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Stop Targeting "Greedy Bankers"?
Raghuram
Rajan, professor of finance at the University of Chicago, and former
chief economist at the International Monetary Fund was interviewed on
Yahoo Tech Ticker peddling a message for Washington, Stop
Targeting "Greedy Bankers" and Focus on Growth:
The
euro
fell to an 18-month low Friday amid growing concerns about
Europe's finances. Less than a week after the EU and IMF announced a
whopping $1 trillion bailout package for Europe's so-called PIIGS, a
growing number of high-profile voices, including Paul
Volcker and Jimmy Rogers, are raising doubts about the euro's
future.
A natural question: Is U.S. the next Greece -- as former
guest Peter
Schiff has stated, and economist James
Galbraith has disputed?
"I would say the parallel is more
with the euro area as a whole than with Greece," says our guest Raghuram
Rajan, professor of finance at the University of Chicago, and former
chief economist at the International Monetary Fund.
European
nations, Greece especially, went on a spending binge. "You basically
gave a drunkard a credit card. He went out and spent like mad," Rajan
says.
Some pundits say America is on the same financial
trajectory. "What the U.S. has as the same lines as Greece is this, or
the euro area I should say, is the constant bailing out of anything that
goes wrong," says Rajan, author of a new book, "Fault
Lines: How Hidden Fractures Still Threaten the World Economy."
But
bailouts aren't the answer. Furthermore, "we've used all our bullets.
We don't have any bullets left," Rajan recently told
The New Yorker.
In "Fault Lines", Rajan makes the case that
without a clear growth strategy, America eventually faces tough
decisions -- higher taxes or budget cuts, or a combination of the two as
Spain and Portugal announced this week.
"We are in for tougher
political times," he tells Aaron in the accompanying clip. "And I think
focusing on some of the greedy bankers as the answer to the crisis
takes political heat off the politicians, but is not really the
answer."
Watch the interview below to get Mr.
Rajan's take on how energy policy -- including a carbon tax -- could
help spark America's economic growth.
»
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This bought and paid for academic is not a part of any solution
+1
Yes, a new, gargantuan, far-reaching tax!
Yeah, that's the ticket for real economic growth!
And forget about those sociopathic Wall Street elites who are running this nation into the ground and sucking the husk of its corpse dry in their rapacious, degenerate and insatiable greed! We need to "move forward"! What's done is done! No need to place blame now!
Actually, Mr. Rajan is correct in a way --- the greedy banksters, as guilty as they are, are only part of the problem, and not even the largest part. It is the greedy and out of control POLITICIANS, their enablers, and their central banking cohorts, epitomized by Ben Bernanke and the Federal Reserve, who should REALLY be the ones being held accountable right now --- and if there were any justice in this world, swinging from lampposts as we speak.
Its amazing, these people sound vaguely convincing untill they invariably mention carbon tax. then I want to beak out some beat downs, carbon tax would be the biggest fraud of them all
But just think of all the children.
"If the house is on fire we don't want to speculate whether the baby is fire retardant or not." Al Gore
What a World Class POS.
He himself is a retardant. He makes other people retarded.
The March 2009 bear market rally ended last week.
http://tinyurl.com/39ptoac
http://www.zerohedge.com/forum/latest-market-outlook-1
if only you would change your avatar, totally distracting
I love your posts. They're clear, backed by a chart, and have a strong conclusion. The rest of the rambling on this site is pointless mostly, although very amusing at times. Supercycle: where does the money flow next if out of equities?
Water filter companies and air filter companies (ever read about a volcano in Iceland and an undersea oil gusher in the Gulf of Mexico?????)
Rambling? Thank you for the clarification Edna. I do concur....Supercycle has solid posts. Pull the broomstick out and READ MY LIPS.
CONGRESS IS THE PROBLEM. THEY ALL MUST GO. Cheers sweetie!
University of Chicago?... what is it with that place?... it's like Obanksta-mobster-central...I know! ... with a pending global currency and thus the demise of the cartel dollar and GB pound denominated energy bourses (Yes, I'm talking to you Saddam Hussein!... and Mahmoud Ahmadumbasstooge) we need a new mechanism to maintain our parasitic yoke on energy, economic plurality and industrial development... Why not a carbon tax to help us thwart the evil threat of (global cooling) global warming?
Yep. That'll work.
Take these weasels at 180 degrees: 'Growth' = 'death'
I used to have a nice size consulting company. EVERY person that I hired from the UofC was lazy, expected or thought success was their right and that they were smarter than everyone else.
I have one word for that school.... FAIL
Jimijon,
Your comment is ignorant and short sighted. It could just be your skills as a manager [i.e. the person that hired the lazy UofC graduates] are suspect. Maybe that's also why you 'used to have a nice size consulting company'.
I take sever exception to your sweeping generalization. I'm finishing my MBA at Chicago soon, I work 80 - 90/wk and plan to use the knowledge I've gained through my studies to create a company that will provide jobs and operate with the utmost ethical integrity. Get your head out of your ass and post your irrational generalizations on a board other than ZH with an equally ignorant and short-sighted community.
You must have a mid-tier education...
A 'sever exception' to his asperities.
Bwahahahaha!!!
Hey!!! You're trashing the school that John D. Rockefeller founded, after all.
That's akin to trashing Satan.....
Most of the American schools are in the same category. Sadly, they represent the future of America.. FAIL.
+1
U of C. IMF! Look at the creds - we can all stop worrying now and love the bailout.
Or more precisely, love those debt-financed billionaires....
+1, apostate, the credit buildup has to be de-leveraged, the only question is how? Through deflation(depression) or inflation, or a combonation of both(inflationary depression)? I'm sure the MSM will fall all over themselves trying to call it everything except that wich it is...double dip recession, jobless recovery, Double dip recession without a recovery...or whatever? The simple fact remains "growth" will have to be redefined! I thjink we have some very "realistic" years ahead of us as a nation and a planet. I'm glad my portfolio is long guns,ammo,survival gear, and a live within my means philosophy.
But the MSM, the administration and the masses NEED villains...!
We should just tell the truth: that the spendthrift, indebted, over-consuming middle classes - who saved and invested nearly NOTHING - are responsible for the mess.
True though it may be, it might not go over well...
They invested in supposedly safe 401ks and houses that they were told never lose value.
How'd that work out?
That said, there were alot of deadbeats who were looking for a fast buck, but, as the saying goes, "Let the buyer beware."
When you lend someone money, you're "buying" their debt, right?
Shit for brains third-worlder deems corruption as acceptable, like the old saying goes..you can take a man out of the Third World .... typical bullshit from the "international" crowd.
He needs to take his big brain back to India and deal with real issues like open defecation, growth is stymied over there because the peeps are shitting everywhere. Small wonder that wholesale corruption is acceptable to him, at least you can't smell that with your nose.
In Rajan's caste system, we are ALL UNTOUCHABLES...... (love your remarks, JohnKing!!!!)
The Wall Street bankers were caught recommending stocks to their clients in companies that they knew to be insolvent. They helped companies like Enron hide liabilities from their balance sheet. They influence the ratings firms to give their securitized debt a AAA rating when 90% of the underlying securities are junk. They manipulate the oil and gold markets. They front-run trades to the detriment of their clients. They pay off politicians to allow them to merge so they now have limited competition. They pay off politicians to bail them out of bad Latin American loans. They pay off politicians to bail them out of the most recent crisis. They pay off politicians to get rid of mark to market rules so they can legally hide liabilities from their balance sheet. In short, they find every opportunity to break the rules. Their excessive influence on the politicians is turning the United States into a facsist country. If there ever was a group of people that deserved to be targeted, this is it.
+10
Short, succinct and to the point.
These guys just want "growth" because they want to stay employed in their shitty little jobs. The economy needs no more "growth." It needs severe contraction, and a methodology for putting all these elderly, lazy, moronic, corrupt, kleptocrats into a retirement warehouse.
I agree.
What good is 'growth' to the rest of us when we have an economy that funnels any and all growth to the top 5% who produce no value?
We need a rebalancing, a restructuring of how our economy allocates GDP.
+100
I believe the kids of the future need a middle class. The Oligarchy doesnt care.
You need to get laid, Ayn.
We would be well on the way to a real recovery if the "greedy bankers" had been allowed to fail and promptly jailed. There won't be any recovery or economic growth until law and order is restored, of that I'm sure. Who wants to invest, spend, innovate in an environment like this, we are not even going down with dignity.
Obama lost his second term by allowing this mess to fester, many in the Congress and Senate are getting payback now, nothing works until this is settled.
What's wrong with multi-tasking? Re-enacting Glass-Steagall will actually increase allocation of capital to authentically productive areas of the economy rather than to the FIRE economy. A two-fer!
+ 1
Lloyd blankfein is NOT a greedy banker. He just wants everyone on the train to bankruptcy/ Auschwitz.
No money, no power, no threat. Easy concept as Dirty South says.
Heres Lloyd's comments on Goldman Sach's next move:
http://www.youtube.com/watch?v=J3YRWhg4YaA&feature=player_embedded
Are you in the audience or the train?
I would rather be suffering on the train than a rent-boy for the bankerista criminals
Even in the case, would everyone mean including himself?
Yes. It is not that hard of a concept to grasp.
Finely chopped up "greedy bankers" is an excellent fertilizer (especially considering the large BS content) and promote excellent growth when mixed with crops, gardens and spread on lawns.
Stop targeting criminals, pay them record bonuses and focus on screwing the taxpayers. Rajan/Chicago/Obama/Goldman/Summers/Rubin