Quote:
Originally Posted by Renato1
The problem isn't the banks, but the governments who seemed to keep spending
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Wall Street created a mountain of debt via unethical and illegal activities I've outlined in previous posts, then the government and reserve bank borrowed and printed more money to bail out the banks that were deemed too big to fail. A responsible government would have allowed the banks to fail, let their debt default, temporarily nationalized the banks and protected depositors funds with government money. We would have done a few hard years and be on the upswing by now. Instead we're looking down the barrel at depression, social upheaval and war.
The government has essentially saved the banks by transferring their bad debt to the public - privatization of profit and socialization of losses is all part of Wall Street's plan and the same people who run the big banks rotate through jobs in the government. The reserve bank governors, the President's financial team and Wall street all work in concert.
There was great hope that the bankers would be jailed and financial problems solved in Obama's first term; he implied as much in his election campaign and hired
Paul Volcker (look him up) as one of his financial advisers. Unfortunately Obama went with the 'too big to fail' team and nothing changed - another useless President.
In Australia government debt is minimal despite the rubbish espoused by Hockey and Abbott. Private debt, in particular housing debt is our problem, and that was created by the banks but facilitated by government via first home buyer grants and low interest rates. The ALP did waste a bunch of money supposedly to avoid the GFC from hitting Australia, but a mild recession would have done us a lot good at that time; the housing bubble would have popped and our kids could look forward to much smaller housing loans and we would have recovered quickly given that the rest of the world were pumping their economies with new money.