The Bailout Bull

First AIG, now Citigroup. The common thread, both companies had close ties with a current or former Treasury Secretary. It is all about who you know, but is that capitalism or communism? Read:

• The New York Times, The Reckoning, Citigroup Saw No Red Flags Even as It Made Bolder Bets
• The New York Times, All Fall Down
• Washington Post, From Market Economy to Political Economy

And why is the government trying to save the financial sector when much of it might be a fraud. Michael Lewis sounded the warning nearly 20 years ago when he wrote the book, Liar's Poker, in which he portrayed "the 1980s as an era where government deregulation allowed less-than-scrupulous people on Wall Street to take advantage of others' ignorance, and thus grow extremely wealthy." Now read his latest article at Portfolio.com, The End, in which he writes:

In the two decades since then, I had been waiting for the end of Wall Street. The outrageous bonuses, the slender returns to shareholders, the never-ending scandals, the bursting of the internet bubble, the crisis following the collapse of Long-Term Capital Management: Over and over again, the big Wall Street investment banks would be, in some narrow way, discredited. Yet they just kept on growing, along with the sums of money that they doled out to 26-year-olds to perform tasks of no obvious social utility.