Financial Terrorism

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by MIKE WHITNEY
The Lehman Brothers default on September 15, 2008, was the biggest incident of financial terrorism in US history. When Secretary of the Treasury Henry Paulson and Fed chairman Ben Bernanke convened an emergency meeting with leading members the US Congress and their aides on September 18, 2008, they had already developed a “break the glass” strategy for extorting $700 billion dollars from US government to make up for the losses on trillions of dollars of toxic “subprime” assets that were at the center of Wall Street’s massive predatory lending swindle.

The plan was to precipitate a financial catastrophe so immense that elected officials would comply with Wall Street’s demands as presented by former Goldman Sachs CEO, Paulson. To that end, Bernanke warned the congressional assembly that if they refused to meet their extortionist demands of $700 billion no-strings-attached bailout, that “We may not have an economy on Monday”. This was clearly a lie that was intended to coerce congress. As it happens, the so called Troubled Asset Relief Program or TARP was not implemented for a full month later (October 14th). The economy was still intact although the markets and Bernanke’s friends on Wall Street had suffered severe losses.

Naturally, this analysis veers from the specious narrative presented in the MSM, which characterizes the behavior of Paulson and Bernanke as selfless and even “heroic”. Nothing could be further from the truth. The two men deliberately blew up the century-old investment bank to blackmail congress and to provide emergency assistance to the many broken and insolvent banks and financial institutions who were at the end of their rope. Bernanke himself alluded to the dismal condition of the country’s biggest lenders in testimony to the Financial Crisis Inquiry Commission in 2011. Here’s what he said:

“As a scholar of the Great Depression, I honestly believe that September and October of 2008 was the worst financial crisis in global history, including the Great Depression. If you look at the firms that came under pressure in that period . . . only one . . . was not at serious risk of failure. . . . So out of maybe the 13, 13 of the most important financial institutions in the United States, 12 were at risk of failure within a period of a week or two.”

They were all broke, according to Bernanke. All, except one. Even worse, “12 were at risk of failure within a period of a week or two”, so something had to be done fast, which is why both men were committed to creating a big enough implosion to scare congress in compliance.

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http://www.counterpunch.org/2013/09/17/financial-terrorism/?utm_source=rss&utm_medium=rss&utm_campaign=financial-terrorism