Why DON'T they prosecute the TBTF bankers? Because...

[Jessy169]

The entire economy is a house of cards waiting to tumble

by David Atkins

Though this was not stated explicitly, the government's rationale in not pursuing criminal prosecutions against the bank was apparently rooted in concerns that putting executives from a "systemically important institution" in jail for drug laundering would threaten the stability of the financial system. The New York Times put it this way:

Federal and state authorities have chosen not to indict HSBC, the London-based bank, on charges of vast and prolonged money laundering, for fear that criminal prosecution would topple the bank and, in the process, endanger the financial system.

<snip>

It's well-known that one of the functions of banks is to bring money that disappears into the black market, back out of the black market. Money laundering is illegal, but in a funny way it's also somewhat essential. It's less essential if you have a strong middle class. But in an economy entirely propped up by assets and investment liquidity, if bankers get imprisoned for laundering money in a way that puts a chill on black market asset processing, the Justice Department types might be entirely accurate in assuming that liquidity will freeze in a such a way as to send the economy into a tailspin. Remember that the Fed has been engaged in "quantitative easing" for years now, giving the banks loads of free money with zero percent interest rates. It still can't afford to take its foot off the gas pedal.

If that's a terrifying thought, it should be. This isn't a question of social and economic injustice. This is a question of an economy built on lies and mirrors, an economy whose sickness is so deep that even a small dose of justice to its asset classes could kill the patient.

Wage growth and reductions in income and wealth inequality are the only medicine that will nurse this dying patient back to health. Without it, even a small breeze like prosecuting some money launderers might be enough to snuff out the candle.

http://digbysblog.blogspot.com/2013/12/the-entire-economy-is-house-of-cards.html

[Jackpine Radical]

1. Because they're not just TBTF.

They're TBTPO. Too Big to Piss Off.

[elehhhhna]

2. Horseshit. They're paying protection money.

And getting their money's worth, bigtime.