Tag Archives: Washington Mutual

Attention today (Monday September 29, 2008) has been focused on the House of Representatives in Washington, D.C., which made a “show vote” against “socialism” and government bailout of the financial industry.  Yet everyone over the age of 6 knows that today was just partisan showmanship, and that Congress will rescue the starving billionaires and “small timers” (i.e. mere millionaires) on Wall Street as surely as they will vote themselves a pay raise sometime in the next few years and create more exemptions for fraud or acts of oppression committed by government officials.  No one in the Republican leadership or the 94 Democrats who joined them in voting down the Republican President’s bill admitted that it is GEORGE W. BUSH’S America, the nightmare of corporate welfare and immunity for financial sleight of hand artists, largely envisioned by Daddy George H.W. and implemented by and under William Jefferson Clinton, which is collapsing.  Populism will blame Wall Street, but it was Bill Clinton’s repeal of the Glass-Steagal Act in 1999 and all the concommitant removal other “brakes” places on the rampage of international bankers on cocaine which has led to the current meltdown.  Why is it that we are amazed at the puppet theatre played out in Congress today?  The members on both sides of the aisle are actually clamouring for yet MORE government intervention because we have repeatedly voted for the worst of the worst of both Republicrat and Democan Parties over the past two decades.  The Republican leadership made it pretty clear that the ONLY reason Bill 3997 failed today was because Nancy Pelosi opened her mouth and said a few semi-rational and coherent things about the effects of deregulation and greed on the collapse of the most insane paper-money manufacturing scheme (securitized mortgages) in the history of the world.  But until SECURITIZED MORTGAGES ARE EITHER ABOLISHED or fully regulated like ALL OTHER SECURITIES in this country, the exponentially increasing risks will continue to pile up. 

As of the present moment, I think that insufficient attention has been played to the government’s intervention in the collapse of Washington Mutual.  Late Thursday night, an incredible thing happened: Washington Mutual made known to the government that it was on the verge of collapse, and OVERNIGHT the government brokered a takeover of Washington Mutual whereby 100% (or something very close) to the government insured deposits, loans, credit card accounts, and other “assets” of Washington Mutual were transferred to JPMorganChase while 100% (or something very close) of the corporate liabilities (i.e. equity shares and bonds, implying UNSECURED obligations of the bank) were declared WORTHLESS. $1.8 BILLION in financial manipulation OVERNIGHT. 

Where is the “wall of separation between government and the private sector these days?”  Since when, in a non-Communist, non-Fascistic economy, can the government in effect order a merger of two major businesses without shareholder consent or litigation of any kind?  This is called a “Command and Control” or “Fiat” economy.  Nothing of this level of dictatorial efficiency was ever achieved or implemented in Nazi Germany, the U.S.S.R., or anywhere else to the best of my knowledge.  The Kings of England up through William of Orange, Adolph Hitler, Joseph Stalin, and Mao Tse-Tung all had more constituencies with whom to contend and negotiate than the financial authorities who merged these two gigantic banks—which happen to be the greatest single offenders in the whole securitized “mortgage backed equity/collateral backed obligation” debacle.  The lack of discussion or any widespread dissemination of information regarding the details or the mechanisms of the Washington Mutual/JP Morgan Chase “overnight shotgun marriage” last week was just a prelude to the “show trial” in Congress today, where amateur actors tried to pretend that Congressional approval of the bailout is all but pro forma. 

The Great Leader GWB will, within a few days, achieve the complete reimbursement of his buddies in high finance if he has to do so by (hush-hush) executive orders—I have no doubt of that.  What I wonder is whether Ron Paul or anybody else on the House Floor was thinking how completely content-free the debate really was, and how pointless the show of posed opposition to the implementation of something close to pure communism in the financial sector.  IF the Federal government can, without comment, by mere announcement merge JPMorgan Chase and Washington Mutual OVERNIGHT in one week, there is really no meaningful limit to what the Government and and will do, given a week or two, with or without rubber-stamped congressional approval. 

So in short, to those of you who were in favor of the Bill 3997 bailout, I say, “be of good cheer, Big Brother will take care of you whether the Puppet Actors in Congress approve it outloud today, tomorrow or never.”  To those of you who think that Congress struck a blow for economic integrity and allowing the free markets to take care of their own greatest leaders’ failures, I would say: look at JPMorganChase and Washington Mutual merger that took place without application to the Antitrust Division of the DOJ, the Federal Commerce Commission, or anyone else, and tell me that it makes any difference what Congress does.  Look at all the dozen or so mergers of the past couple of weeks and tell me that there is a rule of law or free market economy at work here.  Where were the shareholder votes necessary to approve these mergers?  Where were the bids and white knights and marketplace speculation?  ALL of these things have been suppressed and coopted by the government to hide the failures of the corporate-communistic policies of the past 20 years.  Had the free market or even free discussion of these issues been allowed, all the truth about who is responsible for the present state of affairs, and who authorized the exemption of securitized mortgages from securities fraud regulation (and even private civil litigation complaints or demands concerning such securities fraud).  

Free Market Capitalism is dead.  Socialism is managed by and for the primary benefit of the operators and managers of the major financial corporations.  Even the small private shareholders in financial institutions can be wiped out NOT by the Market but by the Government, in a moment, in twinkling of an eye—but without any trumpets…..