A few posts down, we discussed congressman Paul Kanjorski's claim that, in the middle of last September, a massive electronic run on the banks left the world mere hours away from total economic collapse. Now, Senator Chris Dodd is writing a book about that very crisis.
Can't wait to read it, because Kanjorski's comments raised a whole bunch of questions. For one, he said that investors were deserting money market accounts until the amount of money insured by the FDIC was raised. How does that happen, exactly?
TPM is spinning Dodd's book as a ego trip. I don't think that characterization is fair.
5 comments:
Joseph, on Feb 2, I wrote a post called "Trying to Follow the Money" and posted Kanjorski's video. I also posted a NewsBusters piece that supports Kanjorski's allegations. I was trying to research the Federal Reserve/Geithner/bailout, etc. and had written a previous piece called "Barack's Bailout Bullspit and Banks." I found a lot of tinfoil, but some nuggets of gold lay buried in the rubble, too. I'll post the NewsBusters thing, if anybody wants to read my stuff, I'm easy to find.
http://media.newsbusters.org/stories/cnns-crowley-obama-team-wanted-horrific-wall-street-headlines.html
Actually - Kanjorski said money was fleeing money market accounts until "the fed guaranteed those accounts." Other commenters have confused that with the FDIC also around the same time raising the limit on certain bank accounts, including money market accounts. These aren't the same thing or action by the same entity.
Actually, what the FED did in September, when money markets began to "break the buck" was - temporarily - insure all money market accounts in toto to stabilize the system. So, they guaranteed accounts up to any limit - until the end of 2008, I believe. Shortly after this, the FDIC announced they would raise the limit on guaranteed accounts to $250,000 until the end of 2009. The brief window - during the time the FED was guaranteeing any amount and the time the FDIC instituted a raised guarantee cap, gave people who had over $250,000 in one account time to diversity accounts between different institutions to have all their accounts come under the guarantee cap.
So, the emergency guarantee the FED did in Sept. '08 was truly a desperate move to say - don't pull your money out, we'll guarantee it all no matter how much is in one account - just give us time to stabilize things.
Joseph, just another thumbs-up and a thank you for not being a "Federal Reserve!!!" Conspiracy booster and for not being one of those ridiculous "shiny gold rocks are more real than paper!!!!!" moneynuts.
is it possible to make nanogold?
I don't know... if Dodd is holding information for his book that is not already known to the public, I think he should spit it out now. If he's just compiling and analyzing what is already available, that would be okay.
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