Tuesday, October 14, 2008
U.S. to partially nationalize 9 banks; is this European socialism? Would Soros approve?
So, are we part of Europe now? Have we reversed the American Revolution (the heritage of Colonial Williamsburg) and run back to the mercantilism of "mother country"? (Remember your U.S. History from high school?) Are we heading toward European style socialism? You would think so, with the announcement last night that the United States would follow suit behind European governments and buy stakes in nine major banks. The decline in capital for a few of the major banks, particularly Bank of America, compared to a year ago, is simply shocking. If the banks’ financial results improve, the government may be able to sell the shares back with a profit.
The government also announced other guarantees, such as unlimited FDIC coverage of non-interest bearing accounts for business operations, such as payroll.
George Soros (behind Barack Obama) will be pleased.
Here is the President’s statement from the Rose Garden, just moments ago.
Last night ABC Nightline described, in employee interviews, how executives and employees at Washington Mutual had been pressured to go out and sign up business (bad mortgages, and derivatives), paid only by commission, and threatened with firing for not making quota or speaking out. Similar stories have circulated about subsidiaries of Lehman Brothers. The systems of how bank and financial institution employees or associates are compensated would seem ripe for reform.