Most Hyped Non-controversy of the day - Former SEIU Official Reveals Secret Plan To Destroy JP Morgan, Crash The Stock Market, And Redistribute Wealth In America
A decade ago, Henry Blodget was caught fraudulently hyping tech stocks and was banned from the securities industry. Now Glenn Beck is peddling a ridiculous story that's also being hyped by Blodget at Business Insider -- a story about (wait for it) the coming destruction of capitalism in America by an ex-union guy and his massive leftist army of ... well, you'll just have to read Blodget's write-up:The former SEIU guy is behind the curve if nothing else. Wall St and right-wing conservatives, who do Wall Street's biding like good little handmaidens, have already redistributed the wealth. Has everyone already forgotten the billions of dollars used to bail out those big banks and financial firms - the bail-outs started during the Bush administration and were passed by Republicans in both Houses of Congress. The six largest Wall Streets holding banks already have assets that equal 63% of the US GDP. The 400 wealthiest Americans already have assets that equal those assets held by the bottom 155 million Americans. Yet anti-American conservative pundits like Beck, Michelle Malkin etc are claiming this SEIU story is big news. Only if you have severely impaired cognitive skills. The Great Recession
CAUGHT ON TAPE: Former SEIU Official Reveals Secret Plan To Destroy JP Morgan, Crash The Stock Market, And Redistribute Wealth In America
A former official of one of the country's most-powerful unions, SEIU, is detailing a secret plan to "destabilize" the country.
... The former SEIU official, Stephen Lerner, spoke in a closed session at a Pace University forum last weekend.
... Lerner's plan is to organize a mass, coordinated "strike" on mortgage, student loan, and local government debt payments--thus bringing the banks to the edge of insolvency and forcing them to renegotiate the terms of the loans. This destabilization and turmoil, Lerner hopes, will also crash the stock market, isolating the banking class and allowing for a transfer of power.
Lerner's plan starts by attacking JP Morgan Chase in early May, with demonstrations on Wall Street, protests at the annual shareholder meeting, and then calls for a coordinated mortgage strike.
... Lerner was ousted from SEIU last November, reportedly for spending millions of the union's dollars trying to pursue a plan like the one he details here. It is not clear what, if any, power and influence he currently wields....
First of all, I would be ecstatic if I thought something like this could possibly be done successfully in America in 2011. But not only is organized, widespread progressive action of this kind extraordinarily unlikely, but Lerner's notion of how it would play out (if the voice on the tape is his -- Blodget admits he can't verify this) is ridiculously naive.
The pithiest explanation I've seen comes from New York Times columnist and Nobel Laureate Paul Krugman, who noted in one interview: "Regulation didn't keep up with the system." In this view, the emergence of an unsupervised market in more and more exotic derivatives—credit-default swaps (CDSs), collateralized debt obligations (CDOs), CDSs on CDOs (the esoteric instruments that wrecked AIG)—allowed heedless financial institutions to put the whole financial system at risk. "Financial innovation + inadequate regulation = recipe for disaster is also the favored explanation of Greenspan's successor, Ben Bernanke, who downplays low interest rates as a cause (perhaps because he supported them at the time) and attributes the crisis to regulatory failure.There was and is a open conspiracy to redistribute wealth and the mission has pretty much been accomplished. If you're middle or working class and your finances go sideways, you're screwed. If you're one of the Republican parties rich benefactors the government will bail you out.
A bit farther down on the list are various contributing factors, which didn't fundamentally cause the crisis but either enabled it or made it worse than it otherwise might have been. These include: global savings imbalances, which put upward pressure on U.S. asset prices and downward pressure on interest rates during the bubble years; conflicts of interest and massive misjudgments on the part of credit rating agencies Moody's and Standard and Poor's about the risks of mortgage-backed securities; the lack of transparency about the risks borne by banks, which used off-balance-sheet entities known as SIVs to hide what they were doing; excessive reliance on mathematical models like the VAR and the dread Gaussian copula function, which led to the underpricing of unpredictable forms of risk; a flawed model of executive compensation and implicit too-big-to-fail guarantees that encouraged traders and executives at financial firms to take on excessive risk; and the non-confidence-inspiring quality of former Treasury Secretary Hank Paulson's initial responses to the crisis.
