Bernanke – Holder – Obama Find Themselves a Scapegoat

A brief chronology follows:

Bernanke – “There’s no housing bubble”, October 27, 2005 http://www.washingtonpost.com/wp-dyn/content/article/2005/10/26/AR2005102602255.html

 “Ben Bernanke was incredibly wrong”, July 28, 2009 http://mises.org/daily/3588

 

January 3, 2010, “Monetary policy and the housing bubble.”  Read Bernanke’s own rationalization of fed policy during the bubble – in his own words: http://www.federalreserve.gov/newsevents/speech/bernanke20100103a.htm

 

“Bernanke admits failure to see housing bubble”, February 7, 2011 http://www.irvinehousingblog.com/blog/comments/embarrassed-bernanke-admits-failure-to-see-housing-bubble

Bernanke – “Fed didn’t cause the housing bubble”, March 26, 2012 http://money.cnn.com/2012/03/22/news/economy/federal-reserve-housing-bubble/index.htm

 January 21, 2013 – “Bernanke clueless about housing bubble” http://silverunderground.com/2013/01/proof-leaked-bernanke-clueless-about-housing-bubble-in-07/

 Yesterday:

February 5, 2013 – US sues Standard and Poor’s for defrauding investors for inflating credit ratings for mortgage backed securities

http://www.washingtonpost.com/business/us-sues-sandp-over-inflating-mortgage-ratings/2013/02/05/2d235bf1-a337-409f-a968-3c7a96509bfc_video.html  Attorney General Holder says conduct was “egregious”

If we have learned one thing in the past 5 years it is this – the US government is the 800# gorilla in anyone’s room – anywhere – anytime.  That is a fact.  If it supports something – it’s a go – if it doesn’t – it’s a no go.  Stand in their way and you will be crushed.

So, the government does not sue itself – even though it clearly was the cause of the housing bubble – low interest rates – low credit standards – lots of money in the system to make all the loans – those are the causes – the government could have stopped it at any time but didn’t because it liked what it saw and it didn’t want it to end.

When it ended – does the government hold those who caused it accountable?

No.  That would require accountability – of themselves.

Instead they sue the rating agency which would have been pilloried and shunned had it dropped the fecal matter in the punch bowl by saying – it’s (mortgage backed securities) junk; don’t buy it.

The government – America’s top bankers, top regulators, top congressmen and congresswomen and the presidents and all the president’s men.  They loved the bubble and they didn’t think it would end.

Can you imagine a lawsuit against that gang?  Can you imagine accountability?

Not a chance.  Best to blame the messenger who didn’t have the moxie to stand up to the geniuses and deliver the message that no one would have believed anyway.

Clinton, Bush and Cheney – Obama and Holder – Bernanke and Greenspan – all desperately weak leaders – always looking for the good news – all afraid of their shadows – all afraid to embrace fundamentals – our leaders – all afraid to lead. 

 Postscript to this essay – August 5, 2011, S and P downgrades US debt.  US Government Officials attack downgrade analysis: http://abcnews.go.com/blogs/politics/2011/08/govt-official-us-expecting-sp-downgrade/    Obama used the downgrade as an opportunity to preach his “raise taxes” propaganda.

Final comment – Obama and his bureaucrats are incurring debt with no repayment program other than more devalued, printed, US fiat, Federal Reserve notes.   There is no one to indict them other than history – in the meantime, they have provided both a scapegoat and a built in defense for the S and P scapegoat as outlined above.  One need not be a genius to predict that they will follow this pattern as US financial conditions worsen under the burden of Obama debt.