An amazing introduction to our Monetary System and its economic ramifications
Zeitgeist 2: Addendum
Dallas Federal Reserve Bank Attacks Bank Bailouts and Washington Federal Reserve Bank
April 1, 2012
Reference Here
The light of reason may be penetrating the Fed, not from the top but from the bottom up. The Dallas branch of the Federal Reserve excoriated the Washington and New York Fed decisions to bailout the bankrupt Investment Banks in 2008. Bailouts are Bankruptcy by another name says the Dallas Fed.
The Dallas Fed levels its' guns at the TBTF (Too Big To Fail) theory of the Fed chief Bernanke which makes certain large banks assured of future bailouts because their failure would allegedly cause too much damage to the US financial system. This policy ensures future risky behavior by the big banks since they are no longer responsible for their bad decisions.
The TBTF theory is institutionalized in the recently passed Dodd-Frank Act which weighs in at over a thousand pages and fails to give the protections provided by the 56-page and 65 year-tested Glass-Steagall Act. The Glass-Steagall Act was repealed in 1999 by President Clinton at the urging of Republican Senator Phil Gramm and a host of Democrats. Large campaign contributions from Investment Banks were found in many if not all of the Congressional repeal supporters.
The Dallas Fed comes to the only reasonable conclusion: The TBTF banks are Too Big To Exist and must be broken-up.
The Dodd-Frank Act is too large, ambigious, favors big banks over taxpayers and encourages future failures. It should be replaced by the time tested Glass-Steagall Act. This should be a priority of the new Congress.
…
The ultimate destination – an economy relatively free from financial crises – won’t be reached until we have the fortitude to break up the giant banks.
The Dallas Fed levels its' guns at the TBTF (Too Big To Fail) theory of the Fed chief Bernanke which makes certain large banks assured of future bailouts because their failure would allegedly cause too much damage to the US financial system. This policy ensures future risky behavior by the big banks since they are no longer responsible for their bad decisions.
The TBTF theory is institutionalized in the recently passed Dodd-Frank Act which weighs in at over a thousand pages and fails to give the protections provided by the 56-page and 65 year-tested Glass-Steagall Act. The Glass-Steagall Act was repealed in 1999 by President Clinton at the urging of Republican Senator Phil Gramm and a host of Democrats. Large campaign contributions from Investment Banks were found in many if not all of the Congressional repeal supporters.
The Dallas Fed comes to the only reasonable conclusion: The TBTF banks are Too Big To Exist and must be broken-up.
The Dodd-Frank Act is too large, ambigious, favors big banks over taxpayers and encourages future failures. It should be replaced by the time tested Glass-Steagall Act. This should be a priority of the new Congress.
…
The ultimate destination – an economy relatively free from financial crises – won’t be reached until we have the fortitude to break up the giant banks.
