Monday, December 9, 2013

Stockman: Paul Ryan Is a Fiscal Fake

David Stockman, former director of Office of Management and Budget, discusses the budget negotiation process and state of the U.S. deficit on Bloomberg Television’s “Bloomberg Surveillance.”


  1. P Morgan Chase, the Foreign Corrupt Practice Act, and the Corruption of America

    How different is bribing China’s “princelings,” as they’re called there, from Wall Street’s ongoing program of hiring departing U.S. Treasury officials, presumably in order to grease the wheels of official Washington? Timothy Geithner, Obama’s first Treasury Secretary, is now president of the private-equity firm Warburg Pincus; Obama’s budget director Peter Orszag is now a top executive at Citigroup.

    The Foreign Corrupt Practices Act is important, and JP Morgan should be nailed for bribing Chinese officials. But, if you’ll pardon me for asking, why isn’t there a Domestic Corrupt Practices Act?

    Never before has so much U.S. corporate and Wall-Street money poured into our nation’s capital, as well as into our state capitals. Never before have so many Washington officials taken jobs in corporations, lobbying firms, trade associations, and on the Street immediately after leaving office. Our democracy is drowning in big money.

    Corruption is corruption, and bribery is bribery, in whatever country or language it’s transacted in.

  2. New Documents Show How Power Moved to Wall Street, Via the New York Fed

    By Pam Martens: December 9, 2013

    Thanks to a trove of historic documents recently released by the St. Louis Fed, we are now able to see how the New York Fed, a bastion of Wall Street interests, maneuvered itself into control of that process.

    Strong, through force of personality, began to channel all trading of U.S. government securities through the New York Fed.

    Today, even Benjamin Strong would be shocked at the power concentrated at the New York Fed. The New York Fed is the only one of the 12 regional Federal Reserve Banks to have a Wall Street-syle trading floor with Bloomberg terminals and speed dials to the biggest firms on Wall Street. Since 1935, all open market operations of the entire Federal Reserve system have been carried out by the New York Fed.

    On its web site, the New York Fed explains its unique role as the central bank’s central bank: It is the sole manager of the System Open Market Account (SOMA) Despite being the regulator in charge of the largest Wall Street banks at the time that obscene levels of leverage and corruption collapsed the financial system of the United States in 2008, even while top Wall Street CEOs sat on its Board of Directors, the New York Fed continues to be in charge of placing examiners in these banks and functioning as their regulator.
    The fact that the New York Fed needs the goodwill of the major Wall Street banks to carry out its open market operations and to facilitate the orderly functioning of U.S. Treasury auctions, makes it a highly inappropriate regulator of the same firms, in the opinion of many observers.

  3. "Stockman: Paul Ryan Is a Fiscal Fake"

    Yup. Obvious David but true of course. Aren't they all?