No-Fault Banking
Posted by JimYesterday I noted that it is important to appreciate the difference between banks and bankers. Think of the latter as a close-knit economic guild. Because of this, they can move freely from bank to bank, collecting bonuses and options along the way. No where is it remotely important to actually perform well.
If you doubt this, just check the roster of those at the helms of the nation’s financial institutions. Much in the mode of the Chinese Cultural Revolution, this group of pirates has been ‘rehabiliated’. No matter the scope of their past and endless financial missteps, all has been forgiven. The inmates are back in charge.
The President assumed his pardon would carry with it some form of obligation. But thus far, the ex-miscreants have slyly thumbed their nose at our leader. They are chastened to be sure, but they have discovered a vital truth: it is not necessary to loan money to make a bank profitable. Just borrow at the discount window for nothing and sit on treasuries.
I know it is prudent that alcoholics should avoid bars, but we need credit in this economy. The President must either accept the reality of a very slow economic recovery or be ready to endure the slings and arrows from Fox News when he is forced to semi-nationalize the banks.
