Spitzer just told Ratigan that now Obama is listening to Volker, and not Geithner,

[gateley]

Summers! Does this mean he's seen the light?

[alstephenson]

1. I sure hope so. eom

[WCGreen]

2. Let's hoipe...

It was Volker who steadied the economy in the late 70'sand earlt 80's...

Reagen just happened to be there...

[Hannah Bell]

it was volker who put the country through an extended & debilitating recession

to break labor's power -- which wasn't the source of inflation in the first place. that was commodities & banksters.

volker is no good guy. same end, different faction.

[gateley]

15. Your opinion seems to be in the minority -- could it be that

it wasn't actually Volker himself who broke the unions? I'm hoping that's the case.

[Hippo_Tron]

22. I'm pretty sure Reagan had more to do with breaking the unions than Volker

Some union members, of course, had a lot to do with it too by voting in Nixon and Reagan because "social issues" were more important than their own wallets to them.

[gateley]

25. Yeah -- I do remember Reagan dismantling the Air Traffic Controllers union.

My sense, and my reason for asking, is that it was probably more Reagan's manipulators than anything/anybody else. He was so beloved that all they had to do was convince him that whatever they were doing was the right thing to do, and the people trusted him when he presented it. Scary.

[WCGreen]

28. When he went after the Air Traffic Controlers...

That was the begining of the end...

[uponit7771]

34. +1!!!

[Hannah Bell]

48. you're missing the point. the volker recession, the attendant high unemployment & business failure

set the stage for EVERYTHING Reagan did -- including painting unions as the greedy bastards who wanted their cadillac wages & bennies while everyone else was suffering. plus the willingness of unemployed union workers to support reagan's policies.

Capital acts as a CLASS. It's never just one guy. Reagan was a paid shill, he did what his long-time funders told him to do.

Volker = fully-paid member of the ruling class.

[Hannah Bell]

46. volker's ACTIONS, which were part of a coordinated strategy by capital.

volker = rockefeller associated wing of the capitalist party.

[hfojvt]

49. I think lots of people have forgotten Volcker

http://en.wikipedia.org/wiki/Paul_Volcker

[TornadoTN]

52. Some people change- Volcker seems to be a lot more on target now

There's no doubt that he had some issues earlier in his career, but since 2008 he's been pretty accurate on his assessments of the economic crisis, as well as the underlying causes of it. The banks sure have no love for Volcker.

Maybe he's changed a bit with age? I'm willing to give him the benefit of the doubt here, because the alternative is more Geithner/Summers bullshit and we can't afford that.

[Hannah Bell]

55. what's your basis for saying the banks in general have no love for volker?

[TornadoTN]

56. Well, I'll dig around for some links, but they sure hate his current input nt

[Hannah Bell]

60. looking for your links & which bank reps are making such statements.

since volker was an uber-banker, albeit the associate of a particular wing of the capitalist party(tm).

[WestSeattle2]

66. My take on that, and I lived through it, was that nothing

else would break the stranglehold that inflation had on our economy at the time. If the Fed continues to print dollars ad nauseum, we'll be forced to go through high unemployment once again because of the effect that devaluing the dollar will have. Bernanke claims they can "drain the excess dollars out of the economy before inflation takes off..." Bullshit.

The government stopped printing M3 numbers hoping to disguise the volume of dollars they're pumping into the economy. While that's a gallant effort at hiding the truth, http://www.shadowstats.com/ does a great job of presenting true numbers.

[Teaser]

3. Praise Jebus. Now fix the health care mess

.

[Jennicut]

4. Please, don't listen to Geithner anymore. Volker was right all along

and was unhappy at being ignored.

[DJ13]

5. That was plain to see during Obama's press conference

No Geithner, no Summers, standing beside Obama (grinning from ear to ear) was Paul Volker.

[gateley]

13. I missed that -- cool! Do you suppose Tim and Larry are packing their bags? nt

[99 Percent Sure]

35. +1.

[SlipperySlope]

6. How does Spitzer know who Obama is listening to?

[gateley]

12. See posts #5 and # 7. nt

[Dawgs]

7. Interesting... Just read that Obama/Volcker plan will bring back Glass-Steagall.

http://money.cnn.com/2010/01/21/markets/thebuzz/index.htm

"In honor of the latest banking overhaul proposed by President Obama (with inflation fighter Paul Volcker to boot) I give you the following ditty."...

[Phoebe Loosinhouse]

8. Volker was against repealing Glass Steagall and Volker was against

Credit default swaps and predicted exactly what happened.

Thank God! He is finally seeing the light.

[Octafish]

32. Brooksley Born sounded the alarm then got the bum's rush...

Prophet and Loss

[truedelphi]

9. It doesn't matter. The money is gone, the cupboard is bare.

And the more economically educated among us will not vote for him even if he starts working full time at a soup kitchen. (Pissed off I am today, but the soup kitchen work might be a better suit of his talents. Plus poetic justice too - so many of the homeless and destitute are that way because of HIS continuation of the Bush policies.)

I wanted a leader and not a dishrag who does the wishes of the Banking Elite. Unless he personally has 23 Trillion to put back into the Economy that his appointees have taken from, his "turnaround" is meaningless.

[dionysus]

26. so no matter what he does, you'll complain. gotcha. and you know that 23 trillion is a totally

bogus number, right?

[truedelphi]

30. We do not know if it is bogus or not.

We can ask Bernanke how much has gone where, and he won't tell, as if he does, then (According to Bernanke) the Banksters will become too shy to ask for more funds!

Anyway CNN is using it. They have a pretty decent money tracker, also.

And Geithner is rather unhappy with the twelve or thirteen trillion dollar debt limit, so there must be some reason why he wants to raise that figure even further into the stratosphere.

[dionysus]

31. i believe the 23 trillion would be if every single insured security there is defaults

simultaneously.

[truedelphi]

43. That sounds rather incredibly unlikely till one remembers

How between Sept 1st and OCt 15th 2008, so many of the Biggest Wall Street Firms were on the verge of collapse.

They lucked out and got Congress to Bail them out. Except of course for Lehman Bros.

Next time around, Congress will not have the means to do so.

So a lot rests on whether or not we get the likes of Glass Steagall reinstated. (After watching the Health Care Crisis reform efforts play out, I am not holding my breath.)

[99 Percent Sure]

44. Not when all the bad assets on the banks' books are counted. Plus,

the reason that Bernie Sanders, Alan Grayson and others are after Bernanke is because he had already given the banks billions from the Federal Reserve to underwrite the bad debt piling up on banksters' books, just after Bear Stearns went kaput. Actually, there's approximately $12 trillion Bernanke hasn't accounted for. Then, King Henry Paulson skipped up to the Hill and, despite cries of rage from We the People, with full complicity of our Congress critters, looted the Treasury of something approaching a trillion, in September 2008.

The trouble with TARP is that the banks got access to inconceivable amounts of dollars, printable on demand, yet weren't required to do anything about their monumental troubled assets while accessing the relief program. Supposedly, we bought "some" of the bad assets (see Maiden Lane) with the money they "borrowed" and continue to borrow.

The Fed and the Treasury gave away unimaginable amounts--it's much worse than people believe/think, especially when you consider that in 2009, there were 140 bank failures with assets totaling $170 billion or so, costing us/the FDIC Deposit Insurance Fund (DIF) over $36 billion. The bank closings continue at a swift clip--as of January 15, 2010, FDIC/bank regulators had closed 4 banks, costing us $835 million.

[truedelphi]

51. Thanks for your input. It is a shame that so many here do not want to hear

The Truth, although they would have eaten the Truth up faster than Bernanke can print Big Bucks out had a Republican gotten the Presidency.

Party loyalists want the Truth spun so that Party Centrists and their Man Now in Charge (Rahm or Obama, depending on your viewpoint) doesn't come out smelling so bad.

It is also rather scary that the new rules for the FDIC demand that banks raise the funds for the insurance some two or more years IN ADVANCE. That means the smaller banks, which traditionally have served the small business crowd, have even less capital on hand to lend out.

And if the smaller bank goes belly up, the Bigger Bank buying it out gets the credit on the FDIC insurance handed to them!

[flamingdem]

10. Volker is much much much much much much better !!!!!!!!!!!!!!! nt

[Edweird]

11. Ok. Let's see some results.

[Odin2005]

14. Volker is almost as bad as Geitner.

Volker popularized the use of inflation as a boogyman to keep unemployment high and thus depress wages. He even himself said in the 70s that "wages were too high". I don't get why people like that fucker.

[gateley]

17. You're the second one (so far) who has indicated Volker may not be the

savior I was thinking he might be. Do you at least feel it's a step in the right direction?

Who would be ideal in your opinion? I'm not familiar with all the money guys except for Krugman, and that's only because I've seen him on some of the MSNBC shows.

[Odin2005]

39. We need Stiglitz, Krugman or Reich in there.

[gateley]

42. Oh -- Reich, I HAVE seen him, and like Krugman, liked what I saw.

I remember fantasizing Obama's appointments, and I had Krugman for Treasury, and Turley for AG. Needless to say, Obama didn't heed my suggestions. :7


I'll look into Stiglitz, not familiar with him/her. Thanks!

[SemiCharmedQuark]

47. You do know Krugman wrote an article saying Obama should force the House to pass the Senate bill you

call "Fascism" today, right?

I like Krugman but if you think Volcker is crap, I don't think Krugman would pass your test either.

[TornadoTN]

54. Stiglitz, Roubini, Reich, Krugman are all good candidates

But I think Volcker is a good person to listen to right now, especially regarding the banks. It seems he has shifted his position a bit since the 70's and it seems to be a good mix of principles that could very well save our economy from further destruction.

The alternative is that we continue on the Summers/Geithner/Bernanke path and I don't think we can stand that as a nation any longer.

[Phoebe Loosinhouse]

18. I have seen you make this post numerous times.

Why don't you just Google and read a little more about Volcker. It's out there and it's easy to find. I'm not saying he is perfect or correct about everything, but history has born him out on a number of occasions. I think you're factually incorrect as well - he kept interest rates high in order to defeat inflation which had already taken grip. I remember when Ford was in office he was promoting WIN buttons which stood for Whip Inflation Now.

*****************************************************************

Here is Krugman on Volcker
Remember the economic boom of 1984, which let Ronald Reagan run on the slogan "It's morning again in America"? Well, Reagan had absolutely nothing to do with that boom. It was, instead, the work of Paul Volcker, whom Jimmy Carter appointed as chairman of the Federal Reserve Board in 1979 (and who's now the head of your economic advisory panel). First Volcker broke the back of inflation, at the cost of a recession that probably doomed Carter's re-election chances in 1980. Then Volcker engineered an economic bounce-back. In effect, Reagan dressed up in a flight suit and pretended to be a hotshot economic pilot, but Volcker was the guy who actually flew the plane and landed it safely.

http://www.rollingstone.com/politics/story/25456948/what_obama_must_do

********************************************************************

[Odin2005]

41. The inflation would have worked itself out eventually.

It was an excuse. "Wage Push Inflation" is corporatist code for "unemployment is too low to keep wages depressed".

[Hannah Bell]

57. volker no more "engineered an economic bounce-back" than my aunt.

he kept raising interest rates until the economy collapsed, & when enough people were out of work & enough businesses ruined to make it profitable for bigger companies to pick up the ruins on the cheap, he lowered interest rates.

the result was a much-weakened labor movement & a further concentration of capital. which immediately began to invest it offshore & engineer "the chinese miracle".

[truedelphi]

63. But I bet your aunt has some redeeming qualities

Almost all these economists are out for one thing - whatever politial gain/power they can have.

[Odin2005]

64. +1

[BeHereNow]

20. Here is the exact quote-

"The standard of living of the average American has to decline...” - Paul Volcker (1979)

His bio from the Trilateral Commission Web site:
http://www.trilateral.org/membship/bios/pv.htm

BHN

[Phoebe Loosinhouse]

23. Here is the quote in context

http://www.scribd.com/doc/6441987/Volcker-Asserts-US-Must-Trim-Living-Standard-NYT-10181979
Volcker Asserts US Must Trim Living Standard - NYT 10-18-1979


I'm not able to cut and paste it, but you can read the actual scanned article from the NYT in 1979

[BeHereNow]

27. Thanks for that- what a great source link!

Bookmarking that one for sure.
BHN

[Hannah Bell]

59. and "in context" it means the same as it means as a stand-alone quote.

labor has to reduce its living standards so capital can better its own.

and "in context," that's exactly what the next 30 years of flat wages, declining job opportunities, offshoring & tax cuts to the rich were about.

[truedelphi]

62. People tend to not look back that far. You bring up very good points,

And I agree with you.

[tmyers09]

16. Bernie Sanders on now!

[gateley]

19. Yeah -- and going after Bernanke! I love Bernie! nt

[elleng]

21. No tv here now!

I suppose this will be confirmed!

[nadinbrzezinski]

24. ok is it me but something is happening?

First the IMF and the World Bank talk of full debt forgiveness and now this? For many they will miss the tie, but something is telling me that perhaps the Chicago boys are 'bout to get kicked out of many places.

[BeHereNow]

29. That would be a change I could believe in!

Ihope you are right about that and that there
will be a lotto for people who want to do the kicking.
If I won, I'd give my ticket to Skittles!
Send HER to do the kicking!
BHN

[99 Percent Sure]

33. He has to start listening to someone other than the ones he's been listening to, because

they're leading him straight down the path to political destruction.

I gave him the side-eye when he picked Geithner, and I was also disgusted that revelations of the type that killed Lainie Guinier's confirmation in the Billy Jeff era gave the white man street cred in the 21st century. Having Summers as his chief economic adviser means that Robert Rubin is also in the president's midst in some capacity; Geither is a favored student of them both.

2008 Nov 10
The High Priests of the Bubble Economy>

Those following the meeting of Barack Obama's economic advisory committee could not have been very reassured by the presence of Robert Rubin and Larry Summers, both former Treasury secretaries in the Clinton administration. Along with former Federal Reserve Board chairman Alan Greenspan, Rubin and Summers compose the high priesthood of the bubble economy. Their policy of one-sided financial deregulation is responsible for the current economic catastrophe.

(Snipped)

The other key part of the story is the high dollar policy initiated by Rubin when he took over as Treasury secretary. In the first years of the Clinton administration, the dollar actually fell in value against other currencies.

The resulting tidal wave of bad debt has created the greatest financial crisis since the second world war. With the loss of $8tn in housing wealth, consumption has seized up, throwing the economy into a severe recession.

While the Bush administration must take responsibility for the current crisis (they have been in power the last eight years), the stage was set during the Clinton years. The Clinton team set the economy on the path of one-sided financial deregulation and bubble driven growth that brought us where we are today. (The deregulation was one-sided, because they did not take away the "too big to fail" security blanket of the Wall Street big boys.)

For this reason, it was very discouraging to see top Clinton administration officials standing centre stage at Obama's meeting on the economy. This is not change, and certainly not policies that we can believe in. ~ Dean Baker

[Phoebe Loosinhouse]

36. Side note - it would be nice if we all learned to spell it V-o-l-c-k-e-r

That is correct. I can't say how many times I have mispelled it, at least 30. It took me years to stop spelling Cheney as Cheyney.

[gateley]

40. I just learned how to spell Geithner correctly! It'll be a pleasure not to have to

worry about that any longer! Thanks for the correction -- I'll remember!

[TheKentuckian]

37. All real efforts towards actually fixing broken systems is super great.

[SoCalDem]

38. The problem is that it's backwards

Had the banking corruption been tackled alongside TARP & the stimulus, people would have had the faith necessary to support the rest of the agenda..

Banking corruption touches everyone , and for people losing their jobs, houses, lifestyles, seeing the bankers wallow in cash, is enough to boil their blood and to cast doubt on everything else..

It's like starting to use condoms after the pregnancy test is positive.. too little too late..
and couples with the SCOTUS decision today, it;s goning to be harder than ever to get this passed..

I hope it happens, but I'd bet that it will be same ole same ole..

[truedelphi]

53. What a great analogy. Absolutely

F_____ perfect.

"like starting to use condoms after the pregnancy test is positive.. too little too late..."

LOL (though the matter is really nothing to laugh over.)

[Gin]

61. I agree!!

[Frank Booth]

45. Spitzer's not the only one saying this either:

Volcker rules again with 'Volcker's rule'

At least for the day, the most powerful man in the U.S. financial industry and for equities markets is 82 years old, a man who ended his leadership of the Federal Reserve more than 20 years ago.

But Paul Volcker is back. Big time. Reportedly on the margins of the Obama administration even in his current role as an adviser, "the tall guy behind me," in the words Thursday of President Barack Obama, is back on stage figuratively and literally. . . .

It is a fascinating resurrection. Mr. Volcker himself hasn't changed his thinking. What has changed is the environment. The heavy, popular furor as big bank profits and big bonuses are rolled out likely played a role in the new Obama plan. That plan includes flat-out limits on bank size and restrictions on industry consolidation.

http://online.wsj.com/article/SB10001424052748703699204575017300364900036.html?mod=WSJ-Markets-LeadStory

If this lasts, it's great news. I'm sure Summers and Geithner won't go quietly though.

[Grand Taurean]

50. For Obama's own ego if nothing else, wants a second term

he has to turn left and take a hard populist-line against the corporate world.
No jobs bill is going to turn the economy around.

To bring the economy back "online":
1)Break up the big banks
2)Re-regulate the banks
3)No more "free trade" agreements
4)Promote alternative energy (a new means of production and independence from middle-east oil)

[VermeerLives]

58. That's probably becase Geithner is questioning

the new bank rules Obama is proposing:

http://blogs.abcnews.com/politicalpunch/2010/01/geithner-has-concerns-about-presidents-proposed-new-bank-rules.html

So I'm also wondering if Geithner is going to be out the door soon....

[TexasObserver]

65. The president needs to replace Geithner, Bernanke, and Summers.

[Raine]

67. I don't know if he saw the light but apparently he felt the heat. nt