Obama and the financial crisis

Dr. Mahathir Mohamad

When President Obama made a bid for three trillion dollars in order to deal with the financial crisis, I assumed that like the immediate past President and the Head of the Federal Reserve, he was going to use the money to bail out the failed banks and financial institutions. 

2. This would be an exercise in futility because those banks and institutions failed because they cheated, because they abused the system. The only way they could be restored is by allowing them to cheat and abuse again, creating money out of thin air and lending 20 to 30 times more of this money to the funds held by the borrowing institutions for them to invest. It is this practice which has precipitated the financial crisis.

3. The bailouts have clearly failed. Increasing the amounts of bailout will not result in success. The failure will only get worse. It's the classical sending good money after bad money.

4. Now Obama and Brown are talking of going against the powerful financial elites. Brown implicated a shadow banking system based in financial havens – a system that has been beyond the control of Governments, and bereft of rules and regulation.