On MSNBC's Morning Meeting on Friday, host Dylan Ratigan celebrated Halloween by donning a wig and dressing in revolutionary garb like his favorite Founding Father, Thomas Jefferson, channeling the former president's trenchant criticism of big banks.
Ratigan pointed out that Jefferson was the first and most vocal opponent of Alexander Hamilton's proposal for a federal bank. Jefferson's greatest fear, Ratigan announced in comparison to our current economic crisis, was a "bank takeover of the government that would leave taxpayers as slaves to bank-run gambling casinos." Quoting Jefferson directly, Ratigan said, "the banking establishments are more dangerous than standing armies."
Around Ratigan's neck hung a large padlock with TBTF written on it, signifying the government's complicity in the "too big to fail" doctrine. The popular (and controversial) finance blog Zero Hedge alleged on Thursday evening that the Obama administration is seeking to turn TBTF into official canonized law and the blog attempted to quantify the TBTF subsidies by the government.
From Zero Hedge:
In essence it guarantees that the massive mega banks like Goldman Sachs, BofA, and JPM will take on so much disproportionate risk the next time around (and with a moral-hazard encouraging Federal Reserve as risk regulator virtually guarantees their implosion) that not only will they blow up spectacularly once again, but that their bailout next time around will surely force America, already strapped with trillions of new upcoming debt courtesy of stimulus after stimulus, into sovereign insolvency.
The article cites an analysis by the Center For Economic and Policy Research as proof that government contributions to big banks amount to nearly 50 percent of bank profits. The article concludes, "as profits are a function almost exclusively of banker [compensation] as the only substantial banking overhead (consisting of base and bonus), the sad conclusion is that the government directly is funding at least half the bonus pool for all the TBTF institutions."
See the video of Ratigan as Jefferson below:
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