{"id":37291,"date":"2013-04-03T22:52:30","date_gmt":"2013-04-04T02:52:30","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=37291"},"modified":"2013-04-03T22:52:30","modified_gmt":"2013-04-04T02:52:30","slug":"why-crime-pays-for-too-big-to-fail-banks","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/04\/03\/why-crime-pays-for-too-big-to-fail-banks\/","title":{"rendered":"Why Crime Pays for \u2018Too-Big-to-Fail\u2019 Banks"},"content":{"rendered":"

By MoneyMorning.com.au<\/u><\/a> <\/p>\n

You need to know the truth about banks<\/strong>.<\/p>\n

Why? Because they rob you.<\/p>\n

Why? Because they can.<\/p>\n

It\u2019s the Willie Sutton bank robber quote in reverse. Willie was asked, \u2018Why do you rob banks?\u2019<\/em><\/p>\n

He famously answered, while in handcuffs, \u2018Because that\u2019s where the money is.\u2019<\/em><\/p>\n

But, banks can\u2019t keep robbing the public if they keep shooting themselves in their feet. That\u2019s where central banks come in<\/strong>.<\/p>\n

They are the real kingpins keeping their robber minions in pinstripes \u2014 instead of prison stripes.<\/p>\n

Estimates now are that US banks<\/strong> \u2014 the too big to fail ones \u2014 will end up paying more than $100 billion in fines, settlement costs, to buy back bad mortgages, to right some of the past wrongs related to the mortgage crisis they caused.<\/p>\n

It could end up being more. But they\u2019re all still in business. They\u2019re able to digest these \u2018costs of doing business\u2019, and get bigger. And the banks are making enough profits to want to \u2018reward shareholders\u2019 by raising their dividend payouts and buying back their stock. <\/p>\n

\u2018The Cost of Doing Business\u2019<\/h2>\n<\/p>\n

Then there\u2019s the LIBOR mess<\/strong>. Banks colluded to manipulate the London Interbank Offered Rate. LIBOR is referred to by the British Bankers\u2019 Association (an outfit populated by bankers as a kind of trade group that oversees LIBOR dissemination), as \u2018the world\u2019s most important number\u2019.<\/p>\n

There have been some settlements already. Three giant European banks<\/strong> \u2014 Royal Bank of Scotland, UBS, and Barclays \u2014 have ponied up almost $3 billion to settle matters regarding their involvement.<\/p>\n

How much will the big American banks have to pay to settle their end of the scheming manipulation?<\/p>\n

Nobody knows. But estimates I\u2019ve seen range from $7.8 billion (I have no idea how the analyst came up with that figure… Thin air?) to more than $125 billion.<\/p>\n

The point is that no one knows how much it will cost banks<\/strong> because it\u2019s impossible to calculate how so many people, businesses, municipal governments, and anybody who paid interest based on LIBOR, was adversely affected.<\/p>\n

The banks will pay whatever they have to in order to get these matters settled. They\u2019ll all still be in business and able to digest these \u2018costs of doing business\u2019. They\u2019ll get bigger, and make enough profits to want to \u2018reward shareholders\u2019 by raising their dividend payouts<\/a> and buying back their stock.<\/p>\n

But the hits keep coming folks.<\/p>\n

Now the banks are being investigated for collusion, price fixing, restraint of trade, and just flat out being the criminal enterprises that they are. And for all their hard work in keeping credit default swap (CDS) trading off exchanges \u2014 where prices would be transparent and honest.<\/p>\n

Then again, who cares about that little corner of the market for that little product? It\u2019s only estimated to be in the tens of trillions of dollars. They are weapons of financial mass destruction in the shaky hands of speculating shysters.<\/p>\n

Okay, that\u2019s a hyperbole. There is a place for CDS, it\u2019s just not where it is now \u2014 which is everywhere.<\/p>\n

How much will it cost banks? $1 billion? $10 billion? $100 million billion?<\/p>\n

Who cares?<\/p>\n

The banks will pay whatever they have to. They\u2019ll all still be in business. They\u2019re able to digest these \u2018costs of doing business\u2019. They\u2019ll get bigger, and make enough profits to want to \u2018reward shareholders\u2019 by raising their dividend payouts and buying back their stock.<\/p>\n

Get the Picture?<\/h2>\n<\/p>\n

Banks have become protected criminal enterprises.<\/p>\n

They couldn\u2019t do what they do without two things…<\/p>\n

Make that one thing, because the one thing really encompasses the two things. I was going to say with they operate under the auspices of their cronies in government \u2014 and the Federal Reserve<\/strong> or central banks everywhere. But forget the government stooges. They are beholden to the Federal Reserve<\/a> and central, which they long ago sold their souls to.<\/p>\n

Without central banks <\/a>to bail out the banks they would fail. And they should. But they can\u2019t because they are too big to fail \u2014 and too big to jail.<\/p>\n

Now that\u2019s a business model!<\/p>\n

Oh, and why are governments around the world (case in point: the United States) able to run mega-deficits?<\/p>\n

That would be because they\u2019re in bed with their cuddly central banker colluders, so they can print money to buy their never-ending, always-spewing bills, notes, and bonds that finance political pandering to the voters to stay in power.<\/p>\n

They couldn\u2019t do it without central banks.<\/p>\n

Shah Gilani
\nContributing Editor, Money Morning<\/em><\/strong> <\/p>\n

Join Money Morning on Google+<\/u><\/a><\/strong><\/p>\n

From the Archives…<\/strong><\/em><\/p>\n

Why Dividend Stocks May Not Stay This Cheap for Long<\/a>
\n29-03-2013 \u2013 Kris Sayce <\/p>\n

Respect the Market Trend, but Don\u2019t Expect it to Last<\/a>
\n28-03-2013 \u2013 Murray Dawes <\/p>\n

Silver \u2018$100 Within Two Years\u2019<\/a>
\n27-03-2013 \u2013 Dr. Alex Cowie <\/p>\n

11 Billion Reasons to Expect a 200% Move in Gold Stocks Within Months<\/a>
\n26-03-2013 \u2013 Dr. Alex Cowie <\/p>\n

You Want Proof the Stock Market\u2019s Heading Up? Try This…<\/a>
\n25-03-2013 \u2013 Kris Sayce<\/p>\n

\n<\/img><\/a> <\/img><\/a> <\/img><\/a>\n<\/div>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

By MoneyMorning.com.au You need to know the truth about banks. Why? Because they rob you. Why? Because they can. It\u2019s the Willie Sutton bank robber quote in reverse. Willie was asked, \u2018Why do you rob banks?\u2019 He famously answered, while in handcuffs, \u2018Because that\u2019s where the money is.\u2019 But, banks can\u2019t keep robbing the public … <\/p>\n

Continue reading “Why Crime Pays for \u2018Too-Big-to-Fail\u2019 Banks”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-37291","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/37291","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/comments?post=37291"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/37291\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/media?parent=37291"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/categories?post=37291"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/tags?post=37291"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}