"Let me get this straight," asks Jeff Koopersmith. "You're saying that banks refuse to lend to each to each other – so we have to give them trillions of dollars?"
October 13, 2008 – New York (apj.us) – It may be silly, but I am wondering why we haven’t passed a law to force them to lend to each other?
There were already very good reasons that people generally hated their banks.
Now of course, we are in the bank detestation ionosphere.
If one was a conspiracy theorist one might think that bankers got together in some dark cavernous hall below the Federal Reserve in New York and held a private meeting that went something like this:
Banker A: “Look, we have mismanaged and cheated for so long since Ronnie Reagan opened the vaults, I just don’t what we’re going to do.
Banker B: “Well, we could just go bankrupt. I’ve taken care of my family for the next five generations as I’m sure you all have.”
Bank C: “Yes, but that’s no good. If we are go under the world won’t be any fun anymore. No more great restaurants, no villas in Cannes, no polo ponies, no yachts, no Hollywood Hills hideaways, no six star hotels. We can’t do that”
Banker A: “Well, what do you suggest?”
Banker C: “Let’s call our lobbyists!”
Banker A: “Yes”
Banker B; “Double Yes”
Later that evening, all the lobbyists in finance, insurance, and real estate have a meeting. They elect Mr. K. Street as there representative to the financial committee meeting in the bowels of the City.
Now Mr. K Street becomes Chairman of Banker’s Lobbyist Committee and enters the room now filled with more than 75 bankers, insurnace company executives, cocktail waitresses and shoe shine boys. One banker is having his hair permed.
Mr. K. Street: Look gentleman, we have to bring in the insurance, realtors, and securities guys. While you Bankers contributed $50 million, these guys popped for another $400 million. With Half a Billion dollars we can go to town with Congress – believe me. They owe us.
Here’s the latest breakdown:
|Savings & Loans||$2,922,953|
|Securities & Investment||$113,167,129|
(Source:Federal Election Commission and the Center for Responsive Politics (OpenSecrets.org)
Banker A: I see, but gee. That’s only $840,000 per seat in Congress. Do you really think they’ll roll for that?
Mr. K Street: Are you kidding? All the lobbyists and lawyers contributing to these jokers gave$150 million LESS than you guys. I wouldn’t have thought that possible. Heh Heh.
Banker B: So what do ask for?
Mr. K. Street: Well, that’s up to you – but I would stretch things out a bit, and I would also lay the groundwork so that poor people get the blame for this mess.
Banker C: How are going to do that? Tell people the poor don’t put enough money in our banks?
Mr. K Street: No. No. Remember when the idiot liberals asked those morons at Freddie and Fanny – (Sorry Mr. M, Sorry Mr. M I didn’t see you sitting way down there.) – Well, remember when they had you guys giving at least some home loans to people who might have trouble paying those mortgages?
Banker F: Yeah. That’s right – but there really were not many of those compared to all home loans – and we sold those lousy loans right away through Lehman Brothers – (no to Dick Fuld) who then stiffed the Germans and Chinese and a lot of others on them. How can we use that?
Mr. K Street: Well, it’s the complexity of the matter. You start with what I would “sub-prime” loans – nothing like “ghetto loans” or anything like that – something milder – yeah –sub prime sound good to me. Then you add some French words – like ”Tranche” and then would put in a bunch of buzz terms like CDO, CDA, BBC – hahahaha. Well before you know it, those idiot neocons will be ready to string up the poor for trying to own a home! They’ll forget that many of us at this table could serve hard time for this mess.
Banker G: Mr. K. Street. You know I respect you – your stopped the congress from disallowing all those pesky service charges that pay my 45 million salary ever year, you made sure there was no cap on credit card interest rates. You invented the Credit Agencies that charge money to the borrowers to make sure they comply with what WE want! You’re a miracle worker. But I just don’t see how you’re going to do this.
Mr. K Street: First I am going to get AIG Insurance – the company that can’t pay off on all your criminal mortgage sales – and tell them to call Hank Paulson and tell him they are going to go bankrupt. If that happens – well it could be the start of a war between the US and the European Union! – China thrown in for good measure.
Banker U: Hmmm. I own a lot of defense industry stocks – that might not be a bad idea right there. You can stop right there!
Banker M: Oh shut up. You guys from Yale were spawned from Satan.
Banker A: Ok Mr. K Street, what else.
Mr. K Street: Well, then I am going to talk with Hank Paulson. He owes me one. Someone’s head is going to roll who is sitting at this table. I just don’t know whose. However, the first thing I’ll do is have the Feds take over Fannie and Freddie. They have to do that or the entire backbone of the nation will crumble. Once they do that – all you guys start lining up to be “saved” as well. Get it?
(The bankers nod in unison.)
Mr. K Street: Paulson will be looking at what? – One, two, three trillion dollars? If he doesn’t have a coronary then he’ll be primed to help. Yet we can’t move too fast gentlemen, we can’t move too fast. We still have to keep the idiot public’s eyes off us – and on the poor, and the “Chinese devils” and others “who caused this problem”. Heh-heh.
Banker G: Well, I see your point in some ways – but what will that accomplish?
Mr. K Street: That, my friend, will drive stock prices down as the little guys begin to panic and the formula traders being selling as well. Their little computer programs just ticking away maybe half – maybe more of the total value of the New York Stock Exchange, not to mention London, Frankfurt, Paris and Shanghai. People won’t even care about the banker’s culpability, if any, in this mess – they’ll just turn on the Congress and screech to be rescued! And I predict – as does all American pop culture – and this is pop culture in the making – that most of the western world will follow. All the governments on earth that count will be bailing out the banks, insurnace companies, credit card issuers – the whole magilla!
But I’ve saved the best for last. Once the stock markets are way down then you, the bankers have to stop lending to each other like you’ve always done in the past.
You will say you don’t trust the other bankers. Look to your right and look to your left. Now repeat after me: I DO NOT TRUST YOU! Again: I DO NOT TRUST YOU!
This will cause a second wave of plummeting stocks and no matter whether Paulson sees what’s coming or not – it will be too late. He’ll be forced to bail us all out – and with little or no rules. It will be the coup of the century! Believe me.
Bankers (in unison with raised champagne flutes): Hear hear! Here's mud in your eye!
Could this have truly happened? Probably not. It gives the financial industry far too much credit. Yet in essence, this is what did happen – only the word never had to be spoken.
Now, you, my children, my grandchildren, and perhaps their children will pay a price that will turn out to trillions, not billions of dollars.
Now that the floodgates are open, there is no turning back.
Jeff Koopersmith is an internationally renowned political consultant, opinion research authority and policy analyst. He has lobbied for causes including the alternative fuel sector and women's health, and is an expert on the international real estate market. He lives in Philadelphia, Washington and Geneva.