Former Fed Chief Paul Volcker scrapped his speech to rail on the financial system. His points include:
“I’ve heard so many stories about how important” derivatives are but “there doesn’t seem to be much doubt that the creation of derivatives has far exceeded any pressing need for hedging.”
"Normal distribution curves — if I would submit to you — do not exist in financial markets."
“It’s so difficult to get out of this recession because of the basic disequilibrium in the real economy.”
“The financial system is broken. We can use that term in late 2008, and I think it’s fair to still use the term unfortunately. We know that parts of it are absolutely broken, like the mortgage market which only happens to be the most important part of our capital markets [and has] become a subsidiary of the U.S. government.”
Uncle Sam remains the candy distributor for Wall Street and shadow bankers. Their lobbyists and owned politicians ensure the government-supported financial franchise remains intact.
