Commentary - 10/15/08

Godfather of Finance Takes Care of Business

There is a scene in the Godfather movie where Michael Corleone settles all family business during a christening, transferring power away from the old dynasties into a new dynasty. Although unfortunately gory, this scene comes to mind when reading about the showdown yesterday with Hank Paulson and nine bankers. Of course, today we're much more sophisticated, with death by a thousand cuts via financial ruin, character assassination or chemicals such as mercury or polonium. Some say assassination is an extreme form of censorship.

Here's the segment found on YouTube:

This New York Times article describes the Drama Behind a $250 Billion Banking Deal:

The chief executives of the nine largest banks in the United States trooped into a gilded conference room at the Treasury Department at 3 p.m. Monday. To their astonishment, they were each handed a one-page document that said they agreed to sell shares to the government, then Treasury Secretary Henry M. Paulson Jr. said they must sign it before they left.
. . .
But by 6:30, all nine chief executives had signed — setting in motion the largest government intervention in the American banking system since the Depression and retreating from the rescue plan Mr. Paulson had fought so hard to get through Congress only two weeks earlier.
. . .
“It was a take it or take it offer,” said one person who was briefed on the meeting, speaking on condition of anonymity because the discussions were private. “Everyone knew there was only one answer.”
I don't think that Hank Paulson is the "godfather" of finance, but just another agent carrying out instructions. Someone knows the source of those instructions. I'll doubt if we'll ever know.

This article is The Government Rescue Plan, in Detail. The part that I'm sure that concerned these nine bankers the most was that:

The government may sell the preferred stock to a third-party.
The fact that a large block of preferred shares could be sold at anytime, to anyone, would have to be unnerving to the bankers. They may or may not truly know that they are only agents, and when surprises like this happen, it's simply because they, whoever they are, do not always inform their agents. There is much more about agents here in Chapter Five.

What's happening here in the States is not all, as this appeared in the Telegraph.UK:
Why did they deny my story when it turned out to be true all along?

As the day progressed, it was like hopping between parallel universes. In one, RBS spin doctors were demanding a correction. In another, banking sources reassured me that the plan to axe Goodwin and replace him with Hester was still in place, and that it would be activated the moment RBS approached the Treasury, as it inevitably would, for emergency rations. Who was right?

We did not have to wait long for the answer. On Sunday evening, it was confirmed that RBS and HBOS were to be nationalised, and that Goodwin was for the chop. His replacement? Yes, Stephen Hester. Relief at vindication was superseded by perplexity. Why did Sir Fred and the Chancellor go out of their way to issue formal rebuttals of a report that was true all along?

There are certainly powers at work in many places at this time attempting to create a new financial dynasty.
It's truly interesting that one entity has this website:

Today, we must say, "NO MORE!"
The Dragon Wins NO MORE!
Let's accept our failures now. Congress proved themselves not worthy of our trust.
Pass the American Monetary Act to prevent giving away TITLE to our homeland.

© 2008 by Edward Ulysses Cate
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