Tuesday, November 02, 2010

Wall Street Bankster Stocks Are Already Back In Bear Market Territory

Does anyone actually think Jamie Dimon can manage a company with a quarter of a million employees spread all over the world comparative to a local bank with a few hundred employees?   If so, you must believe the U.S. government can manage the entire U.S. economy.  What’s the difference?  Seriously?   Substantial real world analysis has shown that companies over 1,000 employees cannot effectively be managed.   Whatever the number is, we are well past that point by magnitudes.   

These massive companies that our government created on Wall Street would have failed to exist were we not to have bailed them out numerous times over the last few decades.  And this argument that they were hedged or didn’t need bailouts as put forth by Goldman and JP Morgan Chase, as an example, is ridiculous.  Wall Street is so intertwined that once counterparties to their leveraged balance sheets started failing, the entire industry would have  fallen like the Humpty Dumpty it is. 

Efficiency at large corporations is gained not by management brilliance but by using girth to crowd out competition and invention and ruthlessly dictating terms to clients once there are few, if any, alternatives.   This is a major reason why we have a predatory financial system.   We have anti-trust laws for a reason as we have hammered incessantly.  But instead our corrupt government has forsaken the rule of law for bribery and fraud. 

Wall Street is killing our economy, something we have written ad nauseam.  And they are also killing community banks.  Again something we have written repeatedly.  Additionally, when the Federal Reserve props up corrupt Wall Street and gives them special favors through interest-free money and special-interest legislation in the form of corrupt ‘banking reform’, the largest and most corrupt financial institutions in our country can offer below market rate services which drives capital out of community banks.  Community banks actually have to compete on merit and not bribery and fraud.   Again, a topic of discussion on here.

When the market was peaking earlier this year, we wrote that Wall Street profits were in the process of peaking and we were once again bearish on banking stocks.  Now months later we see the stocks have followed suit and are back in bear market territory. (Down greater than 20%) 

Remember, we have said since the first bailout that Wall Street is eventually going to need another bailout without a change in economic policy.  It’s time to nationalize Wall Street and bust up the predatory monopolies.  And let’s be clear.  This is not just a Wall Street problem, monopolies and oligopolies exist within every single industry of the American economy.

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Banking Index comprised of national banks and Wall Street firms.

posted by TimingLogic at 9:47 AM

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