Tuesday, September 23, 2008

Open Forum

Last forum was getting full - Please feel free to use this one for any discussion/topics of interest, links, etc. I will keep it towards the top until it too starts to get too full.

Great discussion out there folks. Keep it going!

49 Comments:

At 9/20/2008 9:37 AM, Blogger Justin_n_IL said...

My 2 sense from a Biblical perspective.

"A study of the original Greek for ministers yields the following. Attendant, waiter, and servant. The definition for the original Greek from which they translated righteousness from is the following. Equity of character or act; justification. So Satan's attendants shall be seen as attendants/waiters/servants of equity and justice. Understanding this is of the utmost importance people. The great delusion that is soon to come upon the earth is going to be seen as an equitable deed coming from equitable men. Do the international bankers, fat cat elitists, and their bought politicians appear as servants of justice & equity? On the contrary they are blatant servants of greed(Hence the looming meltdown.). Here in America this is accepted just as death and taxes are accepted. However with the far reaching meltdown now in progress it will no longer be tolerated. Satan is getting ready to paint a masterpiece."

http://justinnil.blogspot.com/2008/09/coming-delusion.html

 
At 9/20/2008 10:39 AM, Blogger FOFOA said...

With the news coming late Thursday that the taxpayers will likely end up bailing out all that is left of Wall Street, the quote of the week comes from Peter Schiff:

"for AIG, Merrill Lynch, and especially Lehman Brothers, this gives new meaning to being a day late and a dollar short"

Link

 
At 9/20/2008 10:40 AM, Anonymous jerry said...

What just occurred this week was that Reagan's free market, trickle down economic frenzied free-for-all has been declared dead. It failed. But those high powered CEOs at pay grabbing at those big lending banks are whining that they might lose their gravy train. SO, they squeezed Bada Bing Bernanke, Paulson, and Bush to create a government funded trickle down policy because they would not, at any cost, lose their top-tier position at the top of the Pyramid Scheme.

Bush told them, "One trillion it is. my base."

So now the taxpayers are going to be taking the banksta's toxic derivatives and credit default swaps and put them into the hole held by the treasury/taxpayers so these crooks serving the Bush Crime Family and pretend to show a cleaner balance sheet.

In addition, the elitist whiners told The Family to make illegal the act of short selling those big and bad economic cops who are making the financial bankstas a bit more accountable for their net worth and scaring the bigeebers out of them, too.

Now the bankstas can watch their stock prices rise without interference.

But who will pay for all of this? Not the taxpayers who are squeezed. Leave it in the lap of the next president.

We will see just how long the party lasts.

 
At 9/20/2008 10:46 AM, Anonymous jerry said...

This socialization of the losses while allowing for privatizing the gains is more like Mussolini's fascist Italy, whereas the rich corporatists had to answer to Mussolini, yet allowed to make money. This is not like Stalin's Russia or even Putin's Russia, where they would just take the company for themselves.

So, how can the Republicons claim to be against socialism? Or even claim to be a protector of government and believe in a smaller one, at the same time? They are frauds. Fakes. And, flimflammers.

We need to contact our representatives and tell them to make these bankstas accountable for their handouts. How about a freeze on salaries, and bonuses, and how about we take their stock options as collateral for the free gift of staying solvent?

 
At 9/20/2008 11:18 AM, Anonymous Tim said...

Here's another angle on the government bailout being proposed. This is $700 billion that does not create goods or services. $700 billion that will not create any benefit for taxpayers; will not assist the needy, unemployed, homeless, or sick. This $700 billion will not make us safer as a nation or improve our international standing; if anything, it will damage our deficits and our standing even more. And most importantly, $700 billion that the US government does not have.

And I hear rumors of a possible action against Iran. Incredible.

 
At 9/20/2008 12:49 PM, Blogger Justin_n_IL said...

OMG!!!! Have you guys heard? Travis Barker, you know the guy with a zillion tattoos who is a drummer for Blink 182.... He's been in a terrible plane crash... He's in critical condition....OH MY... On a less meaningful side note- The global economic and monetary apparatus is melting down. I can't believe this is happening to Travis....sigh

 
At 9/20/2008 4:00 PM, Anonymous BobD said...

There has been some criticism here and in the media of free markets and Reagan's deregulation - for leading to the current mess.

Free Markets do work. Trickle down does work. But first one must have free markets! When the government via the Fed controls the essential ingredient in a free economy, the money supply - there is no free market!

And the collective wisdom of the market is now sending the signal that the resulting marriage of the Federal Reserve and a greedy Wall Street led to a business model that does not work.

The market, quite wisely, is trying to end these companies and an unhealthy business model along with it.

But Paulson, Bush, Bernanke, et all won't let that happen because it will upset the existing framework of the economy.

So what if credit markets freeze up? Guess what - prices on everything will come down - and we won't need credit - and therefore the banks.

This is the failure of a government created, government protected Banking Cartel - not the free market.

This is a failure of government - not of free markets.

And guess what we are going to get in return? More government and less free markets.

Lets put the blame where it is deserved so that we may derive the most appropriate "hands off" policy solutions.

 
At 9/20/2008 6:32 PM, Blogger FOFOA said...

Eric Janszen post from this afternoon on iTulip:

Which came first, the egg of incompetent crisis prevention or the chicken of incompetent crisis response?

They are preparing Congress for the next phase. They may also hope they might pull out of it, and know they don't have a chance without a blank check from Congress. But at some level they must know they have little chance anyway. Too many things have broken at the same time. This is why Bernanke has been out of sight. Paulson is a crisis-hardened executive, Bernanke an academic. He never learned how to manage and hide his fear. Fear is more contagious than a virus. He is kept out of the public eye.

America's enemies smell weakness. Open season on America has begun.

Next comes financial chaos where even the appearance of control is lost. The sheer speed and randomness of events will catch many by surprise, like a financial tornado.

After the financial tornado passes we will all stare in wonder at the strangeness of the scene, the red Lamborghini stuck upside down 40 feet off the ground in a last remaining branches of a leafless oak tree, at the man smiling who is glad to have survived unscathed in his underwear in the bathtub that was as all that remained of his home. Lives will be frozen in economic time, careers ended, ancient relationships cut off by economic irrelevance.

Next year, slowly we will stagger out of the economic wreckage and start to rebuild. But things will never be as they were, for our old reality was fantasy anyway, built on false beliefs. We have no more chance of recreating it than we have in the morning after waking from a lovely dream to fall asleep again back into it while the alarms are ringing.

That post was in response to this article in the New York Times.

 
At 9/20/2008 8:04 PM, Blogger Gary Near Death Valley said...

The "feed trough" is getting larger and deeper, as the pigs of finance gather around to chow on the lowly taxpayer. The "bailouts" are just starting I believe, and much more coming. More banks, investment firms, FDIC itself, Ford, General Motors, Crysler, the airline industry, etc, heavens, can my Chihuahua get a huge bailout?

Welcome to AMERIKA, and the grinding away of what those of us that remember what the USA used to be. Hang our heads in shame to allow the whole "system" to get to the point it is. And for those that want a piece of history, read about the "Glass-Steagall Act" passed in 1933 which mandated the seperation of commercial and investment banking. This law wa removed from the books by CONGRESS in the 1990's and signed eagerly into law by Bill Clinton. This allowed the banks and investment banks to balloon into what is happening now,,,,,,and imploding. So CONGRESS should be blamed but of course we know how they waffle. Replace them and do not vote them back in.

 
At 9/20/2008 8:12 PM, Blogger Justin_n_IL said...

WOE WOE WOE Gary,

"And for those that want a piece of history, read about the "Glass-Steagall Act" passed in 1933 which mandated the seperation of commercial and investment banking. This law wa removed from the books by CONGRESS in the 1990's and signed eagerly into law by Bill Clinton. This allowed the banks and investment banks to balloon into what is happening now,,,,,,and imploding."

But, but, but....I thought it was just the NeoCons who brought this mess on America? Isn't Clinton suppose to have been a brilliant President? Wait a second, he was there to sign NAFTA into law as well...

99.999% of them are given to greed...PLAIN AND SIMPLE. They bicker about social issues and what not but they are all serve the same master. GREED... Republicrats

The overly entertained Americans are awakening to this reality. As things continue to melt down their eyes will open wider. The stage will be set for a man of change.

 
At 9/20/2008 8:47 PM, Anonymous chris said...

And here we go ...

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/09/21/ccliam121.xml

When you start seeing things like that in the MSM, then you know the time has come.

As Samuel L. Jackson said in Jurrasic Park, "Hold on to your butts".

 
At 9/20/2008 8:56 PM, Blogger FOFOA said...

Riddle this: The BIS, the Bank of International Settlements estimates the worldwide derivative "problem" is one quadrillion, one hundred forty four trillion dollars. The bailout is authorizing seven hundred billion dollars. Let's look at those numbers together:

Problem: $1,144,000,000,000,000
Solution: $700,000,000,000

Can you say "pissing money into an ocean to try and stop the tide"?

 
At 9/21/2008 9:19 AM, Anonymous Anonymous said...

Folks after reviewing the terms of this new disgusting monster bailout bill it is clear this is nothing more than fascism! IT literally gives the treasury control over everything without ever having to answer or be reveiwed by congress or anyone else! What do u guys think of our soon to be fascist economy?

 
At 9/21/2008 10:33 AM, Anonymous Anonymous said...

It's finally really frightening and I think most are oblivious. I guess we better hope they figure out a way to bail us all out. We are helpless really...we have no control...we are at the mercy of whoever... this is not entertainment and not sport... this is scarey stuff

 
At 9/21/2008 10:41 AM, Anonymous Anonymous said...

I don't remember anything about electing Paulson as president, but it looks like he will be calling the shots from now on.

Don't be surprised if the next elected President keeps him on.

 
At 9/21/2008 2:52 PM, Blogger FOFOA said...

"The Plan" was updated last night on the Treasury's website. This should make you feel all warm and fuzzy...

Bailout Eligibility Expanded to Foreign Institutions

"the second sentence is even more surprising: eligibility has been changed from "financial institution having its headquarters in the United States" to "significant operations in the U.S." - and even "broader eligibility" if Paulson so decides."

 
At 9/21/2008 3:01 PM, Blogger Justin_n_IL said...

WOW......Global indeed

 
At 9/21/2008 3:08 PM, Anonymous Virgo said...

September 8, 2008
ArmyTimes.com

"3rd Infantry’s 1st BCT trains for a new dwell-time mission. Helping ‘people at home’ may become a permanent part of the active Army"

"The 3rd Infantry Division’s 1st Brigade Combat Team has spent 35 of the last 60 months in Iraq patrolling in full battle rattle, helping restore essential services and escorting supply convoys.

Now they’re training for the same mission — with a twist — at home.

Beginning Oct. 1 for 12 months, the 1st BCT will be under the day-to-day control of U.S. Army North, the Army service component of Northern Command, as an on-call federal response force for natural or manmade emergencies and disasters, including terrorist attacks.

It is not the first time an active-duty unit has been tapped to help at home. In August 2005, for example, when Hurricane Katrina unleashed hell in Mississippi and Louisiana, several active-duty units were pulled from various posts and mobilized to those areas.

But this new mission marks the first time an active unit has been given a dedicated assignment to NorthCom, a joint command established in 2002 to provide command and control for federal homeland defense efforts and coordinate defense support of civil authorities.

After 1st BCT finishes its dwell-time mission, expectations are that another, as yet unnamed, active-duty brigade will take over and that the mission will be a permanent one...

They may be called upon to help with civil unrest and crowd control or to deal with potentially horrific scenarios such as massive poisoning and chaos in response to a chemical, biological, radiological, nuclear or high-yield explosive, or CBRNE, attack...

The brigade will not change its name, but the force will be known for the next year as a CBRNE Consequence Management Response Force, or CCMRF (pronounced “sea-smurf”)."

Maybe it's just me, but this sounds like someone somewhere is going to use CBRNE soon.

 
At 9/21/2008 3:26 PM, Blogger FOFOA said...

Sorry for the long comment, but this is it. This week is it. The Treasury is mis-named. It should be called gaping hole of nothing. I see only one solution to everything and I will post it later on my blog. This was posted by Aussie at GIM:

Fed flattened, only the Treasury is left

To all; as I mentioned Wed., the Fed has burned through its balance sheet. This crisis has overwhelmed the Fed as they now need to go to Treasury for any extra funds they decide to use. The Treasury announced yesterday that they will "announce" a plan next week to save everything. This will be the 5th or 6th plan that would turn the credit crunch tide. This one had better work, and soon because there are no more chances. There are no other entities past the Treasury. This is the end of the line and the charades.

We came closer over the last two days to a total financial collapse than anytime since 1932. A 10 ton white elephant is now sitting on Treasury's lap, Treasury will explode it's deficit and thus the money supply with this concept of another RTC. This consists entirely of MORE DEBT. I wrote several times last year and this, that more debt will not solve a debt problem once the saturation level has been reached. Leverage is working in reverse now and I don't believe ANY amount of new debt can reverse this implosion. At this point too much equity has been destroyed and in many cases equity ratios are negative.

This is the hail Mary of hail Marys, the kitchen sink and then some has been tossed in the ring, this is the last hurrah! In a few days, couple weeks, whatever, what happens when the next convulsion hits? What "plan" from what "entity" will be paraded out as the next saving grace to the system? Do they announce a summit and bailout plan from God? There are no more rabbits from hats, there are no more mulligans, this is it! When confidence begins to fail again, panic, and I do mean outright panic will grip the entire globe. Charles Schumer was interviewed on CNBC and recounted the "summit" meeting last night. In essence he said that if this "bright new and shiny, wiz bang plan [not even announced yet] had not been announced, the entire system would have frozen up. I agree, it had already frozen solid as of Tuesday night. Had Treasury not said yesterday "but wait, there's more", the markets would have had an 80% chance of not opening Monday morning.

I have a few questions that will surface in the near future. As to tier 2 and tier 3 assets, what happens to the books and thus balance sheets when the government pays .30 cents on the dollar? Are these assets even worth half that? In the mortgage markets, who is going to take out the loans? Can the govt. refinance loans on houses where the loan is more than the home value? How does the government buying existing mortgages help people make the monthly payments? Where will all this money come from? What happens if foreigners wise up and stop lending to the Treasury? I know the answers to these questions, so do you, so does everybody.

We have seen a giant short covering rally off the 10,600-800 level. This is strike two. Strike three and the game is over as paper is in the ninth inning with nobody on, and two outs. This has only bought a little bit of time, nothing more. This is the greatest margin call of all time, it cannot be met with more borrowed money. Even if this were to work [it won't] the Dollar's already pitiful value will be destroyed completely. These desperate moves confirm the path of the Weimar republic, it confirms a socialist response to capitalist mistakes. Weimar didn't work, socialism doesn't work, and capitalism can't work unless mother nature is allowed to cleanse the system with recession. Since the financial geniuses in Washington have refused to allow a real recession since 1982, we won't have one, we will have depression and all the wonderful trimmings. Regards, Bill H.

 
At 9/21/2008 6:28 PM, Blogger FOFOA said...

Karl Denninger has an alternative to Paulson's plan.

Note: There is a second video at the bottom of the blog.

 
At 9/21/2008 6:39 PM, Blogger 45north said...

flight to safety = flight to Canada?

I was in Montréal a year ago, talking to a woman with a strong New York accent. I looked around to find her again and ran by a group of people speaking French. I turned around and realized that she was speaking French! The point is that some Americans have strong connections in Canada and will come here if they want.

 
At 9/21/2008 11:53 PM, Blogger FOFOA said...

FreeGold is the solution to America's crisis.

NOT the Hank Paulson $700b taxpayer funded Hedge Fund that's above the law.

 
At 9/22/2008 6:44 AM, Anonymous Anonymous said...

check out this article i copied and pasted from bloomberg which goes into detail how with this new bill the executive branch will have dictatorial powers and will be above the law:

Treasury Seeks Authority to Buy $700 Billion Assets (Update1)

By Alison Fitzgerald and John Brinsley
Enlarge Image/Details

Sept. 20 (Bloomberg) -- The Bush administration asked Congress for unchecked power to buy $700 billion in bad mortgage investments from U.S. financial companies in what would be an unprecedented government intrusion into the markets.

The plan, designed by Treasury Secretary Henry Paulson, is aimed at averting a credit freeze that would bring the financial system and economic growth to a standstill. The bill would bar courts from reviewing actions taken under its authority.

``It sounds like Paulson is asking to be a financial dictator, for a limited period of time,'' said historian John Steele Gordon, author of ``Hamilton's Blessing,'' a chronicle of the national debt. ``This is a much-needed declaration of power for the Treasury secretary. We can't wait until the next administration in January.''

As congressional aides and officials scrutinized the proposal, the Treasury late today clarified the types of assets it would purchase. Paulson would have authority to buy home loans, mortgage-backed securities, commercial mortgage-related assets and, after consultation with the Federal Reserve chairman, ``other assets, as deemed necessary to effectively stabilize financial markets,'' the Treasury said in a statement.

The Treasury would also have discretion, after discussions with the Fed, to make non-U.S. financial institutions eligible under the program.

Bigger Than Pentagon

The plan would raise the ceiling on the national debt and spend as much as the combined annual budgets of the Departments of Defense, Education and Health and Human Services. Paulson is asking for the power to hire asset managers and award contracts to private companies. Most provisions of the proposal expire after two years from the date of enactment.

A failure by the government to support the U.S. financial system could lead to ``a depression,'' Senator Charles Schumer told reporters in New York. ``To do nothing is to risk the kind of economic downturn this country hasn't seen in 60 years.''

The Treasury is seeking authority to step in as buyer of last resort for mortgage-linked assets that few other financial institutions in the world want to buy, following government takeovers of mortgage giants Fannie Mae and Freddie Mac and insurer American International Group Inc.

``Democrats will work with the administration to ensure that our response to events in the financial markets is swift,'' House Speaker Nancy Pelosi said in a statement.

Fast Track

The majority party will seek to reduce mortgage foreclosures and create ``fast-track authority'' for an overhaul of financial regulation, Pelosi said. Democrats will ensure ``the government is accountable to the taxpayers in any future actions under this broad grant of authority, implementing strong oversight mechanisms.''

The proposal will include curbs on executive pay for the companies whose assets the government will be buying, Steve Adamske, a spokesman for Representative Barney Frank, said today in an interview.

Democrats also will include a plan to stem foreclosures, which may involve tapping the loan-modification abilities of the Federal Housing Administration, the Federal Deposit Insurance Corp., and Freddie Mac and Fannie Mae, Adamske said. Frank, a Democrat from Massachusetts, is chairman of the House Financial Services Committee.

``The consequences of inaction could be catastrophic,'' Senate Majority Leader Harry Reid said in a statement.

`Serious Issues'

``While the Bush proposal raises some serious issues, we need to resolve them quickly,'' he said. ``I am confident that, working together, we will.''

House minority leader John Boehner, an Ohio Republican, said today he is reviewing the proposal but didn't say whether he was inclined to support it.

``The American people are furious that we're in this situation, and so am I,'' Boehner said in a statement. ``We need to do everything possible to protect the taxpayers from the consequences of a broken Washington.''

Congress, which may pass legislation as soon as Friday, needs to ``make sure there are protections built in for taxpayers,'' said Schumer, a New York Democrat on the banking committee. Lawmakers should ensure ``taxpayers who gave the money will be put ahead of the stockholders, bondholders and others.''

Paulson is seeking an expansion of federal influence over markets that hasn't been seen since the Great Depression, said Charles Geisst, author of ``100 Years of Wall Street'' and a finance professor at Manhattan College in New York.

Hoover Era

Geisst likened the plan to the Reconstruction Finance Corp., which was chartered by Herbert Hoover in 1932 with the goal of boosting economic activity by lending money after credit markets seized up.

President George W. Bush said he called leaders in both houses of Congress and ``found a common understanding of how severe the problem is and how necessary it is to get something done quickly.''

``This is going to be a big package because it's a big problem,'' Bush said following a meeting with Colombian President Alvaro Uribe at the White House. ``We need to get this done quickly, and the cleaner the better.''

Democratic presidential nominee Barack Obama said in a radio address that he ``fully supports'' Paulson and Fed Chairman Ben S. Bernanke's efforts to stabilize the financial system. The plan, however, should benefit both main street and Wall Street, he said.

Republican Presidential nominee John McCain ``looks forward'' to reviewing the proposal while focusing at least in part on ``minimizing the burden on the taxpayer,'' said Jill Hazelbaker, communications director for the McCain campaign.

Ban Legal Challenges

The ban on legal challenges of actions by Treasury is ``distasteful, it's unfortunate and it's bad precedent, but this is an emergency and you have to act,'' said Jerry Markham, a law professor at Florida State University and author of ``A Financial History of the United States.''

``What you don't want happen is to have lawsuits that will slow things down and cause problems,'' he said.

The proposal would raise the nation's debt ceiling to $11.315 trillion from $10.615 trillion and require the Treasury secretary to report back to Congress three months after Treasury first uses its new powers, and then semiannually after that.

Paulson would gain discretion to act as he ``deems necessary'' to hire people, enter into contracts and issue regulations related to a revival of U.S. mortgage finance, according to a three-page proposal. The Treasury would ``take into consideration'' protecting taxpayers and promoting market stability.

Hiring Authority

The Treasury plans to hire managers to purchase the assets through so-called reverse auctions, seeking the lowest prices, a person briefed on the proposal said yesterday. The document specifies that Treasury may buy only assets from U.S.-based financial institutions issued or originated on or before Sept. 17.

The House will pass legislation to implement the plan by the end of next week, and the Senate will act soon after, Frank said yesterday in an interview on Bloomberg Television's ``Political Capital with Al Hunt.''

Bush today said he's unconcerned that the price tag on the package may seem high.

``I'm sure there are some of my friends out there that are saying, I thought this guy was a market guy, what happened to him,'' the president said. ``My first instinct was to let the market work, until I realized, while being briefed by the experts, how significant this problem became.''

The Bush administration seeks ``dictatorial power unreviewable by the third branch of government, the courts, to try to resolve the crisis,'' said Frank Razzano, a former assistant chief trial attorney at the Securities and Exchange Commission now at Pepper Hamilton LLP in Washington. ``We are taking a huge leap of faith.''

 
At 9/22/2008 6:47 AM, Anonymous sux2bme said...

In a past history course during my post-graduate days, the prof remarked:

"Back in the days of the Roman Senate, adverse public opinion was manifested by the good senator getting lynched on the street corner by an angry mob. Today, it is measured by nasty letters to the editor in newspapers. I'm not so sure we have really made great progress in the interim."

I think about those words a lot of late an believe that angry mobs may be our ultimate showing of our consent of the governed or lack thereof ...

 
At 9/22/2008 11:20 AM, Anonymous chris said...

"How much worse could things get?" you ask. How about another Cuban missile crisis:

http://news.yahoo.com/s/ap/20080922/ap_on_re_eu/eu_russia_venezuela

 
At 9/22/2008 12:19 PM, Anonymous chris said...

Let's try that again ...

http://news.yahoo.com/s/ap/20080922/
ap_on_re_eu/eu_russia_venezuela;
_ylt=AuMrukmT4zCTWbJRElOo6Qys0NUE

 
At 9/22/2008 4:21 PM, Anonymous Virgo said...

Why was Lehman Brother's allowed to fail? Max Keiser says he knows why (and it is SHOCKINGLY obvious).

http://www.youtube.com/
watch?v=Kvv_5Q4EfNI

 
At 9/22/2008 4:24 PM, Anonymous chris said...

In case you were getting ready to storm the Fed and Treasury with pitchforks and torches in hand, better have a look at this (from Democracy Now!)...

Army Unit to Deploy in October for Domestic Operations

Beginning in October, the Army plans to station an active unit inside the United States for the first time to serve as an on-call federal response in times of emergency. The 3rd Infantry Division’s 1st Brigade Combat Team has spent thirty-five of the last sixty months in Iraq, but now the unit is training for domestic operations. The unit will soon be under the day-to-day control of US Army North, the Army service component of Northern Command. The Army Times reports this new mission marks the first time an active unit has been given a dedicated assignment to Northern Command. The paper says the Army unit may be called upon to help with civil unrest and crowd control. The soldiers are learning to use so-called nonlethal weapons designed to subdue unruly or dangerous individuals and crowds.

 
At 9/22/2008 5:48 PM, Anonymous jerry said...

oAmerican free markets have failed. Trickle down economics cannot work because there are too many greedy, powerful individuals at play. To believe trickle down can work will only exist in dreams.

Read the Violent Radicalization and Homegrown Terrorism Prevention Act of 2007. These Bush Crime Family surrogates at the Fed and in Treasury all knew this was coming. This is why this act was written. Google it. This is no joke. The military is coming back to reinforce neo-fascism here at home.

Remember Bush saying"....as long as I'm the dictator." It was all in jest; but not really!

It won't be him. He is hoping it will be McCon.

Socialism was said in someone's comments as not working. Well, it appears capitalism surely went down the toilet, along with free market theory.

There are Northern European countries that pride themselves on their democratic socialistic way of life. They aren't going into a depression. We are!

Paulson has declared that he will be gathering up debt as if he was playing Monopoly. There is no nation or no economy that grew their economy by taking on more and more debt.

Paulson may have been a big shot at Goldman Sachs, but he is totally over his head now. He does not know what the F**k he is doing.

They are trying to fix the problem as they have tried to fix everything else: by bringing on the contractors and their cronies. These are the crooks, and not very smart to begin with, that brought this failure to us.

Through deregulation, and the absence of transparency, and the building of institutional empires and government revolving doors, we are where we are.

All the legislators are afraid to do what they need to do because this nation has absolutely no leadership, no president with a brain in his head, or anyone to jump up and say what needs to be said.

The idea of bailouts with stiff penalties, fines, prosecution, and the seizure of personal assets by the top banksta gangstas is mandatory. They use Ricco with the mob, then use it with the financial mobsters.

They colluded to commit fraud through the shadow banking system made legal by Phil Gramm. McCain is one degree from separation here. He is culpable. He should be asked to step down from his run for president. The Republican Party needs to institute a
coup in order to bring legitimacy to their party.

It won't happen. But will happen is mediocrity in solution-building, unless the strong and populist congressional representatives ban together to demand that the citizens dictate the rules and the bankstas sit down, shut up, and listen up!

 
At 9/22/2008 6:45 PM, Anonymous Anonymous said...

hey virgo great youtube link i encourage everyone to watch this video immediately! it was awsum to hear him throw some 9/11 truth in there to- folks 9/11 was an inside job and everybody around the world knows what happened that fateful except for our dumbed down brainwashed american public!

 
At 9/22/2008 6:49 PM, Blogger Randy said...

sux2bme,

Couldn't agree more with your comment: "angry mobs may be our ultimate showing of our consent of the governed or lack thereof"

When the homeless, unemployed and hungry masses grow, things will certainly change and people will rise up for change. However, we will probably be under martial law by then.

I suspect a "Peoples Revolution" not too much different from the one that overthrew the Marcos
regime from the Philippines. Hmm, come to think about it, they didn't have 2nd ammendment rights over there. Guess I'll have to ponder this issue some more.

Chris, I'll have to check out the link later - though I did see on Fox today that Russia was cozying up to Venezuela and holding Joint Naval exercises...

Jerry - As usual - Articulate and well thought out.

Regards to all

Randy

 
At 9/22/2008 7:35 PM, Anonymous jerry said...

Let me say this----chaos brings order, but this is not 1776 with young, vocal, active, thinking, and risk taking patriots willing to take down their Mother Land, the one and only Great Britain. If it weren't for the French, and a ferocious spirit, we would never had won the war.

The United States is filled with lap-loving, obese, dimwitted, narrow-minded, beaten down, psychologically impaired, radio pinhead-listening people. The only thing many of them know how to do is bitch. They don't read, don't write, and don't listen.

So, for one to believe that the Revolution Will Be Televised, or cyber-beamed is only dreaming. I do believe that this government has not been spying on, listening to, reading from, and following many us just for kicks. They have been watching people who do what we do; write on blogs. They did not write the Violent Radicalization and Homegrown Terrorism Prevention Act of 2007 because they were afraid of Muslims.

They did not basically give corporate America the right to shoot to kill if they just FELT that their infrastructure was POSSIBLY in danger without the threat of prosecution or legal action taken against them. They did not give those gun-toting corporatists phone cards and passwords so they can get the Marshall Law news before anyone else. They have not built detention camps all around the United States just for weekend getaway camps. This is for real and the Bush Crime Family is playing for keeps when they endorse the McCon for president, and anoint The Paulie Paulson with pervasive powers.

They were concerned with American citizens willing to take up their arms, bats, slingshots, pea shooters, squirt guns, gum bands, tomahawks, spears, knives, and bows and arrows in order to withdraw their cash deposits sitting in their locked up banks.

As Gil Scott Heron once sang, "The Revolution Will Not Be Televised." And he foresaw it 30 years ago!

A critical mass is forming. It has gained momentum. The Nazis did not allow the poor, the weak, or even the vocal and concerned to organize. Mussolini kept a firm hand upon the people. Stalin and Mao did the same. Having a congress that is weak and cowardly will only encourage this critical mass to form quickly.

Call you representatives tomorrow.

 
At 9/22/2008 8:49 PM, Anonymous jerry said...

I failed to mention another point. And that is that the Federal Reserve is a private entity. It is not a government agency or a cabinet position. The Fed chairman is outside the executive branch. But what we are seeing is the Treasury allowing the Fed to use taxpayer dollars to buy private corporations.

We are seeing the Bush regime, ie. executive branch, aiming to own the private economy. This way it could more manipulated to their liking.

 
At 9/23/2008 2:46 PM, Blogger FOFOA said...

http://market-ticker.denninger.net/archives/588-Rescue-plan,-Bailout,-How-About-Den-of-Liars.html

 
At 9/23/2008 4:20 PM, Blogger FOFOA said...

Short video on some technical analysis of the gold chart. The analyst puts gold at $1,200 to $1,500 by Feb. or Mar. '09.

 
At 9/23/2008 6:01 PM, Blogger Justin_n_IL said...

Dear Senator

You are correct when you say the crisis was created by "sloppy underwriting and reckless disregard for the risks they were creating, taking, or passing on to others."

Most importantly you are correct when you state "There are no credible assurances that this plan will work. We could very well spend $700 billion and not resolve the crisis."

Senator, the odds of failure are 100%. The Paulson plan will not create any jobs or help homeowners pay their bills. Instead it diverts $700 billion of taxpayer funds to failed banks that took excessive risks. The sheer size of the bailout will cause interest rates to rise, further adding to taxpayer woes.

Robbing taxpayers to pay failed banks cannot possibly work!

Printing money and giving it away cannot work either. If it did work, Zimbabwe would be the most prosperous nation in the world.

Senator Shelby, our prayers are with you that you have the courage to stand up for what you know you must do: Block This Bill.

I ask that you approach fellow Senators Jim Bunning, Chuck Grassley, and Jim DeMint in hope that one or more will have the courage to join you to in preventing what is still a preventable disaster.

Your Name
Your Phone Number

Sen. Richard Shelby (R) 202-224-3416 or 202-224-5137 (both seem to work, I fax both)
Sen. John Ensign (R) 202-228-2193
Jim DeMint (R) 202-228-5143
Sen. Jim Bunning (R) 202-228-1373
Sen. Chuck Grassley (R) 202-224-6020
Sen. Harry Reid (D) 202-224-7327

http://globaleconomicanalysis.blogspot.com/

 
At 9/23/2008 7:35 PM, Anonymous tg said...

Hey one of our reps actually says something.

http://www.tickerforum.org/cgi-ticker/akcs-www?post=62551

 
At 9/24/2008 4:58 AM, Anonymous Anonymous said...

Any thoughts on why Schumer is soooo on board for this bailout?

 
At 9/24/2008 5:27 AM, Blogger Ellen said...

Has anyone looked at the similarities between our present situation and Scandinavia in the early 90s to make predictions on inflation, stagflation or deflation and other important questions?

Here's an article from Bloomberg.com that is informative as a starting point. Please share your thoughts with us, Randy.

U.S. May Find Painful Parallels in Nordic Bailout (Update2)
By Simon Kennedy

Sept. 23 (Bloomberg) -- If Henry Paulson and Ben S. Bernanke want to know what happens when central banks and governments bail out financial institutions, they should be ``learning Swedish.''

That's the suggestion of Charles Dumas, a director at Lombard Street Research in London. He says the effort by Finland, Sweden and Norway to save troubled banks in the early 1990s is the closest parallel to the market-rescue plan being engineered by the U.S. Treasury secretary and Federal Reserve chairman.

The Nordic effort -- similar in speed and scope to what the U.S. is planning now, though smaller in size -- did manage to end the financial crisis. At the same time, it didn't prevent a deeper recession and surging unemployment in all three countries.

``In the long term, there were benefits, but it took half a decade before they began to show in the economy,'' said Esko Ollila, a member of the Bank of Finland board from 1983 to 2000.

With the U.S. financial markets in tumult, Paulson is seeking to implement a $700 billion plan that will allow the U.S. to purchase illiquid assets such as mortgage-related securities from banks. Last week, the government and Fed pledged to insure money-market funds, seized control of New York-based insurer American International Group Inc. and intervened in the markets for commercial paper and short-term debt for Fannie Mae, Freddie Mac and other agencies.

Surging Economies

At the end of the 1980s, the economies of Sweden, Finland and Norway had surged after deregulation and low interest rates encouraged banks to lend more. Finnish house prices jumped 80 percent in real terms, and its stock market soared 164 percent in five years, according to JPMorgan Chase & Co.

The byproduct was a mounting debt burden. As policy makers sought to slow inflation and protect their fixed exchange rates, banks found their balance sheets decimated by nonperforming loans amounting to 10 percent of the region's gross domestic product.

The response to the subsequent financial crisis was one of ``rapidity and vigor,'' said then-Fed Chairman Alan Greenspan in a 1999 speech. Sweden guaranteed bank obligations against losses and established a $14 billion restructuring fund to provide failing banks with capital in return for equity. In addition to taking over Nordbanken AB, the government created a ``bad bank'' that bought troubled assets at a discount, while leaving financial institutions to manage their more-liquid holdings.

Merging Banks

Norway's government took similar steps by insuring savings and seizing control of the country's three biggest banks. Finland merged more than 40 banks, including Skopbank Ltd., into a government-run entity and moved nonperforming assets to management companies run by its central bank.

While the interventions ``were sweeping and ultimately a success,'' they didn't bring immediate relief to the three countries' economies, as banks cut back on lending and companies and consumers spent less, said Lauri Uotila, chief economist at Sampo Bank, a unit of Danske Bank A/S in Helsinki.

The Finnish and Swedish economies contracted in 1991, 1992 and 1993. Norges Bank calculates that during the early 1990s, output fell 12.3 percent in Finland, 5.8 percent in Sweden and 4.1 percent in Norway. Unemployment didn't peak in Finland until May 1994, when the rate reached 19.9 percent, having fallen as low as 2.1 percent in 1990. Sweden's jobless rate averaged 9.9 percent in 1997, up from 1.6 percent in 1990.

`Aggressive Measures'

``The aggressive measures implemented by the Scandinavian governments were not enough to prevent deep recessions,'' said Nicola Mai, an economist at JPMorgan in London. The Fed Bank of Philadelphia today announced it will host a conference next week on the lessons of the Nordic experience for the U.S.

Mai says the U.S. government and the Fed were quicker to ease fiscal policy and cut interest rates as the crisis took hold, something Norway, Finland and Sweden weren't able to do because they had to maintain currency pegs.

By acting quickly, the U.S. may still avoid repeating Japan's ``lost decade'' of deflation after policy makers in the world's second-largest economy dithered in addressing a banking crisis. The U.S. may even mimic Sweden whose government made money when it was able to sell the assets at a later date, said Jim O'Neill, chief economist at Goldman Sachs Group Inc.

When Japan's stock- and property-market bubbles burst in the early 1990s, lenders were left with trillions of yen in bad loans on their books. It wasn't until 1999 -- two years after the collapse of Yamaichi Securities Co. -- that policy makers found the political will to use taxpayers' money to begin bailing out the banking system.

Bad Debts

It took two more years for then-Prime Minister Junichiro Koizumi to demand that banks accelerate the disclosure of bad debts and their disposal of illiquid loans.

``In Japan, procrastination unnecessarily increased overall costs in terms of asset-price declines, damage to the fiscal position and lost economic growth,'' said Richard Jerram, chief economist at Macquarie Securities Ltd. in Tokyo. ``The U.S. seems to be responding with unusual speed and aggression.''

Still, David Rosenberg, North American economist at Merrill Lynch & Co. in New York, predicts that the U.S., like Scandinavia, probably won't see an immediate economic rebound.

``Even with effective government solution, the process of extinguishing the bad debts via government intervention was painful,'' Rosenberg said. ``We're into a new chapter indeed, but it's very tough to say at this point that the book is finished.''

To contact the reporter on this story: Simon Kennedy in Paris at Skennedy4@bloomberg.net

 
At 9/24/2008 6:29 AM, Blogger Ellen said...

we're trying to bail out the world on the back of US Taxpayers

Here is a paragraph from the Treasury Fact Sheet released last night:

Asset and Institutional Eligibility for the Program. To qualify for the program, assets must have been originated or issued on or before September 17, 2008. Participating financial institutions must have significant operations in the U.S., unless the Secretary makes a determination, in consultation with the Chairman of the Federal Reserve, that broader eligibility is necessary to effectively stabilize financial markets.
So this bailout covers any securities issued on or before last week! Why would we be bailing out activity from this year? Or even after Feb 2007 when the subprime crisis woke everyone up? I'd argue for an even earlier date ...

But the second sentence is even more surprising: eligibility has been changed from "financial institution having its headquarters in the United States" to "significant operations in the U.S." - and even "broader eligibility" if Paulson so decides.

According to this fact sheet, under the Paulson Plan, U.S. taxpayers may bailout foreign financial institutions and even foreign governments.

Update: Paulson confirms on TV, via Reuters: Paulson: Foreign banks can use U.S. rescue plan
Treasury Secretary Henry Paulson said Sunday that foreign banks will be able to unload bad financial assets under a $700 billion U.S. proposal aimed at restoring order during a devastating financial crisis.

"Yes, and they should. Because ... if a financial institution has business operations in the United States, hires people in the United States, if they are clogged with illiquid assets, they have the same impact on the American people as any other institution," Paulson said on ABC television's "This Week with George Stephanopolous."

 
At 9/24/2008 7:01 AM, Blogger 45north said...

reverse auctions: why not try it?

The way I understand it the US Treasury Dept. will buy the lowest bid mortgage pool. I am using Mish's description of a mortgage pool:
http://tinyurl.com/4x5plz
That is if lending institution A offers a mortgage pool for 50¢: on the dollar and if institution B offers another for 40¢ on the dollar then Treasury Dept will buy the pool from institution B at 40¢ on the dollar. This seems like a very good idea - possibility of fraud reduced if the financial officers have to swear to the performance record of the pool with criminal penalties (like jail). Why is Mish so upset with this proposal?

You win when banks compete.

 
At 9/24/2008 9:54 AM, Anonymous Anonymous said...

folks the white house press secretary just admitted yesterday the white house had the bailout drawn up months ago! this is unbelievable- but yet they've been lying saying they had no idea this was gonna happen and we need to pass this immediately? randy wat do u think of the fact that our government had foreknowledge of this collapse and waited until now to tell us? heres the link:

http://www.prisonplanet.com/white-house-admits-it-drew-up-bailout-months-ago.html

 
At 9/24/2008 11:06 AM, Blogger Justin_n_IL said...

There is no shame with those who push the propaganda. For instance this guy.
http://www.huffingtonpost.com/huff-wires/20080923/bailout-national-debt/

The fact is most Americans are in love with propaganda. They like the comforts of deceit. They despise those of us who point to the truth. They don't want their bubble of deceit being popped.

There is a guy in my life whom fits this description of the average American to a T. I have over the past year dropped little tidbits of truth into his ears. He always brushes them aside using the propaganda that he delights in. Well the other night he was commenting about how good Obama will be. He was saying that Obama had some sort of proposal that would exempt 50+yr old people (or maybe it was a bit older) from having to pay taxes. I couldn't help but to respond. I argued that in light of all the bailouts that no American would be exempt from taxes. Furthermore I argued that the next President no matter who he is will almost certainly raise taxes across the board. I also talked about the inflation tax that was going to grow like a hybrid swamp monster. I explained to him what the inflation tax was. His response was nothing short of a tirade directed at me.

He argued that I was nothing but a doomsdayer. He went about to discredit me based on my material assets. I have virtually no material assets. I'm currently laid off and drawing unemployment. I do not own a vehicle or a home or any land. At least I have no debt other than a few small medical bills. He also argued that if I was so fu*$in smart then why don't I do something about it. He argued that my knowledge was useless if I could personally do nothing to change it. Then he argued that I was unpatriotic. That if America was such a bad place to live then I should apply for a visa and move. Then he wanted to know what country was better than America. Then he showed his cards to me. This man is gripped with fear. He said that if I was right then all that he has worked hard for in his life is going to go up in smoke. He said he didn't want to hear about the bad news. He said it's better to enjoy life(He worships the T.V.) and not focus on the negative that could happen. This man cut me down in just about every way possible. This was his way of making my opinion meaningless. He said that all the people with their blogs are essentially a bunch of fu$#in idiots.

Well into the conversation he conceded that I might know what I was talking about. He did this on 3-4 different occasions. He said what if you are right? You may be right Justin. What if you and the others are right? What's this say about my future Justin? I was also informed that I was to NEVER bring this doomsday shit up again or else. I don't dare mention GOD to him. I haven't for well over a decade. He hates anything to do with GOD as well.

For the most part he is your typical American -the idea that there is a GOD. The kind who would rather bury his head in the sand than acknowledge the truth and speak out concerning it. He likes comfort and if that means following after deceit then so be it.

Well I will never reach out to this man again. There is a scripture that applies to this temporal situation just as it applies to the "spiritual".

Luke 9
5And whosoever will not receive you, when ye go out of that city, shake off the very dust from your feet for a testimony against them.

The same goes for secular truth as well.

 
At 9/24/2008 11:55 AM, Blogger 45north said...

Justin: yeah, I have noticed that some people hide behind their cynical view of the world.

God bless!

 
At 9/24/2008 2:32 PM, Blogger FOFOA said...

Link

Text:
OT: Countdown: Three Weeks to Chaos
User Forum Topic
Submitted by partypup on September 17, 2008 - 10:37pm
I know that I have been characterized as "alarmist" and a "doomsayer" by many on this board in the past, but I would be remiss if I did not pass along some information to you all that I have learned from a very knowledgeable and well-placed source in the finance industry who has guided me for the past two years as I have attempted to navigate this crisis.

This source predicted, four (4) months ago, that the market would enter a heart-pounding phase in mid-late September. It would be as though, in his words, "the world would hold its breath" in anticipation of what would follow.

And then, on or about the first week of October, the dam would suddenly burst and the ride to hell would begin -- for months. He predicted that the system would experience a massive seizure, such that all electronic forms of trade (stocks, banks, ATMS) would simply fail. And the much-delayed death of the dollar would begin in earnest.

This coincides almost exactly with what the think tank at LEAP (http://leap2020.eu/GEAB-in-English_r25.html) has been predicting for the past 18 months. I have studied each of their reports, in which they have consistently labeled Fall 2008 as the point in which the world in general, and the U.S. in particular, would enter the heart of the system crisis. The only variation I note is that LEAP estimates that the dollar's role as the world's reserve currency will cease around the end of the 2nd quarter of 2009. My source believes that it will happen sooner. Or perhaps it is the case that the process begins in October and culminates in June. In any event,
the Fall and Winter are going to be extraordinarily brutal.

I am hoping that all who read this will understand the message that I am trying to relay to you: time is short. Many of us have been expecting what is coming from months or years. Some have only awaken to what is coming a few months ago. Others still don't understand what is coming. But as Wall St literally disintegrates before our eyes, I don't think there can be any question at this point that we are on the verge of something unprecedented and catastrophic.

If you have money in the markets, you need to get it out NOW.

If you have a 401K and are fearful of a withdrawal penalty and taxes, keep in mind that 60% of something is better than 100% of nothing.

If you have more funds in your bank than the absolute minimum necessary to pay your expenses, then you're playing Vegas odds. FDIC is technically insolvent as I write this, and one more major bank failure will trigger an unstoppable run on our retail banking system.

Buy a safe. Keep as much cash at home as you feel comfortable storing. BUY METALS. They will be volatile in the near term, but they are truly your best bet for asset protection in a world that is about to implode in a derivatives supernova.

The Chinese did something astounding today: they effectively broadcast to the world that a new world reserve currency is needed. The world heard them. And gold soared almost $100 today. I think that any thinking person can see that the unthinkable is now about to happen. The dollar is about to become irrelevant.

http://us.mobile.reuters.com/mobile/m/An...

And lastly, at the risk of sounding completely alarmist, I would advise you all to begin stocking up on goods that you will need to keep your household functioning in the near (and possibly long) term. When the system fails, there will be massive supply disruptions for a variety of reasons, not the least of which will be that panic will trigger a hoarding mentality, gas will be in short supply and inventories will be easily wiped off of store shelves. Can we buy enough food and supplies to last the rest of our lives? Of course not. The goal here is simply not to be a casualty in the first wave of the tsunami that will wipe out millions. Once the first wave has passed, we can pick ourselves up, look around for a place of safety and start moving.

I'm not advising anyone to buy a gun or any form of protection, although I think civil unrest is entirely possible, particularly in large metropolitan areas.

I am simply advising that, at a minimum, we all be prudent in preparing for what now seems inevitable. An ounce of prevention in these times is easily worth a ton of cure.

For those who may disagree with my post, I respect your opinion and would only ask that you not denigrate mine and simply move on to the next thread. I share this information with you all solely out of a concern for my fellow citizens.

I am hoping this thread will allow like-minded individuals to share practical information and advice as we all move into a grim and unchartered period in our nation's history.

Good luck to us all.

 
At 9/24/2008 3:09 PM, Anonymous Anonymous said...

The guys and gals on cnbc are really scared- they are in panic
unbelievable
catholic girl

 
At 9/24/2008 9:17 PM, Blogger Randy said...

Justin - blow it off. Not worth the time thinking about it... I've been labeled a quack pot for years and only now are people realizing that my thoughts and predictions were actually based on a pretty solid understanding of the complex intricacies in play. Now these same folks consider me a friggin genius! Ha!



Holy Crap FoFoa!

Thinks are happening fast and the wings on this plane may be disintegrating - problem is: we have no ejection seat.

Thanks for the alarming, yet quite sensible post/link



Catholic Girl - haven't heard from you in a while. Good to see you posting up. Scary times indeed.

 
At 9/24/2008 9:23 PM, Blogger Justin_n_IL said...

Well I haven't lost any sleep over it. But the guy is my father. So it's more taxing for me than if he was Joe Smoe. Thanks for the encouragement though.

 
At 9/24/2008 9:24 PM, Blogger Randy said...

Ellen,

Regarding our parallels to the Scandinavia crisis.

As stated before:

Will massive bailout plan work?

This bailout will NOT cure our ailment and a Hyperinflationary Depression will quite likely be the end result.

 

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