If you are one
of these people who has been expressing 'outrage' over bonuses
paid at AIG, after feeling nothing but warm n' fuzzies when this
company alone sucked out over one thousand times as much (so
far) from the public trough, then thumb your eye, hard. You are
part of the problem.
This bonus issue
is the Mother of All Distractions, giving politicians precious
cover to appear to be doing something on behalf of the people
while they continue to shovel your cash through AIG to Goldmine
Staxx and other gambling houses in 25 or 50-billion-dollar chunks.
Seriously, they should give these guys triple bonuses for the
kind of shafting that is being successfully perpetrated on the
great unwashed masses. It is really an impressive shafting. Americans
should all be required by law to name their kids Patsy, even
We'll get back
to some bike-related content shortly, but first, check out the
no-nonsense words of veteran investor Jim Rogers, excerpted from
a BBC radio interview yesterday (BBC interviewer named Roger,
They [AIG] went to the government, what, six months ago, and
said we had no choice. Bail us out, bail us out, bail us out.
Wall Street called up the government and said the same thing:
Please save us, save us, save us. They could have let AIG go
bankrupt. I mean, insurance companies have been going bankrupt
for hundreds of years, Roger, there's nothing new about it. This
is all designed to save a few guys on Wall Street and in the
Roger: Who do
you blame for this? The US authorities, AIG themselves?
Well, all of the above. You know, when the Secretary of the Treasury
[Paulson] is an ex-chairman of Goldman Sachs and Goldman Sachs
is doing gigantic amounts of business with AIG including insuring
a lot of things of their own, then of course when they call --
when AIG calls up the Secretary of the Treasury and Goldman Sachs
calls up the Secretary of the Treasury, he takes the calls, they
all say if you don't save us it's going to be the end of the
world, he goes to the President and says it's going to be the
end of the world, the President doesn't know anything, he says,
okay save 'em.
And now we're
all on the hook, the US government, the taxpayers are on the
hook for not just this billion dollars that's going to bonuses,
we're on the hook for hundreds of billions of dollars.
Because these guys have hundreds of billions of dollars of off-balance
sheet derivatives, that's obligations.
Roger: But Jim,
if we get to next year -- and Ben Bernanke as you probably heard
is now saying he thinks the recession could well be over by then,
and we all come out the other side with AIG still flourishing
and all the banks too, wouldn't it all have been worth it?
[Laughing in exasperation] Oh that would be a miracle, Roger.
Of course it would be, or perhaps it would be. But Roger that's
not gonna happen. Mr. Bernanke's been telling us for two years
everything's going to be all right next quarter. Mr. Bernanke's
been dead wrong for 300 weeks in a row. Why do you listen to
him any more? Why would anybody listen to him?
Roger: You said
in your letter to the Financial Times if only all the regulators
had all been tougher, years ago, we wouldn't have been in this
mess. But isn't that the point -- they weren't, so now, if we
let something like AIG go under, it would really be a disaster,
It would be a disaster for maybe a year or two. But Roger, the
way we're doing things now, it's going to be a disaster for five
years or ten years. Look at Japan. In Japan, it's nineteen years
since their stock market made a peak. Nineteen years! And it's
down eighty percent, Roger. Do you want nineteen years
in the UK, nineteen years in the US? I'd rather go ahead and
have two years of pain and start over.
Roger: So as
far as you're concerned, bailouts should just be banned, full
Absolutely. Anybody who fails, Roger, is supposed to fail. That's
what this is all about. That's what capitalism is all about.
Otherwise it's socialism for the rich. It's welfare for the rich,
and I'm not too keen on welfare for the rich.
Sing it, brother.
There goes a fine American. Too bad he's based in Singapore.
We need these relative few voices of dissent, telling us what
we don't want to hear. Here he is again on CNBC:
the banks is going to increase the debt spiral and finally cause
the destruction of the world's biggest economy, Rogers said.
it's astonishing, they're ruining the US economy, they're ruining
the US government, they're ruining the US central bank and they're
ruining the US dollar," he said.
watching something in front of our eyes, very historically, which
is basically the destruction of New York as a financial center
and the destruction of America as the world's most powerful country."
"lost decade" was caused by trying to bail out the
banks, and the West risks running out of money if it doesn't
let the bad banks fail now, Rogers warned.
is going to be the same in 10 months, 5 years of 10 years if
the fundamental problem is not solved, he added.
that you have too much debt, too much borrowing and too much
consumption and you're going to solve that problem with more
debt, more consumption and more borrowing? These people are nuts."
And now I go
back to the congressional hearings where Barney Frank and other
upstanding representatives are suddenly threatening to 'claw
back' the bonuses they have known of for quite a long time, threatening
subpoenae of various types, demanding that names be named, et
cetera, while, beneath the big table with the microphones on
it, they hand AIG bondholders another stuffed burlap sack with
a dollar sign stenciled on the side. Of course the bill for that,
along with everything else, goes to your kids, Patsy, Patsy and
his other brother Patsy.