The Financial Three Stooges: Rubin, Summers & Geithner

Article by James Hirsen

Maybe studio execs should consider doing a flick on the Three Financial Stooges, Robert Rubin, Lawrence Summers and Timothy Geithner.

These numbskulls had a lot to do with getting us into the economic jam we find ourselves in.

In fact, long before Barney Frank and Chris Dodd threw a gigantic wrench in the works when others were trying to stop Fannie Mae and Freddie Mac from hemorrhaging, the Three Financial Stooges laid the groundwork for the current economic catastrophe, and they did so under Bill Clinton’s administration.

Rubin was treasury secretary, Summers was his assistant and Geithner served as an undersecretary.

Rubin, Summers and Geithner lobbied then-President Clinton, and ultimately the Congress, to get rid of the Glass-Steagall Act, which stopped banks from entering into the securities market. They were also part of the group that rammed the Commodity Futures Modernization Act through.

Banks could then gamble with credit-default swaps and collateralized-debt obligations financial instruments that ordinary folks and even some regulators didn’t really understand.

These were the things that Warren Buffett called “financial weapons of mass destruction.”

Banks were then able to use derivatives to make their books look better, buy mass quantities of subprime mortgages and become “too big to fail” institutions.

Geithner went on to become head of the New York Federal Reserve, where he would be instrumental in backing the Paulson bailouts, including the infamous AIG bailout.

Today Geithner is President Obama’s treasury secretary, and Summers is a key economic adviser.

These individuals knew about the AIG bonuses. They were informed via a Feb. 28 memo that the AIG bonuses were coming on March 15.

They’re also the ones offering us a new plan, one in which taxpayers would essentially buy back from the banks the very toxic assets the Three Financial Stooges helped to create.

Rubin, recently said he plans to leave Citigroup in April; this after he oversaw the bank’s stock go from $50 a share two years ago to today being worth less than $2.

He’ll apparently still avail himself to the Obama administration to give more sage advice.


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