A Den of Vipers and Thieves

[finehoe]

"Gentlemen! I too have been a close observer of the doings of the Bank of the United States. I have had men watching you for a long time, and am convinced that you have used the funds of the bank to speculate in the breadstuffs of the country.

When you won, you divided the profits amongst you, and when you lost, you charged it to the bank. You tell me that if I take the deposits from the bank and annul its charter I shall ruin ten thousand families. That may be true, gentlemen, but that is your sin!

Should I let you go on, you will ruin fifty thousand families, and that would be my sin! You are a den of vipers and thieves. I have determined to rout you out, and by the Eternal, (bringing his fist down on the table) I will rout you out."

Andrew Jackson, original minutes of the Philadelphia bankers sent to meet with President Jackson February 1834,  Andrew Jackson and the Bank of the United States (1928) by Stan V. Henkels

[buckethead]

http://www.zerohedge.com/contributed/2012-20-16/jamie-dimon-endorses-letting-giant-banks-fail-firing-incompetent-executives-a

Jamie Dimon told Meet the Press:

We support getting rid of “too big to fail.” And it’s very important thatâ€"and this is notâ€"this is aâ€"not going to even remotelyâ€"we’re going to make money, we’ve got tons of capital. But we support “too big to fail.” We want the government to be able to take down a big bank like JPMorgan, and it can be done. We think Dodd-Frank, which we supported parts of, gave the FDIC the authority to take down a big bank, and when it happens, I believe compensation should be clawed back, the board should be fired, the equity should be wiped out, and the bank should be dismantled, and the name should be buried in disgrace. That’s what I believe. We need to put that back in the system, and we’ll work with the regulators to try to get that back in the system.

Of course, letting insolvent and poorly managed banks fail, firing executives, wiping out shareholders, and clawing back executive compensation is just what the doctor ordered … in 2008. If that had happened, then we would be through the economic crisis by now.

Moreover, Bill Black (professor of economics and law and former chief S&L regulator) responds to Dimon’s statement by making a very important point:

You can’t have a system work the way he is saying. So, if the institution is allowed to stay this large, it will be too big to fail, and its creditors will be bailed out. And that’s to prevent what is feared to be a cascade of failures, in which one big bank would then cause the failure of the next big bank, etc., etc., and you would have a global crisis. So, allowing them to be this big, even conservative economists call this crony capitalism, and they say that it creates such competitive advantage in it for the systemically dangerous institutionâ€"JPMorgan in this caseâ€"that it is the equivalent, when they compete with smaller banks, of â€" and I’m quoting â€" “bringing a gun to a knife fight.”

So the only way this can work is to shrink the systemically dangerous institutionsâ€"this is the 20 largest banks in the United Statesâ€"down to the point that they no longer pose a systemic risk, they are no longer too big to fail, and therefore, they will no longer have this implicit federal subsidy that completely distorts competition. And, of course, we’re not just talking about destroying market systems; this also destroys democracy, because these giant institutions have so much political power. And lastly, the statement is completely disingenuous because JPMorgan in fact opposes all efforts to get rid of “too big to fail.”

[finehoe]

"It is one of the serious evils of our present system of banking that it enables one class of society, and that by no means a numerous one, by its control over the currency to act injuriously upon the interests of all the others and to exercise more than its just proportion of influence in political affairs."

Andrew Jackson, Farewell Address

[buckethead]

http://youtu.be/8y06NSBBRtY

http://youtu.be/QeYgLLahHv8