Saturday, April 24, 2010
Giannoulias, Goldman-Sachs: Bookends
Many are now saying the Federal shutdown of the Broadway Bank in Chicago is the end of Alexi Giannoulias' campaign for the U.S. Senate seat once held by Barack Obama. While he might be right in saying "There was no bailout for my father's bank," the closing of the bank exemplifies the entire banking problem that led to the mortgage meltdown: "This bank has helped thousands of people when no one else would give them a chance," Giannoulias said. You can find many culprits in the financial meltdown, but the basic problem stemmed from lending money to people who had no prospect of ever paying it back. In practical terms the Giannoulias family-owned bank made loans that could not be repaid and sold those loans to brokerage houses who sold them to investors. Each person in the chain took his piece of the action and the last guy on line was left holding the bag. In the end the Giannnoulias family will lose millions and the taxpayers of American will pay the rest. Sound familiar? Ever hear of Goldman-Sachs, AIG, CitiBank, Fannie-Mae?