Rolling Stone’s Matt Taibbi on how fucked we are.

If you have problems with your blood pressure then you probably shouldn’t read Matt Taibbi’s essay for Rolling Stone magazine titled The Big Takeover. It’ll probably give you an aneurysm. It very nearly gave one to me:

In essence, Paulson and his cronies turned the federal government into one gigantic, half-opaque holding company, one whose balance sheet includes the world’s most appallingly large and risky hedge fund, a controlling stake in a dying insurance giant, huge investments in a group of teetering megabanks, and shares here and there in various auto-finance companies, student loans, and other failing businesses. Like AIG, this new federal holding company is a firm that has no mechanism for auditing itself and is run by leaders who have very little grasp of the daily operations of its disparate subsidiary operations.

In other words, it’s AIG’s rip-roaringly shitty business model writ almost inconceivably massive — to echo Geithner, a huge, complex global company attached to a very complicated investment bank/hedge fund that’s been allowed to build up without adult supervision. How much of what kinds of crap is actually on our balance sheet, and what did we pay for it? When exactly will the rent come due, when will the money run out? Does anyone know what the hell is going on? And on the linear spectrum of capitalism to socialism, where exactly are we now? Is there a dictionary word that even describes what we are now? It would be funny, if it weren’t such a nightmare.

It’s a very long read and in it Taibbi outlines for us how the financial crisis we’re currently experiencing has been years in the making and how the current approach to solving it is just more of the same old bullshit. The more you read the article the more angry you’re going to get as you realize just how bad things were allowed to become and just how screwed we really are. When you’re done you’ll no longer be surprised at the stunning arrogance of Wall Street fat cats expecting to be able to collect their promised bonuses using taxpayer money in spite of being the cause of the crisis. The worst part of it is the fact that the people Obama has running the Fed are pretty much from the same group that fucked us over to begin with.

Who do you think they’re going to be looking out for? You or their old friends on Wall Street?

7 thoughts on “Rolling Stone’s Matt Taibbi on how fucked we are.

  1. Our government is beholden to corporate interests. These sleazebags have short circuited the global economy and we have been left holding the bag. They really should be in jail, all of them, for a long time. Im sure that, even blinded by greed, they were all quite aware of the potential outcome of their actions.

    But no, we’ll throw people in jail for minor possesion and victimless crimes, but the bankers and their politico cronies have set up the system to their benefit. Screw the real victims, us, the worthless taxpaying plebe.

  2. Even if they were aware of the potential harm their actions held, most of their actions were more or less within the letter of the law, Madoff and company excluded. The problem is the law and lack of regulatory agencies to provide oversight for the law. Everyone is in the business of greed to some extent, because money is good. The trick is to legislate in such a way that people improve their lifestyle without recklessly endangering other people. We have safety regulation for dumping hazardous materials, we should have regulations designed to prevent behaviors that would increase risk for investors without checks and balances.

  3. Their actions were within the letter of the law precisely because the law has been designed with their benefit in mind.

    Unrestrained capitilism is evil. And capitilism given further power by government in even worse.

    We really do need those regulations.

  4. Deregulation is also beneficial to the overall economy in certain situations – considering the timing of the development of credit default swaps, something that probably needs a major overhaul now, I think there’s a case to be made that the leverage CDS’ made possible sustained the economy through the post 9/11 economic slump.

    Our economy isn’t lacking in regulation even these days – we’ve never had, no country with laws they can enforce has ever had, unrestricted capitalism. It isn’t a case of “deregulation is always bad!” or “capitalism = evil,” it’s always a question of what and how much you need of any economic solution to accomplish your short and long term goals. It’s a balancing act. It should handled in moderation, and usually is – even if the moderate changes accumulate over time into radical ones like we’re seeing in hindsight now.

  5. The worst part of it is the fact that the people Obama has running the Fed are pretty much from the same group that fucked us over to begin with.

    This is what has had me hopping mad with the all the money being doled out.  It encourages moral hazard by executives with money that isn’t even their own.  If you never have to pay the piper, why stop the jig?

  6. If you never have to pay the piper, why stop the jig?

    Amen, Consi.  Common ground.  Lunch is on me if you’re in town.

  7. If you never have to pay the piper, why stop the jig?

    So, we the sheeple are paying the piper with our taxes. We are encouraging them to continue to do whatever they wish. Maybe when the Chinese come in and take over they will be able to straighten out the mess. Democracy IS the worst form of government, except for all the rest.  shut eye

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