Two Scapegoats Charged in Growing Subprime Crisis
by Jeff Davis
The System appears to have come to appreciate the need for a few sacrificial lambs to blame for the ongoing economic crash. Two Bears Stearns executives are the first to be thrown in the volcano.
A Bloomberg news article reports “Bear Stearns Company former hedge fund managers Ralph Cioffi and Matthew Tannin were taken into custody at their homes this morning over their roles in the collapse of two funds that ignited the subprime mortgage crisis last year. The arrests are the first from a federal probe of possible fraud by banks and mortgage firms whose investments in subprime loans and securities plunged in value, causing losses that now total $396.6 billion. The Securities and Exchange Commission may sue the two men as early as today, claiming they committed fraud by falsely telling investors the funds they managed were in good condition, people with knowledge of the case said.”
Like they were going to tell their investors “We’re growing our business by making $500,000 home loans to crack heads and other people, who would not qualify for a credit card.”
The article goes on “Cioffi, 52, was taken into custody at his Tenafly, New Jersey, home and Tannin, 46, at his Manhattan apartment, said James Margolin, a spokesman for the Federal Bureau of Investigation’s New York office. The two men were processed at FBI headquarters in Manhattan, then taken out in handcuffs by six FBI agents to be transported across the East River to Brooklyn federal court for an appearance later today in connection with an indictment.”
This is an indication of the ritualistic nature of these sacrifices, when two senior suits are “perp-walked” for the media. My guess is that neither the dawn arrests or the perp-walking was necessary. I very much doubt if either of these two white collar crooks had any intention of fleeing. As a defense they could argue that their bosses let them go ahead with the high risk loans. It’s hard to imagine a prosecution that overlooks the CEO. Then again Dick Cheney and Rumsfeld escaped prison over the Abu Ghraib scandal, and a few lowly National Guard troopers took the blame for that.
Bear Stearns is almost old news these days, and has been somewhat eclipsed by the collapse of the housing market and millions of homes being foreclosed on over the past couple of months, but basically, for those whose memories go back as far as January, Bear Stearns was the first major financial investing institution to go down when all this fake money and bad credit we’ve got floating around, which the Jews have basically created out of nothing, finally vanished. They had to be bailed out by J. P. Morgan. Normally an overextended business like Bear Stearns would have gone bankrupt with no one racing in to save them, but apparently someone in the Bush regime pulled a few strings to arrange a take over to avoid the panic and bad press that would follow a major investing firm collapsing.
There will be some more token indictments and arrests, no doubt. The Establishment understands that the public is finally becoming at least dimly aware of how criminally irresponsible policies are threatening to collapse our economy. These obscene CEO salaries seem to be especially getting people’s goats. I think we can assume, though, that none of the men actually responsible for the coming economic horror will ever see the inside of a prison cell.