We'll bail out our banks, your banks, their banks...

The FED decided which banks to purchase and which banks to let die kind of like a financial God. Now the FED is looking to purchase foreign, distressed banks.

Let's observe what got us into this mess in the first place. USA home ownership was at an all time high in the first part of this decade. Greenspan asked George Bush, "Do you want the party to keep going or should be put a wet towel on it?"

George Bush replied, "Let's keep it going, Al."

Greenspan replied, "We can keep the party going by allowing banks to buy CDO's of worthless mortgages. These mortgages are toxic from day one but the banks will never know because these young punks running banks these days haven't seen this ponzi scheme before."

George Bush replied, "Sounds risky. But we'll do it anyway cause I got some wars need fightin'."

And so it was that subprime was allowed to be promoted and abused throughout the land. The FED is the watchdog for the financial sector here in the States. Their silence while subprime loands skyrocketed is very telling. The bubble was being inflated to astronomical proportions and any good investor knows what happens to bubbles; especially big bubbles. Banks were in for a slide that had not been seen since '29. Houses eventually foreclosed at a record pace causing writedowns of 40% on many units. Banks wrote off everything thinking the end was near. Speculators shorted financial stocks; crippling bank to bank credit lines which would ultimately destroy a few large investment banks. Had the speculators not crippled banks there is no objective reason for their failure. The largest mortgage banks; Fannie and Freddie, were far from disaster when their stock began plummeting on speculation they might not have enough money. Rumors started by ex FED president William Poole caused the largest bail out in FED history and it can be proven that both mortgage banks were liquid and ready to ride out the storm. One would assume at such a high level there must be protections in place to prevent wild speculation like this. One would be correct in assuming such a thing, but the SEC president decided to wait until the damage had been done to enact the powerful crisis avoidance systems. The SEC president halted naked short selling of financial stocks and in 2 days the Dow Jones rallied over 800 points. Why did they do that, you ask? Well the dipshits that were short the financial stocks knew the fundamentals did not reflect their positions so they bailed on their predatory positions as fast as they could. 

If you are thinking the FED conspired to purchase a few attractive banks behind the guise of a financial crisis you get a gold star today!

My only question now is who is the FED working with in foreign banks to stir the rumor pot and cause another large bank failure?

The other question is can I hire Chuck Norris to take out these dipshits?