But now the originators of the leveraged-buyout business model want to control taxpayer-backed banks, to apply another round of leverage to already crippled banks in order to squeeze out all the profits possible. Although this comes at a cost to duped and already drained taxpayers, regulators, legislators and the American public would be foolish to expect anything else from the private equity crowd. If the FDIC thinks it has a problem now, wait until the next implosion of leveraged banks happens.Absolute continuity with what got us here.
Friday, August 28, 2009
It's not so nice to see that the crash that was driven by finance is now being covered up by a recovery that is limited entirely to . . finance. There's the "two economies" problem nicely explained by Max Fraad Wolff. One of my Capitalist Pals discusses the continuing wave of bank failures around the country, eclipsed by stories about Goldman Sachs's profits. Finance has managed to create multiple tiers even within itself, with the local banks dying along with the job base that top-tier banks have long invested in destroying. A slice of Mr. Gilani: