US Bail-outs Subsidize Corporate Failures
The News Behind The News: Author Vern McKinley explains how bailing out the distressed companies only subsidizes failures.
Emmy Award Winning Executive Producer Leslie Dutton speaks with Vern McKinley, author of “Financing Failure” who appears in this 9-episode interview from the Full Disclosure Network(R) Special Series on the Federal Reserve System.
The entire series is available on-demand here
McKinley served as Policy Advisor to Central Banking Officials and foreign governments describes his experience working for the Federal Reserve System and Resolution Trust Corporation. He also relates how the government shut down the Savings and Loan Companies and hundreds of them were eventually re-opened back into the private sector.
McKinley blames government for initiating problems, and says that the Federal Reserve did not do a good job of overseeing the economy and keeping the monetary policy steady. He cites periods from the Great Depression into the late 70’s and 80’s that led to the failure of the Savings and Loans. He covers the early 1990’s till present day where home ownership was pushed to the point that it led to foreclosures. McKinley further states that the Bush and Clinton policies pushed Fannie Mae and Freddie Mack to boost homeownership The Federal Reserve led this by easing monetary policy, thus encouraging people to take on (questionable) mortgages.
McKinley, Policy Adviser to Central Banks tells Full Disclosure how difficult it was to obtain public records from the Federal Reserve regarding the huge Bail-outs of major financial institutions. In his book “Financing Failure” Mc Kinley describes a very secretive banking system that will go to all lengths to keep the massive failures secret.
Declaring the sky was falling, the leaders of the major investment firms implored US government officials and the Federal Reserve to fund the tremendous losses of their companies. McKinley speaks about “cafeteria capitalism” of chrony-capitalists. He sites that as long as they are profiting, corporate leaders want no government involvement, but when they fail due to their own risky investment policies, they quickly run to the government for rescue.
According to Article I, Section 8 of the US Constitution, Congress is supposed “to coin Money, regulate the Value thereof.” Instead Congress has relegated that authority to the Federal Reserve. Does Congress actually oversee the Fed? According to Vern McKinley, author of “Financing Failure,” Congress is in cahoots with the Fed, using FannieMae and Freddie Mac for “free money” as he states to buy political favor. This resulted in the massive recession in 2008. The Fed was initially designed specifically to protect American citizens from that kind of disaster.
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