Politics 101, Economics Edition

(warning: lengthy, Socratic-ish discourse ahead):

Damn It Feels Good To Be A Banker

Over at POLITICO, we learn that Wall Street intends to turn the full wrath of it’s newly-increased, post-Citizens United and SuperPAC strength, against President Obama this year. Expect a veritable blizzard of deceptive, negative advertising.

The usual suspects will, no doubt, tout this as proof positive that claims of Obama being friendly to Wall Street are – and always were – simply wrong at best, and more likely the malicious fabrications of angry liberals (yeah, I know, but this is what these folks really think) who, in Robert Gibbs’ notorious phrasing, would’ve preferred a President Kucinich (but wouldn’t even have been satisfied with that). But the reality is far simpler.

It isn’t that the POLITICO piece is wrong – because I doubt it is. The Center for Responsive Politics does excellent work, and there’s no reason nor evidence to suspect they’re wrong when they say that Wall Street’s number one priority this election cycle will be to defeat President Obama (followed closely by various vulnerable Democratic legislators the bankers perceive as openly hostile to their interests). The fact, outlined in the article, that “Obama has raised just $5.1 million from the finance, insurance and real estate sectors so far this cycle compared with $12.4 million for Mitt Romney’s campaign” ought to be enough to convince anyone where Wall Street’s sympathies lie this time out.

Instead, what’s incorrect is the facile assumption that because Wall Street is backing Mitt Romney over Obama, it must be due to the fact that Obama has been in practice some kind of crusading Occupy Wall Street 99%er. Even a casual glance at the record of evidence amassed over the past three-plus years disproves this notion easily. What such a glance reveals is an administration at least as concerned with reducing the deficit immediately as it is in putting Americans back to work or reducing their suffering on the mortgage/housing bubble front. Such a glance shows an administration whose actions – if not always their words – reveals their belief that a healthy finance sector equals (or at least will lead to) an equally healthy America for the rest of us. Such a glance shows an administration all-too-willing to hold-over Bush-era appointees in key financial positions, and to refuse to use the power of the executive to appoint desperately needed, pro-consumer/citizen heads of its own to departments and other key positions (DeMarco, at FHFA, is perhaps the most-visible of these).

Greece Today

Greek MPs pass austerity measures.

Oddly, at the same time, Greek people weigh in on the idea of years of crushing recession to pay for politicians’ profligacy & central bankers’ unwillingness to make investors actually lose any money:

Cause, meet effect. Dammit.

Obama Recess-Appoints Richard Cordray to Head CFPB, GOP (P)outraged

I’ve said it on Twitter already, I’ll repeat it here: THANK YOU, PRESIDENT OBAMA, FOR RECESS-APPOINTING RICHARD CORDRAY TO HEAD THE CFPB:

President Obama will appoint former Ohio Atty. Gen. Richard Cordray on Wednesday to be the first director of the new Consumer Financial Protection Agency, making a controversial decision to install Cordray while the Senate is in brief recess to avoid Republican opposition, according to a White House official.

And although that paragraph is “just the facts,” kudos as well to the LAT for getting the backstory right and not trying to soft-pedal it or shoot for false equivalence in an attempt to provide “balance”:

By refusing to allow Congress to adjourn, Republicans have been able to prevent recess — and recess appointments. The Senate and House have met every few days in pro forma sessions that last a matter of minutes.

Democrats, under Majority Leader Harry Reid of Nevada, used the same strategy on occasion when President George W. Bush was in power.

But the Republicans have used the strategy throughout 2011 as the procedural arms race has escalated in the face of GOP opposition.

(emphasis added)

That’s exactly right: the GOP has escalated the procedural war(s) in both houses of congress – but particularly the Senate, which is more susceptible to such procedural abuses of power by the minority. This will be – in fact, already IS being – portrayed by the GOP as an unprecedented abuse of power, yada yada yada…you can almost write the half-whiny, half-fulminating script yourself. The important things here are two: 1) it is the GOP which has broken every vow, gone back on every “gentleman’s agreement,” stretched every rule to (and sometimes past) the breaking point in an effort to deny this President any victories (and ultimately to deny him a second term), and 2) on this issue, Obama did not bend. He did not cave. He did not give in to either GOP pressure, fear of not being “bipartisan” enough, or centrist-leaning, pro-banker aides’ advice to “let the (Wall St.) wookie win.”

I could probably waste a lot of time trying to guess what combination of circumstances motivated Obama to do exactly the right thing in this case: it could be because it was the right thing to do. It could be because he felt heat from progressive groups. It could be because it’s now campaign season and he’s switched back to “stump Obama” and away from “bipartisanship-seeking, conciliator-in-chief Obama.” I have no doubt that in some corners of the Internet, Obama’s decision today is already being portrayed as yet another glorious, planned-in-advance, perfectly-executed example of eleventy-dimensional chess. Any combination of those things might be the real story. But none of it matters much at this point, primarily because we’ll likely never really know what the reasons were (at least not until memoirs-time, years in the future, and possibly not even then).

But even though the political junkie in me would LOVE to know what the real combination of reasons or forces which compelled this particular decision were, and even though I think knowing would help many political observers get a better handle on how this White House operates, even THAT doesn’t change my opinion that it wouldn’t matter all that much if we knew. At least, not in comparison to the simple fact that the (obviously in-the-works for a while) decision to recess appoint Richard Cordray stands as a shining example of this administration choosing to utilize the full tools available to it in the service of the American people against powerful special interests (and the opposition party), instead of inexplicably leaving some tools available to the executive unused or cutting a premature deal that relied even in part upon the good faith of an opposition party clearly unmoored from not just restraint and ethics, but seemingly reality at times, as well.

Because although nothing is certain and no one can see the future clearly, this is the most hopeful signal we’ve had in a long time from this President that he understands the nature and MO of the forces arrayed against him as well as the realistic options he has available to him to make as much genuine progress for Americans as possible. And it is also a very hopeful signal from the President that he both wants and intends to do many of them. I seem to remember this guy from 2007-8. Only back then, he was just talking a good game about a lot of this stuff. The intervening three years have been a mixed bag in terms of both Obama’s willingness and his ability to deliver on them. Today, he’s talking about them again, but this time after having taken a giant, concrete step forward in DOING them.

Congratulations again, Mr. President, and thank you for doing the right thing when you had the ability to do so.

Jared Bernstein and Two Presidents

President Obama Wows 'Em in Kansas, 12-6-11 (image courtesy of LA Times)

The two Presidents in question being Obama (of course) and Theodore Roosevelt.

Over at his blog, the fantastic economist (and Joe Biden’s former top economic adviser) Jared Bernstein has a post up called O goes YOYO. A little bit of explanation. “YOYO” is the term coined by Bernstein himself to describe economic policies and doctrine of post-’80s Republicans; the trickle-down, supply-side, “you’re on your own” (hence: “YOYO) idea of economics that has bedeviled us for at least three decades now. He seems happy that the President is talking in such explicitly confrontational terms about the Republicans’ failed economic ideas. I am, too. It was a typically excellent speech on Obama’s part. And it was significant beyond the usual because it represented a much-closer embrace by the President of the themes of Occupy Wall Street (even though, as usual, the President tried to split the difference and find the “middle” by trying to downplay or deny at one point the Occupiers’ central theme of 99% vs 1%).

Bernstein loved it, and took the opportunity to point out much that is wrong with the “YOYO” economics of the right wing. He’s entirely correct, too. But Prof. Bernstein closed with the following sentences: “For now, I think the President is speaking to the American people in a way that is extremely resonant to them.  He’s right about this stuff, and people know it.”

I agree, the President IS right, and people DO know it. But there’s an additional, glaring problem Bernstein didn’t address in his overview. I began a reply at his site, but quickly realized it would be longer than his word-limit on replies allowed, so I’m posting it here:

Yep, great speech – again. You’re absolutely correct in stating that the President is “speaking to the American people in a way that is extremely resonant to them.”

Only, it would have resonated with the public to an even greater degree back in ’09, in the immediate wake of the utter collapse of the economic theories underpinning YOYO economics (as well as the economy itself). People were not just ready to have a serious conversation about making fundamental changes to the way our economic system is setup (or, rather, has been steadily perverted by the YOYOs over the last three decades), they were near-desperate to have that conversation.

But that conversation didn’t happen then, and we’ve been stuck in neutral (at best) ever since as a result.

Connecting the Dots

The future of a civilization depends on our overcoming the meaninglessness and hopelessness which characterizes the thought of men today.
~ Albert Schweitzer

This Saturday, the Occupy Wall Street protests will be two weeks old.

Several days ago, I had written the start of a post I’d tentatively titled “Protesting: Ur Doin’ It Wrong,” centering on my frustration with the response of numerous supposed liberals to the protests, namely: sitting back on Twitter and/or blogs and mocking and tearing down the efforts of the OWS protesters. I left it as a draft, because I recognized that the subject had made me “hot” enough that the chance I would veer off into a feel-good (but ultimately pointless if not counterproductive) rant against those individuals who were reacting in this way was greatly increased. And I really wanted to get this critique right, and put it forth in the best possible light, because I think it’s a crucial issue. Unfortunately, as often happens when you have children, life wound up intervening and it slipped off my “front-burner list” of to-dos.

I haven’t stopped thinking about it, however, and today, another article came to my attention that caused my thinking to gel a bit further. The article was from Yves’ Smith’s Naked Capitalism blog, and it was by an Oakland, California guest-poster, entitled Protestors Disrupting Foreclosure Auctions in California:

…once the protest started to get going, the protesters would circle up around an auctioneer and start chanting so loudly that it was difficult for the auctioneer to be heard. In response, the auctioneers distributed themselves around the steps so that the protesters couldn’t stop all of them. The protesters broke up into a couple of groups, with each group attempting (and succeeding in some cases) in surrounding an auctioneer with chanting people. Electronic media devices were everywhere– people were pulling out phones and digital cameras and taking pictures. I even saw one of the bidders do a self-video with what looked like an Android phone– he showed the crowd then turned the phone on himself and gave a quick narration of the scene. The protesters were able to disrupt the sales enough that one person I took to be an auctioneer (due to his clip board and demeanor– I have been to more than a few courthouse step auctions) got on the phone and said that it was “getting rough” and he “need[ed] everyone here.”

The organizers of the protest (according to the article’s author), Make Banks Pay California, has no ties that I could see, covert or explicit, to the actions taking place on Wall Street since September 17. In fact, there is no mention whatsoever of that other coast’s actions. Reading this article, however, I cannot imagine any other left-ish activist or even just politically-inclined person NOT making a connection between the two apparently completely separate events. Why? Because of their similarity, obviously: both are focused on the problem of the banks having crashed our economy in the late 2000s, partly by uncontrolled and unwise speculation on poorly-understood derivatives and partly through gaming the housing market. We all – those of us who follow politics, anyway – know the story pretty well by now. While the OWS protests appear to be targeted (in a rather muddled fashion, it must be said) against the actual physical home of the major investment and retail banks who led the charge, the Alameda protest written about in this piece was clearly focused on the same underlying goal of organizing to raise public awareness around the culpability of the banks in our current fiscal mess, and the fact that the problems and weaknesses in our system they exploited to enable their feeding frenzy have not been addressed in nearly a thorough enough manner.

I won’t make this post unreadably long by entering into an explanation of the ways in which the banks were allowed to run wild and subsequently (mostly) let off the hook. There are plenty of places one can read such material, and my guess is that anyone reading this has probably read a good deal of that sort of factual explanation already and either agrees with it or rejects it. The important thing I realized is not that the banks need to be held accountable or at least restrained from doing similar things with other bubbles in the future. As I said, that’s glaringly obvious, and has been since 2008 if not before (if you listened to the right people back then). So the problem isn’t that these facts aren’t knowable, it’s that most regular (non-economist or non-political-junkie) people don’t know them, and the moment is starting to come to a head. That makes the problem one of organization and education. And that is what is starting to happen, almost organically, from necessity. Indeed, as another (excellent) recent article I read in England’s Guardian newspaper put it:

What we are witnessing can also be seen as a demand to finally have a conversation we were all supposed to have back in 2008. There was a moment, after the near-collapse of the world’s financial architecture, when anything seemed possible.

Everything we’d been told for the last decade turned out to be a lie. Markets did not run themselves; creators of financial instruments were not infallible geniuses; and debts did not really need to be repaid – in fact, money itself was revealed to be a political instrument, trillions of dollars of which could be whisked in or out of existence overnight if governments or central banks required it. Even the Economist was running headlines like “Capitalism: Was it a Good Idea?”

It seemed the time had come to rethink everything: the very nature of markets, money, debt; to ask what an “economy” is actually for. This lasted perhaps two weeks. Then, in one of the most colossal failures of nerve in history, we all collectively clapped our hands over our ears and tried to put things back as close as possible to the way they’d been before.

That’s exactly it: the current situation is that “regular” people who aren’t economists and don’t follow politics in detail just know that things are bad. The economy’s been bad for a long time, and from what they know, it doesn’t seem to be getting any better any time soon. They, or their friends, may be “underwater” on their mortgages, or saddled with crushing student loan debt they can’t pay. They hear rumors or bits of stories from the media related second-hand about entire towns going bankrupt (or nearly so), about various other economic ills, and they look around and see pain and suffering (or at least insecurity) of a financial nature all around them in their own lives and communities, and they’re worried, pessimistic and angry. Faith in government institutions is at or near all-time low levels. Congress’ approval ratings are barely avoiding single digits. People want something done, they’re just discouraged about the possibility of any of the traditional means which have been historically used to address similar issues being able to work this time.

And that’s both a scary and an exhilarating place to be, because it means we’re on something of a knife-edge. The fact that two entirely-separate organizations came into being and began protesting at the exact same time on different coasts on virtually the same issue(s) shows that the frustration has at least a vague idea of how to tell the story and where to put the blame. But those of us who HAVE been paying attention need to recognize this moment, these spontaneous uprisings, for what they potentially are, and help fan this little spark/flame into the kind of “viral” conflagration that history shows us is always where real change comes from. Organizing is very hard in general, and it becomes more like an exercise in banging your head against a stone wall if the people you’re trying to organize aren’t aware of what you’re talking about, or if don’t understand (or don’t agree) it’s a problem. Or if they have to break free of preconceived notions that tell a different story than the one the organizers are trying to use as a base for action they hope will get results. When societal conditions are mostly good-ish, very few people think about (and even fewer advocate for) change. That’s easy to understand. I mean: why bother? But even when things are bad, much of the time, people just accept it. They get phlegmatic: “whattaya gonna do,” people shrug, and they try to find ways within their own lives and their own personal circles to mitigate the damage or the problem. That’s often true even when the problem’s causes are pretty clear, partly because not everyone’s paying attention, partly because there’s often numerous well-heeled interested parties who’ve got a personal stake in telling a different story, and also partly (largely) due to inertia. Getting “regular” people to start moving to DO something collective about the problems they all face but face individually – in short, organizing them – is one of the more difficult things there is to do. Often, organizers can toil away sixty, seventy hours a week to very little effect, if the “spark” that allows public consciousness to coalesce around an idea simply isn’t present.

Don’t get me wrong, the work that organizers do (myself included, sometimes) in the absence of such a “spark” is both helpful and necessary. Doing such work on an ongoing basis is something near-heroic in my personal pantheon, and the fact that there are those who (unlike myself) do it day in and day out means that the apparatus and the knowledge of how to do it survives, completely separately from whatever achievements such organizing manages to accomplish. But it is often difficult, thankless work even on a good day, and the change it can effect is that of identifying and maximizing support and working incrementally to enact typically small-bore measures which will make life better or perhaps simply keep it from getting worse. It is not the kind of “transformational change” that comes about only rarely, and only when conditions are right. Transformational changes are the rare pivot-points of history when things coalesce in a moment and there is a person or (usually) a group who can see the opportunity and are able to do what is necessary to effect change that actually changes the way ordinary people think about what is possible or what the shape of reality looks like. That kind of change can’t ever be forced, and often, the moment when it’s possible can’t even be predicted. In fact, a great many people do not even recognize such moments even while they are happening. The difference between the incremental change brought about through regular organizing and the kind of quantum leap possible through taking proper steps at an organically-occurring moment is the difference between evolution and revolution, between a step up the stairs (or, just as often, one step forward and at least one frustrating step back), and a rocket to the moon. Both are helpful. Both are necessary. Both are admirable goals to work towards. But the former is by far the more-common, everyday form of progress, while the latter is a once-in-a-generation (if even that frequent) opportunity.

That’s why the combination of that Guardian article and this Naked Capitalism article struck me like a lightning bolt: because it made me see that we are quite possibly entering such a moment right now. And as I said, it’s both exhilarating and a bit scary. Because the under-the-surface swell is definitely there. “Regular,” non-political people are angry and restless and all those other things I mentioned, in a way they haven’t genuinely been in quite some time (for good reason). The world (and America’s) fiscal situation is again entering crisis mode; we are poised for another disaster. If we, the people who have the best story to tell about how we got here, about who and what were responsible for these calamities, and who have the best idea(s) about where to go and what to do with this energy, fail to capitalize on this moment, then the risk is that the swell will get away from us, the energy will spin out of our ability to direct it, the pivot-point will pivot away from us. If that happens, and sentiments like those that animate the tea party – or worse – seize what should – and could – have been our moment, a great opportunity will have been lost.

That’s why I get so dispirited when I see fellow activists who I KNOW want essentially the same things sniping at one another. It’s bad enough that the corporate-owned media will almost certainly ignore the work of groups like Occupy Wall Street and Make Banks Pay California, and that (as Chris Hedges said) the power structure will define whatever those groups do as failure. If those few of us who profess to similar beliefs about the poisonous influence of Wall Street and banks in general over our economy and our political institutions actually join in the condemnation or mocking of the few of us willing to take the risks of being active, we’re certain to fail.

In his fantastic “secret history of the 20th century,” Lipstick Traces, author Greil Marcus recounts a bit of the history of the May 1968 general strikes that swept across Europe, particularly Prague and Paris. Marcus ferrets out a bit of the actual signage used by those young protesters who were desperate to seize their moment. They spoke not in the language of 60s protests where one uses the supplicative voice to make entreaties to entrenched power, but in the first person present, a voice that by definition isn’t planned in advance and might very well make mistakes or even fail (and knows it), but which has the benefit of insisting upon it’s own relevance and which might actually break the logjam and truly change at least a part of the world. Marcus points to the best and also shortest of the signage spotted in Paris in 1968. It read, in the most heartbreakingly self-aware language, simply: “Quick!“

Their moment ultimately failed, as most attempts to truly change the world instead of merely reform it usually do. If nothing else, let’s not look back and realize that by mocking instead of joining, we helped this moment, our own moment, pass unrealized. I sense there is a rare chance brewing for a do-over; to have the conversation we should have had in 2008 about what freedom in America means. About exactly how much these financial giants can own and control us. Adlai Stevenson knew the score years ago; maybe it’d be good to remember what he knew but we may have forgotten:

Freedom is not an ideal, it is not even a protection, if it means nothing more than freedom to stagnate, to live without dreams, to have no greater aim than a second car and another television set.

Quick!

**UPDATE** dday has more on Make Banks Pay California

Have Fun Storming The Castle! Obama Nominates Richard Cordray to Head CFPB

President Obama has apparently nominated Richard Cordray, the former Attorney General of Ohio. Here’s a pic:

It’s an interesting choice, for at least two reasons:

1. Cordray appears to be very honest as well as a very tough customer – not at all the sort of guy who will rubber-stamp the actions of the banksters. In this article from last October’s Washington Independent (regarding the foreclosure fraud mess, which was just developing at that time), Cordray is very tough on, and unequivocal about, the problems and illegality of foreclosure fraud. Certainly doesn’t sound like the kind of guy who’ll be a patsy for the big banks at the CFPB. What’s more…
2. Cordray already works at the CFPB, and he was hand-picked by Elizabeth Warren herself for his current job (leading the enforcement arm of the newly-created CFPB). In other words, Cordray seems to have Warren’s full faith and confidence, and he has been one of her top deputies for more than half a year now. She’s had a chance to see him work close-up, as has the Obama administration. So far, so good.

However, (unfortunately), as I just got done posting below, I’m not sure how much this changes. The GOP, as I and many others have pointed out, has always been much more focused against the CFPB itself, rather than simply against whoever is picked to lead it. It’s true there’s no love lost between some of the current GOP and Warren, but unless the Obama administration were to nominate an outright flunky of the big banks, the GOP won’t be happy with (or in favor of) any nominee Obama chooses.

I’m going to assume the Obama administration knows that the GOP’s main objection is to the CFPB itself (as opposed to Warren herself). If so, that, in turn, leads me to speculate about a couple of things:

1. Quid pro quo – Could it be that not nominating Warren specifically was part of a back-room deal to which Obama and the GOP agreed…but which the administration is trying to minimize the impact of by nominating someone just as strong as Warren – in fact, someone who has close ties to her? If so, that would beg the question of whether…
2. The administration is (once again) being too clever by half …axing a Warren nomination was part of some back-room deal or was simply a case of Obama attempting to once again to split the difference by appearing to grab the “reasonable center” mantle in the contentious CFPB nomination battle (appearing “reasonable” by taking away the supposedly “loathed” Warren, but nominating someone just as strong as a way to appeal to all sides), the end result appears to be the same. By nominating someone who isn’t a patsy for the banks, Obama has all but ensured Cordray will not be confirmed by the Senate (absent some back-room deal). That, in turn, leads me to wonder whether…
3. Head fake …the Obama administration, by nominating a strong regulator like Cordray, who has equally strong ties to Elizabeth Warren, is sending a sacrificial lamb up to a public slaughter in Senate confirmation hearings. This would be an incredibly cynical move on the administration’s part, and – to believe it – requires one to also believe that two of the administration’s goals are to A) get a much weaker, pro-bankster candidate eventually nominated, and to do so by B) sticking it to the progressive base while plausibly telling them: “See? We tried for a strong candidate with Rich Cordray, and he just weren’t confirmable! What could we do? Squishy McJellyfish over here was the best candidate that could also win Senate confirmation.” If the administration all along had no intention of getting a strong regulator into the top slot at CFPB, then picking someone with close ties to Elizabeth Warren who, from all appearances, would be just as strong a consumer advocate as she would have been, and then publicly allowing his nomination to be scuttled, would be the best way to accomplish that. The ground would be softened, and the case that “this was the best we could do” would then be plausible in a way it wouldn’t have been if Obama had nominated a pro-bankster candidate immediately instead of Warren.

I see only two other possibilities, both of which I consider much less likely:

1. Misread – the Obama administration really never did grasp that the GOP’s primary opposition was to the CFPB itself, much more than to whoever is leading it. Sure, they’d like a weaker candidate, but what they really want is to be able to gut the board itself. If that’s the case, then Obama just threw away the obvious choice to head the board (Warren, the CFPB’s creator and the person who oversaw its implementation) and got nothing in return (because the GOP won’t be confirming Cordray either).
2. Warren was asked, but declined – it’s possible (though I have a hard time imagining the circumstances which would lead to this) that Elizabeth Warren herself rejected the job. If so, then obviously the administration would have had to select a different candidate. The reason I find this hard to believe is partly that Elizabeth Warren is such a dedicated public servant that I find it bordering on impossible to believe that if the President of the United States went to her with a message of “your country needs you” that she would turn down his appeal. I also think she probably wanted to lead the board which was literally her own intellectual brainchild and creation. But it’s remotely possible, I suppose, that for some personal or professional reason, Warren wanted to pass the baton.

Only time will tell which of these possibilities (or another I haven’t thought of) is the case. If Cordray gets confirmed without too much of a fight in the Senate, then it lends credence to the idea that some sort of back-room deal we may never know the details of was struck. It would also lend credence to the notion that perhaps the sticking point really was actually the person of Elizabeth Warren herself — though I find this, as I’ve said repeatedly, HIGHLY unlikely. However, if Obama can get Cordray confirmed without having to bargain away something else of equal or greater value, I will be tickled. Ditto if Obama simply overrides the bankster-fellating GOP and simply recess-appoints Cordray. Either would be just fine with me; Cordray seems like a good strong consumer advocate; just the thing we need.

If Cordray’s nomination gets stiff-armed by the GOP and held up for months, it will lend credence to either the notion that the Obama administration was once again trying to be too clever by half, and wound up getting burned by a united, our-way-or-the-highway GOP that Obama has never quite seemed to believe was really all that nasty and obstructionist. Or it might mean that Obama’s advisers just truly mis-read the tea leaves and thought the problem really was Warren and not the CFPB itself (which would also be a loss, since if he can’t get anyone nominated through regular channels, then might as well recess-appoint the obvious, best choice – Warren).

Or, most disappointingly, if Cordray gets stiff-armed by the GOP, and after months of deadlock and a headless CFPB, Obama pulls Cordray’s nomination (or waits for Cordray to get frustrated, take the hint and withdraw his own name from consideration, a la Peter Diamond), and then the administration nominates someone else who’s much weaker and pro-bankster, then it will be almost certain that that’s what Obama intended all along.

Guess we’ll have to see how it plays out. But for now, I am disappointed in Obama for not recess-appointing Elizabeth Warren, but cheered by his decision to pick one of Warren’s top deputies, a man who appears every bit as pro-consumer as Warren herself. Congratulations to Richard Cordray, and good luck running the gauntlet. Or perhaps I should put it this way:

What Is Best In Life?

Awesome! Zero hedge discovers an internet copy of a Conan-like letter written by a “foreclosure prevention” attorney to opposing counsel:

Mr. Harman, Prepare to Be Conan'ed

You just don’t get to see the concept of “lay waste to your minions” spelled out so plainly in a legal document. Refreshing. And in the service of a great cause, too: foreclosure fraud prevention. More like this guy, please!

Welcome Back To The Bubble Years

A.K.A, the “conspiracy of optimism.” ZeroHedge lays it out for us:

As regular readers know too well, one topic Zero Hedge enjoys ridiculing with the disdain it deserves is groupthink of any form. The phenomenon, which is nothing but transference of laziness by those who manage other people’s money with complete disregard for the consequences of their actions, was among the main reasons for the Great Financial Crash. As nobody was willing to engage in any form of critical thought, and with the market “only” going up, any investment thesis was predicated solely on what the “other guy” was doing. Of course when it all blew up, it was time to blame the evil rating agencies. After all, heaven forbid someone actually think about the logic behind the credit ratings of hundreds of billions in synthetic CDOs, or worse still, take responsibility for their own stupidity and laziness. We are now precisely in the same place we were when the market peaked last time around, with groupthink rampant, with any attempt at opposing thought squashed for fears it will end the party early, with sellside analyst optimism at all time highs, and with the administration actively encouraging rampant lies and perpetuation of the myths that take hold in the market with no factual footing whatsoever. The “conspiracy of optimism”, as dubbed once by James Montier, has once again fully taken hold. As SocGen’s Albert Edwards points out “despite another post mortem on forecasting failure, nothing has or will change”: this is true… until the next crash. Then the finger pointing will begin anew, theatrics about the change in the Status Quo will resume, and once again the Fed will attempt to reflate the latest bubble crash. Only this time there will be no reflation, as the central planning committee’s reign of terror will be over, and the fiat monetary system will have ended. Below we present Edwards’ most recent solemn and very troubling thoughts on the latest break out of the great groputhink malaise, which will only last as long as the great chairsatan has some control over events. Luckily, with the amplitude from a stable market equilibrium shifting ever greater in either direction, and as the Fed’s very existence (remember: the whole point of the central bank is to contain price stability) is repudiated, the time until the reset is now shorter than ever before in history.

More, much more – including the all-important supporting evidence – at the link.

Operation Smoke And Mirrors

Where the HELL are the prosecutions, of the REAL criminals, Mr. President (and more importantly, the convictions)? You’re doing the Lynndie England thing here.

Financial Rorschach

Well, “Helicopter” Ben Bernanke has been confirmed for a second term by the full US Senate. What a disaster.

Much has been written in the past couple of months, since the Bernanke re-nomination has been slow-boiling in the Senate. Much of what’s been written has focused on the indisputable fact that Bernanke was at the helm when the financial ship almost went down sixteen months ago during the last year of President Bush’s second term (and the hotly-contested Presidential election of ’08). In fact, though it’s never completely clear in matters such as this where so many different variables bear on the outcome, it’s probably valid to say that there’s a good chance Barack Obama owes his Presidency to the financial collapse of fall ’08.