by Catherine Austin Fitts and Carolyn Betts, Esq.

(1) Crime that pays is crime that stays.

There is reason to believe that Wall Street and those they represent are holding loans without collateral, multiple loans secured by the same properties, and other fraudulent instruments among the “troubled assets.” Based on the secret “Treasury Conference Call” with 800 Wall Street insiders, we know the deal proposed to be passed by Congress isn’t the real deal promised to Wall Street.

(2) This smells like obstruction of justice.

Bail-out without due diligence of so called “troubled assets” is a perfect way to hide documentation of financial crimes. It is also a perfect means to launder both the past ill-gotten gains and new federal money spent recklessly and without necessary safeguards and oversight mechanisms. Be very suspicious when they tell you “we just can’t tell what’s in these troubled assets.” We can assure you that the federal government has field offices all across the country that deal with significant amounts of real estate and mortgage assets on a daily basis. If Treasury refuses for more than a decade to comply with the laws, with approximately $4 trillion missing (and counting), it is not competent to manage $700 billion of taxpayer money while its arm is twisted by Wall Street.

(3) Wall Street owes the federal government money.

We need to get stolen money back from the banks that served as depositories for the US government (including trillions for which the Pentagon and HUD could not account) and punish them, not create another opportunity for them to game the system and engage in criminal enterprises to rob consumers. To the extent there has been regulatory wrong-doing, let’s not let the miscreants leave town with the evidence.

(4) Good guys are shut out.

A bail-out provides no way for honest leaders to come to the fore and use their creativity and expertise to restore balance and integrity to the system or for unproductive and poorly-managed banks that contribute to current over-capacity in the banking system to die a dignified death.

(5) This results in more investment in the “bubble economy.”

Spending massive amounts on non-productive uses (“buying” worthless credit default swaps, mortgages with no collateral and derivatives, which could even include the derivatives used to manipulate the precious metals markets) as opposed to productive uses (repairing infrastructure, creating alternative energy systems, supporting inventing and production of “green” products) is inflationary.

This bail-out will drive prices of food, water and energy up for the people who can least afford it.

(6) Bail-out does not result in capital circulating in healthy ways.

The bail-out of Wall Street and too-big-to-fail banks and insurance companies that are getting bigger by the minute by swallowing up other failing financial institutions (and creating more institutions that are “too big to fail”) does not result in trickle-down to those whose money was stolen in recent swindles (S&L, dot.com, current housing crisis), i.e., the taxpayers/middle class and working poor.

(7) These arrangements will result in more corruption.

Centralized “fixes” are sure to result in black holes, no-bid contracts and other scandals.

(8) The bail-out drains the real economy, rather than invests in the real economy.

The US economy can’t be productive or grow if consumers don’t have jobs and can’t afford to purchase goods and services. Real stimulation of Main Street is accomplished through productive investment, not bail-outs that shift money to unproductive sectors. We should use all of our precious resources to reinvest in our people in the real economy.

(9) It props up sectors that need to downsize and consolidate.

There is significant overcapacity in the financial and banking sectors. Brainpower and talent needs to stop blowing financial bubbles and shift to economic activities that create real value.

(10) It is a temporary “fix” to keep Wall Street afloat until after the election.

Our resources are better invested in permanent, long-term solutions. This bail-out will not fix anything. Rather, it will help the perpetrators get away and ensure that the ultimate day of reckoning is worse.

The Administration wants to drain the real economy to bail out Wall Street. It seems to us that the more appropriate plan would be to require Wall Street to return the $4 trillion plus that is missing and use that to rebuild the real economy.

We think the time has come to reverse the flow. Go to any business school in the country. That is what they teach. Money should move out of unproductive sectors into productive sectors. The bail-out does just the opposite.

“Just say NO!”
Related Reading:

Bailout Mo’ Money Catherine’s Blog, March 11, 2009

67 Comments

  1. Catherine!

    The House just passed the $700Bil. Bailout Bill!

    Please do an emergency conference call
    for those of who are terrified about the
    next step, which is, Mike Ruppert predicts,
    the “final pump” from this “pump and dump”
    campaign before the total collapse of America.

    CAF, considering MCRs comments, Would you
    please do an emergency conference call to
    help guide us through todays events?

    Thank you for considering my request.

    With great respect and admiration,

    “UNDERDARK”

    THEREALUNDERDARK@GMAIL.COM

  2. I read Joe Biden’s mind last night. He was watching Sarah Palin speak, a look of utter astonishment on his face, smiling, reluctantly thinking:
    “Damn! She’s good!”

  3. There is so much that we don’t know. As I read the comments of some folks who have no compassion for people in debt, tell that to folks with 4 kids and minimum wage jobs or folks who got laid off. We can’t judge others unless we are in their shoes. I know that Catherine has said in several of her seminars/interview that people in govt etc. are to play ball or else. This is not opinion nor hearsay. People with kids have to play ball.

    There has been a brainwashing for a very long time. Most people don’t understand even now although alot of people are waking up.

    It is hard to have compassion for people who were buying foreclosed houses to try to flip them, but they too are victims of the brainwashing.

  4. One correction. Business schools do in fact teach the exercise of finance capitalism in preference to productive capitalism. A study of the events of the past 30 years of de-industrialization would show that business schools have had a pernicious and deleterious effect on the economy of the world not just the US.

  5. Your point #8 is what Jack Bogle (founder of Vanguard) says. See his interview by Bill Moyers on 9/28/07 at PBS.org, as well as other Bogle sources/writings/interviews.

  6. Problems;
    1. The Wall Street guys are smarter than the Washington guys
    2. The Wall St guys have bought the Washington guys.
    Solution;
    PUT THEM ALL IN JAIL!!!

  7. Problems;
    1. The Wall Street guys are smarter than the Washington guys
    2. The Wall St guys have bought the Washington guys.
    Solution;
    PUT THEM ALL IN JAIL!!!

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