Is the idea being pushed in respectable newspapers that since Goldman Sachs has posted an unexpected (by whom) second quarter profit of no less than 2.7 billion euros, the economy is on the mend again. Let Matt Taibbi explain why this is wrong:
Last year, when Hank Paulson told us all that the planet would explode if we didn’t fork over a gazillion dollars to Wall Street immediately, the entire rationale not only for TARP but for the whole galaxy of lesser-known state crutches and safety nets quietly ushered in later on was that Wall Street, once rescued, would pump money back into the economy, create jobs, and initiate a widespread recovery. This, we were told, was the reason we needed to pilfer massive amounts of middle-class tax revenue and hand it over to the same guys who had just blown up the financial world. We’d save their asses, they’d save ours. That was the deal.
It turned out not to happen that way. We constructed this massive bailout infrastructure, and instead of pumping that free money back into the economy, the banks instead simply hoarded it and ate it on the spot, converting it into bonuses. So what does this Goldman profit number mean? This is the final evidence that the bailouts were a political decision to use the power of the state to redirect society’s resources upward, on a grand scale. It was a selective rescue of a small group of chortling jerks who must be laughing all the way to the Hamptons every weekend about how they fleeced all of us at the very moment the game should have been up for all of them.
The only reason Goldman Sachs or any other big bank is now “profitable” again is because of the huge pots of free money our governments handed out to them as a reward for fucking up the economy — as if you went to Vegas, gambled away your house and the government got you a new one to play away at the blackjack table.
Back in January the entire financial sector was bankrupt, barely kept alive by those massive government cash injections, yet six months later everything’s back to normal again, a bank like Goldman Sachs can be billions in profit and this is evidence the economy is turning around? Pull the other one. that 2,7 billion is loot, evidence for the greatest wealth transfer ever, as millions of tax payers are fleeced to make a few multibillionaires even richer.