President Obama has complained for a year that “the banks aren’t lending.”
So, the morons in the White House have a brilliant plan to deal with it. They are going to slap the banks with a punitive tax amounting to $90-$100 billion. Since banks lend at a ratio of a minimum 10:1, this means that $1 trillion less will be lent to small business, corporations, and individuals.
If Obama thinks bank lending is bad now, wait til he removes $1 trillion of loan capital.
If the architects of the bailout (like Tim Geithner) wanted to prevent these bonuses and spur bank lending, they would have demanded that the TARP funds be used to improve their balance sheets, and if any profits were made from the investment of these funds, then those profits would be used to offset rising loan losses further strengthening the banks. The administration also would not be engaged in wealth destroying policies that have made entrepreneurs reluctant to get loans in the first place.
As it stands now, many banks are still suffering, but the profits they are earning are being paid out as bonuses and not being used to rebuild their balance sheets since they know the government will not let them fail since as in Citigroup’s case they are owned by the taxpayer.
Also, our investment in Citigroup is taking a beating today as Obama pushes this bank tax. So Mr. Taxpayer, you bought Citigroup and now Obama is causing that investment to go down in value! Wow! Is he available for financial consultations?
This is all one big ponzi scheme so the government can pay for the limitless bailout they have guaranteed Fannie and Freddie and the tens of billions we have put into GM.
One last thing, Warren Buffet who was a huge supporter of Obama’s pap has come out strongly against the bank tax. He of course owns shares in Wells Fargo and other financials. Hmmmmmm.
Tags: Capitalist, Debt, Economy, Geithner, Government, Obama, Taxes