The media is trying to spin the FTX crisis as a quasi-libertarian indulging in capitalist excesses.
The real story is that he was working hand-in-glove with Democrats to pass legislation to destroy his competitors. Funny how they leave that part of the story out. pic.twitter.com/updjk2PjOu
— Ben Shapiro (@benshapiro) November 14, 2022
Crony Capitalism
- Donald R. McClarey
Donald R. McClarey
Cradle Catholic. Active in the pro-life movement since 1973. Father of three, one in Heaven, and happily married for 43 years. Small town lawyer and amateur historian. Former president of the board of directors of the local crisis pregnancy center for a decade.
Quite correct. This was a scam within a scam designed to exchange intrinsically worthless cryptos for hard currency with a piece of the action going to the dems and the rest into the organizers pockets. Charlie Munger of Berkshire fame was right when he pronounced anathema on all crypto activities. Now, wait to see who lines up for relief, a la Long Term Capital, from the public trough (taxpayers).
Now, wait to see who lines up for relief, a la Long Term Capital, from the public trough (taxpayers).
IIRC, the government brokered a rescue of LTCM by a collection of I-Banks. Do not recall the government putting up funds itself.
Crony Capitalism – Corporate Socialism.
Same old story, different mechanisms to fleece the taxpayer and the consumer.
Above Art is correct: it was not US taxpayer money that bailed out LTCM creditors. It was the NY Fed’s/Federal Reserve’s indirect actions.
Many deep thinkers [there are too few] look on that intervention as an early bail out and led to assumed indirect bail outs that could be seen as contributing factors to big money guys taking outlandish risks because the Fed indirectly would bail them out, which led to the great recession.
“To save the U.S. banking system, the Federal Reserve Bank of New York President William McDonough convinced 14 banks to bail out LTCM. 3 They spent $3.5 billion in return for a 90% ownership of the fund. The Fed started lowering the fed funds rate. It reassured investors that the Fed would do whatever was needed to support the U.S. economy.”
In 2008, the Fed orchestrated bail outs of several bankrupt investment houses, e.g., Merrill Lynch. But refused or could not do the same for Lehman Bros. touching off the late 2008 financial catastrophe.
In the past what? 14 years [since late 2008] the Fed kept at near zero so-called market interest rates and poured in trillions in quantitative easing to keep long rates unnaturally low and buy UST and mortgage-backed securities markets providing excess liquidity.
Now, we have 40-year record inflation and a $31.2 trillion national debt. And many see a looming recession in 2023.
In conclusion, inflation is the cruelest tax, and it is not susceptible to elected legislatures.
Sorry, not buying the banking system would have buckled had LTCM gone into receivership.
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