Monday, November 10, 2008
3 Trillon and counting
On June 8, 2008, I advised my squires about a change in the Financial Accounting Standards Board "Statement 159" rule that allowed losses to become profits. Ben "Bankrobber" Bernake and Hank" J Edgar" Paulson also authorized the Treasury Department to change Section 382 of the United States Tax Code. This rule, changed on September 30, 2008, allows bank losses resulting from a merger to qualify for a tax rebate.
Now, I am no economist, but if losses become profits and and also qualify for a tax rebate, whats the incentive to make loans.?!?
If there is no incentive for a bank to make loans, then where and how is the three trillion dollars in new money supply ever going to make it to main street?
Back on May 19, 2008, The King wrote that banking was going to become a foolproof business because of these regulation changes. Banking's new definition should be expanded to include hoarding cash. Even American Express is getting into the business. Again, why lend money to consumers when all I have to do is borrow money from the Federal Reserve under TARP, use FASB 159 to change my losses to profit and then get a tax rebate with IRS 382. Then my new friends J Edgar and Bankrobber will cover my tracks and keep the information from the American people.
Posted by BlakPac