Guest Post: Too Big To Fail Or Too Stupid To Stop - Screw Banks/Not People

Tyler Durden's picture

Submitted by Nomi Prins

Too Big To Fail Or Too Stupid To Stop - Screw Banks/Not People

This morning, amidst news of Moodys
cutting Greece's debt rating to Caa1, I came across a phrase I wish I'd
thought of first, reading through a friend's morning commentary. The
phrase? "Too Stupid to Stop". 

According to Bill Blain, Senior Director
at Newedge in London, and self-professed Euro skeptic, "'Too Stupid to
Stop' is based on politicians behaving as rational maximisers of their
electoral objectives." He was referring to the real reason behind all
the bank-demanded bailout loans for austerity measures throughout

In the United States, that mantra can be
extended to include appointed officials, like Treasury Secretary, Tim
Geithner (still not admitting our record debt increase came directly
from the $4 trillion worth of Treasury issuance and other forms of
assistance extended to our banking system since late 2008, as we endure
his stomach-churning 'show-begging' to the GOP for a debt cap raise) and
Fed Chairman, Ben Bernanke (ditto). It also, of course, applies to
congress people whose political survival depends on corporate and bank
contributions and financial support, the ones that believe the
Dodd-Frank bill changes anything.

Rather than considering how governments
have systematically done, and continue to do, the wrong (as in immoral,
unfair, and uneconomically sound) thing by trying to preserve banks, any
politicians possessing the ability to think independently (an oxymoron,
I know) should be asking themselves instead, how clever they could be
about closing them down. Take a cue from Iceland.

But, the 'Too Stupid to Stop" behavior, prevents this from occurring. 

Bill and I used to work together at Bear
Stearns in London during the 1990s, before the Euro came into being.
Then, arguments in favor of its inception were more about how it would
lead to a 'much-needed' consolidation of political-economic control,
rather than an engendering of widespread economic well-being to more
European citizens, which didn't even enter the realm of political

Fifteen years, marked by global currency
crises, a US recession caused by energy and telecommunications fraud, a
bank fostered global Depression, and a persistent strategy to guage
citizens to pay for the sins of bankers, later -  nothing has changed.

What Greece should do is default. Not as
a sign of economic weakness, but as a sign of protective strength
befitting the notion of Democracy that the country is credited for
having brought to the world. Default as an act of much-needed financial
defiance and independence from the insatiability of banks.

Last year, Greece's bailout was
fashioned in order to make foreign banks and their investors 'whole' on
their investments in Greece. It had zero to do with strengthening
Greece's local economy or its citizens' financial futures. Indeed, it
was designed to further trash the Greek economy, to chain the country to
untenable loan conditions that required selling assets at discount
prices to pay off new and old debt, while callously condemning its
population to decreased average wages and increased unemployment rates,
particularly amongst the nation's youth.

Rather than telling those banks that
were out the money - THEY HAD RISKED to begin with, to take the
free-market, s**t happens, hit, all sorts of austerity measures were
attached to the $157 billion bailout loan. They hurt citizens
immediately in terms of reducing pension and other social-economic
benefits, and hurt them ad infinitum by forcing ongoing fire sales of
their national assets which resulted in job losses. The same banks on
the hook for lending money to Greece during Phase 1 of the massive
global leveraged bet gone wrong, demanded repayment for their risk
(otherwise their investors would be upset). Now, they have a greater
opportunity to scrounge (read: extract fees) for new deals via brokering
European and global firms swooping in for fresh kill, amidst the
remains of Greece's assets, such as communication and energy

And yet, rather than say - screw you -
to the ECB and the IMF, and all the mega-banking conglomerates that
signed off and received fees on deals and debt gone wrong, rather than
say - you know what? - we owe a debt to OUR CITIZENS, not the banks that
bet against them, and we don't like the terms of this arrangement,
Greek politicians are saying - screw you citizens. Again.

Greece is set to present a brand new austerity plan on Friday calling
for a FASTER pace of privatization, and more tax hikes on its citizens -
just to be able to pay off bondholders and the risk incurred by
international banks. This won't end well. If Greece does get a second
bailout package, everyone will discover that absent a strategy to revive
the local economy, the package will incur further pain, and at some
point there won't be any national infrastructure left to sell, and
unemployment will skyrocket further. A few bondholders will be happy
temporarily because they DON'T CARE whether Greece succeeds or the ECB
and IMF keeps creating debt to prop debt (like we do here in the US as a
matter of economic policy), same difference. A few banks won't have to
write down their losses for the same reason, and a few global
corporations will have bought some more assets at rock-bottom prices in a
country whose citizens won't be able to afford the payments that will
be counted upon to price the related securitization deals. And Greece
will be screwed even more.

The better plan would be to disband the
Too Stupid to Stop mentality. Screw the banks. Sadly, it's a
self-fullfilling downward spiral of incompetence - in Greece, Ireland,
Portgual, Spain, Italy, and the United States where the Fed is gearing
up for some verison of QE3 in the wake, ironically, of
Euro-pay-the-banks, indenture-the-citizens, chaos.  

I have a feeling meanwhile, there will be a lot more Greeks protesting in the streets come Friday.

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Rodent Freikorps's picture

It won't stop until people stop taking paper for oil.

Weisbrot's picture


banks would be stupid not to stop

and politicians would have to be honest to stop the banks

too corrupt to stop = most politicians



chumbawamba's picture

Thus once again confirming that neocon zionists are complete fucking idiots.

Nobody takes paper for oil.  They take gold.  Arabs aren't stupid.  But zionist neocons are.

I am Chumbawamba.

Rodent Freikorps's picture

Other than appealing to the anti-Israel lobby, how did such a brain dead fuck like you gain so many fan boys?

You are a fucking moron.

Birds of a feather...bitch.

chumbawamba's picture

Oh, wow, nice comeback.  Did you get help with that one?

Rodent Freikorps's picture

Yeah, your sister suggested the birds part.

Doña K's picture

Saudis actually sell dollars and are buying water as they are running out. They need 25 or more desal plants in the next few years alone or they are dead in the water "pun intended."

The US of A can turn a blind eye to Iran and there will be no more Saudi Arabia. With the left over dollars, they are buying treasuries.

chumbawamba's picture

Yes, right after she finished dominating and humiliating you.  Just as you like it.

Yeah, that's right, it doesn't all stay in that little room with your diaper on, bitch. 

I am Chumbwamba.

eatthebanksters's picture

You are a pathetic individual who espouses bigotry and hate while hiding behind the walls of anonymity.  If you truly believed what you espouse and had any inner strength and character you would not need to engage others with infantile behavior and derogatory comments. 

BTW, chumbawumba is what comes out of my ass when I'm sick...

Rodent Freikorps's picture

Hey, I'm on a budget, she only charges $40/hr and she takes it in the ass. You'd hit it too, if you weren't so creepy, she'd vomit from the thought.

bankruptcylawyer's picture

i used to think you were just another troll, and i generally ignore anti-semitic trash that tries to play itself off as anti-zionist.


next thing assholes like you will start blaming the jews for wall street's problems and lead a crusade against them just because a few of the big names do happen to be jewish. this is precisely why the jews created israel, and had a friend in america to do so. because once upon a time sixty years ago, this country actually fought against fascists.

Kayman's picture


I totally agree that the anti-jewish rant does not help the discussion, but I have always had to wonder about the wisdom of setting up a Jewish state on such a small plot of land surrounded by hostile neighbors.

If the U.S. continues to rot, who will become Israel's benefactor?  Just a question.

Rodent Freikorps's picture

Mr. Neutron.

Why would anyone think Israel is as stupid as the US?

samsara's picture

It won't stop until people stop taking paper for oil.

It will stop when the flow of Oil drops by 20% over the next 10 years.



The Count's picture

You did not realize that we will start a war with any country that stops using Dollars for oil?

Cleanclog's picture

At a conference recently, I heard a well respected researcher suggest that oil is becoming like new interest rates - especiallly in the ZIRP manipulated world.

Urban Redneck's picture

So when does the US invade China & the USSR?

I forgot- they are already at war with the US dollar.

1100-TACTICAL-12's picture

The oil will not stop fracking flowing, only potable water will...

equity_momo's picture

Its all over bar the shouting. Doesnt really matter what the politicians do. Let them kick cans or otherwise, the end result is the same (and as much as i would like to think it will be better seeing the banks eat their losses , it probably wont be)  

All paths lead to zero.   Enjoy.

chumbawamba's picture

Get the clips loaded.  The fun starts soon.

I am Chumbawamba.

Hugh G Rection's picture

Never store a fully loaded mag, it weakens the spring.


I always put 28 in my 30rd mags.

TorchFire's picture

Dark Harbor

Where has she gone

with her lamp held high

beckoning outcasts who would live free or die?


There, in the east!

What? She stands as if caged...

her eyes remain steady yet her heart's disengaged


Once revered by the nation

(those who would not be ruled)

but her people grew weaker and now they are fooled


“Liberty!” they greet her

for they seem well acquainted

but she views them as strangers, with her wisdom untainted


While yet in her youth

the year nineteen thirteen

she was tied to an altar by hands so unclean


As freedoms were stolen

from that day to this

her children sat idle and did not resist


Now forced into shadows

for one hundred years

she stands in the harbor imprisoned by fears


She waits for the hour

for her torch reignited

by the courage of people from a nation united


When truth is revealed

from the flame in her eyes

those who once chained her will see their demise


And the elegant lady

once more we'll defend

and her principled nation will rise once again


© TorchFire 2011


illyia's picture

Very nice.

Put it to music.

chumbawamba's picture

As one poet to another, that was brilliant.

I am Chumbawamba.

1100-TACTICAL-12's picture

Em, A, Em, A, A7, D SOLO Em ...... 

TorchFire's picture

I authorize your continued efforts and eagerly await the mp3 or youtube link! ;)

buzzsaw99's picture

the gods of finance are not pleased.

YesWeKahn's picture

I don't think there is any stupidity involved. This is a pure corruption and fraud. Unfortunately Bernanke becomes the weapon for some criminals. And there is no accountability for Bernanke who is a big liar and spin master.

aheady's picture

Agree. All by design.

Antarctico's picture

I don't think there is any stupidity involved. This is a pure corruption and fraud.

Indeed, this is not about stupidity it is pure and simple evil -- sociopaths doing what they do taken to an ultimate extreme.  I imagine that after all the simple folk of the world have been ground for their last bit of marrow, the owners of the millstones will return to the old medieval ways and start fighting amongst themselves for the scraps that remain. Unfortunately, by then few of us will still be around to enjoy the irony.

I don't know, perhaps I am just in a foul mood from the over saturation of recent bad news.  After all, tomorrow is another day.

The Count's picture


Who else in the forum has come to the conclusion that almost all our problems like immigration, sovereign debt, trade imbalance can ultimately be traced back to our ponzi scheme financial system and the guys who run it, the int. investment banks?





docmac324's picture

Yeah, what he said.

Miles Kendig's picture

Nomi, it's incompetent because its designed to be this way.  The fact that so much is premised upon the insane concept of riskless risk, and the power of its purveyors speaks volumes about the current state of affairs.

Miles Kendig's picture

Good to see yaz!!  Lots going on, that's fo sho

SilverDoctors's picture

Ah but if we screw banks, not people, how can the banksters justify the 10 digit salaries and as many islands as they have girlfriends?

Gubbmint Cheese's picture


I can do that.

The crisis in Greece will be ceasing,

on Friday through ECB greasing

the market will cheer,

celebrating with beer,

at the greek citizen's absolute fleecing.


Hugh G Rection's picture

Stalking through the chambers of the Federal Reserve

Ready to deal out what the swine deserve


A fully loaded betamag inside his M4

55 grains of justice cut banksters to the floor


Alas a bearded villain appears in the hall

Blood soaked marble results in his fall.


A quick burst to the waistline rips open his guts

A single shot to the forehead and its goodnight to the putz

jkruffin's picture

So, once Greece is kicked down the road with more bailouts, who is next up on the agenda immediately after? Are we back on Spain then? Italy? Ireland? Portugal back in the lead?  How in the world do you keep bailing out entire countries like the ECB has, and their currency not tank into the toilet, just to keep US stocks propped up?  This has to be the largest ponzi scheme ever run on the world.

CompassionateFascist's picture

Actually, it's Germany bailing EU....still doing penance for WWII and the Jew-thing. It'll stop when enough people in Germany have had enough guilt. In America, when silver crosses 70, and the dollar drops below 70. Then, it - and all else - will stop like a down elevator hitting the basement.

willien1derland's picture

Interspersed with bouts of 'Yentervention' by the BoJ, 'Springtime' in Arabia, Fiat Floods in the U.S., & periods of Chinese Debt Shuffling...