Spitzer: “a breakdown of capitalism”

Eliot Spitzer made some bad decisions in his personal life but he’s been on the money for a while when it comes to Wall Street. The interview on CNBC is as blistering as I’ve ever heard him. He slams Wall Street greed, Greenspan, regulatory failures and also asks hard questions about Goldman Sachs. (Why the heck is Goldman not on the troubled bank list today and how did they receive almost $13 billion via AIG without question?) When I listen to him on CNBC it infuriates me that he made so many poor personal decisions because this was someone who really understand what was going on and how costly the failures would be for the country. The interview is inside the link and definitely worth the investment of 10 minutes. If only we had a few more hardball types out there today who could make a difference.

We won’t know if these bank stress tests are real until we see how the government measures them, said Eliot Spitzer, former governor of New York.

“What we have seen is a breakdown of capitalism,” Spitzer said in a live interview on CNBC. “We have seen a libertarianism driven by Alan Greenspan’s worldview that was absolutely destructive to the life-savings of middle-class Americans. The Fed has been sliding [money] into these banks through hidden mechanisms, lowering interest rates, this notion of converting the common stock…It is the same scam continuing—and this should not continue.”

Spitzer criticized the bank stress tests and said the middle class will suffer the most as a result. He said that without any change in bank behaviors, the banking crisis would only continue to persist and grow.

A trillion dollars and counting yet no changes in corporate leadership or business practices. How does that work? The most troubling is Spitzer’s comment at the end when he responded that he does not believe we’ve learned anything from this crisis. I’d like to be wrong on this but I would agree.

An American in Paris, France. BA in History & Political Science from Ohio State. Provided consulting services to US software startups, launching new business overseas that have both IPO’d and sold to well-known global software companies. Currently launching a new cloud-based startup. Full bio here.

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