Geithner and Bernanke demand mega-bailout of Europe

Shades of the 2008 Hank Paulson, three-page ransom note to the Treasury for a $700 billion bailout for banks or the world economy would collapse. This time the LaRouche Political Action Committee reports that “Capitol Hill sources confirmed that Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke are demanding that Congress prepare emergency legislation for yet another hyperinflationary bailout of the hopelessly bankrupt trans-Atlantic financial system.”

This is not exactly the news America, already in deep recession and debt, expects to hear. Nevertheless, “For the past week, the two men [Geithner and Bernanke] have been meeting secretly with leading Congressional Democrats and Republicans,” LaRouche reports, “demanding that they draft new legislation to bailout the banks on an even larger scale than after the 2008 collapse.” Like Gordon Gekko, they want more, unsatisfied with the public dole to date.

LaRouchePAC reports, “According to several congressional sources, Geithner and Bernanke have pledged that they will do everything in their power to flood European banks with bailout funds through the Federal Reserve, but they candidly admit that it may be impossible, and that congressional action may be required.” Good luck with asking a Republican-weighted House, obsessed with austerity, for more Fed bailout money for Europe. Yet, LaRouchePAC warns, “If the crisis hits . . . there must be legislation already prepared, because the speed and magnitude of the crisis may require extraordinary intervention to ‘save the system.’”

Lyndon LaRouche responded today, June 28, denouncing the Bernanke-Geithner efforts as “tantamount to treason.” He warned, “The current Trans-Atlantic system cannot be saved. The only option is the immediate reinstatement of the original Franklin Roosevelt Glass-Steagall Act [Read LaRouchePAC link explanation of this great act]. “It must happen now!” LaRouche warned, “as of Thursday or Friday of this week, the entire European financial system will explode.

“Either Germany will hold firm and refuse to surrender the last vestiges of national sovereignty, or Europe will go into a hyperinflationary breakdown. It all hangs on Germany.” The fact is, “German Chancellor Angela Merkel is under pressure from a swarm of British and Wall Street agents—from Geithner and Bernanke to George Soros—to agree to a German bailout of the entire euro system,” LaRouchePAC reports. It adds, “The reality is that the gambling debts of the European and Wall Street banks can never be paid. The only option is an orderly cancellation of all those trillions of dollars of gambling debts by reinstating Glass-Steagall.”

Additionally, we’re told that, “Rep. Marcy Kaptur (D-OH) has introduced H.R. 1489 to reinstate Glass-Steagall and the bill now has 69 co-sponsors from both parties. Last week, LaRouchePAC exposed the fact that former Federal Reserve Chairman Paul Volcker has been mobilized, on behalf of Geithner and Bernanke, to sabotage the passage of Glass-Steagall.” Actually, Volker was originally appointed to serve as a Senior Advisor on finance by President Obama, along with Timothy Geithner (former New York Fed Bank Chief) as Treasury Secretary, and Larry Summers, former Clinton adviser and President of Harvard (2001–06), long gone from the administration.

LaRouchePAC adds, “Now, Geithner and Bernanke are pushing for another even bigger taxpayer bailout of Wall Street and London’s gambling debts. According to Capitol Hill sources, even Rep. Barney Frank (D-MA) rejected the Bernanke and Geithner demands!”

Lyndon LaRouche reiterated, “The only option is Glass-Steagall. Anyone who is not fighting for Glass-Steagall now is going to be judged a traitor to humanity. The only way to save the viable commercial banks is to end the bailouts and go back to Glass-Steagall. If Glass-Steagall is not passed into law now, we face the danger of total chaos, when the system comes crashing down. It could happen as early as the end of this week, as the European crisis reaches a break point.”

Whether this is date is prophetic or not, the Glass-Steagall Act should be reinstated ASAP. In effect, it simply states that an investment bank may not also be a savings bank and offer its commercial services, because those savers funds are prey to invasion and commingling by the investment half of a bank. This has all too often been the case from before 2008 and after, even after the bailouts and easements, garnished with lavish bonus-taking.

Most recently, JPMorganChase CEO Jamie Dimon reported a $2 billion loss (which could grow to $50 billion) in derivatives trading, saying that he knew nothing about it to Congress. Unfortunately, he was not even sworn in under oath by the Senate. Thus, the lies compounded with corrupt acts could bankrupt investors, savers and our economy.

Jerry Mazza is a freelance writer, life-long resident of New York City. An EBook version of his book of poems “State Of Shock,” on 9/11 and its after effects is now available at Amazon.com and Barnesandnoble.com. He has also written hundreds of articles on politics and government as Associate Editor of Intrepid Report (formerly Online Journal). Reach him at gvmaz@verizon.net.

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12 Responses to Geithner and Bernanke demand mega-bailout of Europe

  1. AUTHOR’S UPDATE: A follow-up question to a representative from the LaRouchePac organization re: how much would this bailout amount to, was the following: “The IMF estimates that the minimum amount to bail out the European bank and sovereign deb is $4.5 trillion euro. The total is is closer to $10 trillion. But all of this is hypothetical, as the entire Euro system is imploding, which will trigger a similar crisis in the U.S. However, the plan is to print money, hence this will trigger hyperinflation. So the best model to look at is Weimar Germany in 1923. The money printing ended with people taking wheelbarrows of money to buy mere loaves of bread.
    “Plus, we were told that Chief Justice Roberts was told that if he didn’t support Obama Care, in order to get money to bailout the derivatives, the system would crash. The bottom line is this is a bottomless pit, and that no amount of bailout can save it, and they will bluff all the way to the end.”
    Jerry Mazza.

  2. Henry Carraro

    The top 5 U.S. bank and trust companies holding derivative contracts in December 2009: [9]

    JP Morgan Chase $78 trillion
    48:1 leverage exposure
    Bank of America $44 trillion 30:1 leverage exposure
    Goldman Sachs Bank $41 trillion 457:1 leverage exposure
    Citibank National $37 trillion 32:1 leverage exposure
    Wells Fargo $ 4 trillion 4:1 leverage exposure

    These five have a derivative exposure of $206 trillion representing 97 percent of the total derivative holdings of all U.S. bank and trust companies. Their leverage exposure of derivatives to assets shows that when the derivative bubble bursts, they will burst with it. They are giant zombies, kept alive by both political parties subservient to the elite class that owns them.

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