A friend told me to read Charles Gasparino’s new book, and I’m glad I did because I learned a great deal about how Wall Street works. Here are the book’s title and subtitle:
Bought and Paid For: The Unholy Alliance Between Barack Obama and Wall Street
Gasparino, who has written other books and has served as a reporter for the Wall Street Journal and other national publications, has penned an important book for anyone who wants to learn more about what he calls the “warped” relationship between Big Business, Wall Street and Big Government.
When most Americans think big business or big banks or hear the term “Wall Street,” their tendency is to think Republican Party. Because too few Republicans know how to communicate with the American public, too few of our citizens are aware of the incestuous and corrupt connections between big government supporting Democrats and the big banks.
What Charles Gasparino’s book reveals is that the companies like Goldman Sacks enjoy a very privileged government-protected spot in the world of finance which has allowed them to benefit like no one else from government bailouts. And every time government increases its debt, the Goldmans profit big time.
Few areas of the economy show this better than the housing market. While the federal government guarantees what were once risky investments in order to “provide support to mortgage and housing markets,” Gasparino explains:
“[T]he biggest beneficiaries of this program hasn’t been the average American homeowner…but the average big-bank bond trader, who profited by buying the debt on the cheap and sitting back and watching his investments pay off thanks to a government payout.”
That all sounds like an evil Republican plot, no? It’s a good bet that those who have followed the news regarding Fannie Mae and Freddie Mac over the past many years know the names of Congressman Barney Frank and now retired Senator Chris Dodd. Those two men ran interference for the now insolvent “public/private” entities. But fewer people realize the close relationship between other Democrats and the Wall Street profiteers. Gasparino writes:
“The fact of the matter is, when you strip away the name-calling and class warfare coming from the Obama administration, and when you ignore Wall Street’s gripes about the new financial reform legislation that will put a crimp in some of its profits, these two entities are far more aligned than meets the casual eye. They coexist to help each other-in an unholy alliance against the American taxpayer.”
The left-leaning press, Gasparino explains, has generally chosen to ignore “the role government played in bringing about the downfall of the American economy and the propping up of the one business that cause the trouble in the first place.”
Big Government used Wall Street, which “made bundles off its role in fulfilling the dreams and desires of Big Government.” Bankers made fortunes “while ordinary Americans have struggled.” Gasparino puts it simply:
“Every time one of these politicians approves a bond issue, the bankers collect a fee. Likewise, every time the federal government goes into debt to fund another entitlement, the big firms “underwriting” that debt) buying it from the government and selling it to investors) get rich.”