Unpunished and unreformed, the bankers have got away with it

Punishing the bankers who brought on the financial crisis has proved distressingly difficult. None have gone to jail. A few young traders, who hid their post-crash losses and thereby stole from the banks, are behind bars. The rest are untouched by the tragedy. It's true that a handful fall into the category of "disgraced banker", such as Barclays' former boss Bob Diamond and Edinburgh's finest, Fred "the shred" Goodwin of Royal Bank of Scotland fame, but they kept their wealth and pensions and live comfortably.

Tim Geithner, Osborne's opposite number in Washington, is not in charge of prosecutions, but he has made it his job to explain why bankers have avoided the courtroom. In short, the Bush and Obama administrations put the recovery before reform of Wall Street. Geithner stuffed the banks with government cash during the credit crunch, even when they didn't want it, to get them back on their feet and lending again. There are no taxes on bankers. The White House let Congress devise a complicated and ineffectual set of new banking regulations. He doesn't wring his hands about the lack of prosecutions.

He recently told the Wall Street Journal: "A huge part of what happened across the system was just a mixture of ignorance and greed, or hope over experience, and not illegal. Most financial crises are not caused by fraud or abuse. They're caused by people taking on risks they don't understand, too much risk. When the tide turns, it can have catastrophic damage."

Read more at link http://www.guardian.co.uk/commentisfree/2013/feb/08/unpunished-unreformed-bankers-financial-crisis?CMP=twt_gu

By now it is no secret that in the past decade, the “Big 6″ global central banks have boosted their combined balance sheet by an unprecedented $11 trillion, from $3 trillion to over $14 trillion, just as it is no secret anymore that the only reason the global market trades where it does is courtesy of the “flow” or liquidity generated as a result of this unprecedented intervention, whose inevitable outcome is eventual inflation. What, however, was hidden in plain sight, was the chart responsible for this massive stock market surge, which has seen the S&P double in the past 4 years (if go nowhere in the past decade). Luckily, we now have “deciphered” the subliminal message contained in the global central bank liquidity “flow”, which is shown as the deep blue line in the chart below. Technicians have a specific name for the pattern that has emerged: “the middle finger formation” and while others can call it by a plethora of other names, the central bankers’ message to the rest of the world is now plain for all to see.

After having less than half the total US deposits back in 2005, China has pumped enough cash into the economy using various public and private conduits to make even Ben Bernanke blush: between January 2005 and January 2013, Chinese bank deposits have soared by a whopping $11 trillion, rising from $4 trillion to $15 trillion! We have no idea what the real Chinese GDP number is but this expansion alone is anywhere between 200 and 300% of the real GDP as it stands now. And more: between January 2012 and January 2013 Chinese deposits rose by just over $2 trillion. In other words, while everyone focuses on Uncle Ben and his measly $1 trillion in base money creation in 2013 (while loan creation at commercial banks continues to decline), China will have created well more than double this amount of money in the current year alone! The reason why US deposits have grown relatively slower compared to China is because the bulk of the newly created credit-money has been injected directly into the stock market, whereas in China, where the Shanghai Composite is still mostly a distraction, cash rules. But back to China, and its gargantuan money creation: between January 2012 and January 2013 Chinese deposits rose by just over $2 trillion. In other words, while everyone focuses on Uncle Ben and his measly $1 trillion in base money creation in 2013 (while loan creation at commercial banks continues to decline), China will have created well more than double this amount of money in the current year alone!

The house of cards that is Europe is close to collapsing as those widely held responsible for solving the Crisis (Prime Ministers, Treasurers and ECB head Mario Draghi) have all been recently implicated in corruption scandals. Those EU leaders who have yet to be implicated in scandals are not faring much better than their more corrupt counterparts. In France, socialist Prime Minister Francois Hollande, has proven yet again that socialism doesn’t work by chasing after the wealthy and trying to grow France’s public sector… when the public sector already accounts for 56% of French employment. France was already suffering from a lack of competitiveness. Now that wealthy businesspeople are fleeing the country (meaning investment will dry up), the economy has begun to positively implode. The first sign of this came actually came from Germany. As we noted a few months ago, Germany had prepared a working group to examine the impact of an economic collapse in France.