patrick.net

At some point in time I made a claim along the lines that that for top Bankers or Realtors to make 1 Billion in ill-gotten profits, the public would eventually have to lose 100 Billion. I admit I guesstimated the numbers by looking at the size of TARP, other bailouts and the FED balance sheet (3.7T, was it?).

Last Saturday, Prof. Simon Johnson of MIT made a presentation at the following conference

CRISIS and RENEWAL: International Political Economy at the Crossroads, April 8-11, 2011
http://ineteconomics.org/initiatives/conferences/bretton-woods

In his speech (see youtube below) he made the case that for the top 5 bankrupt bankers to make 2.6B from 2000-2008, the public and our nation had to lose 40% of GDP. What does that make PrivateGain/PublicLoss? We can all do the math, but suffice it to say, we all pay an enormous price for these private gains.

It seems pretty clear to me that this is the core problem. We would in fact be better off paying the criminal class of bankers "protection money" to stay out of banking, similar to what people to do the mafia, than having them be in charge of crucial aspects of our economy.

Here is the Video:

http://www.youtube.com/watch?v=-GmBoJ7qHYg

I'm trust the calculated irony of holding the conference at Bretton Woods is not lost on everyone :-).

#housing