Financial writer Karl Denninger is calling for a boycott of all discretionary consumer spending until free market capitalism is restored.
Specifically, Denninger says that we’ve tried to ask the government and big banks to start acting honestly, but we’re just being ignored. The only thing which is both (1) legal and (2) effective is a boycott.
We can all live without a new ipod or big flatscreen tv until our boycott brings results, right?
Denninger provides a specific set of demands:
What are our demands? Here’s the list:
- All the financial fraudsters are investigated, indicted, and prosecuted. This includes the con artists in CONgress who got “special deals” from Mozilo and his “Friends of Angelo” program (and who are blocking a subpoena to BofA as it would implicate them), it includes those past and current members of Government Sachs, and it includes all those other financial “professionals” who deceived Americans and others with their sale of toxic exploding mortgage products along with the securities supposedly backed by them.
- Glass-Steagall is restored, in full, and all the firms that can’t exist under it are broken up. Period.
- The insider-trading that has become blatant and outrageous is prosecuted where illegal and where not, is made illegal and then prosecuted, with the focus being on the size of the scam. This includes obvious circumstances such as August 2007 (Bernanke’s phone logs were FOIA’d) where trading patterns made clear that “certain someones” had foreknowledge of the discount rate cut along with Congresspeople who were briefed on the TARP and within hours or days made significant stock trades. Today if you’re Martha Stewart you’re prosecuted where if you make millions in an hour by exploiting government information “leaks” the SEC and FBI look the other way.
- The Government withdraws all of its backstopping of financial firms who created this mess. All of it. If you’re a bank or other firm and did something imprudent, you fail. Period. This is true whether you’re a small regional bank (as is happening now; 5 in the last week) or a big behemoth like Citibank or Bank Of America. No “special deals”, no “special guarantees”, nothing of the kind. If the government wishes to avoid “systemic risk” then the government regulators can do their damn job.
- The Fed disgorges all of its improperly-acquired MBS and other related securities. If it doesn’t have a full-faith-and-credit guarantee and was bought, it is disgorged – period.
- The Fed agrees to full annual audits without exception.
- Those people inside government who conspired with certain bankers to cook the books, along with those in the banks who did so, go to jail. Our own Office of The Inspector General in the government has confirmed that there was an active conspiracy to break the law within the OTS, but not one indictment has been issued.
- Those who committed fraud in the creation of this economic mess, whether they be mortgage lenders, those who packaged up securities while intentionally omitting credit information, those in the real estate industry to pressed for appraisal fraud and others are investigated, prosecuted and if convicted jailed. All of them.
- Losses are born by those who made bad decisions, not the taxpayer generally. Those who made good decisions get to reap the benefits, while those who made bad decisions eat the losses. No exceptions.
- Government cuts the annual budget deficit to zero. If government wants to blow the money it has to have the money. If they can’t raise the money they don’t spend it. It is time to live within our means and hold government to account for its profligate spending along with promises of “benefits” they know they cannot actually deliver down the road such as Medicare Part D.