The beginning of the end of the fed’s grotesquely inflated housing bubble began with the collapse of AIG, which sold “insurance policies” called credit default swaps, with no backing other than other deriviatives, to the likes of goldman sachs as part of massive bets GS was making against the housing bubble. (Goldman undoubtedly knew W bush was blocking state attorneys general investigations into predatory lending in all 50 states http://www.washingtonpost.com/wp-dyn/content/article/2008/02/13/AR2008021302783.html and thus knew the transitory nature of the bubble ) The taxpayer bailout of AIG was nothing more than a payoff on goldman’s massive bet.
Former NY Governor Eliot Spitzer said:
“The appearance that this was all an inside job is overwhelming. AIG was nothing more than a conduit for huge capital flows to the same old suspects, with no reason or explanation.”
Obama has allowed this and all the other crimes of wall street and the fed to go completely uninvestigated and unprosecuted. To this day we still don’t even have AIG’s internal documents relating to their reckless behavior, despite AIG being under direct US government ownership post-bankruptcy. http://www.washingtonsblog.com/?s=spitzer
So just a quick review: the insiders flooded the financial system with toxic derivatives (mortgage backed securities) based on unpayable mortgages which were created under clinton’s loosening of mortgage requirements supposedly in the name of getting poorer people into housing. It’s inconceivable that clinton’s advisors were ignorant of the fact that this deregulation, backed by US-backed agencies like fannie mae, would not result in massive fraud since the mortage brokers could profit from the sale without having to worry about the credit worthiness of the borrower. Obviously the smart money knew where to place their bets, and they paid off handsomely. Framing “deadbeat homeowners” for it is not only unjust (banks were supposed to vet their creditworthiness, what average joe knows enough to judge for himself?) but entirely misses the real, conscious and criminal interests involved.
The actions of the fed and the clinton and bush administrations resulted in an utterly predictable mortal wounding of the global econonmy, and a recipe for financial catastrophe, because the toxic derivatives permeated the entire system due to the ratings agencies entirely fraudulent AAA ratings. Their coordinated actions and insider trading is more than incriminating. They knew exactly what they were doing. As Catharine Fitts said on this show, they wanted to engineer a housing bubble and then pop it. Why? Obviously so they could profit (which they did immensely) but also because they want to destroy this country’s economy (remember clinton’s NAFTA treaty) and create a pretext for genocidal austerity (the shock doctrine). The US middle class was/is the biggest obstacle to the takeover of this country and the US military, which is essential to the takeover of the rest of the world.
We can still stop this wickedness simply by defunding the mobsters who are implementing it. Their funding comes from multiple sources: debt-based currency, derivatives and the “drug war” are the biggest sources. All of these could be shut down at any time by passing the American Monetary Act (included in Kucinich’s NEED act), restoring glass steagall, outlawing derivatives and abolishing the drug war. This is not rocket science people. The alternative is national ruin.
“If this mischievous financial policy [greenbacks]… should become endurated down to a fixture, then that government will furnish its own money without cost. It will pay off its debts and be without debts. It will have all the money necessary to carry on its commerce. It will become prosperous beyond precedent in the history of the world. The brains and wealth of all countries will go to North America. That government must be destroyed or it will destroy every monarchy on the globe.” — London Times, referring to Lincon’s issuance of debt-free money. http://uts.cc.utexas.edu/~wbova/fn/history/greenbacks.htm
We are, in effect, fighting the same war we won in 1776. We can do it again.
Addendum: It gets better. See http://thoughtcrimeradio.net/2012/01/pivotal-player-in-housing-collapse-linked-to-cia/