This is a wide-ranging discussion about the anatomy of bank failures. Dave Kelley, the moderator, is a pension actuarial expert, headquartered in Ohio. Chairman of the Domestic Policy subcommittee of the Govt Oversight Committee, Kucinich, as a senior member of Congress, investigated the subprime meltdown (see you tube videos), grilling Wall Street titans. Michael Hudson is one of eight economists in the world who predicted the collapse of the financial system 2007-2008. He is a noted author on the corruption of the economy. Kucinich’s most recent book, The Division of Light and Power, explored corruption in the banking and private utilities industries.
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Dennis Kucinich and Michael Hudson on the Anatomy of Bank Failures
Bank failures have long plagued economies across the globe, causing devastating consequences for individuals, businesses, and governments. Understanding the intricate anatomy behind these failures is key to preventing future economic crises. Dennis Kucinich, a former United States Congressman, and Michael Hudson, an economist and professor, have extensively researched and analyzed the factors that contribute to such catastrophes.
Dennis Kucinich, who served in the U.S. House of Representatives for 16 years, has been a vocal advocate for financial reform throughout his political career. Known for his progressive stance on economic issues, Kucinich has often highlighted the detrimental impact of an unregulated financial system. He believes that the anatomy of bank failures lies in a lack of oversight, unchecked risk-taking, and an emphasis on short-term profits at the expense of long-term stability.
According to Kucinich, one crucial aspect of bank failures is the role of deregulation. Policies that dismantle financial regulations, such as the repeal of the Glass-Steagall Act in 1999, have been detrimental to the industry. These regulations were designed to separate commercial and investment banking activities, ensuring that banks didn’t take excessively risky bets with their customers’ deposits. The removal of such safeguards allowed banks to engage in risky practices and speculative investments, ultimately leading to their downfall.
Additionally, Kucinich highlights the moral hazard in the banking industry. Banks that are considered “too big to fail” are often bailed out by governments, creating a sense of invincibility among these institutions. This perception of safety encourages banks to engage in excessive risk-taking, knowing that they won’t bear the full consequences if things go wrong. This moral hazard undermines market discipline and further exacerbates the potential for catastrophic failures.
Michael Hudson, an economics professor and researcher, has closely studied the financial sector’s role in causing economic crises. He brings attention to the problem of debt and leverage, which he sees as a major contributor to bank failures. Hudson argues that the excessive debt taken on by banks amplifies the vulnerability of the financial system. When market conditions worsen, highly leveraged banks find it challenging to meet their obligations, triggering a cascade of failures that can bring down entire economies.
Furthermore, Hudson emphasizes that banks play a role in fueling speculative bubbles. The pursuit of short-term profits often leads to reckless lending practices, inflating asset prices beyond their intrinsic value. These inflated prices create a false sense of security, encouraging individuals and businesses to take on more debt. Eventually, these bubbles burst, leaving both borrowers and lenders in financial turmoil.
To address these issues and prevent future bank failures, Kucinich and Hudson advocate for comprehensive financial reforms. They emphasize the importance of reestablishing robust regulation in the banking industry, reinstating safeguards that separate commercial and investment banking activities, and ending the “too big to fail” mentality. Additionally, greater scrutiny of lending practices and the management of debt are necessary to avoid the buildup of systemic risk.
In conclusion, Dennis Kucinich and Michael Hudson shed light on the complex anatomy of bank failures. Deregulation, moral hazard, excessive debt and leverage, and the creation of speculative bubbles are all key factors that contribute to these catastrophic events. Reforms aimed at strengthening regulations, reducing systemic risks, and promoting responsible banking practices are crucial in order to avoid future economic crises. By heeding their research and insights, policymakers and economists can lay the groundwork for a more stable and resilient financial system.
H. L. Mencken (1880 – 1956): “The men the American people admire most extravagantly are the most daring liars; the men they detest most violently are those who try to tell them the truth.”
"Breakdown of trust": this is hilarious as greedy unprincipled corporate assholes make their money by exploiting trust.
Alexis de Tocqueville: “A democratic government is the only one in which those who vote for a tax can escape the obligation to pay it.”
H. L. Mencken (1880 – 1956): “Nobody ever went broke underestimating the intelligence of the American public.”
William Casey (CIA Director 1981-1987): “We’ll know our disinformation program is complete when everything the American public believes is false.”
Frank Wilhoit (The travesty of liberalism by Henry Farrell): “Conservatism consists of exactly one proposition, to wit: There must be in-groups whom the law protects but does not bind, alongside out-groups whom the law binds but does not protect.”
For as long as science and technology unilaterally divorce Mathematics from Physics, Physicists who trained as Quants will treat pure-math logarithmic relative-timing as inconsequential Vapourware, of little to no Material importance in (death and/or glory) Finance.
The functional focus of Mathematics is perceived as something magical belief, because the innate nature of the universe is pure-math flash recognition of compound-complex logarithmic integration of a nodal-vibrational emitter-receiver interference based Ecology, for which everyone shares responsibility for the Gold-Silver Rules of Mutual Respect.
"Time to Wake Up" and cut pollution, and Dark Money corruption.
The truth is out there . The sad fact there should be 10 million comments and view. I guess that most insist the BS narrative from Wall Street.
When a snake shoots itself in the foot, it's actually shooting itself in the ass.
Obama is an obamanation.
Too bad Mr Kelley is not savvy enough to raise the issue: what really happened on 9/11? That day of days was probably the greatest rip-off of our country's wealth in our history. Obviously, the official story is a lie. 9/11 was staged to vastly expand the capacity of the 1% to extract wealth from, i.e., loot, the rest of the planet. Think about it, folks. What better way to get rich than by attacking and destroying entire nations? That's what happened after 9/11 — all in the name of combating terrorism! Wow! It was one of the greatest scams in human history…followed more recently by the plandemic which also had the effect of concentrating wealth in a few hands at the expense of humanity…all of us.
So obvious this was coming but no one pays attention.
A brilliant conversation and a truthful one.
The creation of wealth is no longer an influence so the zero sum frenzy unfolds
Great discussion!
They aren’t just “monopolies”. They are fascist corporatist cartels for globalist oligarchical fascist elites. The elite’s Uniparty puppet politicians won’t do anything to reform a corrupt system that profits them.