Executive Intelligence Review
Subscribe to EIR


Big Banks Are Bankrupt, Admits Big Banker

Nov. 2, 2008 (EIRNS)—"The only reason that any big banks remain 'well capitalized' today is because the government provided a guarantee to Fannie Mae and Freddie Mac that immediately shored up the value of their mortgage-backed securities," an unnamed banker with one of the largest U.S. banks said. The statement appeared in a comment to an Oct. 30 blog entry by reporter Joe Nocera on the New York Times website—which entry itself was based upon an e-mail from the banker, in which he criticized the big banks for refusing to behave responsibly. "The big banks are enjoying their capitalization status on the backs of the taxpayer already. Do not misunderstand this," the banker said. "The government had to take over Fannie and Freddie or we would not have ANY banks in business today unless they were under the control of the FDIC" (emphasis in the original). The author of the e-mails, Nocera said, works for one of the nation's biggest banks, and agreed for his letter to be posted on condition that his name was withheld.