- Special Report: How the Government is Setting Us Up for a Second Subprime Crisis
- Bank Failures Could Surge as Commercial Real Estate Losses Continue to Mount
- What TARP Banks Are Investment Grade?
- The Newest Ruse: Banks Capitalizing on “Toxic Assets” to Book Puffed-Up Profits
- U.S. Banks: Why Only the Simplest Will Succeed
- The Slow Death of General Motors
- As Big Banks are Criticized for not Lending, Small Banks Find They Can’t Lend
- The New Banking Bailout Plan Reconstitutes Some of the Same Ingredients That Touched Off the Financial Crisis
- GM Chopping 10,000 Jobs, Executive Pay
- Bankruptcy Looks Increasingly Likely for GM and Chrysler; Nissan to Slash 20,000 Jobs
- Citigroup Lifts Curtain on $36.5 Billion in TARP Money; Will Other Banks Follow?
- Obama’s New Stimulus Plan May Be the Needle That Pops the Treasury-Bond Bubble
- The Real Reason for the Global Financial Crisis…the Story No One's Talking About
Stay tuned: We're about to see more of these puffed-up profits. JPMorgan Chase & Co. (NYSE: JPM), Bank of America Corp. (NYSE: BAC) and PNC Financial Services Inc. (NYSE: PNC) will reportedly be booking as much as $56 billion in windfall profits using similar financial chicanery in the months ahead.
Sadly, millions of investors will likely interpret this as a sign that the U.S. financial sector is once again a viable "profit" play - when the reality is that Wall Street hasn't learned a single darned thing from the financial crisis and is up to its old tricks once again.
He may well be right; more interesting is what this tells us about the U.S. banking system going forward.
"The institutions are insolvent," Roubini said in a Bloomberg Radio interview. "You have to take them over and you have to split them up into three or four national banks, rather than having a humongous monster that is too big to fail."
This time around, someone should take the punch bowl away before the party even gets started. Otherwise, as Yogi Berra once said, it will be "Déjàvu all over again."
The only difference this time around is that the U.S. Treasury Department is calling the plays.
The United States of America is an expensive household to run. In order to pay the nation's bills, the U.S. government levies taxes. When expenditures exceed tax revenue, the government has to borrow money. The United States borrows money by ordering the Treasury Department to sell government IOUs to investors in the form of Treasury bills, notes and bonds, known as "Treasuries."
How much does the government owe? As of Friday, according to TreasuryDirect.gov, total U.S. public debt stood at $10,620,397,126,433.54 ($10.62 trillion) - and counting.