Reviewing the history of the great stock market crash of
1929, its hard not to see the uncanny similarity
that can be drawn between present time and the lead up
to the great stock market crash of 1929........
Following the great stock market crash of 1929, the US
Govt. created
the Pecora Commission in 1932 to study what had
caused the great crash, to learn about and then adjust
financial policy to prevent a similar stock market crash
in the future.
One of the main factors the
Pecora Commission cited as a possible cause for the 1929
crash was the wide range of abusive practices on the
part of banks and bank affiliates... these
abusive practices included a variety of conflicts of
interest such as the underwriting of unsound securities
in order to pay off bad bank loans as well as "pool
operations" to support the price of bank stocks...
following the
the Pecora Commission, the
Glass-Steagall Act of 1933 was established to
protect the public against the abuses made by the
banking industry, unfortuntely;
70 years later, Wall Street interests were able to
repeal Glass-Steagall Act in 1999.
With the Glass-Steagall Act repealed 1999, Wall Street
was able to start its slow-motion repeat of the banking
circumstances preceeding the 1929 crash, for example;
the current
US Secretary of Treasury is none other than
an ex-CEO of the Wall Street giant investment bank; Goldman Sachs... Goldman Sachs
has been heavily
involved in the
securitization business on Wall Street over the past
decade...
securitization is a buzzword for the packaging of
debt which is then sold to investors, products like;
sub-prime mortgages,
CDO's,
ABCP's, etc, etc, which have now been
found to be riddled with fraud... and which are now at
the base of Wall
Streets problems.
To me, it looks like Wall Street has
essentially already committed the same
malfeasance that ultimately lead to the great stock
market crash of 1929... so, in my opinion,
any major bailout that Hank Paulson is able to swindle
out of the US taxpayer will only delay the painful
re-adjustments coming to US stock markets.
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