One of the defining features of the financial crisis since the 2008 acute phase began with Lehman Brothers’ collapse is how tightly the narrative about it has been controlled.

As Dean Baker observed,

The folks who led us into this disaster rushed to do triage and tend to the most important problem: saving the bankrupt banks.

They also had to cover their tracks. They insisted that the financial crisis was some sort of fluke event — a lot of bad things went wrong simultaneously — and who could have predicted or prevented that?

They had a lot of assistance in this coverup because almost all the people who did and wrote about economics at the time also missed the housing bubble and the harm that its inevitable collapse would cause.

The coverup continues to the present, largely because the same people who messed up in the years leading up to the crash are still in positions of authority. They are still the ones writing and talking about economics in major news outlets. So we can expect a lot of “who could have known?” drivel.

Reuters’ Jamie McGeever confirmed these folks were back in a nice summary tweet.

As the 10th anniversary of Lehman nears, it’s baffling that those who contributed to the economic and financial catastrophe – the central bankers, bankers, politicians and regulators of the time – are being wheeled out to lecture us on the lessons that need to be learned.

It isn’t baffling.  It is part of narrative control by the Committee to Save the Banks.

The mainstream press abdicated its role as fact finder by letting the Committee control the narrative as Lehman was collapsing.  By letting the Committee control the narrative, it allowed a banker friendly response to occur while effectively silencing the voices of those who pointed out the narrative was based on lies.

Why did the mainstream press publish the equivalent of “fake” news?

The Financial Times John Authers offered up “in a crisis, sometimes you don’t tell the whole story.”

Pardon me while I call BS on this line of reasoning.  Recall our financial system is based on investors knowing what they own.  Apparently, the mainstream media didn’t think investors were capable of handling the truth about what they owned.

Obviously the mainstream media saw this as their call to make.  Equally obviously, the media sacrificed its impartiality when reporting on the crisis by doing so.

In doing so, the media lost the ability to point out the narrative was based on lies.

How could the media now say bailing out the banks hadn’t ended the crisis when the media had already established it was worried accurate, factual reporting could start a panic?  It couldn’t.

How could the media say bailing out the banks was unnecessary as deposit insurance had already made the taxpayers the insolvent banks’ silent equity partner?  It couldn’t. [Example to show why this is true:  Bank has assets of 100 which equals its government insured deposits of 95 plus equity of 5.  Value of assets drops to 90.  Bank is insolvent as value of assets less than its liabilities (deposits in this example).  Since the liabilities are government insured, the taxpayers stand behind the government insurance program.  It is this insurance that lets the bank continue in operation and makes the taxpayers into the insolvent banks’ silent equity partner.]

It wasn’t lost the media had turned into a lapdog for the Committee to Save the Banks and control over the narrative assured.