Merrill’s toxic assets were eating a hole in the balance sheet. ibid.
Long before the economic meltdown the story of one woman who tried to warn about the threat to the financial system. Before the toxic assets poisoned the economy, she warned of their danger ... Alan Greenspan v Brooksley Born and the Warning. Frontline: The Warning, PBS 2009
Reagan made Greenspan the most powerful banker in the world – the chairman of the Federal Reserve. ibid.
In 1993 Bankers’ Trust, one of the largest banks in the country at the time, had sold derivatives to Proctor & Gamble. The lawsuit set the stage for a stunning revelation: Bankers’ Trust employees took advantage of the fact that derivatives were too difficult to understand. ibid.
Trillions of dollars and the biggest banks in the country operating in secret. ibid.
Born’s warning became a prophecy. ibid.
The Wall Street banks were pressured to bail out LTCM themselves. ibid.
Some in Congress began to clamour for regulation. ibid.
Alan Greenspan had no intention of yielding. ibid.
Congress did decide to do something about Brooksley Born – they stopped her entirely. ibid.
Wall Street was largely left to regulate itself. ibid.
Have you taken a large home loan? Or did you put your savings in stocks, mutual funds or bonds? If not, you can relax. But all of us who did are living on borrowed time. This is the story of the greatest financial crisis of our time: the one that is on its way. Overdose: The Next Financial Crisis, 2010; viz also Johan Norberg’s Financial Fiasco
In 2003 it [interest rates] was cut all the way to 1%. ibid.
Greenspan argued that the Fed should never remove the punch bowl. But rather start refilling it when the party started to peter out. And if things went bad, the Fed would clean up the mess and tend to the hangover. ibid.
The big banks dared to make riskier loans because they had started repackaging loans and selling them to others as securities. ibid.
The rating agencies that rate securities gave the mortgage-backed bonds their highest rating ... The rating agencies were being paid by the sellers of securities. ibid.
The difference is that this bubble is much bigger. ibid.
Even banks who don’t want the money will be forced to take it, so that the public won’t know which banks are on the brink of collapse. ibid.
Congress approves the biggest financial bail-out in history: $700 billion. ibid.
President Bush gives billions of dollars to General Motors and Chrysler. ibid.
On February 7th 2009 Obama approves a stimulus package worth $787 billion; with the Bush stimulus package from the year before US politicians have now spent close to $1 trillion to stimulate the US economy. ibid.
We have been saved from the consequences of one burst bubble by inflating a hundred new ones all around the world. ibid.
Bush almost racked up more US debt that all presidents before him combined. ibid.
4Each time and every time a bank makes a loan, new bank credit is created – new deposits – brand new money. Graham F Towers, governor Bank of Canada 1934-1954
From the late 1990s banks lent around a trillion dollars to Americans on low incomes to buy houses. Bankers II: Risking It All, BBC 2013
Why do you think that the Banks aren’t lending money despite a £1 trillion bailout? Simple. The only people and businesses that need money right now are those who are already struggling to make the repayments on their outstanding borrowing! Would you lend another £1000 to someone that you knew had no possible means to repay the £1000 that you had already lent them? Perhaps, but only if you never expected to see any of it ever again! Consequently, the Banks know that if they are forced to create more ‘Toxic Debt’, the current level of ‘financial crisis’ will seem like ‘chump change’. Ian R Crane, Stepping Through Financial Fear; viz website
Adam Applegarth, the chief executive behind the bank’s [Northern Rock] disastrous lending strategy ... continues to be paid £63,000 a month in severance pay and can look forward to a £2,000,000 pension fund. Dispatches: How the Banks Never Lose, Channel 4 2008
Around a quarter of all bank loans are so dodgy they have had to be insured: an astonishing indictment of the banks’ lending practices. Will Hutton, Dispatches: Crash: How Long Will It Last?
One of the greatest disservices you can do a man is to lend him money that he can’t pay back. Jesse H Jones
Only commercial banks and trust companies can lend money that they manufacture by lending it. Professor Irving Fisher, 100% Money, 1935
The economy might be struggling but one area of business is thriving – the debt business – payday loans and door-to-door lending. Panorama: Undercover: Debt on the Doorstep, BBC 2012
We reveal the real costs of taking out a loan. ibid.
Provident dominate the doorstep-lending market. ibid.
Agents are encouraged to sell more loans. ibid.
Banks lend by creating credit. They create the means of payment out of nothing. Ralph M Hawtrey
How like a fawning publican he looks!
I hate him for he is a Christian;
But more for that in low simplicity
He lends out money gratis, and brings down
The rate of usance here with us in Venice. William Shakespeare, The Merchant of Venice I iii 42
Neither a borrower nor a lender be. William Shakespeare, Hamlet I iii 75, Polonius to Laertes
At the end of every seven years thou shalt make a release.
And this is the manner of the release: Every creditor that lendeth ought unto his neighbour shall release it; he shall not exact it of his neighbour, or of his brother; because it is called the Lord’s release. Deuteronomy 15:1&2
Give to him that asketh thee, and from him that would borrow of thee turn not thou away. Matthew 5:42
[Jesus said], ‘If you have money, don’t lend it at interest. Rather, give to someone from whom you won’t get it back.’ Gospel of Thomas 1:95
Our entire civilisation is based on the lending and borrowing of money. Niall Ferguson, The Ascent of Money e1: Dreams of Avarice, Channel 4 2008
The Hindu or Arabic numerals made all kinds of calculation easier. ibid.
For the first time money lending had evolved into banking. ibid.
‘There are millions who are victims of this predatory lending.’ Dirty Money II: Payday, Netflix 2018
‘The online part of payday lending was like a ten billion dollars a year business.’ ibid.
‘You’re really targeting the most vulnerable people out there.’ ibid.
In February 2016 Scott Tucker and his general counsel Tim Muir were indicted on federal criminal charges for operating an unlawful internet payday lending enterprise. ibid. caption
Payday Loan Mogul’s $1.3 billion judgment is record FTC penalty. ibid. newspaper article
Husband: I’m in debt to a moneylender. Aye, and it’s Boyle. Jimmy Boyle.
Wife [takes pay packet]: I’ll not expect you back then. A Sense of Freedom 1979 starring David Hayman & Jake D’Arcy & Sean Scanlan & Alex Norton & John Murtagh & Roy Hanlon & Martin Black & Fulton Mackay & Hector Nicol & Bill Barclay et al, director John Mackenzie