Contrary to the prevailing analysis, we believe that the Obama and Bush administration insistence on protecting banks at the expense of the taxpayer is the result of a Machiavellian effort by Goldman Sachs and other major banks to influence U.S. economic policy by infiltrating the corridors of power.

There are a lot of unanswered questions for Tim Geithner and his pals in the banking industry. One Wall Street suit who’s dirtied his bib is Bank of America CEO Ken Lewis. Lewis should go to jail for securities fraud, according to Porter Stansberry of Stansberry and Associates Investment Research.

Why wait for Tim Geithner’s rigged stress test results for banks when the underground can help you separate the winners from the losers? Thanks to research carried out by Money Morning’s Martin Hutchinson, we can pre-empt the Treasury Department and reveal which are the strongest banks are which are most poisonous.

Treasury Secretary Tim Geithner is taking his sweet time to work out the details of TARP II.  But for all the uncertainty surrounding his plans, we know one thing:  Zombie banks will not be allowed to go under.

Gold was under pressure right from the open in Sydney on Wednesday morning. This pressure accelerated once London was open for business. The bottom was in about fifteen minutes after Comex floor trading began in New York. A rally began that was highlighted by a big spike in the price around the time of the London p.m. fix. Was it that…or Geithner’s lips moving? The top price of the day arrived shortly after Comex trading ended and electronic trading commenced. All in all, a very interesting 24 hours.

In the currency market, the dollar eased against the euro. Late Wednesday, the euro was trading at $1.358 vs. $1.3464 on Tuesday.

Gold declined from Hong Kong through to the New York open on Wednesday, falling below $920, but as it did on Tuesday rallied from there, working its way back into positive territory and holding there to finish at $933.80/oz., up $7.70. Overnight, gold is slightly higher.

As you may have figured out, these Taipan Daily missives are (usually) written the day before. That way they can hit your inbox in time for a read with the morning coffee.

Another day…another bailout…another rally on Wall Street… And another milestone on the road to ruin.