The Spark

“The emancipation of the working class will only be achieved by the working class itself.” — Karl Marx

Small-time Schemers on Wall Street

Oct 15, 2018

With Wall Street rocking and rolling, it is good to remember that the bankers manipulate stocks and bonds in their own interests, to a certain degree. Ergo ... a story.

A financial journalist, John Authers, recently came clean about what really happened 10 years ago in the financial crisis. According to the Financial Times, he said:

It is time to admit that I once deliberately withheld important information from readers. September 17, 2008 was ‘the scariest day of the crisis,’ when world finance came closest to all-out collapse.

“As it happened, I had a lot of cash in my bank account, at Citibank. I was above the limit covered by U.S. deposit insurance, so if Citi went bust, a once inconceivable event that I could now imagine, I would lose money for good.

“At lunch hour I headed to Citi, planning to take out half my money and put it into an account at the Chase branch next door. That would double the money that I had insured. At Citi, I found a long queue, all well-dressed Wall Streeters. They were doing the same as me. Next door, Chase was also full of anxious-looking bankers.” A Citi officer then told him that she and her opposite number at Chase had agreed on a plan of action and that he would not need to open an account at another bank, to protect his money.

In 2008, only the first $100,000 deposited in any bank account was insured by the federal government. After the 2008 economic crisis, the deposit insurance limit was increased to $250,000 – protecting the rich even more!

When a crisis hits, ardent defenders of honesty, transparency, and democracy, like this scheming journalist, are out to save their own butts!

But more importantly, this convenient confession reveals that these schemers don’t much trust their own system, capitalism. Contrary to what they advocate, this system can very easily collapse.