<http://abcnews.go.com/print?id=8748299>
They Lied: Watchdog Says Treasury and Fed Knew Bailed-Out Banks Were Not 'Healthy'
Before the $700B Bailout, Senior Government Officials Had Financial Concerns About Nine Bank Instiutions Receiving TARP Funds ====================================== They want to prevent runs - in the public interest, of course, not those of investors. The alternative would be to nationalize the banks, and everyone knows how bad that would be. There's ample precedent for the latest coverup. In February, the New York Times, in a piece entitled "Large US banks on brink of insolvency, experts say" recalled:
"In the 1980s, during the height of the Latin American debt crisis, the total risk to the nine money-center banks in New York was estimated at more than three times the capital of those banks. The regulators, analysts say, did not force the banks to value those loans at the fire-sale prices of the moment, helping to avert a disaster in the banking system."
William Black, the government regulator who fingered House speaker Jim Wright, John McCain, John Glenn and other members of the "Keating Five" for bribe-taking during the S & L crisis and is now a prof at the University of Missouri, has been sounding a similar note for some time. In April, he told Bill Moyers that "the entire strategy is to keep people from getting the facts..."
"[Moyers] Are you saying that Timothy Geithner, the Secretary of the Treasury, and others in the administration, with the banks, are engaged in a cover up to keep us from knowing what went wrong?
"[Black] Absolutely....
"They're deliberately leaving in place the people that caused the problem, because they don't want the facts. And this is not new. The Reagan Administration's central priority, at all times, during the Savings and Loan crisis, was covering up the losses.
"[Moyers] So, you're saying that people in power, political power, and financial power, act in concert when their own behinds are in the ringer, right?
"That's right. And it's particularly a crisis that brings this out, because then the class of the banker says, "You've got to keep the information away from the public or everything will collapse."
http://www.pbs.org/moyers/journal/04032009/transcript1.html