“Currency warfare is the most destructive form of economic warfare."
Harry Dexter White, US Representative to Bretton Woods, 1944
"The war was entirely one of choice; Iraq was not posing any significant threat to the United States and U.S. interests. The costs were huge. Estimates by academic experts of the war’s long-term monetary cost to the United States — covering everything from bullets to medical care for disabled veterans — are on the order of two to three trillion dollars.
The selling of the Iraq War to the American public was an exploitation of mass gullibility. That feat was accomplished not so much through lies as through a rhetorical drumbeat that cultivated certain misperceptions among Americans.
Current circumstances give little or no hope that the public response would be much different to the selling of some future untoward war. If anything, the nation has sunk even deeper into a post-truth era, with lies by the tens of thousands at the presidential level having been a major part of recent American political history."
Paul Pillar, The Selling of the Iraq War: Gullibility and Mass Hysteria, March 15, 2023
“See, in my line of work you got to keep repeating things over and over and over again for the truth to sink in, to kind of catapult the propaganda.”
George W. Bush, New York, May 24, 2005
"Cliches, stock phrases, adherence to conventional, standardized codes of expression and conduct have the socially recognized function of protecting us against reality. The sad truth is that most evil is done by people who never make up their minds to be good or evil."
Hannah Arendt, The Life of the Mind
Stocks were in slumping mood this morning but were cheered by the move of the Swiss Central Bank to throw a life line to troubled behemoth Credit Suisse.
And then the Banking Boys, herded by the Treasury and the Fed, offered to cough up a hundred billion or so in loans to First Republic Bank, which was swirling down the drain.
Are these loans or deposits? I hear they are deposits.
If deposits, will the FDIC backstop them against loss as well? I hear yes. LOL
Sheila Bair, the former head of the FDIC, was barfing over all this ad hoc favoring of big tech billionaires after the bell.
Gold and silver churned around.
The VIX fell sharply on the bailouts, which we are assured are just transitory.
The Dollar fell a bit.
And Treasury Secretary Janet Yellen and money meister Jay Powell basked in the glow of another job well done.
After the bell the Fed released figures showing that the Discount Window and the new Special Facility is doing a bang up, record business lending out funds to troubled Banks.
All is well. For the favored few.
"And with all that in mind, what is very clear, and what most policymakers have come to understand, is that the collapse of Silicon Valley Bank is 100% the fault of the Federal Reserve.
SVB was regulated by the San Francisco Federal Reserve Bank, and examiners at the SF Fed didn’t see serious problems until the fall of the bank was imminent. This is despite public reporting in the Wall Street Journal about the hole in the bank’s balance sheet months earlier.
The incompetence of Fed examiners is married to supreme smugness by those same regulators. Indeed, nearly all of my contacts in bank regulation are uniform in hating the Fed, which is composed of, as one of them told me, 'arrogant patronizing fucks who are not any good at their jobs.'
The closer you get to the facts the worse it looks. Supervisors should never have allowed a bank funded with between 90-100% uninsured ‘hot money’ deposits by venture capitalists to bet on unhedged long-term bonds. And you didn’t need to be a genius to get this fact. Everyone in Silicon Valley knew that SVB was insolvent, it was pretty much an open secret. The piggishness of the place, and the social climbing, was legendary.
And the collusiveness of the bank with the Fed itself was very clear. I mean, Becker was on the board of the San Francisco Fed until the day his bank collapsed, when the SF Fed quietly replaced him with a ‘vacant seat’ notice."
Matt Stoller: Fire the Fed
Quad option expiration tomorrow.
Have a pleasant evening.
