The crooked finger of blame

During a week which saw the G20 Economic summit, accompanied by mass anti-capitalist protests in London, albeit less violent than billed, and the mass worship of a politician, unmatched within Britain in living memory, one theme continued to be promoted by politicians, protesters and press pundits, namely that the problems we currently face are the fault of greedy Western bankers.

Brazil’s President Luiz Inácio Lula da Silva, went further, and in a display of racist stereotyping, which would never be tolerated were it aimed at any group other than his chosen target announced that that the crisis is the fault of “white people with blue eyes”.

His accusation clearly delighted, the white hating white news presenters, such as Jon Snow on Channel 4 news, and Newsnight's Gavin Esler who have repeated it with such regularity that it is clear they want the term permanently fixed on the public conciousness.

White Western Bankers are the hate figures of our age, and any with the added stigma of possessing blue eyes would be wise to get the builders round quickly to install bullet-proof glass, motion detectors and a safe-room in their homes, maybe even in their offices.

Of course, they are exactly the people whom the establishment want us to blame when things go wrong, and indeed maybe to hate. Predictably the anti-white banker rhetoric has come from the very top, with the establishment's most prized celebrity glove puppet, Barrak Obama leading shrieks of condemnation aimed at AIG, the US insurance behemoth who made the mistake of insuring the excesses of others, and, as a result, required a £180 billion bail out from the US taxpayers.

Naturally, what Obama and the media commentators fail to clarify is that AIG was, and remains, a hugely profitable international corporation or that the problem it experienced were caused by a part of a small, semi-independent subsidiary called AIG Financial Products, operating out of offices in London and specialising in insuring lenders against bad debt, (possibly a simplistic way of describing Credit Default Swaps, but that is effectively how they worked in this respect) which all seemed a great idea in the good times, when nobody realised quite how bad those bad debts night get.

They may have been unwise, they were very likely greedy, and they certainly paid themselves huge bonuses. However, the greed and the bonuses did not bring them low, it was not the insurer which caused the problem, it was what they were insuring. When the sub-prime lending crisis struck in America, AIG Financial Products were hit by multiple Katrina sized claims, rather as occurred at Lloyds of London in the late 1980's, but of a scale which had been previously undreamed of, and certainly unprecedented.

However, to what degree was that AIG's fault? If you insure your car, then get drunk and mow down a bus queue, is your insurer at fault?

Like AIG, who insured the out of control monster, bankers and investors who invested in assets backed by sub-prime lending are also being blamed and slandered by Presidents, Prime Ministers and publishers, however, to do so is like blaming the money launderers rather than the drug barons for the drugs trade. They may not be blameless, but it is not they who imported and distributed the poison.

To make matters worse, the sub-prime crisis was created by the deliberate and reckless actions by people whom the establishment continue to protect behind the smokescreen they have created, they protect them because they are them. It is interesting to note that, whilst Obama, and others, heap abuse on AIG and RBS, they remain silent about two entities who benefited even more from tax-payer bailouts, mortgage lenders Fannie Mae and Freddie Mac. There is a reason for this silence, those two organisations are the symbols of a wider agenda which nobody in power, least of all a US politician, wants the public to be reminded of.

Fannie and Freddie are not your average mortgage lenders, they were created by, and are tools of the federal government, and in recent decades they, together with friendly sounding government legislation have been used by cynical politicians both to buy votes, and to support an agenda based on social engineering.

The whole world has been damaged but the root of the problem is not in bank boardrooms, but in the political dogma which has driven domestic political agendas throughout the western world for over 40 years, particularly in America, which is where the sub-prime mortgage market primarily took hold. That and the monster offspring it gave birth to is at the bottom of this whole mess. The current crisis has many strands, but if you follow each and every one back to it's centre, you will find those same two words SUB PRIME.

However, nobody will dare admit it. We are still blaming so called "greedy bankers" yet as I mentioned earlier they merely played the role of money launderers, by packaging the toxic debts and selling them on, which is how the whole world became infected. Bankers and financiers may have passed on the infection, but they were far from being either patient zero, or the mad scientists in who's ideological petri dishes the plague was created.

Mixed metaphors notwithstanding, the real villains are American politicians playing social engineers. It actually goes back to an innocuous enough sounding piece of legislation called the Community Reinvestment Act, which initially came into force under Jimmy Carter, but which was given extra teeth by the Clinton administration and then allowed to run wild under Bush. It's official aim was to require banks to extend credit to minority groups and deprived parts of the community, however, its true aims ride as pillion passenger to the unworkable multi-cultural fantasy which obsesses so many western politicians.

We will all have read the articles written by prominent commentators in recent months declaring “Community Reinvestment Act not to blame for Credit Crunch!” my response to which is, if I may paraphrase Mandy Rice Davis, Well they would say that wouldn't they. To attempt to claim that legislation designed to force bankers to lend to illegal immigrants, minority groups and people with low credit ratings, had no role in creating a crisis caused by excessive lending to illegal immigrants, minority groups and people with low credit ratings would stretch the credibility even of a CNN news anchorman, it behoves the rest of us not to be so naïve.

To an overwhelming degree the current financial crisis was caused by agenda driven politicians and by minority groups, many with brown skin and brown eyes. Together they demanded that the number of home loans to minorities must be increased. If that didn't happen, they filed lawsuits accusing banks of that multi-purpose “R” word ‘racism’ and politically correct courts ruled in their favour, whether evidence of the dreaded “R” existed or not. As a result, US based banks were pressured into making more minority home loans –without verification of employment or credit status and without down payments, all of which were labelled ‘racist’ requirements.

These same banks had operated profitably for decades right up until PC Courts and politicians pressured them into changing their policies. Yet they are now being blamed for the outcome.

Fannie Mae and Freddie Mac didn't need to be pressurised, they did what their masters told them to do, and in recent years they were run by the sorts of politically motivated zealots, such as Richard Syron and Franklin Raines who were committed to the cause. Between them, these to mortgage giants, together with the law suit whipped banks, embarked on an orgy of irresponsible lending which the world is now having to pay back.

Lending to those who are usually excluded from credit is what Fannie Mae and Freddie Mac spent the last 70 years doing, to be fair it worked okay until people with radical agendas ended up in politics and in charge of Freddie and Fannie themselves, which is when it got out of hand. Hundreds of billions of dollars were lent to people with no visible means of paying it back, and commercial banks were forced to do the same. Sub prime loans were viewed as extending so called “white privilege” to minority groups, and anyone who urged caution were predictably labelled as racists.

It may seem unbelievable that crazy mortgage lending in the USA could have had such an impact, however, that is one of the results of the globalisation which links all our economies. When we remember quite how many individuals from "minority" groups there are in America, all desperate for a loan, but not so anxious to pay it back, and multiply that figure by deposit free home loans, and the proportions of the folly begin to come clear.

This madness did not cause too many problems in the good times, because when people defaulted the lenders just took the house back and sold it on, but in the bad times when those same lenders were left with bad debts and unsaleable properties the whole thing fell apart.

To make matters worse, back in the good times, investment bankers had been buying these debts repackaging them as funds, under exciting names like "Dynamic Property Trust Acquisitions" and selling them on to banks, pension funds and small investors, which is how a damn stupid idea ended up burning the world.

That is how we got into the mess we are in, but nobody in power will admit that, it is easier and more politically correct to blame "White blue eyed people" like the Brazilian racist did last week (imagine the screams if he had blamed black brown eyed people). White bankers, some of them Christians, must accept their share of the blame, but in truth they were only part of the problem and entered the game well after the damage had been done.

The main culprits will escape censure, it is not politically correct to blame non-whites and a deliberate social policy aimed at extending capitalism to minority groups for the greatest damage done to the global economy in almost a century.

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On a lighter note, I enjoyed this take on the outcome of this weeks summit: