating that the Occupy Wall Street protest is unfocused and needs clear goals expressed as political demands. Matt Stoller disputes this, saying essentially that the protest is actually about the hope and change that President Obama promised and then promptly caved on. It's a grassroots movement, not an orchestration by political activists.

That Yves Smith chose to post Stoller's piece at Naked Capitalism acknowledges not only the political significance of the protest movement that is gathering steam across the US, but also it's economic significance. The protest is, after all, about The Big Rip-Off, in which a few profited wildly on the backs of the many, with many of the many suffering horribly for mistakes in which they were not involved.

Read Stoller's post at Naked Capitalism, Matt Stoller: #OccupyWallStreet Is a Church of Dissent, Not a Protest. Kudos to Matt for writing it and to Yves (Susan) for posting it.

Also interesting is a report by David DeGraw of AmpedStatus on "How Anonymous, AmpedStatus, the NYC General Assembly, US Day of Rage, Adbusters and Thousands of Individual Actions Led to the Occupation of Liberty Park and the Birth of a Movement." Read it at Washington's Blog, A Report from the Frontlines: The Long Road to #OccupyWallStreet and the Origins of the 99% Movement.

While the Tea Party fades into the background, except as pushed by Fox News and astroturf organization like Dick Armey's FreedomWorks, there is a grassroots movement rising up that seems to transcend ordinary categories, at least so far, precisely because it is amorphous and unfocused, except on eliminating corruption. If there is a demand, it is for accountability and restitution.

But mostly it is about changing course. About 80% of Americans agree that the country is veering off course. So it is conceivable that this movement will have strong legs and could even go viral if conditions do not improve or worsen.

This is very much the trend that was predicted to arise at around this time by economist Ravi Batra in The New Golden Age: The Coming Revolution against Political Corruption and Economic Chaos (2007), and historians/social scientists William Strauss and Neil Howe in The Fourth Turning (1007). Although Batra's most recent book was published in 2007, his initial published work dates back to The Downfall of Communism and Capitalism (1978).