Former S&L Regulator: 'Absolutely' A Banking Bailout Coverup

Hat-tip to Crooks & Liars for content!

This Bill Moyers interview is going viral so fast, I can't even keep up with it. And for a very good reason - former S&L regulator Bill Black explains exactly why the current banking bailout is a mistake.

complete transcript

Full interview video is here

There's so much information, you simply have to read or watch the entire thing. Some snippets:

BILL MOYERS: Yeah. Are you saying that Timothy Geithner, the Secretary of the Treasury, and others in the administration, with the banks, are engaged in a cover-up to keep us from knowing what went wrong?

WILLIAM K. BLACK: Absolutely.

BILL MOYERS: You are.

WILLIAM K. BLACK: Absolutely, because they are scared to death. All right? They're scared to death of a collapse. They're afraid that if they admit the truth, that many of the large banks are insolvent. They think Americans are a bunch of cowards, and that we'll run screaming to the exits. And we won't rely on deposit insurance. And, by the way, you can rely on deposit insurance. And it's foolishness. All right? Now, it may be worse than that. You can impute more cynical motives. But I think they are sincerely just panicked about, "We just can't let the big banks fail." That's wrong.

BILL MOYERS: But what might happen, at this point, if in fact they keep from us the true health of the banks?

WILLIAM K. BLACK: Well, then the banks will, as they did in Japan, either stay enormously weak, or Treasury will be forced to increasingly absurd giveaways of taxpayer money. We've seen how horrific AIG -- and remember, they kept secrets from everyone.

BILL MOYERS: A.I.G. did?

WILLIAM K. BLACK: What we're doing with -- no, Treasury and both administrations. The Bush administration and now the Obama administration kept secret from us what was being done with AIG. AIG was being used secretly to bail out favored banks like UBS and like Goldman Sachs. Secretary Paulson's firm, that he had come from being CEO. It got the largest amount of money. $12.9 billion. And they didn't want us to know that. And it was only Congressional pressure, and not Congressional pressure, by the way, on Geithner, but Congressional pressure on AIG.

Where Congress said, "We will not give you a single penny more unless we know who received the money." And, you know, when he was Treasury Secretary, Paulson created a recommendation group to tell Treasury what they ought to do with AIG. And he put Goldman Sachs on it.

BILL MOYERS: Even though Goldman Sachs had a big vested stake.

WILLIAM K. BLACK: Massive stake. And even though he had just been CEO of Goldman Sachs before becoming Treasury Secretary. Now, in most stages in American history, that would be a scandal of such proportions that he wouldn't be allowed in civilized society.

BILL MOYERS: Yeah, like a conflict of interest, it seems.

WILLIAM K. BLACK: Massive conflict of interests.

BILL MOYERS: So, how did he get away with it?

WILLIAM K. BLACK: I don't know whether we've lost our capability of outrage. Or whether the cover up has been so successful that people just don't have the facts to react to it.



[edit on 5-4-2009 by shrike071]

reply to post by shrike071



i recall that Secretary Paulson (ex-CEOof GS)
insisted, nay Demanded...
that the $700bn in future TARP money come with no-strings attached, & no 'wrongdoing' charges could be leveled against whomever decided where to Spend the funds, or how much, or for whatever securities/paper was deemed necessary ...

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~


the cover-up, hood-winking, goes further & deeper upon inspection...

BILL MOYERS: A.I.G. did?

WILLIAM K. BLACK: What we're doing with -- no, Treasury and both administrations. The Bush administration and now the Obama administration kept secret from us what was being done with AIG. AIG was being used secretly to bail out favored banks like UBS and like Goldman Sachs. Secretary Paulson's firm, that he had come from being CEO. It got the largest amount of money. $12.9 billion. And they didn't want us to know that. And it was only Congressional pressure, and not Congressional pressure, by the way, on Geithner, but Congressional pressure on AIG. ...

What's still being buried or made opaque is that these monies to GS & UBS, among others, were not for 'mortgage securities' as we are being railroaded into thinking the whole financial mess is about.


NO
the recent AIG installment of billion$ was for derivatives known as CDS -
or credit default swaps.
which can be described as 'Gentlemen's betting slips'...
wagered with no money or collateral to make-good any future payment,
as they just created billions & trillions of these 'bets' and swaping among themselves as counter-parties...
the cabal of Issuers having a reasonable assurance that the US Treasury would bail-them-out ...as a last resort,

('assurance': by the fact that ex-CEOs from a small cadre of top/elite banks
~OR/AND~
former Federal Reserve chairmen or governors would all be in strategic
positions within the financial /economic/regulatory arms of government...
for the next generation, at least guaranteeing a 'positive & beneficial' result)



thanks





[edit on 5-4-2009 by St Udio]

Nice find! - thanks for posting.

Hope this goes right round the world & back & mandatory viewing for everyone... if enough people peek under the skirts of the banking system & realise just how much of a bunch of criminals they are & how they're hellebent on scr*wing the rest of us & getting rich then maybe - just maybe something might actually change... I can dream can't I?... I hope so anyway...

I hear that the derivatives are the great black hole that will cause everything to go down. I am asking this question - please pardon its ignorance. If the derivatives are the problem why can't they are be declared null and void?

[edit on 4/5/2009 by sad_eyed_lady]

so black is basically saying it is a cover-up but not so sure about a conspiracy...........maybe he is saying that just so he can get mainstream credibility.............

moyers had another interview a while back that echoed the same things simon johnson wrote about in the quiet coup ........that the bankers, and Big corp's only have their sphere of interest's in mind when they make decisions and when these people create a revolving door between public and private office you have a recipe for ......(figure it out).....

Now sure Geithner and Bernake WILL BELIEVE IT IS THEIR DUTY TO LIE to the people in order to manage pereceptions and future EXPECTATIONS for better growth as well as consumer spending (i.e no deflation expectation for people)...

.in addition does black go into detail about why he says...they don't want people to know what went wrong......is it because the financial system was so GREEDY and focused on making short term "alpha" that they decided to play a game of deregulaton casino and this was ALLOWED because they had enough fox's watching the henhouse.......(like they still do!) and that's why they can't really talk about the insolvency or address it....now that is corruption......

but knowing they had enough fox's in the henhouse to be bailed out when they get the deregulation they were fighting and somehow allowed to have is clearly conspiring to do something with the full intention of the negative consequenes but going ahead with it because they knew their would be golden bailout parachutes....

Something has got to blow wide open and soon, maybe tomorrow. You can't turn the furnance up without feeling the heat. At the rate this incrediable "cancer to society" is unfolding makes one wonder just how close mass chaos is. Without jobs and a system of exchange their can be no society and "good luck" becomes "just how screwed are we?". Royally!! I would venture to say.

reply to post by St Udio


You are right and we wont have a correct value until 2014. I expect a Global financial collapse by 2010.

Paulson is still in hiding. I hope he stays there!

Just got that from a friend and fowarded it on. I was numb after I saw it.
This is one conspiracy we cannot afford to let go of. Its horrendous.
Its noble for Barak to be beholding to favors from friends, its another to to Overpay the favor by a thousand fold, at taxpayers expense.
Put these morons into recievership, before they bankrupt the entire planet.
No wonder China and Geithner say develop a new currency, its to hide the extent of the fraud, whether Duckettes or Dollars it the same.
Barak can be the greatest president in history if he took the bull by the horns, instead he's grooming it!
Fire those frauds, and stop the fiscal hemmoraging!

[edit on 5-4-2009 by Sys_Config]

[edit on 5-4-2009 by Sys_Config]

Originally posted by sad_eyed_lady
I hear that the derivatives are the great black hole that will cause everything to go down. I am asking this question - please pardon its ignorance. If the derivatives are the problem why can't they are be declared null and void?

Probably the best overall solution, but these estimated $100 TRILLION worth of "credit default swaps" (nothing but legalized gambling that represents 100X the entire world's GDP), are so pervasive and intertwined that it would be hard to do.

And anyway, that would defeat the new U.S. bankster bail-out plan that requires all profits to be privatized while any losses are socialized.

America has become the worlds greatest comedy act with a power elite manifesting an elaborate prank played at the expense of an unwitting American public the - who cannot (and refuse to) fathom that their conception of reality might be a grand joke, and their entire lives the punchline of a strata of society which is seeking to evolve. The banksters and elite of the country are going to keep concocting grander and more absurdly blatant ways to exploit and usurp our souls until they get a rise out of us - when we realize that we've played the fool and attempt to retaliate - at which point they'll play the game they've been building up for all along. And that is when things get really hilarious.

[edit on 5-4-2009 by illusionincarnate]

Originally posted by sad_eyed_lady
I hear that the derivatives are the great black hole that will cause everything to go down.
I am asking this question - please pardon its ignorance.

your question is not stupid or ignorant....

If the derivatives are the problem why can't they are be declared null and void?

It is a complex 'problem', the derivative paper could/should be declared null & void--- except that action would put 'uncertainty'
into the equasion ~
and If any-or-all of USA generated and issued securities were all going to be questioned as to their validity or value or liquidity...
then the many products made in the USA such as bonds,
treasuries, stocks, mortgages, debt instruments, even contracts...
made by any Agencies or Firms operating under the rules of the USA regulators will be very hard to market, in-the-future.

So, by default, the present stash of cruddy, toxic paper, aka derivatives,
have to be 'honored' at face value and then 'monetized' by someone
~in this case the US Treasury &/or the Federal Reserve~ (and passed along to the Taxpayer)
Like it or not, the Fed/Treas are monetizing the garbage so that all the other Trillions in legitimate securities can continue to have a 'market' in which to sell-trade.
Now... we can surmise that seedy businessmen knew that they could 'infect' the financial system with a modest ammount of 'garbage'
and make off like bandits with nary a slap-on-the-wrist....
but too many -- got too greedy -- all at once --- and the system is reeling!

we are getting schooled like kindergarteners, & are told our unsophisticated brains cannot fathom the intricacies of the derivatives...
so we need to retain & give bonuses to these Specialists...
imho, this is just hush money to silence the minds that can reveal the rats & the whole scam


i don't know if i've helped you out any, but that's about 90% of the tale...

thanks

[edit on 5-4-2009 by St Udio]

Well put St. Udio, God Damn those that did this.

But they'll fly off in their private jets to their hiding places and laugh at the chaos that befalls the commoners.

So, I hope that you all are planning on attending the Tea Party on April 15th?

Come out and show that you are outraged. Then remember your outrage next time you vote.

Thanks for the thread, very informative and I hope people wake up more everyday to this fraud.

As exceeding pressure persists on the political and financial powers becoming greater, as congressman, financial experts, and the the people are becoming more knowledgeable, those elite, and their puppets must be running more scared every day.

What can these elite do at this stage to slow this knowledge down, to stop the people knowing the truth and the dangers of them being exposed?

I believe maybe a false flag very soon, or a 'NWO', or both, as soon as possible to take the pressure off!

[edit on 5-4-2009 by DarksDeception]

Originally posted by gaslaugh123
Something has got to blow wide open and soon, maybe tomorrow. You can't turn the furnance up without feeling the heat." At the rate this incrediable "cancer to society" is unfolding makes one wonder just how close mass chaos is." Without jobs and a system of exchange their can be no society and "good luck" becomes "just how screwed are we?". Royally!! I would venture to say.

My sentiments exactly. How long can we go before the whole pot boils over. To me, it seems we are at critical mass right now. people are nervous, and I keep wondering exactly when are people going to figure out, it's time to make a run for the exits, so to speak??

Gore Vidal said it best ... once you deregulate a republic or empire there isn't one left. You need to regulate a society to keep it growing.

In essence the USA is becoming a third world country, one without borders or regulations.

This is BIG.

The problem is America is like a schoolkid who has a choice of two classes - economics 201 or fashion design. The schoolkid hates economics. It is boring. Plus she never had Economics 101 so she's over his head if he even tries to take that class and she knows it.

[edit on 6-4-2009 by hadriana]

This is pretty good.

I think he understates the problems but nonetheless he does point out the whole system was based on fraud and that is the most important thing the public needs to understand.

The thing is I have a feeling the truth actually is too terrible for it to come out, once it does the economy will completely collapse. I have a feeling Obama now knows this and that is why they are essentially stalling, because the alternative is immediate economic destruction.

I just recently read a story how AIG was actually selling CDS contracts cheap with off the book agreements with the buyers that they would actually never pay out. The buyers agreed to buy these CDS's because it allowed for them to get the AAA ratings on their packages of crap and sell it to some sucker because it was supposedly insured accept it really wasn't. If that kind of blatant fraud was going on at AIG I think it is likely many others were doing the same thing in order to attempt to compete.

Of course the problems are to big and the truth will come out eventually, soon I am afraid. The signs are already there, the fed is already buying our own bonds in a futile attempt to keep rates down. This is a clear sign the market is getting to point where they are losing faith in the US governments ability to pay back its debt. If they keep growing the debt at a trillion plus a year (pretty much an absolute certainty) the fed will have two options accept massive deflation or attempt inflation. Both are terrible for the citizens.

I think the sad fact is at this point we are pretty much screwed no matter what.

There are over 600 Trillion in derivatives that we know about, some estimates place the number at over 900 trillion. All of them worthless created by international Bankers mostly at the Bank of England.

There will be massive inflation, too much money is being pumped into the banks, and banks themselves are sitting on large amounts of cash. When this liquidity hits the marketplace inflation will tear into the fabric of the US economy, and be extension the world economy.


Banks should have been allowed to fail, the bottom line is massive looting and embezzlement require the cover of bailout program.

So, when the next bailout is announced, when the FED or the Treasury ask for Trillions more to try to fix this....

What do we do? Do we sit there and capitulate, in the face of knowledge of this?

One man's opinion does not make a case, but from what I've read, this man knows what he's talking about.

This summer indeed will be faced with many interesting things. I hope and pray that violence is not one of them, but judging from the G20 protests, I fear it will be anything but.

Great post, great find, S&F