PrintWashington, D.C. and Wall Street doing just fine, thank you.
The entire calamity that was the '07 ' 08 financial debacle can be directly attributable to machinations of Wall Streeters and Washington DC politicians. The packaging of mortgages and the continual dropping of standards to originate those mortgages were the play things of those brokerage houses and certain politicians.
These two areas, these two groups of people, have now become the beneficiaries of the crisis they perpetrated.
The area is thriving in construction, home values, and salaries. And not just Washington DC proper, but any community within a commute or connected to the federal governmental money spilling machine.
First and foremost, no one has been prosecuted for malfeasance or securities violations regarding the financial meltdown in 07 and 08. Some say this lack of prosecutorial energy and diligence ensures another debacle.
Trading houses go months without a losing day. Goldman, JP Morgan seem to have the magic touch.
Of note is the power in the hands of the Federal Reserve. Notice that the working arm of the Fed is the New York Federal Reserve and understand who is on that board and how they get there. Now understand the source of confidence that some of these trading houses possess. If a Federal Reserve decision is in the wind, I'm pretty certain that my phone won't ring. They expect the call.
Andrew Jackson was correct in his cautionaries regarding a "national bank". Stating the case against a national bank, Jackson said we should....
"...take a stand against all new grants of monopolies and exclusive privileges, against any prostitution of our Government to the advancement of the few at the expense of the many... "
The stock market is at or near all time highs. Money is flowing at the discretion of the Federal Reserve and under the guise that loose money somehow creates jobs. Never mind that it has had only a modicum of impact in that area, and disregard that there is no questioning of the economic theories under which this program is implemented. The money flows, the Federal Reserve decides, and the secretive nature of the decision making is lax. (Stock market seems to rally sharply before Bernanke speaks of continued loosening.)
It appears there are two sections of the country. Draw a big circle around the New York City and Washington, D.C. corridors and you have one. The area outside is the other.
Jobless numbers and the work force participation numbers flounder. The Fed continues to use a paint brush to try and fix a plumbing problem. They are certain this is the way.
This certainty creates a utopia for some, a windfall. Wall Street and Washington ask, "So what's the problem? The worse the job numbers and the more tepid the GDP, the better we do." I wonder for what they are truly rooting. Most certainly they are always near their phone.
Bruce Johnson
