Fed to markets: Let the bubble blow David Callaway – MarketWatch

Fed to markets: Let the bubble blow David Callaway – MarketWatch

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Last Night on TV

So, last night I’m watching the La Lakers take the first game of the Western Conference Finals (online of course) and I get to watch all the commercials on ESPN. Some of you might think that’s a bit odd, but I don’t have access to commercial television; no cable or satellite dish, just my internet connection.

All through the game I saw a lot of different advertising and this one I couldn’t believe. First of all Toyota is advertising their prius and it’s Green Appeal, and then I see this Cadillac Escalade commercial and it hits me that this whole GM bailout is going to fail, sure as shit. How is this any different?

Toyota and Honda are both selling cars that people need in order to meet with the changes coming, frankly gasoline cannot last for ever and these things can get 50 mpg. What does an Escalade get for mileage. I don’t even care. Like I said I don’t even own cable..

It amazes me we even bothered bailing anything out at all, the banks the insurers and the automakers can fold and I don’t think I would miss them at all. It seems to me that they got themselves into this mess, right!?

But, promising the American Government that it would change directions and then going on like “business as usual”, minus the layoffs, factory closures, and dealer closings. Don’t worry we’ll help you stretch out that failure, while we let our factory workers and and sales people find something else to do.

Personally I believe that all that bailout money would have been far more wisely spent on education, because the people running these companies obviously missed out on economics 101…

Is that Tamiflu in your pocket…?

OMG!! We’re all gonna DIE! Again… It really amazes me how ridicules the Nation’s Media is. Look, I like Drama just as much as the next guy, but Pandemic? The Spanish Influenza kill 50 million people in 30 days. Loosing 200 in a week is not on the same scale. First of all only about 50-75 people in the US have contracted this thing, and according to “The Centers for Disease Control and Prevention (CDC) (they) estimate that approximately 1.1 million persons are living with HIV in the United States.”(1)

The funny part about living with the US’ Media is that they are all on the same script. I wonder if viewers could start a group law suit for starting a panic over total misinformation. When Howard Dean was tore apart by the Media after misinterpreting what I would consider to be a pep rally to raise the morale of the thousands of volunteers that were there to support his Campaign. For weeks we had to see this one stupid picture that fraudulently depicted his actions, while the “commentator news core” ripped on him and told us all about his poor behavior, unbecoming of a president.

Now, everyone may not agree with me, but I think he was the only president running at the time who had any real plan, including a balanced budget, health care for America, and alternative energy. We could have really used him in 2004, but that’s not what happened. Instead we got a Republican agenda which was running rampant against all the things most American’s believe in, like Torture and Financial System Bailouts, and 4 dollar a gallon gasoline.

Personally I feel that any format that presents itself as a news program must leave commentary to the commentary segments and should be held accountable for the facts they present as news to America. I wish Howard Dean would have sued AP News and any parrot news agency who repeated the lie. It’s bullshit and we all know the Media is a PR scandel in American life. If you don’t believe me check out your sources and the fact surrounding them and see what’s what. Don’t take my word for it, do a little research on your information.

1). Taken from the CDC website.

A Taxing Tea Party

In response to Congress’ new Stimulus Package A site called taxdayteaparty.com/ has become the highly vocal spirit behind the movement to protest the taxation built into the new Congressional Stimulus Package. Fox News, as well, have begun running commentary ringing the theme “Take Back America”. A big position for a National News Service, to say the least.

It has been my opinion that there is a strong and steady building of sides that has cast a shadow on the Obama Administration. Probably not as potent as the separation of ideals that originally led to the breakaway states that ignited the Civil War in the 1800’s, but America has definitely come to a turning point in its History.

As Fox News has pointed out there is almost no coverage from many of the Major News Services in the US or abroad for that matter. It doesn’t seem PC to discuss it.

Michael Steel, RNC Chairman, had to respond publicly to rumors that he was asking to be counted in as a participant of the Tax Day Demonstrations. According to his response he had never considered himself involved in any way, nor had he suggested that to Tax Day Tea Party or its organizers.

In the past few months since Obama has taken office there have been a cacophony of voices cheering on one side of the isle, while another less casual voice from across the way that has begun chanting descent of the Liberal Pull that has swept through Congress.

But, lets not forget that the Republicans got the ball rolling with the TARP program request to Congress which gave $700 bil to financial institutes, who essentially put the US in dyer straights with reckless decisions, while ignoring the systemic risks involved, not to mention the bailout of Bear Stearns and AIG, Instigated by George Bush’s choice for Fed Chief, Ben Bernanke.

Some of America have become quite upset with the bailout and feel that the economy should have followed the natural course it had created for itself, which could have brought a huge number of major banks to ruin. It’s hard to say what’s really helping, but it is well known in economic circles, that the Government isn’t responsible for the health of the economy, or shouldn’t be. Hence the idea of Free Enterprise.

Its very hard to predict where this movement will take us, as it is equally difficult to predict whether or not the now Trillions of dollars being spent on these broken financials will ultimately do what it has been intended to do.

The good news is that people are talking about topics that were once considered taboos in America. Lets just hope it comes to wholesome and constructive ends!

Congress Averting another Catastophe: But this time a Revolution

Man, talk about a close call. The public uproar on the whole AIG bonus Scandal was quite a fervent scene to observe. Congress was so worried about it that they basically lynched anyone who was supposed to get any kind of bonus, that had anything to do with any financial agency that took Fed or Treasury funds.

The problem is that it reminds me of the day the Treasury announced the take-over of Freddie and Fannie. I really think it was the first wave of panic that started the horrible conditions we see today. The second shock was letting Lehman Bros. fail… but the biggest shock so far was when Congress’ Lame duck Republican leaning vote against the original TARP Funds. That was the shot heard round the World.

Within a few hours of the outcome, the LIBOR jumped more than 200 basis points and essentially shut down all loaning. This was the real Credit Crisis. Everything previously experienced was just a warm up. After that everything became a shock to everyone…

So, here we are. 2 years after the fall of the Real Estate Bubble and things were starting to look as though there might be a shift in the momentum, of what many are hoping would be the bottom of this deflationary period, and Congress sounds the Alarm!

I wonder how many people will show up for work tomorrow. At least the ones that are being held responcible for cleaning up the mess at AIG might not be interested in working for free… The one thing that’s certain is that we will find out whether or not Liddy was telling the truth, in his testimony to Congress. He said that without the people who are receiving the bonuses, it would leave about $1.6 Trillion of risk unmanaged, and that that would lead to the collapse of AIG. And… according to Ben Bernanke, a collapse of AIG would lead to a World Financial Systemic Collapse.

hmm… It should be an interesting week ahead.

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We Own You, Citi!

Now that we own a 36%, most likely majority, stake in Citibank I would like to propose a solution to help ease the suffering of its stock holders, the American People. Lets trim down the company and sell off all the divisions of the bank until it is NOT “Too Big to Fail”. All those little subsidiaries and other companies that Citi purchased during its rise to being too big can now go back to being their own little businesses. At least that’s my vote, since I now own it!

Assessing the companies risk, based on the conditions of the present financial climate, I feel that this decision, which may effect the lives of many of the companies stock holders in a positive way should begin commencing now.

One of the things that totally amazes me is that Congress hasn’t begun the Anti-trust hearings for these bailout banks, and the auto makers. Who wants to have a few companies that are too big to fail ever again? Oh, but wait! That’s just how it is…

Yesterday I watched a Documentary on the Labor Movement of the early 20th Century, when the IWW was trying to get an 8 hour work day for ALL workers in America. The government of the US finally got so disgusted with this sense of an empowered workers organization that they arrested all the Union leaders and sentenced them to prison for causing disruption to the American way of life, and it dawned on me! This has always been a war, and as long as socialism was the enemy, the Company of the United States of Wealthy Corporations would use every tool in its arsenal of abuse to discourage anyone from ever joining sides with the enemy…

It amazes me (an yet doesn’t surprise me) that there isn’t the biggest outcry in American History, for the heads of the Corporations and Financial Institutions, that have put our children’s and their children’s future at risk. Remember, when Bush took office in 2001 there was a 6 Trillion Dollar Surplus in the US budget, and that administration along with the previous Republican Congress’ habit of deregulation turned our country completely over to the point that the rating firms are watching to see if the US Credit rating might not be threatened, by the massive debt we’ve accumulated.

There has always been a tenuous thread of difference between the Social and Capitalist leans in America, and it usually takes a time like this to point out the massive division of wealth that the rich enjoy when we forget the lessons of the past. Greed has never made our country prosperous for very long. When Reagan pushed for the trickle down economic measures that brought us out of the 70’s recession, it barely lasted through his term in office, and the same thing happened during the second Bush. It doesn’t work and deregulating the financial institutions, trusting them to monitor and assess their own risk leads to greed, and not longevity of prosperity for everyone, because the flawed part of the Trickle Down part always gets stuck in linings the rich pockets.

I think it’s hilarious that Fox News and some Conservative Politicians are calling Obama a Socialist like its a bad thing, while using the excuse “I Worked Hard for What I Have”. Excuse me, but who worked hard? To me it looks like all those people who are losing their jobs right now were some of the hardest working people out there. Most CEOs don’t even do their own dishes, let alone work. And if you think that’s not the truth, ask them, or better yet let them try to make billions of dollar without our help. See how long that lasts. What a joke…

The Greenspan Rule: Words are Power!

Recently I heard some blame being cast at Greenspan for the failed policies of the Federal Reserve and I think it’s ridicules unless you add it to the constant stream of mistakes being made in the Quest to “save” the economy from “catastrophe”…

I do agree that deregulation was founded on a weak cornerstone, that Banks could govern there own sense of risk, and assess it based on the longevity of their business. It’s kind of like trusting that Hedge Funds won’t drive up the price of oil, in an attempt to avoid a devaluing dollar. Because everyone knows that an inflated fuel supply could apply the brakes to an economic system in the form of inflation.

Or maybe it’s more like Short Selling. I’m sorry but that whole practice just doesn’t make any sense to me. Let me get this straight, you’re borrowing someone elses stock and selling it to buy it back for less when the price falls. Doesn’t that seem a bit adverse to a growing economy, having big financial institutions and hedge funds betting against their own pool of wealth… And whose stocks are they “borrowing”.

Anyway, I believe there’s only one answer for all the toxic assets. require the banks give them up in exchange for loans. The assets will then fall into the hands of a trust that will match them with homes that are in foreclosure, reducing the paper to their original mortgages and thereby giving them a quantitative value again. The homes would then be held until the housing markets are restored and then released slowly back into the market. An assessed value would be paid toward the debt the banks held, and profits would be used to shore up any future foreclosures. The problem is the paper.

This is the core of the problem and it could have been met with when it was occuring if it hadn’t been about the non-chalant responce by Ben Bernanke when he first acknowledged the situation in 2007. The real problem has still been left for these 2 years without fully being addressed, and 3 years since the foreclosures began.

Obama has failed to address this current crisi with the right formula to really resolve the main issue. Part of it has been addressed, but with nothing like the rigor they have addressed the condition of the fallout, that was supposedly never to happen. Spending another $2.5 Trillion to shore up the financial institutions seems like bullshit after the 700bln on top of the 2 Trillion pumped into it from the Fed., and why are those two agencies acting independently.

So, all together we are looking at about $5 Trillion, while companies and individuals are continuing to slip into foreclosure unable to borrow, and the main core problem is still on the chalkboard. The one thing that no one seems to be considering is the momentum that is being acquired and fueled by lame statements that include words like “catastrophe” and “collapse”, when economic leaders are speaking. You would have never heard Alan Greenspan make such greenhorn mistake.

Risky Business: Playing the Blame Game

It really seems like Congress is spending more time worrying about how to avoid any direct responsibility for the Subprime Mortgage Scandal as they work out the details of a Mortgage Bailout Bill, then taking the time to look at lawmakers shortcomings in what has always been a highly regulated industry.

When Senators, like McCain, sight the fault in the pitfalls of housing prices as the irresponsibilities of buyers, when it was the Mortgage industries themselves who were required to investigate the details of the contracts, for indiscretions in the facts like income and assets, it leaves us all feeling a little cheated.

Now Congress is going to put the ‘Keepers of Mortgages’ at risk in order to NOT use tax payers money to solve the problem, requiring Freddie Mac and Fannie Mae to flip the bill for the Bailout.

This will put a something like $7 Trillion safety net at risk for the tune of $280 billion worth of trouble, while the Fed freely loans the banks an unlimited amount of money just to keep them alive and loaning, regardless of their risky loaning practices.

This entire outcome could have been avoided had the Fed put their initial efforts into nipping the entire thing in the bud by shelling out the 200 Billion, they force fed the banks, directly to the families and individuals who got caught up in the Subprime loaning frenzy. It would have halted the collapse and allowed the banks to recover on their own and kept the lid on inflation by slowing down spending as the banks sought to recover liquidity.

Instead Bernanke denied any risk (from the fallout) to the economy until it hit the front pages of the Media, making the Fed look like a nervous investor holding penny stocks instead of the reigns of the economy.

The problem with delay in the Fed’s actions is that the limited tools available to them have put inflation at a roar and the Dollar in the drain, sending investors into Oil, Gold, and Food Commodities which are spiraling out of control and stoking inflation like a billow, while the Labor Department feeds us huge lies like the price of Gas actually fell in May by 0.2 percent after it was “adjusted for demand”. WTF…

Everything these geniuses are doing now are insane if you ask me, like they want to help create the biggest collapse ever just to make the history books. The only problem is that there wont be any paper left by the time its over if we stay the course on this, let alone a printer…

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