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According to the Collins English Dictionary 10th Edition fraud can be defined as: "deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage".[1] In the broadest sense, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation. Defrauding people or entities of money or valuables is a common purpose of fraud, but there have also been fraudulent "discoveries", e.g. in science, to gain prestige rather than immediate monetary gain
*As defined in Wikipedia

Wednesday, September 22, 2010

Goldman Sachs and the Bailout

Goldman Sachs's lobbying and acceptance of the government bailout funds was hardly a socially responsible action especially when you consider that it was their financial dealings which contributed to the present meltdown of the financial system and which helped bring about the Great Recession.

The Big Bailout, Two Years Later

The Terrible Tale of TARP

By DEAN BAKER - CounterPunch

Two years ago, the top honchos at the Fed, Treasury and the Wall Street banks were running around like Chicken Little warning that the world was about to end. This fear mongering, together with a big assist from the elite media (i.e. NPR, the Washington Post, the Wall Street Journal, etc.), earned the banks their $700 billion TARP blank check bailout. This money, along with even more valuable loans and loan guarantees from the Fed and FDIC, enabled them to survive the crisis they had created. As a result, the big banks are bigger and more profitable than ever.

Now, the same crew that tapped our pockets two years ago is eagerly pitching the line that their bailout was good for us. It may be the case the history books are written by the winners, but that doesn’t prevent the rest of us from telling the truth.

Let’s step back to where we were two years ago. The huge investment bank Bear Stearns had collapsed. So had Fannie Mae and Freddie Mac, the mortgage giants. Lehman Brothers, the fourth largest investment bank had also gone down. AIG, the country’s largest insurer had been put on life support by the government.

At this point, Merrill Lynch, Morgan Stanley and Goldman Sachs, the three remaining independent investment banks, all faced runs that would quickly sink them absent government intervention. Citigroup and Bank of America, two of the three largest commercial banks, were also almost certainly insolvent. Many other banks also faced insolvency, especially if they took big losses on their loans to other institutions that were about to go bankrupt.

This was when the Wall Street boys made their mad rush for the public trough. They enlisted everyone that mattered in the effort, including Treasury Secretary Henry Paulson, Federal Reserve Board Chairman Ben Bernanke, and Timothy Geithner, then the head of the New York Federal Reserve Bank.

Read the full article here


Anonymous said...

"You should be very peeved. Everything in this country is run for debtors, speculators, multinational corporate interests and the banking oligarchy. This is just another one.... under the guise of whatever is convenient to use. Watching the speculator class clap in glee on CNBC is disgusting..... as long as it increases asset prices, everything is fine with them. As Greenspan has telegraphed in various appearances the past year the best 'stimulus' in their eyes is the wealth effect via asset price inflation. As if there are no knock off effects. Bernanke is taking that playbook and running with it."

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