I still find some of the best stuff in comments on great blogs.
Here's one that made my day, from a poster named barry (hang in there until the end, on E.F. Hutton):
I seem to have lived in some alternative universe. The essence of Reaganomics was use of government resources opportunistically to help advance GOP interests and to help select firms.
We can start with the nationalization of Continental Illinois Bank in 1984 (in the middle of an election) and use of government funds to bailout all depositors for the full amount (not just the FDIC limit).
We can continue with the seizure of Franklin Savings and Loan (a healthy financial instituion with never a losing year) on the grounds of improprer ‘hedge accounting’. The assets of the institution were sold at a discount to connected Wall Street firms.
We can go onto the ’sale’ of a bunch of Texas banks to Nationsbank for a pittance and with a put option. The government gave Nationsbank a free call option (an option that belonged to the shareholders of the Texas banks and the taxpayer).
E. F. Hutton is an amusing diversion. Here was comapany charged with everything from check kiting to wire fraud. The Reagan Justice Department was reluctant to move against them. State Attorney Generals in NY and PA were about to get indictments in state court. The Feds moved with amzaing rapidity. E. F. Hutton (the company) pleaded guilty to various crimes in a court room in Wilkes Barre, PA (not Philly or NYC where there would have been media). Not a single officer of E. F. Hutton was charged. E. F. Hutton should have lost its broker/dealer license but the SEC swiftly came in with an exemption. The CFTC should have debarred E. F. Hutton but another exemption was forthcoming. E. F Hutton’s President, one Scott Pierce was happy. He called his sister Barbara and thanked her. She said that she would pass on the good news to her husband, George Bush.
We could go on and on. But the statement that Ronald Reagan had something to do with free markets seems divorced from reality.
We can start with the nationalization of Continental Illinois Bank in 1984 (in the middle of an election) and use of government funds to bailout all depositors for the full amount (not just the FDIC limit).
We can continue with the seizure of Franklin Savings and Loan (a healthy financial instituion with never a losing year) on the grounds of improprer ‘hedge accounting’. The assets of the institution were sold at a discount to connected Wall Street firms.
We can go onto the ’sale’ of a bunch of Texas banks to Nationsbank for a pittance and with a put option. The government gave Nationsbank a free call option (an option that belonged to the shareholders of the Texas banks and the taxpayer).
E. F. Hutton is an amusing diversion. Here was comapany charged with everything from check kiting to wire fraud. The Reagan Justice Department was reluctant to move against them. State Attorney Generals in NY and PA were about to get indictments in state court. The Feds moved with amzaing rapidity. E. F. Hutton (the company) pleaded guilty to various crimes in a court room in Wilkes Barre, PA (not Philly or NYC where there would have been media). Not a single officer of E. F. Hutton was charged. E. F. Hutton should have lost its broker/dealer license but the SEC swiftly came in with an exemption. The CFTC should have debarred E. F. Hutton but another exemption was forthcoming. E. F Hutton’s President, one Scott Pierce was happy. He called his sister Barbara and thanked her. She said that she would pass on the good news to her husband, George Bush.
We could go on and on. But the statement that Ronald Reagan had something to do with free markets seems divorced from reality.
I wonder if Barry followed the amusing case, during this era under Bush-fils, of how aggressively SEC Chairmen Cox looked into that matter of insider trading, Pequot, and John Mack, Chairman of Morgan Stanley. Maybe there was nothing there - I certainly have no reason to think one way or the other. Still, we'll never know.
